Tekcapital shares were firmly higher on Friday after the technology investment company announced a dramatic increase in the value of its portfolio and touched on plans to focus its future investment strategy on artificial intelligence.
The group’s investment portfolio valuation increased 49.6% to US$61.5m in 2024, while Net Assets increased 46.3% to US$70.1m.
Tekcapital shares were 14% higher at the time of writing.
“We are excited to provide this 2024 summary report which describes a few of our portfolio company achievements and their contribution to our profitability and growth. In 2024 our net assets reached US $70.1m, an increase of ~46%, over the previous year, an annual record since the Company’s inception. NAV per share was US $0.33,” explained Dr. Clifford Gross, Executive Chairman of Tekcapital.
Gross continued to outline the progress of its portfolio companies – the driving force behind the sharp rerating of the group’s net assets in 2024.
“Our performance reflects strong commercial progress through the completion of two AIM listings (MicroSalt plc & GenIP plc), and as a result, four of our five portfolio companies are now listed,’ Gross said.
“Additionally, we observed significant commercial traction for Innovative Eyewear Inc. as they achieved several new product and go-to-market milestones.
“We were also pleased to note MicroSalt has received new and follow-on B2B orders from a major snack food manufacturer. Further, we believe that Guident Corp’s commercial advancements, coupled with improving performance and market traction in the autonomous vehicle industry, have created a fertile opportunity for Tekcapital to potentially further crystallise its balance sheet in 2025.”
The fertile opportunity mentioned by Gross relates to Guident’s proposed NASDAQ IPO. Tekcapital recently announced that Guident had filed confidentially for its IPO, an increasingly popular way of listing in the US that allows companies to undergo preparations away from the public eye.
Listing portfolio companies has been hugely successful for Tekcapital in terms of asset value creation, with the IPOs of GenIP and MicroSalt crystallising a combined £18.3m of portfolio value in 2024. The value of Tek’s stake in MicroSalt increased substantially after its February 2024 IPO as shares rallied through the year.
The Guident IPO promises another uptick in Tekcapital’s net assets as the autonomous vehicle safety company seeks to list amid a wave of increasing adoption of AVs.
Artificial intelligence investment strategy
While investors will be encouraged by net asset growth in 2024, Tekcapital doesn’t appear to be resting on its laurels and provided a fascinating insight into things to come.
After the successful IPO of AI analytics firm GenIP in 2024, Tekcapital’s outlook hinted at increased investment in AI companies that are transforming workflows across various sectors.
“We intend to aggressively pursue further investments in pre-existing generative artificial intelligence companies (GenAI). Our potential targets are expected to include companies that are focused on the transformative impact of GenAI on business workflows across a number of sectors,” the Tekcapital report read.
In addition to hints at the group’s future investment strategy, Tekcapital reaffirmed its strategy to return cash to shareholders through special dividends, once significant capital growth is achieved.
“Once material levels of capital are monetized from our portfolio companies, we will seek to provide a special dividend. We remain committed to this long-term objective, and our portfolio companies’ progress in 2024 is a good step in that direction,” Tekcapital Executive Chairman Clifford Gross said.