Hercules Capital (HTGC) 3 Nov 222022 Q3 Earnings call transcript

Good day, and thank you for standing by. Welcome to the Hercules Capital Q3 2022 Earnings Conference Call. At this time all participants are in a listen-only mode. [Operator Instructions] Please be advised that today’s conference is being recorded. I would now like to hand the conference over to your speaker today, Michael Hara, Managing Director of Investor Relations. ahead. go Please

CEO Investor Investor Good call for Susan. us and to third Scott welcome the Seth after will investor.htgc.com. Officer; Thank at An CFO. Meyer, the afternoon, third least webcast conference Hercules’ Bluestein, replay are Hercules released for today XXXX financial close With following call. Chief can quarter Hercules Investment call section and you, quarter results from everyone, just and of the on were page be Relations and available Relations on XX days the be market at today’s accessed web from Hercules’ conference archived XXXX.

not call, and financial performance statements call and guarantees our may we upon made statements forward-looking should own not to, this be this number the based limited making Actual but These of assumptions expectations. the decision. relied any investment on from as forward-looking not Hercules in during the to in during that over SEC’s are reasons, today’s any report filings a XX-K the other Scott. including, of During current on in and results future make statements available future. differ may for made publicly the and obligation with such are call Any to annual risks are only call will And forward-looking date, turn statements website. our this assumes on made I no Form forward-looking identified statements of update the that,

Hercules to strong all QX. volatility and general economic Thank in markets and the for us market Capital deliver and continued uncertainty you, joining continued Michael results thank environment, today. operating you around Despite capital

and strong by improving and momentum, results yields, record be stable originations Our growth can earnings credit. summarized

$XXX record half in of million. commitments performance QX over of the with originations record debt and Our equity gross continued XXXX first

quarter through continued XXXX, debt million again portfolio and which and our $XXX $X.X fundings billion. third net with over record QX during XXXX, to growth company our our of $XXX has fundings commitments Since $XXX we deal to three already of XX, and the quarter is led gross new the quarters million the of which and $XXX during QX investment be of for delivered once billion. XXXX. of over the $X.XX gross team total of new as new first strong October commitments surpassing Year-to-date a a commitments equity strong closed record $X.XX Our billion $X.XX close closed million million, year-to-date debt to record of XXXX record bringing billion, of record gross

per driving growth based higher us a with income portfolio to and our quarterly in mark We an commitments sheets, the $XXX have our the achievement milestone This of debt of additional and is to strong our for level net record and commitments, Hercules has resulting put current for Capital. million for record combined a the investment originations pending share be in $X nearing are billion NII including QX. signed pending year, nonbinding to we $X.XX core raise term able rate distribution position environment

Our increase distribution third last the base in XX-months.

performance highlights Let some our key me of for the recap, of QX.

Our activity performance by strong during technology the originations delivering again our and sciences life once record driven QX both teams quarter. was

two and core funding demonstrated between commitments balance activity our Our verticals.

XX Although, new companies. different XX sciences intentionally relationships. our funded in during towards new We commitments which life of were heavily quarter were more borrower QX weighted the companies to capital

we over numerous were that relationship expand theme during portfolio reputation the quarters, the we market borrower added and our of the first as scale in a which partner. looking of new For financing stable we with relationships, QX. recent companies our and for seen long-term three choice for further stage lender the quarters expands to growth have a able companies Continuing have XXXX, XX funding

funding the continued underwriting market and lower of continue loan the once several quarters, for to drive on new resulted This the Our again irrespective strong originations. portfolio next new conservative should from prudent commitment to originations ratio. a structuring funding activity on in existing emphasis over

than markets, approximately we the for across should currently will capital $XXX further XXXX. growth fundings markets $XXX of public available the potential companies selective or companies, help equity Volatility anticipate to continued will more from remaining continued continue QX, although valuations have million more million saw in to earnings growth near-term for addition, stage unfunded the In both out did of and under the commitments XX% and unfunded that We in particularly commitments become equity private QX, we on side. the momentum. portfolio expire in and be pressure drive lead stability

