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Firsthand Technology Value Fund, Inc. (SVVC): One of the Most Robust Venture Capital Players in Broader Tech Category & Cleantech
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
