SuRo Capital Corp. (SSSS) on Q2 2021 Results - Earnings Call Transcript
Operator: Good day, ladies and gentlemen, and thank you for standing by. Welcome to the SuRo Capital Second Quarter 2021 Earnings Conference Call. During today's presentation, all parties will be in a listen-only mode. Following the presentation the conference will be open for questions. This call is being recorded today, Wednesday, August 4, 2021. I will now turn the conference over to speaker, Claire Councill of SuRo Capital. Please go ahead.
Claire Councill: Thank you for joining us on today's call. I'm joined today by the Chairman and Chief Executive Officer of SuRo Capital, Mark Klein; and Chief Financial Officer, Allison Green. Please note that a slide presentation that corresponds to today's prepared remarks by management is available on our website at www.surocap.com under Investor Relations events and presentations. Today's call is being recorded and broadcast live on our website, www.surocap.com. Replay information is included in our press release issued today. This call is the property of SuRo Capital and the unauthorized reproduction of this call in any form is strictly prohibited. I would also like to call your attention to customary disclosures in today's earnings press release regarding forward looking information. Statements made in today's conference call and webcast may constitute forward-looking statements which relate to future events or future performance or financial condition. These statements are not guarantees of our future performance or future financial condition or results and involve a number of risks, estimates and uncertainties including the impact of the COVID-19 pandemic and any market volatility that may be detrimental to our business, our portfolio companies, our industry and the global economy that could cause actual results to differ materially from the plans, intentions and expectations reflective and/or suggested by the forward-looking statements. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including but not limited to those described from time to time in the company's filings with the SEC. Management does not undertake to update such forward-looking statements unless required to do so by law. To obtain copies of SuRo Capital's latest SEC filings, please visit our website at www.surocap.com, or the SEC's website at sec.gov. Now I would like to turn the call over to Mark Klein.
Mark Klein : Thank you, Claire. Good afternoon, and thank you for joining us. We are pleased to share the results of SuRo Capital's second quarter 2021. Today I will discuss how our portfolios performed in the second quarter. This has been one of the most exciting quarters to-date for our fund, ranging from portfolio exits to exciting investment opportunities in various different verticals. Five of our portfolio companies have announced intentions to either become publicly traded companies by either a SPAC merger or traditional IPO. One portfolio company announced it intends to be acquired, and we expect the lock-up on remaining Coursera shares to expire imminently. On the investment side, we continue to evaluate exciting new opportunities in the market. In this quarter alone, we sourced and performed diligence on more opportunities than any other prior quarter. I am excited to share in more detail our performance over this quarter, and then we'll hand the call over to Allison Green for a brief financial overview. At the conclusion of our remarks, we will open the call for questions. Let's start with slide 3. This quarter SuRo Capital reached our highest dividend adjusted net asset value per share since inception, beating the record marks we set in both Q4 2020 and Q1 2021. As of June 30, 2021 net asset value was $16.56 per share, which is $1.05 increase on a dividend adjusted basis from the prior quarter. As of June 30, 2021, net assets totaled approximately $440 million compared to $436 million in the first quarter. On August 3, SuRo Capital's Board of Directors, consistent with our desire to be shareholder friendly, and our continued practice of distributing realized gains declared a $2.25 cent per share dividend to shareholders. This dividend will be payable on September 30 to shareholders of record on August 18. Given the positive receptivity of our previous dividend, our Board is again offering shareholders the option to elect to receive as much as 100% of their dividend stock and has capped the aggregate cash dividend to 50% of the total dividend payable This $2.25 per share dividend follows $3 per share of dividends declared and paid during the first half of this year, resulting in an aggregate amount of $5.25 per share declared to date. Later in the call, Alison will walk through in detail the election process of this cash and stock dividend. Looking forward, and subject to ongoing portfolio activity, the Board intends to declare at least one more large dividend in November on a similar cash and stock basis. Please turn to slide 4 for a review of our top five positions. SuRo Capital's top five positions as of June 30 were Coursera, Course Hero, OZY Media, Enjoy and Blink Health. These positions accounted for approximately 61% of the investment portfolio at fair value. Additionally, as of June 30, or top 10 positions accounted for approximately 78% of the portfolio. First of all, I want to highlight our investment in Coursera, or currently our largest position. As previously discussed