Trinity Capital Inc. (NASDAQ:TRIN) Q4 2022 Earnings Call Transcript

Steve Brown: I think we’re going to look at equity raises cautiously. We have proven the ability with our existing portfolio, as it sits today to generate meaningful numbers relative to income than investment income and distributions. And so we can certainly continue, we believe, to perform like that if we don’t grow the portfolio, which means if we don’t raise money, but obviously, if our stock price reacts positively, and we have the ability to raise some capital and do it just judiciously, we’ll certainly do that. It’s kind of mentioned with the off balance sheet activity now. We can raise capital there, and we can continue to be active in the marketplace on a co-investment basis. And that gives us effectively liquidity as a platform to go do what we do in the marketplace with the benefit all coming back to the BDC shareholders.

Christopher Nolan : Then, on the dividend, did you guys indicate that there’ll be a supplemental dividend in the first quarter or did I miss something?

Steve Brown: So we have not determined that, we’re going to be visiting with the Board here later this month, I think, as Mike said in his prepared remarks. And we do have spillover income. As you know, we’ve continued to grow our core dividend, and then for the eight straight quarter, we increased it. So we’ll sit down with the Board and look at all of those factors and make a decision later this month.

Operator: And our next question comes from Ryan Lynch with KBW.

Ryan Lynch: First question I have following up on the question regarding the RIA. I’m just curious. I know there’s a lot of variables and a lot of uncertainty, all the timing of things. But as we sit here today, do you guys have any sort of expectation of when you would hope to get the first fund up and running and some capital deployed? And when potentially that could actually get to the stage where it could start contributing fee income to the BDC?

David Lund: So timing is not unobserved as you know, I think you can expect some time that’s in the next six months that we will have that ramped up and we’ll be deploying capital out of it. We mentioned the JV. We’ve begun deploying out of that. Steven mentioned this before, that also provides us with some liquidity BDC level, because we’re doing a look back and we’re able to provide advance against fundings we’ve already done. So, that income, that off balance sheet income, it’s already begun, and it will continue. And our intention is for that to grow.

Ryan Lynch: My other question was, I would love to hear you guys’ perspective on what is the pulse of venture capital investors in this environment, their willingness and ability to support portfolio companies that aren’t cratering but maybe performing slightly below expectations in this environment. At one point, there was kind of free money and it felt like everybody was getting capital. Certainly the strong companies who are outperforming expectation I think, would still be able to get capital, the ones who are severely underperforming probably aren’t. But I’m curious about those companies that are maybe just slightly underperforming expectations and venture capital participants’ willingness and ability to continue to help support those companies?