Final results for the year ended 31 December 2023

SuperSeed Capital Limited

23 May 2024

 

23 May 2024

SUPERSEED CAPITAL LIMITED

(the "Company")

FINAL RESULTS FOR THE FINANCIAL YEAR ENDED 31 DECMEBER 2023

SuperSeed Capital Limited, a company established as a venture capital fund of funds for early-stage AI/SaaS companies, announces that the final results for the financial year ended 31 December 2023, as detailed below, have been fully extracted from the Annual Report and Audited Financial Statements for the year ended 31 December 2023, which were approved by the Board of Directors on 22 May 2024.

In the coming days, the full Annual Report and Audited Financial Statements will be available on the Company's website at: https://www.superseed.com/investors/superseed-capital/documents/.

The Company invests in technology-led innovation, primarily through funds managed by SuperSeed Ventures LLP (the "Investment Manager"). The Company's principal investment to date is in SuperSeed II LP (the "Fund").

For more information, please contact:

SuperSeed Capital Limited	[phone]
Mads Jensen, Investment Manager
VSA Capital - AQSE Corporate Adviser and Broker	[phone]
Corporate Finance: Simon Barton / Alex Cabral

Chairman's Statement
Introduction
This is now my second statement on the audited financial statements published for SuperSeed Capital Limited ("SuperSeed" or the "Company") since its admission to trading on Aquis Stock Exchange Growth Market in January 2022. The IPO market for listed investment companies has continued to be very challenging with very few IPOs. As a member company of the Association of Investment Companies (the AIC) the board receives regular updates on sector performance and there is a general theme of members trading at a discount to their NAV. The Company's NAV as of 31 December 2023 was £1.13 when the shares were trading at a mid-price of £0.85 per share, which is a discount of 25%. At time of writing (2nd May 2024) the share price has remained around this level since June 2023 when the most recent published NAV was £1.18 and the current price would have represented a discount of only 28%. The discount has therefore steadily increased as NAV has been growing. In contrast, in the first quarter of 2023, the Company's shares traded at prices as high as £1.10 per share, a premium of 5% to the then net asset value. The Board believes that the current share price represents a good opportunity to buy shares in the Company at an attractive price.
The intention behind the Company was to permit investors to invest into a listed fund with liquidity and no minimum investment, and which can access opportunities in seed stage venture capital portfolio companies through funds managed by SuperSeed Ventures LLP. This has been achieved but of course the Board would like to see more liquidity and additional share issues to enable the Company to continue to commit capital to its principal underlying fund investment and other opportunities. The fund-raising environment has not been conducive to that during 2023 but can only really improve from this low point. Despite the adverse market conditions the Company was able to issue equity in January 2023 of 244,240 new shares and a further issue of 41,366 shares in April 2023. In June 2023 100,000 investors warrants were issued to the Company's broker to aid liquidity.
In February 2024 the Company issued and subsequently repaid 60,000 Convertible Loan Notes. Since the year-end the Company has used £150,000 of its £1m loan facility to continue to meet its capital commitments to SuperSeed II LP (the "Fund") which has in turn deployed its drawn capital into further new investments that are strongly positioned to take advantage of exceptional growth opportunities.
The Fund performed well during 2023 with two successful exits of underlying companies being made in the third quarter providing the Company with net cash of £435,238.
The Company continues to comply with the AIC Code of Corporate Governance which ensures that it meets the required standards of governance and ESG, which are expected by investors and stakeholders. It is an honour to lead such a dynamic and forward-thinking organisation, and I continue to be excited about the opportunities that lie ahead.
Investment Policy
The Company invests in early-stage European software and AI businesses which have technologies that are disruptive to the traditional services sector. A typical investment will offer the prospect of high growth and the potential to scale. The Company's objective is to provide long-term capital growth to shareholders.
Performance
I am pleased to report that the Company has performed well with an increase in the Company's NAV from inception to £1.13p per share as at 31 December 2023. Accordingly, we are pleased with the Company's performance which gives us confidence in its current value and future prospects. The Company continues to actively review potential acquisition targets at various stages of development and operating in a number of geographic regions, all of which have potential global relevance.
Pipeline
The investment pipeline of the Fund remains strong and the Company's investment manager continues to have visibility over large swathes of the opportunities in European SaaS and AI.
ESG
The Company and its investment manager, SuperSeed Ventures LLP, recognises the importance of ESG and governance considerations in building a sustainable and resilient business. As an investment fund with no staff and premises, the Company's main effort to ensure positive ESG outcomes are achieved is by monitoring the actions of our investment manager and our portfolio companies, further details of which can be found here: https://www.superseed.com/journal/superseed-esg-policies-and-investment-strategy/
Outlook
The Board is of the view that the combination of an established, successful and hands-on investment manager with access to an attractive seed portfolio as well as an identified and growing pipeline of investments in the SaaS and AI space, makes this a compelling investment. We remain committed to our vision and strategy of supporting the growth of innovative and high-potential AI companies, while adhering to high standards of governance and ESG practices. We welcome our new shareholders and look forward to working with them and successfully delivering on our investment strategy.
Joseph Truelove
Chairman
SuperSeed Capital Limited