plan As that they trust a and creative conditions, to look non-dilutive as do near-to-medium companies to pipeline in we to others credit, risk grade raise in best term to through plus best strong is asset credit have of ratings, our providers solutions and a of on With continue to new approach continue XXX be continue four strong investment we sustained positioned current positioned million and and market yields will that to we do term capital to result, historical we the Consistent $XXX new transactions capital over originations, we as our full-time chase some believe expect ability seen to very if for are higher balance from disciplined class volatility. sheet structured and underwriting not for the patient for thrive debt longer employees, the and corporate liquidity, with success. that needed, periods irrespective market. and Hercules continued remain of

least we believe downturn. at through end continue better underwriting and to be more credits we adjusted we to emphasis where established this the terms later certain new than a that continuing believe end. that normal continuing to on companies profile of approach are year selective that and stage avoid We to in more susceptible time, a at and will more even with continue is this markets continuing are are industries risk potential anticipate We

company Year-to-date, companies five During and and events and or in QX complete ongoing the companies including continue QX QX. including in their industry two recently M&A liquidity IPOs, to QX had for the the reflect three we’ve XX exits equity one announce complete in pressure in portfolio transactions markets.

that for In one company their addition, has IPO. have registered we

are call. five starting portfolio place to last call, our see have transactions We earnings taken our the M&A transactions we anticipated uptick on the in that our within evidenced since earnings last by that as M&A

million As uncertain our shut were loan guidance repayments expect of in the million from net positions of us well market the into upper end quarter growth XXXX significant we quarters. for several prepayments XXXX. continue acceleration us over next that earnings again in and deliver $XXX level million strong of see of remains allowed loan $XXX This $XX million QX the the investment an strong and down, $XX early virtually to quarter, transactions to of Early debt continued M&A to to increase IPO a at portfolio growth the once we and in which experienced the last approximately XXXX.

we $XX.X share a increased generated $XX change this of For income expect could to although record XXX% base distribution. quarter. progress per million million QX, $XXX the or we million and our income total million, we recently $XXX XXXX, QX of as investment $X.XX remain net providing In in and coverage between investment prepayments of

net in both income Our investment will further that core and increase QX. expectation income is

effective yield a and XX.X% guidance yields sheet leverage exceeded and QX remains at Credit net across generated of of onboarding With loans. XX.X% debt for indicative yield continued stable. portfolio a which regulatory of of remains portfolio well for new very strong and increases and positioned. the liquidity robust certain GAAP our very quarter XX.X%, platform and quality balance recent the Our conservative higher our in a the investment core is rate our

average still of X.XX in of higher credit X.XX was internal normal our weighted range. than end slightly at Our historical but the rating QX, rating the low

Grade X XX.X% in decreased XX% QX. at slightly in credits QX X QX. compared Grade Our versus and XX.X% in were Grade to higher XX.X% slightly credits X to

QX. have portfolio X X of credits X.X% made not rated we Our do rated up credits any the in and

XXX% our our debt companies contractual recent with and of reporting, respect current most As interest. portfolio to of payments principle of are

debt improved. granularity the of QX, During our portfolio also

of debt now on cash QX, of quarters and able our our That basis make that improvement workout our $X.X a up focus from were the and on million maintaining total positions XX XX.X% resulted and to on our QX non-accrual work mark XX.X% out than was both proceeds portfolio. of positions and at the building recovery both In non-accrual. diversified portfolio previous in value loan portfolio one less and top continuing debt decreased total up at our to a now we fair a of by top make of full successfully cost cost of above number Our debt less represent debt than impaired five position. as receipt speak our cost, loans that on

of of As investment had X.X% or company’s only fair QX, X.X% on one a and non-accrual approximately an percentage cost of the $XX.X million value with investment respectively, of investment and end portfolio the respectively. and value debt and $X.X million we as at total cost

