Triplepoint Venture Growth BDC Corp (TPVG) 2014 Q3 法說會逐字稿

Good afternoon, ladies and gentlemen, and welcome to the TriplePoint Venture Growth Third Quarter 2014 Earnings Conference Call. (Operator Instructions) This conference call is being recorded, and a replay of the call will be available as an audio webcast in the TriplePoint Venture Growth website at www.tpvg.com. I would now like to turn the call over to Mr. Harold Zagunis, Chief Financial Officer of TriplePoint Venture Growth. Mr. Zagunis, please go ahead.

Thank you, Courtney, and thank you, everyone, for joining us today. We are pleased to share with you the results of the third quarter ending September 30, 2014, which was our second full quarter as a public company.

Here with me to discuss our results are Jim Labe, CEO and Chairman of the Board; and Sajal Srivastava, President and Chief Investment Officer. Jim will discuss our progress in building our business and demonstrating our core earnings power as well as cover our assessment of the current and near-term venture capital and venture lending market environment. Sajal will provide an update on our investment activity in the third quarter and our outlook for the rest of the year. I will then wrap up by reviewing financial results from the third quarter. After that we will open the line for questions.

Before I turn the call over to Jim, I would like to call your attention to the customary Safe Harbor disclosure in our press release regarding forward-looking statements and remind you that during this call we will make certain statements that relate to future events or the Company's future performance or financial condition, which may be considered forward-looking statements under Federal Securities Law.

We ask that you refer to our most recent filings with the Securities and Exchange Commission for important factors that could cause actual results to differ materially from these statements.

With that, I'll turn it over to Jim.

Thanks, Harold. Welcome, everyone. I've always said this is a long-term business, but the reason this quarter was so remarkable, and I'm so pleased, is that it shows the underlying earnings power of our business model.

While it's only our second full quarter as a public company, given our significant experience in venture lending, the strong brand we have out there in the market, TriplePoint, our sponsor, has already written more than $3 billion of venture loans, and our time-tested disciplined approach in venture lending, I'm really pleased to report every single one of our key metrics is up. The dividend is up, our average yield is up, our net investment income is up, our ROE is up, our originations, our portfolio, our yield on NAV -- every single one of the criteria we look at has been up. I think it really demonstrates the earnings power of this business model.

We covered our dividends with our core earnings. We had a target leverage ratio of 0.75x, which we hit. We continue to build this high-quality portfolio of high yielding assets. We saw really strong growth in the pipeline. We signed up $177 million worth of new term sheets. That's 300% of an increase over last quarter and, on top of that, signed another $110 million post the quarter's close. Right after the quarter, we also had our first customer prepayment.

Customer prepayments, as you may recall, enhance the yield on our transactions and are real beneficial to our stockholders. We expect more of these to occur.

I'm really feeling good about this business. I am pleased with the strong demand and the returns that we've been generating. We're going to continue to grow this business and execute our business according to the plan that we set forth back at our IPO.

We know this business. We know tech, we know lifesciences, we know the best VCs in the world. We ought to, we've been working with them long enough. A major differentiator for us in the venture lending market, as a reminder, is that we only work with, by design, those companies that are backed by a highly select group of the leading VCs out there. These are firms that are associated with some of the biggest tech and lifescience successes during the past several decades.

Our portfolio includes warrants and direct equity investments in what we believe to be some of the most exciting and promising tech and lifescience companies out there. We're involved with a number of companies in rapidly growing tech sectors like SDN, software defined storage; infrastructure convergents plays; digital media; eCommerce; networking; there's a whole bunch of others. These are companies with recognized names in their respective markets -- Newtonic, Shazam, One King's Lane, Simplivity, Birchbox, and others.

Last quarter we also recognized unrealized gains as some of our customers closed additional equity rounds. In the future, as these portfolio companies experience acquisitions and IPOs, our stockholders will begin to really see how these warrant and equity-related investments provide additional realized returns.

With regard to the market conditions out there, the demand for our form of debt financing in our market continues to be really strong. Our select venture capital investors continue to raise new funds, and they are deploying this capital.

Early-stage companies, which we've seen in our portfolio on the sponsor side are also continuing to mature into these venture growth companies, which is right in the target zone.