Investment Manager's Report

2023 marked yet another successful year for SuperSeed II LP (the "Fund"). Artificial Intelligence continued to be both a driver of business transformation and to form the foundation for many promising new software companies, precisely the type of companies the Fund invests in.

During 2023, the Fund backed seven new AI-led SaaS companies (one investment, FreightCore, was agreed in December 2023 and closed in early January 2024). The Fund also successfully sold two positions, as both Garvis and Techsembly were acquired by large US technology corporations (Logility and Sabre, respectively).

The technology industry continues to be full of disruption and volatility, but the possibilities created by technological advances are undiminished. In fact, we believe that AI provides the biggest opportunity in decades to transform how business is done.

Portfolio Progress and Revenue

Fund portfolio revenue grew 96% year-on-year. There is a general sense in the industry that software revenue growth bottomed out in 2023, with a positive outlook for 2024.

At SuperSeed we work closely with our portfolio founders to help them build strong companies. A core part of this is supporting the build-out of their teams. In 2023 we helped bring in excellent business leaders across several of the companies, including:

·     At Uhura, where we brought in Pete O'Neil (former Chief Revenue Officer of Blueprism) as new VP Sales; ·     At Octaipipe, where we brought in Arnaud Lagarde (former VP Europe of Automation Anywhere) as new Chief Revenue Officer; and ·     At Finteum, where we brought Rupert Hume Kendall (former chairman of Bank of America Merrill Lynch in Europe) as vice chair of the board.

Outlook for the rest of 2024

As we look to 2024, we continue to see advances in AI providing great investment opportunities across the software landscape. Thus, the strategy for the year ahead is unchanged: SuperSeed looks to back the best technical founders and support them in building successful global software companies.

The Fund continues to perform to strategy with existing portfolio companies growing well and exciting new companies being added to the portfolio. This positions the Fund strongly to capitalise on the continued opportunity in AI in 2024 and beyond.

Mads Jensen

Managing Director

SuperSeed Ventures LLP

Statement of Comprehensive Income
for the year ended 31 December 2023
		1 January 2023		6 October 2021
		to		to
		31 December 2023		31 December 2022
	Notes	£		£
Income
Investment income		1,024		379
Realised gain on investments held at fair value through profit or loss		221,955		-
Unrealised gain on investments held at fair value through profit or loss	7	297,373		260,581
Bank interest income		2,947		2,347
Total income		523,299		263,307
Expenses
Administration fees	13	30,450		27,432
Audit fees		23,500		21,000
Directors' fees	13	18,000		18,000
Establishment costs		-		194,298
Insurance		1,036		1,316
Legal & professional fees		54,911		40,838
Loan interest		134		-
Management fees		5,128		-
Regulatory fees		16,131		14,839
Sundry expenses		2,126		1,599
Total expenses		151,416		319,322
Total profit/(loss) and comprehensive income for the year/period		371,883		(56,015)
Basic earnings per share	6	0.1582		(0.0371)
Diluted earnings per share	6	0.1518		(0.0368)
All the above items are derived from continuing operations.
There is no other comprehensive income for the year.

Statement of Financial Position
as at 31 December 2023
			2023		2022
		Notes	£		£
Non-current assets
Investments		7	2,433,012		1,799,616
Total non-current assets			2,433,012		1,799,616
Current assets
Trade and other receivables		8	182,827		11,025
Cash and cash equivalents			99,185		235,089
Total current assets			282,012		246,114
Total assets			2,715,024		2,045,730
Current liabilities
Trade and other payables		9	29,413		21,745
Total current liabilities			29,413		21,745
Total liabilities			29,413		21,745
Net assets			2,685,611		2,023,985
Equity
Share capital		11	2,369,743		2,080,000
Retained earnings			315,868		(56,015)
Total equity			2,685,611		2,023,985
Net asset value per ordinary share			1.1333		0.9731