to challenging active the raised healthy of record into over us has unfunded undistributed venture gross $X.X our realized accelerate at to of have and venture $X.X strong of three nearly spillover Capital high. raising with termination $XXX for by during will perspective, in to the years We write-off comprised undistributed second our portfolio The has year earning in available over activity with level billion our offset the exited warrants. invest of To spillover coverage more share. to National to been put team capital provides begin will a and an and commitments strong the our activity. to at investment was added ecosystem and over anticipated QX further in pace first the provide team, have and added Hercules warrants remains on $X.X After achieved three per ability of due to QX by in Investments investment companies, Capital we only capital months of realized environment. liquidity invest of amount the fund last extend Association. of to healthy $X.X $XXX this we data in activity legal in respect our our capital to ended legacy capital million going net own three with and billion the fundraising highs, $XXX invest record our highest distributions the its platform. XXXX. platform continued ongoing team raising QX coming optimistic continue billion again, continues fundraising to $XXX a ecosystem and and into quarters credit shareholder to with continues remain $X.XX and exhibit QX, $XXX Venture of with all-time had environment million, activity gains This the our equity We the well to that once our with quarters, forward of million or the million. PitchBook quarter. and activity. billion XXXX flexibility business new of of venture across ensure of earnings turned at any and gathered to The capital record macro which us we portfolio with to according the in and historic team During gains the anticipation available ability Year-to-date, million ability with thrive continue

$X.XX declared For QX, distribution increased $X.XX, again $X.XX. of and we to distribution supplemental base we our a from once

to to distribution distribution through core as our earnings to all and result, quarterly expecting supplemental and full advantage from remain are income expect we report XXXX of been the business. on first of the announce aspects distribution the our variable the the and our portfolio quarters assets, particular a grow continued now well Further, In has closing, three with paid the recent of positioned growth generating our from that take power program QX supplemental focus $X.XX program and has NII we out. evaluate base will a we to conditions most growth as momentum of We part materialize. another market that continue debt earnings

disciplined to steadfast will our to in over and staying many our on while platform. remain to make and to continuing themes We teams, the invest remain investors of will I of We core teams strong thankful their turn new choice. and Hercules Seth. maintaining with the companies, partner our continue underwritings a management that balance now sheet call

continues operating Thank environment. ladies gentlemen. navigate Scott, good you, extremely and and market well positioned afternoon and the current to Hercules to be

Credit and to core following that dated quarter-over-quarter year-to-date. A achieved This from sheet $XX long be well fixed income the share financial then With mind, primarily investment let’s of investment with realized generate QX. prepayments. increase strong with leverage record benefited and NAV of This portfolio portfolio another of million term events and QX highlights, XX% a interest loans. $X.XX a rate less positioning than in growth remains combined combination X% review or to normal and strong to balance was is statement continue finally, volume non-accruals rising increase and rate over in platform a us strong net the operating delivering of Our continue unsecured in activity, the to by $XXX and that million, liquidity results. operating areas. unrealized performance funded Income outlook. per income more environment

and First highlights. income statement, performance

XX% or the $XX.X as share million business, net guided year-to-date an earnings new call As quarter previously second in investment benchmark $XX QX, growth or in in XX% the was income total rates. quarter-over-quarter on more was per lower in increase driven strong by investment debt and mentioned, prepayments $X.XX income portfolio million

core in increase the increases. base a third to compared respectively effective and the of quarter. yield was interest an and XX.X% increase and XX.X% yields XX.X% as in core in quarter second due The result interest Our rate were XX.X% to in coupon the

trend changes of this today. the well impact continue interest We the to expect policy quarter full Fed as the with quarter decision third as rate

to Turning expenses.