The demand is also fueled by the IPO and acquisition dynamics. Through the second quarter of 2014 alone, there were some 273 IPO and acquisition events, and that's compared to 457 for all of 2013 and 522 in 2012. The takeaway here is that the average age for a VC-backed company at the time of the IPO is still eight years. That means the IPO process is still a pretty long one that requires a lot of patience as well as combinations of both debt and equity. All of these are great opportunities for TriplePoint Venture Growth.

We experienced a strong third quarter and a significant increase in the pipeline all during a period of a lot of various market talk out there -- spread compression, interest rate worries, capital abundance, and media coverage about commercial banks battling it out with each other and competing for the business at venture-backed company among some of the other concerns.

I've been in the business long enough to know how important it is to stick to your knitting during these times and to do what we've always done best, which is, in our case, just continuing to work closely with the venture capital-backed firms and the venture capitalists.

The business has never been about price or market share for us. For me it's been about experience, reputation, relationships, references, and a continued focus on quality, discipline, and I guess I don't want to forget, most importantly, returns.

Given this pipeline, we're not in the business of generating volume for volume's sake or to just build market share out there or to respond to whoever is the latest entrant in the business. I learned a long time ago, for us, that's simply not a viable long-term strategy.

We are in the business of taking measured risk while delivering attractive returns. The math has to fundamentally work. And it's worked for the TriplePoint Capital platform since our inception given, roughly, some $3 billion plus, I think, that we've deployed and put to work. And given over $0.5 billion, $500 million worth of investment income and related gains at the TriplePoint platform.

More specifically, as you know, with our venture growth strategy we focus on rapidly growing companies. These are ones that have real businesses, real enterprise value, real markets, and solid financial profiles. We've already indicated, and this is in the earnings release, that we've added assets with a 15.2% weighted average yield, and with Q3 with a weighted average portfolio yield of 14.5%, which was up from 14.4% last quarter. That's no accident.

We'll cover this more in detail, but we continue to originate high quality and high-yielding assets and have built an impressive backlog of signed term sheets in the third quarter as well as in the fourth quarter, to date. And every single one of these has been within our targeted yield profile.

So we continue to see the opportunity for us to take advantage of our reputation, track record, and expertise as a seasoned long-term lender.

I'll finish by saying as a result to this quarter indicate we are delivering on our promise of building our venture growth franchise and growing our portfolio in a measured and profitable fashion. As always, we remain disciplined and focus on what matters most to us. We've always called it the four R's -- reputation, relationships, references and, of course, returns.

I'll now turn the call over to Sajal, who will provide you with some more details about our portfolio composition and investment activity.

Thank you, Jim, and good afternoon, everyone. As the results of this quarter indicate, we are focused on growing our portfolio in a measured and profitable fashion. Our portfolio continues to perform, and we've built a strong backlog and pipeline of very exciting and promising venture growth stage companies backed by our select group of venture capital investors.

During the quarter, we signed $177 million of term sheets and entered into $19.5 million of new debt commitments with three obligors -- one based in the UK and two based here in the US. We funded nine debt investments in eight companies for $39.8 million and one equity investment in one company for $250,000. We also acquired warrants valued at $900,000 in six companies.

The $39.8 million of debt investments funded in the third quarter had a weighted average yield of approximately 15.2%, which is particularly impressive considering approximately 30% of the loans we funded during the quarter were formula-based revolving loans with yields at the lower end of our targeted return profile given their generally lower risk. We are also very pleased by the fact that we raised our total weighted average portfolio yield to 14.5% as of September 30th from 14.4% as of June 30th, and 14.3% as of March 31st.

During the quarter, we also began originating floating rate assets on a select basis, and as of the end of the quarter, approximately $23 million of our outstanding assets, or roughly 10% of our total debt investments were floating rate loans with floors. We expect to continue to originate floating rate assets but, again, on a select basis given that our high-yielding loans are very short term in nature and our unfunded commitments typically float with changes in the prime rate from the date we closed the deal to the date of a customer's actual draw.

Therefore, we believe any impact of increasing interest rates would be short term and would be offset as we fund new higher-yielding investments as well as redeployed capital from prepays.

With regards to unfunded commitments, at the end of the quarter these totaled $138 million. The yield profile of these commitments is generally consistent with what we've funded, to date. Of the $138 million of unfunded commitments, $43.5 million are subject to milestones before the debt becomes available; $36.5 million will expire during 2014; and $101.5 million will expire during 2015.