Statement of Changes in Equity
for the year ended 31 December 2023
		Share Capital		Retained Earnings		Total
		£		£		£
Ordinary Shares issued on incorporation		1		-		1
Issue of Ordinary Shares		2,079,999		-		2,079,999
Total comprehensive loss for the period		-		(56,015)		(56,015)
Balance as at 31 December 2022		2,080,000		(56,015)		2,023,985
		Share Capital		Retained Earnings		Total
		£		£		£
Balance as at 1 January 2023		2,080,000		(56,015)		2,023,985
Issue of Ordinary Shares		289,743		-		289,743
Total comprehensive income for the year		-		371,883		371,883
Balance as at 31 December 2023		2,369,743		315,868		2,685,611

Statement of Cash Flows
for the year ended 31 December 2023
		2023		2022
		£		£
Cash flows from/(used in) operating activities
Net profit/(loss) for the year/period		371,883		(56,015)
Realised gain on investments		(221,955)		-
Unrealised gain on investment revaluation		(297,373)		(260,581)
Non-cash income adjustments		(1,529)		-
Movement in prepayments		(1,471)		(11,025)
Movement in trade and other payables		7,668		21,745
Loan interest		134		-
Investment income		(1,024)		-
Net cash flow (used in) operating activities		(143,667)		(305,876)
Cash flows from/(used in) investing activities
Purchase of investments		(216,611)		(1,539,035)
Proceeds from disposal of investments		825,253		-
Movement in prepaid investments		(600,745)		-
Net cash flow from/(used in) investing activities		7,897		(1,539,035)
Cash flows from/(used in) financing activities
Proceeds from issue of shares*		-		2,080,000
Loan interest		(134)		-
Proceeds from loan		50,000		-
Repayment of loan		(50,000)		-
Net cash flow (used in)/from financing activities		(134)		2,080,000
Net movement in cash and cash equivalents during the year/period		(135,904)		235,089
Cash and cash equivalents at the beginning of the year/period		235,089		-
Cash and cash equivalents at the end of the year/period		99,185		235,089
Non cash activity
* On 12 January 2023 122,120 Ordinary shares were issued by the Company as compensation for a further investment in Duel Holdings Limited of £244,240.
* On 15 March 2023 a further 41,366 Ordinary shares were issued by the Company as compensation for an investment in Kluster Enterprises Limited of £45,503.

Notes to the Financial Statements

for the year ended 31 December 2023

1

General Information

The Company was incorporated on 6 October 2021 in Guernsey, as a non-cellular company limited by shares under The Companies (Guernsey) Law, 2008 (as amended) ("Company Law"). The Company is regulated by the Guernsey Financial Services Commission as a Registered Closed-ended Collective Investment Scheme pursuant to the The Protection of Investors (Bailiwick of Guernsey) Law, 2020 and the Registered Collective Investment Schemes Rules and Guidance 2021. The address of the registered office is given on page 3.

The main purpose of the Company is to carry on business as a fund-of-funds. The Company will invest in technology-led innovation primarily through unquoted funds managed directly and indirectly through SuperSeed II LP by SuperSeed Ventures LLP, the Investment Manager, with the objective of maximising investors' long term total returns - principally through capital appreciation.

2

Significant accounting policies

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been adopted consistently in the preparation of the financial statements unless otherwise stated.

Basis of accounting

These financial statements are prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") and The Companies (Guernsey) Law, 2008. These financial statements have been prepared under the historical cost convention, as modified by the revaluation of financial assets and financial liabilities at fair value through profit or loss.

a)

Functional and presentational currency

The financial statements are presented in British Pound Sterling ("GBP" or "£"), which is the Company's functional currency as the Company's primary business transactions and majority of overall transactions are conducted in GBP. The Directors consider GBP as the currency that most faithfully represents the economic effects of the underlying transactions, events and conditions of the Company.

b)

Foreign currency translation

Monetary assets and liabilities are translated from currencies other than GBP ("foreign currencies") to GBP (the "functional currency") at the rate prevailing at the period end date. Income and expenses are translated from foreign currencies to the functional currency at the rate prevailing at the date of the transaction. Exchange differences are recognised in the Statement of Comprehensive Income.