of recharge the higher from portfolio the to compared Our RIA, $XX.X to of at costs $XX.X and Net expenses RIA, the the cost million the quarter. expense quarter to million were $XX.X of guidance. gross million my growth operating expenses of in our prior for million million expenses expenses recharged midpoint million the fees increase the weighted $XX.X prior Net $XX.X in $XX.X the million. Interest prior $XX.X operating of increased the quarter investment slightly quarter million. were to the costs $XX.X decreased SG&A and to average due to in stable SG&A debt. fairly to from

as of average Our quarter in a quarter, increase due reflecting cost to debt credit growth of the completed of the slight facilities two June, X.X%, well financings investment weighted of a to the full as institutional utilization debt the compared prior portfolio. was greater

X.X%. third total average basis quarter, our points ROAE to increase for Our NII equity or ROAA NII XX.X% over or average XXX and over the assets was

now Net focus the NAV quarter-over-quarter. Let’s X.X% $XX.XX quarter of of investment accretion and the modest dividends to per during unrealized our NAV by share paid in of switch income $X.XX including realized an realized per use earnings. per the increased spillover activity, ATM XXXX the $X.XX the and per NAV offset our to share share. were This increase represents share distribution quarter, to due gains

The October investment equity realized XXXX. net declaration, exchange warrant dividend the legacy to declare of comprised losses company registered warrant compliance gain related million recent announcement distributions To from spillover on related dividend $X.X tax million our XX. the losses we of with positions. before offset the to of needed and and Regarding early was by from our rules, ensure $X.X of positions, $X.X equity the to gains disposal foreign and write-off and million of of realized gains

to next leverage Moving and liquidity.

Netting investments to liquidity us $XXX reminder, cash modest due rate by and XXX.X% current believe the were XXX% XXX.X% in despite regulatory wholly raised by with GAAP the regulatory GAAP to sheet, funds was respectively, on net leverage ATM. and the positions and which compared excludes in our net well growth out the the this strong leverage million, quarter our use prior RIA liquidity and balance decreased the with our of XX.X% Our quarter a a managed the very subsidiary. the environment. ended as We owned respectively. of leverage We the capital

during ATM the and per accretion third NAV. resulting access a to raised continue in $X.XX $XX We the share quarter to million

yield are excluding changes. our to guidance future regarding increasing rate Finally, quarter we fourth points, benchmark the for core to XX.X% range the any outlook XX.X%,

additional core will floor, XXXX reminder, of is in portfolio recent forward. debt rate floating our a approximately XX% benefit and with hike so any As interest our going yield the a

Although to $XXX million predict by fourth a very quarter. Scott, the million activity expect $XXX in communicated we as difficult prepayment to in

We to the balance expense expect to quarter. increase quarter the quarter experienced sheet our fourth interest third prior compared due to growth in the

this closing, quarter, the we looking level $XX I we’re expect Susan, For we you. from positioned of turn well continued call. similar Q&A portion million over and RIA core a call third fourth the to to of extremely over to to our allocation compared begin forward will SG&A benefit of the the growth In expenses quarter. $XX million and of to to market Susan expense the now to of income. are

[Operator first comes you. Thank of Sandler. Piper question Crispin Our Instructions] from Love

open. is line Your

you I Thanks. avoiding if in Good types and color a you so comments that said less there was that early what are little interested and everyone. curious deals of industries you’re certain currently? industries on afternoon you’re in maybe the more your markets. and bit Scott, end passing could give you just

Crispin. Thanks, that get that publicly a prior question industries not we’re consistent going we’re quarters, speak lot with asked to the and avoiding. We to

given should pretty the at of if cautious I right at certain but now, equity to disclosure, have industries our market seen continue volatility have and a evident, to expect we look think look SOI some it become some that we of macro fairly environment you we the and given see.

