BTI - Bailador - a safer way to play spec tech?

[Lizard]

When I first heard one of the founders of Bailador speak, I pulled my phone out and placed an order for a few shares before he'd even sat down...

I've been happy with that decision and have added since via DRP and SPP.

BTI is actually an investment fund, but operating in the small-end of (mostly) unlisted SaaS businesses and targetting just 10-12 holdings. Ideally, they'll take businesses that are post the initial development phase and entering the early growth phase, assisting with capital needs and expertise to grow a business to a scale where it can be on-sold or listed. This gives much smaller investors like myself the ability to access high risk/return tech investments in a less volatile and more marketable way.

While tech itself is fraught, these guys have a strong history within the fund, as well as in prior experience (former All Black captain and BTI co-founder, David Kirk, famously bought TradeMe for Fairfax media for what seemed like a rich price, but came to be seen as a very prescient investment).

While BTI has varied between trading at a discount and a premium to NAV, the current price of $1.43 this morning follows the latest monthly NTA release, which values units at $1.61 post tax. This marks a 35% increase in NTA/share over the past 12 months, while still pricing shares at a substantial discount. They've also demonstrated a willingness to recycle capital from some investments, with gains from the listing of SiteMinder adding to the cash pool available for new investments.

These kinds of "venture capital" listed funds have come and gone over the years and some have been of dubious quality, but I think BTI is the real deal, and actually well on the way to demonstrating the discipline to operate successfully in this space, as well as currently available at what seems like a decent discount.

Note that over the next few months, the share price will likely largely follow the market - and particularly the price of SiteMinder shares which form a large part of the portfolio. There are no major revaluation events outside of the listed companies until May/June, with larger ones not due until October - December. Note too that they're taking some fairly chunky costs and performance fees. There also seems to have been a seller in the market of late, not apparently driven from any fundamentals, so there may well be more buying opportunities before year end.

For New Zealand investors, please be aware that BTI is not exempt from the FIF tax rules.

[kiora]

Along similar lines to SOR.AX ?

[Lizard]

Happy with the title I chose for this thread.... tech in general has had a fairly harrowing start to the year, while BTI has managed to increase slightly in both share price (now $1.45) and NTA (was $1.69 at end of April and probably fairly unchanged since). They've had a couple of good cash realisations in the portfolio, which means close to half the NTA is in cash. As a result, they've announced a new dividend policy at 4% of NTA. It's an unusual step for a fund focussed on growth investments, but if in future they get tight for cash, they do have the option of underwriting the DRP built in.

Not too much of significance expected in the next few months, as next larger revaluation events are October and December. Nor will the actual dividend be announced till after FY accounts, so there's a bit of time here before I'd expect any big moves.

[Snow Leopard]

Thank you for the update.

I have severe itchy finger these days and a small buy order could cure that