Foreign currency transaction gains and losses on financial instruments classified as fair value through profit or loss are included in the Statement of Comprehensive Income.

c)

Financial instruments

Financial assets and financial liabilities are recognised in the Company's Statement of Financial Position when the Company becomes a party to the contractual provisions of the instrument. Financial assets and financial liabilities are only offset and the net amount reported in the Statement of Financial Position and Statement of Comprehensive Income when there is a currently enforceable legal right to offset the recognised amounts and the Fund intends to settle on a net basis or realise the asset and liability simultaneously.

The Company's financial assets comprise of receivables and cash at amortised cost and investments held at fair value through profit and loss.

Receivables

With the exception of receivables related to investments, receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They principally comprise trade and other receivables. They are initially recognised at fair value plus transaction costs that are directly attributable to the acquisition, and subsequently carried at amortised cost using the effective interest rate method, less provisions for impairment. The effect of discounting on these financial instruments is not considered to be material.

For assets measured at amortised cost, IFRS 9 requires an assessment of impairment based on providing for expected losses. The Company has chosen to apply an impairment approach similar to the simplified approach for expected credit losses under IFRS 9 for the Company's receivables. Therefore, the Company does not track changes in credit risk, but instead recognises a loss allowance based on life time expected credit losses at each reporting date. This approach takes into account historic observed loss rates over the expected life of the receivables, and is adjusted for forward looking estimates.

Investments at fair value through profit or loss

(i)

Classification

The Company classifies its investments as financial assets at fair value through profit or loss. These financial assets are designated by the Company at fair value through profit or loss at inception.

(ii)

Recognition

Purchase and sales of investments will be recognised on the trade date which is the date on which the Company commits to purchase or sell the investment. Investment purchases which involve earn-out payments or similar deferred payments will be accounted for at the best estimate of fair value, any subsequent changes in these fair value estimates are recognised in the Statement of Comprehensive Income as part of the changes in fair value of financial assets held at fair value through profit or loss.

(iii)

Measurement

The investments will be initially recognised at cost, being the fair value of consideration given. Subsequently such assets are carried at fair value and the changes in fair value are recognised in the profit and loss.

(iv)

Derecognition of financial assets

A financial asset (in whole or in part) is derecognised either:

•

When the Company has transferred substantially all the risks and rewards of ownership; or

•

When it has neither transferred nor retained substantially all the risks and rewards and when it no longer has control over the assets or a portion of the asset; or

•

When the contractual right to receive cash flow has expired.

Cash and cash equivalents

Cash and cash equivalents are defined as cash in hand, demand deposits and highly liquid investments readily convertible to known amounts of cash with an original maturity of three months or less and are subject to an insignificant risk of changes in value. As at 31 December 2023 cash and cash equivalents consists only of cash at bank.

d)

Fair value estimation

International Financial Reporting Standard 13, "Fair Value Measurement" recommends investments treated as "financial assets at fair value through profit or loss" to be subsequently measured at fair value. IFRS 13 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction in the principal (or most advantageous) market at the measurement date under current market conditions. Fair value under IFRS 13 is an exit price regardless of whether that price is directly observable or estimated using another valuation technique.

The Board has delegated responsibility for carrying out the fair valuation of the Company's portfolio to the Investment Manager.

Investments are reported as having the fair value estimated by the Investment Manager at the reporting date. The fair value of the Company's investments in SuperSeed Fund II LP and other future investments will be calculated in accordance with International Private Equity and Venture Capital ("IPEV") valuation guidelines. Under IPEV guidelines, the fair value of unquoted investments can be calculated using a number of approaches, broadly categorised under three headings, Income Approach, Market Approach and Replacement Cost.

Given the type and stage of investments, the Investment Manager will seek to take a Market Approach where possible, most often based on calibration to the price of the recent investment and market multiples. Alternative methodologies may be considered in accordance with IPEV.

It is the opinion of the Directors, that the IPEV valuation methodology used in deriving a fair value is not materially different from the fair value requirements of IFRS 13.

All valuations made by the Investment Manager will be made, in part, on valuation information provided by the portfolio companies of SuperSeed Fund II LP alongside other future investments. Although the Investment Manager will evaluate all such information and data, it may not be able to confirm the completeness, genuineness or accuracy of such information or data. In addition, the financial reports provided by the Portfolio Companies may be provided only on a quarterly basis and generally will be issued one to two months after their respective valuation dates. Consequently, each quarterly Net Asset Value is likely to contain information that may be out of date and require updating and completing. Shareholders should bear in mind that the actual Net Asset Values at such time may be materially different from the quarterly valuations.

