Augmentum Fintech covid-19 update – the investment management staff are working from home and the tone of the statement is upbeat, based on the premise that these young companies can more easily adapt to the changed circumstances. In fact, they reckon that over 40% of the portfolio may actually benefit. In addition, the company has £14m of cash that it can use to support its portfolio if necessary.
Interactive Investor (represents 11.4% of the portfolio)
This dealing platform aimed at small investors continues to see strong trading volumes in Q1 and that has not diminished in the past two weeks. As a digital, scaled, flat fee platform, ii has a highly resilient business and operating model which is not excessively reliant on treasury revenues.
Zopa (represents 9.0% of portfolio)
Zopa (the direct lending platform – here the concern might reasonably be about higher defaults. The statement says “the rate of return for investors on the platform has historically shown little volatility relative to the public markets. Individual investments are spread across multiple borrowers which, together with world class underwriting and strong tech capability, is how they’ve been able to offer positive returns for the last 15 years through both downturns and upturns.
Zopa constantly monitors external factors for any impact on their customers’ ability to repay their loans. In recent months, Zopa has already been through two rounds of targeted tightening on who they lend to and has responded quickly to the changing situation with further measures to reduce credit risk which are expected to result in lower lending volumes while the situation persists.”
BullionVault (represents 7.6% of portfolio)
An obvious beneficiary of the heightened demand for gold. BullionVault offers customers direct, digital access to physical bullion and has seen trading volumes increase 387% over the last week from the previous 52-week average to total £14.3m per day across gold, silver and platinum.
iwoca (represents 5.9% of portfolio)
iwoca is focused on business funding and has made about £1bn available to over 50,000 UK and German businesses since launch. The statement says “The company has a strong balance sheet and is well prepared to weather the challenges ahead. Nevertheless, it is expected that iwoca will reduce their typical lending levels as they assess the impact of Covid-19 on the broader UK and German markets…. iwoca is also engaging with Governments in both Germany and the UK to offer their support. They are in talks with HM Treasury in regard to the £330bn support package for SMEs.”
Grover (represents 3.9% of portfolio)
This technology rental business is a beneficiary of the crisis as more businesses need to equip their staff to work from home. “The company grew its subscriptions 12% month-on-month to end of February, and this growth has continued into March. As a result, year-on-year revenue comparisons continue at 2.9x with the company well positioned to continue to perform strongly despite the uniquely adverse market conditions.”
Onfido (represents 6.5% of portfolio)
Onfido provides identity verification and biometrics services to financial companies and increasingly other companies too. It has generated 2.3x revenue growth year on year. The statement suggests Onfido could help as the likes of the online doctor Babylon take some of the pressure off GPs.
Farewill (represents 3.1% of portfolio)
More people are making a will and the company is trading 10x in terms of revenues versus the same period last year and has seen 100% quarter on quarter growth.
Augmentum is taking advantage of its discount to buy back shares.