Horizon Technology Finance Corporation (NASDAQ:HRZN) Q3 2023 Earnings Call Transcript

Ryan Lynch: Okay. One last one that I had, I think both in your prepared comments and your press release, you sort of talked about remaining selective and originating new investments in remainder of 2023. I would assume that there’s still really good deal opportunities out there, but I would assume that the kind of the comment on remaining selective is to reduce leverage levels at the BDC. Is that kind of what – is that kind of the driver behind remaining selective is that you can kind of get leverage levels down to a lower level? And if that is the case, where would you like to see leverage levels ultimately end up at?

Jerry Michaud: Well, let me just address it from the marketing side and Dan may have some comments. From the marketing side really, we have to – you have to be really aware of where market conditions are right now, particularly relative to venture capital investment. The kinds of companies that they – venture capitalists are still investing in, they’re still leaning forward on where are those companies, where are those markets. So you got – on the marketing side, you got that and there are really good opportunities there because there aren’t exit – really good exit markets for those kinds of companies, right. So companies that are performing really well, continuing to get attract capital, that’s fine. But we’re – anyone who comes into the market and says, we expect to be public next year, that probably not – if that’s their goal and that’s their exit strategy, that’s probably not something that in today’s market we would consider being interested in.

And I’ll let Dan speak to the leverage side of this, but…

Dan Trolio: Yes. As we mentioned, we are at net of cash at 1.12, so that’s below our target leverage. So we’re comfortable where we are today. Being selective, I would agree with Jerry, it’s more just on the market dynamics and the deals we’re looking at.

Ryan Lynch: Okay. All right. That’s all from me. I appreciate the time today.

Operator: Thank you. There are no further questions. At this time, I would like to turn the call back to Robert Pomeroy, Chairman and CEO for closing comments.

Rob Pomeroy: Thank you all for joining us this morning. We appreciate your continued interest and support in Horizon. We look forward to speaking with you again soon. This will conclude our call.

Operator: Thank you. This concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.