Since these commitments may expire without being drawn upon, unfunded commitments do not necessarily represent future cash requirements or future earning assets for the Company. We generally expect about 75% of our gross unfunded commitments to eventually be drawn. As we look to our existing unfunded commitments, there are a number of companies with meaningful amounts of current liquidity, which we expect may result in either a higher unfunded percentage, delays in draw towards the end of their availability period, or requests to extend draw periods to give them more time to decide whether to utilize their loan with us or not. During the quarter, we had 5 million of unfunded commitments expire undrawn.

Regarding credit quality, our portfolio remains strong. Under our ratings system, loans are rated from 1 to 5 with 1 being the strongest credit rating and all new loans initially rated at 2. As of September 30th, the weighted average internal credit rating of the debt investment portfolio was 1.97, unchanged from the end of Q2.

During the quarter, we upgraded one customer from category 2 to category 1 based on their strong financial profile and liquidity position and downgraded one customer from category 2 to category 3 based on the company performing behind plan and reducing their revenue projections for the year.

With regards to other key indicators of portfolio health and quality, as of September 30th the weighted loan-to-enterprise value at the time of originations for our portfolio was approximately 8%, not a meaningful change from the end of Q2 but well below our general guideline of 25%.

We also had three customers close follow-on equity rounds with one, in particular, Nutanix, announcing that it raised around the devaluation of double its last round of private financing as it prepares for a potential IPO.

While not all of our companies need additional equity capital, we generally view our customers doing so as a positive indicator as it typically improves their financial profile with additional liquidity to service our debt and/or get them to an exit event.

As we look to closing out the year, so far in Q4, we have signed an additional $110 million of term sheets, closed another $20 million in new commitments, and funded $12.5 million of debt investments. We remind investors that not all signed term sheets will necessarily close nor will they necessarily be assigned to us, and timings of the draws and unfunded commitments may be late in the quarter or slip to future quarters.

But to put this in perspective, since our IPO in March through today, our sponsor's direct originations platform has signed, roughly, $370 million of term sheets to venture growth-stage companies not including the $45 million of term sheets our sponsor signed prior to our IPO and assigned to us.

While we have closed some of these and not all the remainder will necessarily close, we have a healthy backlog of high quality and high-yielding assets where we can deploy current and future funding capacity. We also have a several hundred million dollar pipeline of deals at various stages of our evaluation and originations process.

As a reminder, per our advisors' allocation policy, we are the primary vehicle for committing and funding venture growth-stage assets for the TriplePoint Capital platform. During periods when we don't have sufficient funding capacity, TriplePoint Capital will serve as the vehicle for committing and funding new transactions until we have sufficient funding capacity.

In summary, we are pleased with the growth and performance of our portfolio during the quarter, and we are grateful for the continued support from our select venture capital investors. We remain optimistic for near-term growth given our creative and relationship-focused approach to lending, and we look forward to continuing to be able to deliver exceptional returns in a disciplined fashion to our investors.

With that, I'll now turn the call back to Harold.

Thanks, Sajal. Before we take your questions, I'd like to spend a minute reviewing the highlights from the third quarter and give you a quick overview of our financial position.

Our interest income for the third quarter ended September 30 totaled $7.8 million, representing a weighted average portfolio yield of 14.5% on our investments for the period held. Of that 14.5% yield, 10.9% was from cash coupon payments, 0.4% was from the original issue discount of up-front facility fees and warrants, and 3.2% was from the accretion of end-of-term payments.

The weighted average portfolio yield of 14.5% for the quarter was higher than the weighted average portfolio yield of 14.4% the previous quarter reflecting the addition of assets in the third quarter with a weighted average yield of 15.2%.

Our expenses increased this year to $4.3 million from $2.6 million due to increases in our assets, greater profitability, and increased leverage. More specifically, our base management fee of $850,000 -- our base management fee was $850,000, which increased in line with our gross assets. Our incentive fee was over $900,000, which increased as a result of our greater profitability.

This quarter our pre-incentive fee investment income was 13% of net assets, while last quarter our pre-incentive fee investment income was 8.6%.

Our debt expenses increased to $1.4 million as our average borrowings for the quarter were $90 million, up from an average of $30 million last quarter. Our increase in debt capacity from $150 million to $200 million also increased our deferred credit facility cost and unused fees. Our administrative and general expenses remained steady at just under $1 million quarter-over-quarter.

We recorded net investment income of approximately $3.5 million, or $0.36 per share. Excluding the impact of capital gains incentive fee accrual of $230,000, the Company's coordinate investment income was $3.8 million, or $0.38 per share in the third quarter as compared to $2.9 million, or $0.29 per share in the second quarter.

