According to the most recent
MoneyTree Report from PricewaterhouseCoopers and the National Venture Capital
Association, 2014 saw a 61% jump from 2013 in terms of total annual venture
capital investment, coming in at just over $48 billion, led by a 77% uptick in
software company investments and the highest level of investment in
internet-specific companies since 2000. Expansion stage investments were the
real winner, more than doubling their take year-over-year to roughly $20
billion, but early stage investments saw the largest growth in terms of the raw
number of deals, with a whole host of small companies coming into the market.
Amidst all this activity,
Silicon Valley-based Firsthand Technology Value Fund (NASDAQ: SVVC) has
steadily continued to grow the value of their portfolio. SVVC is the venture
capital operation advised by Firsthand Capital Management, Inc. (formerly known
as SiVest Group), which also provides investment advice for alternative energy
and tech sector no-load mutual fund firm, Firsthand Funds. Having participated
in some of the biggest IPOs in recent years, shrewdly entering and exiting its
positions at optimum intervals, the externally managed, closed-end,
non-diversified management investment company, Firsthand Technology Value Fund,
has leveraged the extensive expertise of Firsthand Capital Management’s CIO and
the CEO/portfolio manager of SVVC, Kevin Landis, with great success.
Landis (B.S. Electrical
Engineering and Computer Science from UC Berkeley, MBA Santa Clara University)
grew up in Silicon Valley and has two plus decades of frontline experience
spanning engineering, market research and product management, as well as in
making strategic investments in promising technology companies. A regular guest
on Bloomberg News and CNBC, Landis and his insights into the tech world have
also been featured numerous times in Forbes, Fortune, and Time magazines. The
company’s director of research, Greg Sheppard, also brings a great deal to the
table, with over three decades of experience in tech market analysis and
intelligence under his belt. Sheppard is also notable for having founded
iSuppli, the successful market intelligence firm which he later sold to
research and analysis giant, IHS (NYSE: IHS).
With Firsthand’s team having
been responsible for more than $300 million of investments across over 40
private companies within the last two decades, SVVC is one of the most robust
venture capital operations in the game today. The company is focused primarily
on technology and cleantech companies, with considerable traction across tech
segments like advertising, consumer electronics and social media, as well as
medical devices and semiconductors. SVVC got in on the Facebook (NASDAQ: FB)
run early for instance, layering up a position starting back in Q4 of 2011 and
existing in September of last year, bringing in a tidy 144% realized gain to
benefit the company’s shareholders. A similarly well-timed entry and exit play
on Twitter (NYSE: TWTR), getting in back during mid-2012 and exiting last year
in October, returned even greater realized gains, with 193% upside obtained to
the benefit of SVVC’s investors.
Firsthand goes way beyond such
social media homeruns though, with superb plays under their belt like SolarCity
(NASDAQ: SCTY), where the company saw a June 2012 entry and July 2013 exit,
realizing a 157% gain. Firsthand also started stacking shares in the
micro-electronics industry company specializing in foundry ion implantation
services, Innovion, back in April of 2011. Ion implantation technology has
become indispensible in a variety of silicon carbide applications like LEDs,
fiber optic switching networks, and SOI (Silicon-on-Insulator) for
cost-effective silicon layer transfer in solar cells. Innovion was subsequently
bought up by private venture capital group, West Peak Partners, in late 2014.
The company’s current top five
holdings are spread across the medical device, semiconductor manufacturing and
control systems, advertising technology, and advanced electronic materials
industries. As of March 31 this year, SVVC has 12.8% of their preliminary net
assets in intra-operative radiation delivery device manufacturer IntraOp
Medical; 10.6% in Pivotal Systems, a process control and monitoring systems
developer for the semiconductor manufacturing industry; 7.7% in Turn, Inc., an
advertising technology developer servicing marketers and agencies in the
Fortune 1000; 6.7% in semiconductor wafer processing equipment maker Mattson
Technology; and 6.2% in QMAT, Inc., a developer of advanced materials for the
electronics industry. These top five holdings represent 44.1% of the fund’s
preliminary net assets.
Firsthand recently (March 31,
2015) pegged their preliminary NAV (Net Asset Value) or “book value,” based on
the fair market value of their portfolio holdings (as opposed to the company’s
share price, which is the value of the fund’s common stock on the market), at
$25.14/share, including cash of roughly $0.82/share.
Take a close look at the company
by visiting www.firsthandtvf.com
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