Investment income from financial assets at fair value through profit or loss is recognised in the Statement of Comprehensive Income when the Company's right to receive payments is established.

e)

Financial liabilities

The classification of financial liabilities at initial recognition depends on the purpose for which the financial liability was issued and its characteristics.

All financial liabilities are initially recognised at fair value net of transaction costs incurred. All purchases of financial liabilities are recorded on trade date, being the date on which the Company becomes party to the contractual requirements of the financial liability. Unless otherwise indicated, the carrying amounts of the Company's financial liabilities approximate to their fair values. The Company's financial liabilities consist of only financial liabilities measured at amortised cost.

(i)

Financial liabilities measured at amortised cost

These include trade payables and other short-term monetary liabilities, which are initially recognised at fair value and subsequently carried at amortised cost using the effective interest rate method.

(ii)

Derecognition of financial liabilities

A financial liability (in whole or in part) is derecognised when the Company has extinguished its contractual obligations, it expires or is cancelled. Any gain or loss on derecognition is taken to the Statement of Comprehensive Income.

f)

Segmental reporting

In accordance with IFRS 8, Operating Segments, the Company is required to present and disclose segmental information. The Chief Operating Decision Maker, which is the Board, is of the opinion that the Company is engaged in a single segment of business through its investment portfolio, with the aim of providing long-term returns through capital appreciation to shareholders. The financial information used by the Chief Operating Decision Maker to manage the Company presents the business as a single segment.

g)

Critical accounting judgements and key sources of estimation uncertainty

IFRS requires the Directors to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses.

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances, the results of which form the basis of making judgements about carrying values of assets and liabilities that are not readily apparent from other sources. However, uncertainty about these assumptions and estimates could result in outcomes that could require a material adjustment to the carrying amount of the asset or liability in future periods.

The areas where assumptions and estimates are significant to the financial statements include the valuation of investments. The Company's investment into SuperSeed II LP is measured at the net asset value of the Company's investment at year end. The underlying investments of SuperSeed II LP are valued in accordance with the IPEV methodology in which unlisted investments are carried at such fair value as is considered appropriate by the Investment Manager. The investment in Duel Holdings has been valued at fair value and in Kluster Enterprises Limited at recent round of financing. The models used to determine fair values are validated and periodically reviewed by the Investment Manager. Refer to note 2 (d) for further disclosure details.

h)

Income and expenses

Operating income and expenses have been accounted for on an accruals basis, and are recognised in the Statement of Comprehensive Income in the period which they are incurred.

i)

Management fees

Management fees are accounted for on an accruals basis and are measured at the fair value of the consideration paid.

j)

Going concern

The Directors, and the Investment Manager having considered the Company's objectives and available resources along with its projected income and expenditure, are satisfied that the Company has adequate resources to meet its liabilities as they fall due and continue in operational existence for the foreseeable future. The Company adopts an "Overcommitment Policy" in order to reduce the cash reserves held by the Company that have not been called by its commitment-based investments. In order to meet ongoing investment commitments, the Company may utilise any cash reserves held, incur borrowings, issue new share capital or sell assets in order to realise their value. The Directors are cognisant of potential capital calls from underlying investments. Loans can also be drawn from the Investment Manager under the Convertible Loan Note Instrument entered into on 14 September 2022, if required. The Directors do not consider there to be any threat to the going concern status of the Company.

For these reasons, the Company continues to adopt the going concern basis in preparing the financial statements.

3

Adoption of new and revised standards

Standards issued and effective

There are new standards and amendments to existing standards that are effective for the period beginning on 1 January 2023 and have therefore been adopted. None of these standards or amendments have a significant impact on the Company's financial results or position; hence they have not been disclosed.

Standards issued but not yet effective

New standards, amendments and interpretations issued but not yet effective are not early adopted by the Company. At the date of authorisation of these financial statements, several new, but not yet effective, Standards and amendments to existing Standards and Interpretations have been published by the IASB. None of these Standards or amendments to existing Standards have been adopted early by the Company and are not thought to have any impact on the Company's financial results.

4

Taxation

The Company is exempt from income taxation in Guernsey under the provisions of the Income Tax (Exempt Bodies) (Guernsey) Ordinance, 1989, as amended. An annual fee of £1,200 is payable and is included in the Statement of Comprehensive Income within regulatory fees.