Core net investment income is a non-GAAP financial measure. For a reconciliation of core net investment income to net investment income, please see the press release we issued earlier today. We believe an important measure of the investment income that we will be required to distribute this year is core net investment income, since capital gains incentive fees are accrued based on unrealized gains that are not earned until realized gains occur.

Our loan fundings were a little more distributed this quarter than past quarters with approximately 20% funded in July, 45% funded in August, and 35% funded in September. But we won't see the full earnings contribution from these assets until subsequent quarters.

Our net change in unrealized gains on investments was $1.2 million, or $0.11 per share consisting of $300,000 of net change and unrealized gains on debt investments, $600,000 of net change in unrealized gains on equity investments, and less than $100,000 of unrealized losses on warrants.

In addition, we had $300,000 of net unrealized gains on unfunded commitments due to receiving formal notice from a customer of their intent to pay off their $5 million in loans early and terminate the remaining $12 million in unfunded commitments. We had no realized gains or losses during the period.

Our net increase in net assets resulting from operations for the third quarter was $4.7 million, or $0.47 per share compared to $2.9 million, or $0.29 per share for the second quarter. On an annualized return basis, our net increase in net assets this quarter represented a 12.9% return on our average net assets. Our core investment income was 10.4% on average net assets, and our net investment income was 9.7% on average net assets.

As of September 30th, we had 73 investments in 23 companies. Our investments include 47 debt investments, 22 warrant investments, and four direct equity investments. The total cost and fair value of these investments were approximately $245.5 million and $247.7 million, respectively.

As of September 30, the Company's net asset value was approximately $144.8 million, or $14.64 per share, up from $143 million, or $14.49 per share at the end of the last quarter. This increase is a result of our third quarter net income and annualized gains exceeding our dividend distribution.

Our total cash position was $9.9 million at quarter's end. During the quarter, we amended our credit facility with our existing lenders to increase our credit facility by $50 million to $200 million.

Our Board authorized and declared a dividend of $0.36 per share for the fourth quarter, payable on December 16 to stockholders of record as of November 28. This dividend reflects an annualized dividend rate of $1.44 per share and is a 12.5% increase from the Company's third quarter dividend. When paid, this will bring our total dividend paid to stockholders since their IPO in March to $1.07 per share.

With that, I'll turn the call back over to Jim.

Thanks, again, Harold. At this point, we'll be happy to take your questions. Operator, could you please open up the lines.

Certainly. (Operator Instructions) Douglas Harter, Credit Suisse.

Thanks. I guess when thinking about the available liquidity that you have to, sort of, fund investments before you would need to raise additional capital, how should we think about that? And I'm guessing, right now, when you calculate the debt-to-equity that the payable for the treasury is excluded from that calculation?

Correct. Hi, Doug. So, yes, absolutely, good question. And so we'd look at it from our track record in being in this business for over 30 years, and so the reality is not all customers draw on their unfunded commitments, the guidance we've given is generally 75% or less of gross unfunded commitments ultimately get drawn.

What's unique within our existing portfolio, as we talked about, roughly, $44 million of that $138 million are subject to milestones before the companies can draw on that debt of which none of those companies have hit those milestones. That's neither good nor bad, one way or another.

So -- and then as we look to the remaining unfunded commitment, as we look to, just, given the liquidity of these companies, some of these companies have over $100 million of cash on the balance sheet right now. So we're either not expecting them to draw on their debt commitments with us, or we're expecting them to draw on the debt later on in their availability period, so towards either the middle or end of 2015.

And so we look at it on a name-by-name basis as we maintain and ensure that we have liquidity to meet our near-term funding obligations.

Got it. So, I mean, I guess, based on all those factors, I mean, I guess, how do you look at the appetite for the public vehicle to fund and grow the balance sheet versus the need to -- you know, for new commitments versus the need to, kind of, hold back given those various puts and takes you just talked through.

Yes, no, I mean I think from our perspective, given just the meaningful pipeline of term sheets, of deals that we anticipate closing and being responsible for to our public shareholders, it's our intent to, per our allocation policy, to assign new commitments and new obligations to the TriplePoint Capital platform unless we raise additional capital before then.

And, Doug, I would only add we're always going to be in the market, so we don't plan to hold back or have any kind of holdback plans. This is a market that TriplePoint can serve very easily and capital is not the issue.