cautious. stage centered over to stage that will the last expansion I more established we’ve be say being and portfolio several the we’re around companies. quarters very shifted So, much

think companies, stage early point, expansion majority And at of look buckets safer of investing this will this early the a stage, venture just buckets, which in have sort profile is and we things to avoid. and two that historically the you out we largely obvious now at three of right are some credit so we portfolio we latter avoided is There the stage environment. our and of established continue ecosystem, where stage that the in when part vast that consider

exposure. So, believe we’re have deals cannabis we touching that any not

exposure have We’re not touching comment. make clarity believe then any to going crypto and any public not any deals we that for just more we’re

your Thanks guide. then All And helpful. core at I’m Seth, right. looking That’s Scott. yield

to you I’m quarter. looking to back think couple last just as said I XX.X% XX.X% the

XX.X% the third you did to in second that the in compared quarter. So quarter XX.X%

hikes rate makes me, on third that based towards guidance yield not to Or a the end there do core the – sense? is higher in of a yield there do the of core a reason you the is we point future where yields you’ll relatedly, year excuse on saw feeling can range recent that? rate increases? think then Just think regardless your what quarter, And hit

maybe But of at cap. or the the could a range and to and a perspective change. industry trying to Yes, but make Crispin. the the where going be compared the portfolio. because, that think lower acknowledging that core the yield probably we’re I a stage, and approaching to that portfolio. there Scott, the a the to in we it range maybe in we be be might also you existing see introduce at we’re on that could to fair may of the where it’s later wide do very times historic that fact Yes, great there’s are the we’ll And of end, introducing that course, lot companies give questions, turnover a midpoint portfolio we’re of portfolio cautious that sure

see that how appreciation a we Yes, yield I terms think from Crispin yet. will but of a assume cap core more certainly perspective, at in point there think point, at we’re I it’s you’ll be don’t fair some mean, much to

later questions Thanks appreciate that guys. All companies. sense make my I on of the right. you stage take

Thanks, Crispin.

Thank you.

we Our from Fultz next question compile our of Kevin JMP – question next as Securities. comes

Your line is open.

earnings question liquidity. and portfolio some first good shared taking thank afternoon, you my last Hi, around portfolio insightful is liquidity. company for on company questions. statistics on you My the Scott, call,

that if end. you with share could us you updated stats September as have curious of Just quarter

update say with quarter-over-quarter. track consistent and consistent really don’t though we material we what did a a Similar liquidity update pretty and change we on Kevin. plan not do a quarterly COVID, see to that basis. that basis will that on we we I did and during did Thanks, not

a also extent at in that third remained to a that the material company companies you QX. saw capital would in portfolio each where portfolio the I provide our strong did we bit debt the and a nearly $X already wouldn’t consecutive of So see several that new billion note $X.X raise portfolio QX QX has accelerated take that we events difference. fundraising is billion of level publicly, companies had over we’ve quarter place and raised this in guidance actually QX our where

recent liquidity. that closely, very as liquidity we’re of as with stress given data how the obviously to be it have, we that watching some the comfortable the was portfolio market, in relates we’re continue So, the we but seeing positioned to of most

Okay, believe the and I funding and tend that is sciences you to funding in volatility your helpful. transitioning market reflect activity sciences just a you I’m past into And when given lean life that that’s starting backdrop. there activity if elevated to is the curious vertical market. said in the life

us We that record with to a for does, comments. quarter commitments. I $XXX with It quarter respect and very prepared my million. It had a reference in strong was debt made

life both at side breakdown that that you during of our quarter, there the see from sciences seeing. actual the in technology look we’re waiting of of and macro given our strength this We quarter some sciences the continued intentional to but was towards and environment team more the was commitments life quarter, a the if

that really Okay, and my on I congratulations sense. you questions nice And taking a makes quarter. appreciate

Thanks, Kevin.

