Kyle Brown: Yes, Ryan, this is Kyle. So a couple of things. One, I don’t think as venture capital private equity generally are supporting companies that are cratering anyway, in good markets or bad markets. We have — we believe the way we’ve underwritten — that our companies have a real true moat around the technology. They’re growing in the face of headwinds. We’ve seen this over and over again, with our — the investments we’ve made over the last couple of years. And when they need more capital, they get it. And — but I would say, what companies are having to come to grips with is that, that money is not free like you said, it’s not cheap, maybe like it was in 2021, 2022. They’re our own portfolio. And the new investments we make founders and CEOs are having to come to grips with the fact that, that company is just not worth the multiple that existed for them a year or two ago.
And so while we continue to see our companies get funded, we see it quite regularly in our own portfolio, and they’re getting the capital, they need to get a couple of years down the road and continue to grow in the face of headwinds, but the valuation is decreasing. As a secured lender, I’d be cautious, I will say this, it’s not that we don’t care, we do care. But the majority of our returns are fee income, rate and fee income, current income. And so the valuation whether it’s high with the free money, or it’s low with more premium capital, that doesn’t affect our returns, that doesn’t inhibit our ability to collect from our borrowers. So it doesn’t necessarily hurt our position. So we monitor it, we track it, we want to see our kind of companies continues to receive capital, and they are getting — most of those companies are getting it at a revaluation, a lower amount.
Steve Brown: Yes. Probably the only thing I’d add to that Ryan is the expectation on the founders is no longer unfettered growth. But pivoting to profitability, right? Let’s make this capital last, let’s make the cash likes last. That’s why the cash like question is difficult one, right? Because you get a much different answer on a trailing 12-month basis than you do on a forward 12 basis across virtually any company within the portfolio, right? Because they’re all talking about pivoting to profitability. And there’s real enterprise value in the companies we underwrite. So they’re getting the equity. It just may not be the valuations that the Congress would love.
Operator: And our next question comes from Bryce Rowe with B. Riley.
Bryce Rowe: I wanted to maybe start with the comp line and thoughts about operating expenses. Obviously, you’ve grown the headcount quite a bit to ramp up. You noted your 57 employees now. How should we think about, you know, the growth of the employee base as we look out over the next couple of years?
Steve Brown: Yes. I can tell you Bryce in our annual plan for this year, there’s very modest headcount growth. Some of it is within the finance and operations team as we do add the off balance sheet entities, right? There’s a bit of complexity in Mike’s team on the back end. But growing judiciously, we mentioned in our prepared remarks, we’ve added a life sciences practice in 2022. We will be expanding that per our plans. But the headcount growth is going to be very moderated in 2023 compared to last year.
Bryce Rowe: And maybe shifting gears here, just thinking about the comment you made around Core Scientific and where its mark as of December 31st, and relative to maybe the performance of Bitcoin here in 2023. When was that mark kind of determined? And was there any ability to kind of go back and reflect what the mark might look like today with some of the better information you have to work with?