Got it. So what you're saying is you will be able to continue to originate and -- per allocation, those loans would come back to you if and when you have more available capital?

Well, the way it would work is once those new commitments are assigned to the TriplePoint platform, they can't come back to the public vehicle, so it would only be any new funding commitments would then flow back or be entered into by the public vehicle.

Okay, thank you for that clarification.

(Operator Instructions) Jon Bock, Wells Fargo.

Congratulations, gentlemen, on a very strong quarter. So maybe if we dive into a few specifics, let's talk about the deals that you put on balance sheet this quarter, obviously, at a higher rate than the weighted average yield of the entire portfolio. And I'm curious, when you originate deals at higher yields, can you give us a sense, Sajal and Jim, about whether it is all in rate-related, whether it is end of term accretion, whether it is another ancillary fee that is responsible for the boost in yield, relative to the weighted average portfolio yield?

Hi, Jonathan. I'll take a first cut, and then, Jim, please add. So I'd say the beauty of our experience is relatively consistent. Our goal, first of all, is to maximize total return and to maximize current return, current coupon, as much as possible, and then use the other levers, be it up-front facility fees, be it end of term payments, even additional warrants to ensure that we're maximizing our return and making sure we're generating the proper return for the risk that we're taking.

So I'd say we're not changing anything, I think we're just sticking to our bread-and-butter of generating high-yielding assets with high coupons and then, opportunistically, either driving the coupon higher or driving other levers where it makes sense.

It's hard to add to that. I would simply say that it's individualistic. It depends on the customer that we're dealing with, but there's definitely a focus on the current coupon aspect.

And I think that, again, it's the aspect of the TriplePoint Capital brand, the BDC's reputation, our track record, our relationships that are allowing us to do this. And, again, I think we're very disciplined in how we approach structuring and negotiating our deals.

Okay, great, that makes some sense, and I appreciate it. Perhaps another -- you mentioned fees. When we see the interest income relatively high this quarter, particularly related to the dividend, give us a sense of dividend coverage outside of the fees that you're bringing into term accretion. Because you're getting cash income, but then there's also a noncash component and, obviously, you've thought it through many times and solid quarters like this only puts you even closer to full coverage.

But now with the dividend higher, give us a sense of that dividend policy in relation to the true cash generation coming off the assets.

Hi, this is Harold. So as we talked about, most of the yield we get is from cash couponed, and a portion is from OID. The OID is monies we get or the value of warrants we get up front. So a portion of that is more money than we're actually recognizing. And then, certainly, 3.2% of our income this quarter was accretion of the end of term payment.

Over time, we will receive that cash, and the timing of our cash distributions and cash outlays and cash receipts will be equal. But, certainly, as we grow our portfolio, we will generate more -- or recognize more cash -- more income than we generate in cash income.

We, to date, have distributed 94% of our taxable earnings, so while a portion of our tax -- our income is on cash, we do factor that in when we do set the dividend level, and we set it at $0.36 per share for the quarter based not only on what our portfolio is earning currently, but we do review and factor in how much of that is cash versus noncash.

And, again, I think our Board takes a very long-term approach. I mean, we're in our first year as a publicly traded company, and so we think it's very important to manage expectations and to be consistent with regards to our dividend policy but, most importantly, our ability to cover our dividend regardless of how the portfolio performs in any given quarter.

Okay, I appreciate that. Now, maybe one particular repayment that caught our eye was the repayment that you announced, I believe, subsequent to quarter-end. And can you give us the name of that investment that repaid?

Sure. It's in the 10-Q, which we just filed. It's Birchbox paid us off. They raised a meaningful size of capital -- of equity capital earlier in the year, and so they paid us off as well as their unfunded commitment was terminated in conjunction with the prepay.

So the question is, considering that was an outstanding loan, the question would be do you receive an end-of-term payment on the entire amount of committed capital? Or only the amount of outstanding?

We only receive the end-of-term payment on the amounts we actually funded, and so, in this case, $5 million of principal, so we received the end-of-term on the $5 million. But we did receive facility fee and warrants typically on the full commitment amount, and so to the extent that a customer does not utilize fully their facility, we do earn a little bit and would recognize the facility fee or the unearned facility fee and the unearned warrant at that time that the expire their commitment.

And then, I guess, just on that unfunded amount, I think it might have been, like, $12 million, maybe a sense, Sajal, is it -- not in this case but in general cases, is it unused facility fee or termination fee, but what does that run on the unused amount? I mean, it's obviously not eight points, but -- ?