on March 31, Coursera, executed an initial public offering and began trading on the New York Stock Exchange. Coursera priced at $33 per share at the top of its range and closed the second quarter at $39.56 per share. Since the IPO March 31 Coursera shares have traded above the IPO price of $33 per share. In the second quarter 25% of SuRo Capital's Coursera shares became unrestricted. After certain pricing conditions were met. We monetize these shares during the quarter for net proceeds of approximate $31 million and realize the gain of approximately $27 million. SuRo Capital's Coursera remaining shares are restricted until August 6. Consistent with our past communications and practices, we will evaluate monetization of Coursera as these shares become unrestricted. We value our investment in Coursera as of quarter's end, and a closing share price on June 30, and apply a discount for lack of marketability due to the lockup restrictions on our holdings as of the valuation date. This is consistent with our valuation methodology applicable to public shares subject to lockup provisions. As of June 30, we value our remaining Coursera investment at $87.2 million. As mentioned in Coursera's earning call yesterday Jeff Maggioncalda, the CEO highlighted growing adoption and impact of their platform around the world. Institutions have launched Coursera at a large scale and new learners are coming to the platform for rescaling efforts, as well as learners are coming to the platform to upskill for high demand digital roles. Jeff noted that this effort has been successful thanks to partnerships with global brands like Google, IBM and Facebook. Following the pandemic-related surge of the platform use in 2020 it's Coursera's belief they will continue to see sustained structural demand for online learning as businesses governments and individuals seek the skills required to compete in today's economy. With 5 million new learners added to their platform in Q2 Coursera's total registered learner count is now 87 million. In Q2 Coursera grew quarterly revenue by 38% year-over-year to over $102 million. Coursera's consumer segment grew 23% year-over-year. Its enterprise segment grew 69% year-over-year, and its degree segment grew 78% year-over-year. Coursera raised their 2021 revenue estimates from $369 million to $381 million to a new range of $402 million to $410 million. Today's share price increase by over 21% shows Wall Street's enthusiasm for Coursera's earnings report. We are delighted with performance of course arrow following their IPO. As previously announced partial monetization of Coursera generated over $30 million of proceeds resulting in realized gains of nearly $27 million. We are pleased to have delivered these positive outcomes for our shareholders. As reported in a June 21, 2021 TechCrunch article, Course Hero, our second largest position acquired LitCharts, an education technology platform to help students study literature. The acquisition allows Course Hero to expand its already significant investment in the vertical and marks Course Hero's second acquisition in eight months after its October 2020 acquisition of Symbolab, a platform that helps students solve complex mathematical equations. We believe these acquisitions will continue to support Course Hero's goal of being the leading comprehensive platform for students' study materials. According to TechCrunch Course Hero are estimates that it will have between 2 million and 3 million paid subscribers this year, up from 1 million paid subscribers last year. Due to the impact of COVID, the Covid-19 pandemic and related quarantines and school closures with less in-person student access to teachers or study groups, students have increasingly turned to online learning supplements for their studies, including Course Hero's online documentary -- document library. We believe Course Hero continues to capitalize on the same long term trends as online learning is enjoying. Our investments in online learning companies, most notably Coursera, Course Hero, and our new investment in Symbolab to be discussed later in the call represent approximately 51.3% of our total investment portfolio value at quarters end. From recent media reports as well as the earning reports from public online companies, it is evident that the initial spike in online learning generated by the COVID-19 pandemic has continued to the current beginning of 2021 to 2022 academic year. We continue to believe the effects of the pandemic have accelerated a long term structural change in how education is delivered and consumed, with a clear transition toward online learning. We believe our portfolio is well-positioned to continue capturing the benefits of this trend. However, we anticipate monetization of our Coursera investment after the expiration of lockup, and the closing of the Clever's acquisition by Kahoot!, together this would make our portfolio's exposure in education technology much more evenly distributed across other sectors such as marketplaces, financial technology, social and mobile, cloud and cloud and big data categories. While online learning and online communities are changing the way we live, SPACs have continued to be a significant driver of change in the financial markets. As such, we have begun to see SPACs impact not only our existing portfolio, but the investment opportunities due diligence and some of the investments we are currently making. Please turn to