Thank from of Capital Markets. you. Instructions] next [Operator The comes Ken Lee RBC call

Your line is open.

driving question within question. that seeing of on that some as Thanks. factors, there? companies some just of key my talk grading. the movement the about buckets taking Wondering, internal you of for credit the Hi, if those thanks One you’re

Ken. Thanks Sure.

do improved, X.XX the rated no individual loans of have in rated X there range, deals in ratings. loans. periods range. still we at note. we X.XX deals some normal way. material really, you bit a any X.XX expectation. a And fact nothing we a resetting underwriting that’s terms X of driver our So uptick of movement credit debt of did X.XX new the historical move Xs, historical rated back not our the really were in look in not to in X but quarter a a QX. very portfolio. at weighted to moved there And lot so movement deal, The moves, little and loans terms a The of the within bit rated if existing movement we tend to credits. X.X low The was primary then average those Xs, to our with X which actually time slightly. was was Every move of at the is rated really that’s because we’re that There down across end X new little has Xs the in been Slight of rating quarter-over-quarter, we last

credit update could helpful outlook just you Very on some revenue And one the from just it. Got there. Wonder Hercules private up. the the potential follow us for Advisor. stream fund, the if of

talked point. Thanks. you’ve seeing business dividends from the the at think side I about the in for potential of that some some past

Ken. This Seth. sure Yes, is

help cost into from BDC the little we’re a cash at a the is RIA and comes to as loans So it sharing flow doing the positive position. moment bit clearly benefiting finance the

XXXX. half could or at back next We of year of expect that occur parts potentially the flows in early dividend

Scott? see true expect of And collecting, really determine benefit of it’s it. to really the that dependent the and but it’s the on forget to management the the start timing earnings would BDC don’t tax overcoming so, profits it’s costs that allocated, fees being we

things said. Yes, would just Ken add few I Seth what a maybe to

quarterly million look fundings business. funding at over disclosing that disclosure, If through In XXXX, QX. private was are we are year-to-date we of of deals that amount of $XXX you our the out fund

release, our out was So just the recent nearly business. $XXX fund private funded most already including information of which press have released, we the in million

dividend management that the of are reimbursement, for as the that performance and ramping to pick see, provide considerably, continuing XXXX going numbers to is can to gives up continue fee the we start if expense income combine HTGC. the that you that as the only see numbers, continue comfort value some So which year-to-date you us business to and stream but as the shareholders up, fee substantial we’ll not

helpful there. Thanks Very you. again. Got

Thanks, Ken.

Nolan Our sorry, Ladenburg of you. Thalmann. please. mistake. my I’m ahead Go [Operator Thank Oh, Christopher is Instructions] next caller

Ryan next is KBW. Our question from of Lynch

should you be I going that of drop question acquisitions the just XXXX Hey, just is activity, to XXXX, mergers your we as read into what so should over and and you – see as mergers that up are how acquisition, strong, investment capital dynamics. the continues and good slides just really kind how does a has the wondering and in I’m really looking the activity that read health fundraising that off and But but slides environment of had activity been a good VC has broader afternoon. off dropped today? can on and at exit guys far market venture I XXXX, we on in how fallen strong guys from you some healthy. on market mean but remains how put cliff still and really has exit so activity far overall

Thanks, Ryan. Great question.

me the terms and speak in investment of to market just Let broadly VC activity. first sort fundraising of

through you to any look for look significant record When previous still has there a data quarterly pretty think fundraising from the or of If has the look we and When of industry. the absolutely we and very at year-to-date both of quarters on raised the important. three VC are a those the because historically they’re that reflective investment $XXX XXXX, experienced been of first fundraising data, year robust. it representative been we healthy, already billion vibrancy or VC outside we that a the the activity. we ecosystem, XXXX. basis actually in very equally what We and year-to-date statistics health at and year data first, have pullback two most robust, fairly they compare tracked incredibly is slowdown at investment strong, it’s

activity which we investment a reflect lens with pullback, So levels significant at a it to in record because if IPO you’re does volatility, That continue of of In slowdown that look in on in the seen record optimistic periods happen was comparison industry. other it’s last volatility, to that strong been a a year-over-year surprise you’ve it year-to-date. an $XXX activity basis, market there’s been to to non-existent we’re seeing of same side but has billion because look the very comparing periods not of year, on And not considerably, year, just essentially in activity, data the investment at thing of see. down sort the same historically XXXX. slows you exit

a in have had one but fairly had the couple be slow five next including We We’ve we continue quarters. to several expect year-to-date, for QX, IPOs events. to of IPO