5

Material agreements

Investment Manager

Under the Alternative Investment Fund Management Agreement dated 21 January 2022, the Company has appointed SuperSeed Ventures LLP as the Company's Investment Manager to provide portfolio and risk management services to the Company. The Investment Manager does not charge separate fees to the Company for managing funds where it is already paid a fee as part of a direct fund management mandate (including the Company's investment in SuperSeed II LP). For all other investments, the Investment Manager is entitled to receive from the Company a management and performance fee for the management of investments. This is calculated as being:

(a)

0.25 per cent. of the Total Portfolio Value; and

(b)

20 per cent. of the aggregate net realised profits on Investments since the start of the relevant Calculation Period.

In each case, calculated as at the end of a Calculation Period and payable in arrears within 30 days after the end of that Calculation Period.

For these purposes:

"Calculation Period" means each calendar quarter, with the first Calculation Period commencing on Admission and ending on 31 March 2022.

"Investment" means any investment or other asset (including cash) of the Company of any description, the acquisition or holding of which is authorised under the investment policy of the Company from time to time, and in the case of investment commitments into other funds the total commitment to that fund should be regarded as an "Investment".

"net realised profits" means the net profit received by the Company following a disposal of an Investment as recorded in its accounts in accordance with the Company's adopted accounting policies from time to time.

"Portfolio" means the portfolio of Investments held by the Company directly or indirectly from time to time.

If all assets were to be realised at the current valuation, the Manager would be due additional management fees that have not been accrued in the amount of £48,311.

Administrator

Under the Administration agreement dated 15 October 2021, Imperium Fund Services Limited provides secretarial, directors and administration services to the Company and is entitled to remuneration and reimbursement of expenses as may be determined from time to time by the parties.

VSA Engagement Letter

Under the engagement letter dated 7 October 2021, the Company appointed VSA Capital Limited to act as its Corporate Adviser for the purposes of seeking admission of the Company's shares to trading on the Access Segment of the Growth Market operated by Aquis Exchange Limited, for which the Company agreed to pay VSA Capital Limited £40,000 plus any applicable VAT.

AQSE Corporate Adviser Agreement

Under the AQSE Corporate Adviser agreement dated 7 October 2021, the Company has appointed VSA Capital Limited to act as corporate adviser and broker to the Company on an on-going basis following admission of the Company's shares to trading on the AQSE, for which the Company agreed to pay VSA Capital Limited a fee of £40,000 plus any applicable VAT per annum payable quarterly in advance.

Registrar

The Company utilises the services of Link Market Services (Guernsey) Limited as a registrar in relation to the transfer and settlement of its issued shares. Under the terms of the Registrar Agreement, the Registrar is entitled to an annual fee of £3,969 per annum. In addition, the Registrar is entitled to remuneration as may be determined from time to time by the parties. Additional remuneration of £2,448 was paid during the year.

6

Earnings per share

Earnings per share is calculated by dividing the profit or loss for the period by the weighted average number of ordinary shares in issue during the period.

31 December 2023

31 December 2022

£

£

Total profit and comprehensive income for the year/period

371,883

(56,015)

Weighted average number of shares in issue

2,349,972

1,509,234

Basic earnings per share

0.1582

(0.0371)

Diluted weighted average number of shares in issue

2,449,972

1,522,505

Diluted earnings per share

0.1518

-     0.0368

7

Investments held at fair value through profit or loss

31 December 2023

31 December 2022

£

£

Cost at beginning of the year/period

1,539,035

-

Purchases during the year/period

939,321

1,539,035

Disposals during the year/period

(603,298)

-

Cost as at 31 December

1,875,058

1,539,035

Movement in fair value at beginning of the year/period

260,581

-

Movement in fair value during the year/period

297,373

260,581

Movement in fair value as at 31 December

557,954

260,581

Fair value at year/period end

2,433,012

1,799,616

All investments are fair valued at the year end.

The Company has committed to invest up to £4,500,000 in SuperSeed II LP, of which £3,020,778 is unfunded as at 31 December 2023.

8

Trade and other receivables

31 December 2023

31 December 2022

£

£

Prepayments

4,160

2,689

Prepaid investment costs

178,667

8,336

Total

182,827

11,025

9

Trade and other payables

31 December 2023

31 December 2022

£

£

Audit fees payable

23,500

21,000

Legal fees payable

785

745

Management fees payable

5,128

-

Total

29,413

21,745

10

Financial risk management

The Company's activities expose it to a variety of financial risks including credit risk, liquidity risk, and the market risks of interest rate risk, price risk and foreign currency risk. The Company uses different methods to measure and manage the various types of risk to which it is exposed. These methods are explained below.

a)

Credit risk

Credit risk refers to the risk that the counterparty to a financial instrument will default on its contractual obligations that it has entered into with the Company resulting in financial loss to the Company. At 31 December 2023, the major financial assets which were exposed to credit risk are cash and cash equivalents, investments (note 7) and trade and other receivables (see note 8). The maximum exposure to credit risk is represented by the carrying value of each financial asset recognised in the statement of financial position. The Company has no overdue financial assets as at the year end.