Just to clarify, we typically don't charge unused fees. What I was referring to is a facility fee, as Harold mentioned, we typically would receive a facility fee on the entire commitment at the time of entering into the commitment. But as we fund a portion of that total commitment, we'll only see that portion of the up-front fee enter into the yield of the assets funded.

So, for example, if only $5 million of a $15 million debt commitment is funded, that means only one-third of the facility fee that was received up front, is actually in interest income. And so at that point when the customer terminates the remaining two-thirds of unfunded commitment, you still have that remaining two-thirds of facility fee cash that you received that didn't flow through income yet, plus you typically receive the full warrant up front. And so you have to, as they call it in accounting, "flush it through," and so that's what happens when the unfunded commitment terminates as you flush through that facility -- the remaining facility fee and the remaining up-front warrant.

Got it. Very useful and, again, all good things. So, then, one last question, actually two. Jim, just an overall kind of industry view -- we've dealt with a significant amount of volatility, and we've seen that nowhere more than in BDC prices. Can you give us a sense as to how this volatility enters in and affects the minds or the venture capitalists that are out financing transactions with you, right? I understand the groups that you work with, obviously, are all market leaders, but the question is, is this volatility more of a -- opportunistic for them? Do you see them doing additional add-ons or taking advantage of it? Or is it perhaps a different approach -- steady as she goes and not really subjected to the market lends one way or another?

I used "stick to the knitting," but I like what you say. I think it was, "steady as she goes." So, quite frankly, the venture capitalists are not focused on the BDC markets or what's happening in BDC stock prices of volatility. It's something that's not even thought about.

We scratch our head when we see all those things, but it really is, as I said, "sticking to the knitting." And we have the capital, we have the platform, we have the reputation, and it's nice we're showing the earnings power, the BDC model, when it's put to work. But the venture lending business is, at least for us, we're feeling exceptionally good about it. This is now your TriplePoint platform-wise, as I said, $3 billion and counting. This is the strongest quarter in terms of this pipeline and signed term sheets, and I think Sajal alluded to and I wish we could cite some numbers.

The extremely strong amount of deals that are presently under evaluation for future signed term sheets. So we're feeling very good about this business, and there's very little focus on what the price of some BDC is today or tomorrow or next month, last month.

I appreciate that, and one legal question I always want to try to understand is so that you always being relevant to the VCs that can be done through the BDC, it can be done through the broader TriplePoint platform. Either way, anybody associated can succeed. The question is, though, how do you think about exemptive relief in the event that one loan funds at the private entity versus the public entity? I understand you have counsel looking at this. It's just always trying to walk through that policy, Sajal, and whether or not there is a policy in place for the unfunded commitments in the unlikely event that we have another 2008 and all those try to fund at once. Just -- I want to get a sense of how you think those risks through?

Yes, no, I think as we grow the -- our vehicle, we definitely will want to pursue exemptive relief. We think it makes sense. We think other quality platforms have done the same, and so we would look to do the same. And so I think we feel we have plenty of capacity right now at the BDC for our existing funding obligations, and I think we're being smart and balanced with regards to this immense pipeline of signed term sheets and of deals that we have outstanding where at this point it makes sense for the platform to step in and enter into these new obligations and funding requirements, so until the BDC has sufficient capacity to enter into them.

Okay, and then as you think about the SBIC program, Jim, Sajal, Harold, how does that enter into maybe your long-term growth plans for the BDC and TriplePoint, in general?

We're definitely -- we continue to pursue our SBIC program, and it's part of our long-term plan.

That's enough for me. Very strong quarter, guys, thank you very much.

Thank you.

That concludes this afternoon's question-and-answer session. I'll turn the call back over to Jim Labe for concluding remarks.

Thanks, Operator. I'll close again by expressing my appreciation to everyone on the line and to all of you for your interest in TPVG. As you can tell, we're really, really pleased with the dynamite quarter that we just had. We're going to continue on that momentum. We want to build our franchise and portfolio. We want to continue to meet this growing market demand and deliver the attractive returns, which we've been doing to our shareholders.

I look forward to talking with you all again soon as we continue to execute in this growth strategy, and I'm sure we'll see some of you at the upcoming Wells Fargo or Credit Suisse conferences both in New York in November.

Thank you.

That concludes today's call. You may now disconnect.

[DC1]