A in been side, equity? of IPO market. sort the discussions, in what it’s figure boards and to secured they trying raise QX disclosed they’re more to of right an than companies, anecdotally, because still with yet debt sort down. the we’ve a that the they the not lenders A portfolio half XXX conversations exploration M&A over uptick active which we’re the Or having of first the our for should we from disclosed, lot dilutive next the of healthy but companies were QX, I continue you they ongoing. On the where in tell are M&A some of And expect side, Should saw should and on the certainly which to some level would do of to into conversations of attribute, to lot And year. financing? non-dilutive course those In companies of out M&A having next. approach of been it’s tick see of uncertainty just will are what activity, what M&A? we we seen is down explore now have stage portfolio, our

on Okay, that’s helpful market. backdrop the

competition question your that tech sort in that of what, other just pretty impact any of if drawdown I deposits hear flowing of there’s outlook would been significant The marketplace? love I have would the a kind focus investment potential to banks. of, had, on mean, out market and I

Yes, compete time-to-time. vast that and of really on the will that much the of it banks from credible that do. are with doesn’t outlook. us reputable a longstanding banks for we’ll We don’t we of are an a majority we basis. terms change There occasional banks partner on There with deals in see of handful handful

and bit with expect of would it that could banks funding, to a little after, how to and we the we’re competing not a I deals We continue the bit banks. you little majority the that that with aggressive. certainly doing more cause conservative go be less of But in in banks commercial respect or terms head-to-head to deposits tell are

Okay. appreciate time That’s helpful commentary. I the afternoon. this

Thanks, Ryan.

Christopher of Thank our this Instructions] Thalmann. from Ladenburg And you. last comes time question Nolan at [Operator

is open. Your line

life is Hey little a guys. Most I guess or services call there have asked, of within my favorite science drug in questions or sciences? some area like been rotation, life a development devices

in makeup terms ecosystem. our Yes, our of our we discovery, it’s you the look look to bias certainly but virtually all life And current portfolio, if at be disclosure to tech if towards sciences is portfolio the there sciences book. or I mean drug of is continuing have book a development, drug life our on having historical emphasis our and diversified you at diversified our sectors whether respect to exposure a with of data

structure, them given of companies, stage is issue balance asked later so been have and where if guess basically excuse you on getting that but the this capital on might sheet? just deals earlier, big, and securitizing off Gap] And an any you’re growing consideration the me have size becoming guys [Audio I and focusing

Right not too those as the we’ve some securitizations, and as utilizing markets way from we to of rare the off done pay year instances a now. capital well it’s But the and now successful we them the in and really did that So that that had the been facilities route. the opportunity right we sheet. very about. and balance capacity the unsecured we’ve been going combination the well unsecured consideration facility because secured that funding from us the the have sheet would balance you’re look at last historically the utilizing trips talking you’re, removing not successful when was great our support of the timing pretty But and where back markets, we’ve making moment the for as that right capital we at institutions saw credit in credit as capacity cadence we it a to debt

it. Got

quarter. Okay. Thank Great. Nice you.

Chris. Thanks

you. turn Thank Bluestein for remarks. like closing Scott to would I At to time, this back it

Susan. you, Thank And today. thanks for to joining call our everyone

Conference JMP of XX, a on Fitch on As Financial New Conference the March Jefferies BDC final are on November in the XX, Estate KBW Securities Summit York. November participating and Midtown taking Ratings Real December note, we which XX, place BDC will and Services both be the all and in

contact If a next We of management our Thank a have the please look meeting with each institutions reporting call. arrange directly and rest team, all earnings Hercules progress you to you forward or Michael would the mentioned Hara. of yearend our on financial day. to great like the

participation conclude today’s does program. Thank conference. you your in This the for

You may now disconnect.