The table below shows the cash balance at the reporting date and the Standard & Poor's credit rating for the counterparty as at 19 February 2024.

Rating

Carrying Amount

31 December 2023

HSBC UK Bank plc

A1

99,185

b)

Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting its obligations arising from financial liabilities. At 31 December 2023 the Company had £99,185 in cash balances. Financial liabilities consist of trade and other payables (see Note 9).

The following table details the Company's expected maturity for its financial liabilities as at 31 December 2023:

Total

Less than

More than

31 December 2023

3 months

12 months

Financial liabilities

Trade and other payables

29,413

29,413

-

The Company's investments will be, by their nature, illiquid. As a result the Company may not be able to liquidate quickly any part of its investment at an amount close to fair value.

In order to meet ongoing liquidity requirements, the Company may incur borrowings, issue new share capital or sell assets in order to realise their value.

c)

Market risk

i)

Interest rate risk

Interest rate risk is the risk that the value of financial instruments will fluctuate due to changes in market interest rates. The Company is exposed to interest rate risk as it has current account balances.

The Company does not have any interest-bearing liabilities and hence considers interest rate risk, in respect of financial liabilities to be minimal. The Company monitors market interest rates and will place interest bearing assets at best available rates but also taking into consideration the counterparty's credit rating and financial position.

During the year, the interest received on current accounts and deposit accounts was immaterial, and therefore no sensitivity analysis has been provided.

ii)

Price Risk

The Company's investments will be susceptible to market price risk arising from the business and financial uncertainties facing individual underlying portfolio companies. The value of investments may fall as well as rise and consequently the Company may not be able to return all or any of the investment made by shareholders. To manage market price risk, the Investment Manager will review the performance of the underlying portfolio companies and will be in regular contact with the management of the underlying portfolio companies for business and operational matters.

The table below summarises the sensitivity of the Company's investments. It is based upon the assumption that the investments increase or decrease by 10% with all the other variables held constant. The Directors feel that 10% best represents the margin of price risk associated to the activity of the Company.

2023

£

Effect on net assets attributable to investments of an increase in the index

243,301

Effect on net assets attributable to investments of a decrease in the index

(243,301)

iii)

Foreign currency risk

As all monetary assets and liabilities and all transactions of the Company are denominated in its functional currency, the Company is not exposed to significant foreign currency risk.

Financial investments measured at fair value

IFRS 13 requires disclosure of fair value measurements by level of the following fair value hierarchy:

•

Level 1 -

Inputs that reflect unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date;

•

Level 2 -

Inputs other than quoted prices that are observable for the asset or liability either directly or indirectly, including inputs in markets that are not considered to be active; and,

•

Level 3 -

Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs).

The Company's investments have been classified within Level 3 as these investments are valued based on unobservable inputs and trade infrequently or not at all.

The following table presents the investments carried on the Statement of Financial Position by level within the valuation hierarchy as at 31 December 2023.

31 December 2023

Level 1

Level 2

Level 3

Total

£

£

£

£

Investments

-

-

2,433,012

2,433,012

There have been no transfers between levels during the year. Due to the nature of the investments, they are always expected to be classified under Level 3.

Note 7 shows a reconciliation of all movements in the fair value of investments categorised within Level 3 between the beginning and the end of the reporting year.

The Company's investment into SuperSeed II LP is measured at the net asset value of the Company's investment at year end. The investment in Duel Holdings has been valued at fair value and in Kluster Enterprises Limited at recent round of financing.

SuperSeed II LP's investments are valued in accordance IPEV valuation guidelines, including valuing investments at the price at which third party capital has recently been raised, comparative industry price earnings ratios discounted for marketability and performance of the investment, and net asset valuations for asset based investments.

A reasonably possible change in the net asset value used +/-10.0% would result in:

-

An increase in carrying value of GBP 181,986 or 7% (+10%)

-

A decrease in carrying value of GBP (181,986) or -7% (-10%)

A reasonably possible change in the recent capital raising price used +/-10.0% would result in:

-

An increase in carrying value of GBP 61,316 or 2% (+10%)

-

A decrease in carrying value of GBP (61,316) or -2% (-10%)

11

Share Capital

31 December 2023

31 December 2022

Authorised:

Number

£

Number

£

Ordinary Shares of no par value

Unlimited

Unlimited

Unlimited

Unlimited

Issued:

Allotted and paid up Ordinary Shares of no par value

2,369,743

2,369,743

2,080,000

2,080,000

On 24 November 2022, 100,000 warrants in the Company were issued at no premium with an exercise price of 100p. Each warrant shall entitle the warrant holder (VSA Capital Limited) to subscribe in cash for one share at the exercise price. Each warrant is exercisable at any time during the subscription period on or prior to the expiry date, which was 24 June 2023. On 22 June 2023 a new warrant instrument was issued with the same terms as above apart from the exercise price which was 112p.

The subscription rights shall automatically lapse and be of no further effect if they have not been exercised by the expiry date on 24 June 2023. On 22 June new rights were issued with the same terms.

Shares issued pursuant to the exercise of a warrant will rank in full for all dividends and other distributions declared, made or paid after the relevant exercise date and rank pari passu in all other respects with the shares in issue at that date.

Ordinary shareholders are entitled to vote at the general meeting of the Company, to receive dividends and to participate in the results of the Company.

12

Capital risk management

The Company's objectives when managing capital are to safeguard the Company's ability to continue as a going concern in order to provide returns to shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.

Management assesses the Company's capital requirements in order to maintain an efficient overall financing structure while avoiding excessive leverage. This takes into account the warrants and convertible loan note. The Company manages the capital structure and makes adjustments to it in the light of changes in economic conditions and the risk characteristics of the underlying assets. In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares, or sell assets to reduce debt. As at 31 December 2023 the Company's capital structure consists of 100% equity.

13

Related parties

Joseph Truelove, Andrew Hatton and Mads Jensen were Directors of the Company during the year. Colette Taylor was appointed as Alternate Director to Andrew Hatton with effect from 27 February 2023.

Joseph Truelove earned £18,000 in the year ended 31 December 2023 (2022: £18,000), £nil of which was outstanding at the year end (2022: £nil).

Andrew Hatton and Colette Taylor are employees and Directors of the Administrator, whose services include the provision of the directorship and alternate directorship. During the year ended 31 December 2023, the Company incurred £30,450 (2022: 27,432) of administration fees of which £nil was outstanding at the year end (2022: £nil).

Mads Jensen is Managing Partner of the Investment Manager, management fees for the year were £5,128 (2022: Nil) (see Note 5). He has waived any director fees payable to himself. He holds 604,797 shares in the Company via nominee.

On 28 February £1,000,000 capital commitment in SuperSeed II LP was transferred from the Company to SuperSeed Ventures LLP for a consideration of £299,833.

Please refer to note 15 of the financial statements for related party transactions with SuperSeed Ventures with respect to credit facility arrangements.

14

Ultimate controlling party

In the opinion of the Directors the ultimate controlling party is Mads Jensen.

15

Credit facility

On 14 September 2022 a convertible loan note agreement was signed with SuperSeed Ventures LLP. This is a loan facility of which the aggregate principal amount of notes outstanding at any time is limited to £1,000,000.

The notes when issued and outstanding shall rank pari passu, equally and rateably, without discrimination or preference among themselves and as obligations of the Company.

Until the notes are repaid by the Company or converted into Shares, in each case in accordance with the provisions of this Instrument, interest shall accrue and be paid on the principal amount of the notes outstanding at the rate of SONIA plus 10% per annum.

All outstanding notes shall automatically convert into fully paid Shares of the class set out below at the Conversion Price on written notice of the noteholder. The noteholder shall have the right to serve a Conversion Notice on the Company at any time to convert some or all of the notes outstanding into fully paid Ordinary Shares at a price of £1.30 per Share.

During the year there were borrowings of £50,000, there was no outstanding balance at the end of the year.

16

Events after the end of the reporting period

On 12 February 2024 the Company issued 60,000 convertible loan notes to SuperSeed Ventures LLP for a subscription price of £60,000.

On 11 March 2024, the 60,000 convertible loan notes issued to SuperSeed Ventures LLP were redeemed for £60,000.

On 11 March 2024 the Company sold £300,000 of its commitment in SuperSeed II LP to the investment manager SuperSeed Ventures LLP for £119,974

On 3 April 2024 the Company issued 150,000 convertible loan notes to SuperSeed Ventures LLP for a subscription price of £150,000.

There are no further subsequent events to note.

 

END