slide 5. On July 6, Nextdoor, a SuRo Capital portfolio company announced its intention to merge with Khosla Ventures Acquisition Company II, a SPAC sponsored by an affiliate of Khosla Ventures. The potential transaction values the combined company at a pro forma enterprise value of $4.3 billion and includes a $270 million PIPE and is expected to provide approximately $686 million in gross cash proceeds to the company and will trade under the ticker symbol K-I-N-D. Nextdoor is more than -- is now more than -- is now in more than 275,000 neighborhoods around the world, and is in nearly one in three households in the United States. Neighbors turn to Nextdoor to access trusted information, getting good help and build real world connections with those nearby, including neighbors, businesses and public services. Nextdoor's merger aims to fund Nextdoor's growth plan and accelerate its strategies to monetize its social network with hyperlocal advertising. According to the investor presentation, Nextdoor expects to generate $178 million in revenue in 2021 and $249 million of revenue in 2022. Nextdoor notes that the digital advertising addressable market represents more than a $600 billion global opportunity by 2024, growing at a pace -- up by 83% from $335 billion digital advertising market in 2020. We are excited for the successful conclusion of this business combination. As previously, discussed on February, February 11, SuRo portfolio company, Rover announced plans to merge with Nebula Caravel Acquisition Corp., a SPAC sponsored by True Wind Capital. Stockholders approved the business combination and the transaction closed on July 30. The combined entity now trades on NASDAQ under the symbol R-O-V-R. The transaction valued the company at an enterprise value of $1.35 billion and provided approximately $240 million in gross cash proceeds to the company. According to Rover's regulatory filings, our shares will remained locked up till the end of January 2022. The initial reaction to this listing has been quite warm as the stock is up 30% since the closing of the business combination. We're excited by this transaction for Rover which we believe has emerged as the leading online marketplace for pet care. As previously discussed on April 28, Enjoy, SuRo Capital portfolio company announced plans to merge with Marquee Raine Acquisition Corp., a SPAC sponsored by affiliates of the Raine Group and Marquee Sports Holdings. Upon the successful closing of this transaction, the combined entity would trade on NASDAQ under the ticker symbol E-N-J-Y. The transaction values the combined company at enterprise value of $1.2 billion and includes an $80 million PIPE and is expected to provide approximately $450 million in gross cash proceeds to the company. Enjoy's mission is to disrupt the physical retail model by bringing a personalized, convenient retail experience through the door into the comfort of a customer's home. Through partnerships with companies like Apple, AT&T and Rogers Communication Enjoy has achieved 100% compound annual growth rate from 2018 to 2020. According to the transaction press release, Enjoy expects to achieve more than $1 billion annual revenue and a 30% adjusted EBITDA margin by 2025. This potential transaction marks a significant step for Enjoy, and we look forward to the transaction closing in the next few months. In addition to SPAC mergers, one of our portfolio companies has announced that it intends to be acquired and two of our portfolio companies have announced their intention to go public through traditional IPOs. On May 6, 2021, Kahoot, a global education technology company announced that it would acquire Clever. Kahoot intends to acquire Clever for $500 million, $0435 million of which is guaranteed and $65 million of which is incentive based. The transaction is expected to close this quarter. Clever offers a learning platform to schools and school districts and serves 50% of all the United States students in over 89,000 schools in 2020. This represents 65% of the United States' over 13,000 school districts. Clever has partnered with 600 application developers, including many of the leading U.S. and global learning providers like Khan Academy and McGraw Hill. Clever expects to generate $44 million in total revenue in 2021, which will represent an annual growth rate of approximately 25% over the last three years. On July 19, Rent the Runway, said it confidentially filed paperwork for an initial public offering. Because Rent the Runway has not disclosed the target price range or the size of the offering. We do not capture the potential transaction in our current valuation of Rent the Runway. We look forward to Rent the Runway becoming a public company. On June 21, NewLake Capital Partners filed its S-11 as the next step towards becoming a publicly traded Cannabis REIT, with an expected market capitalization in excess of $500 million. NewLake merged with SuRo Capital portfolio company GreenAcreage in the first quarter of this year and since then has continued to be active in the act acquisition of new properties in the cannabis real estate sector. NewLake's portfolio is geographically diversified between both industrial park properties and dispensaries and the company continues to find and execute on creative opportunities around the country. NewLake has applied to have the stock quoted on the OTCQX and they intend to become a public company by the end of the third quarter. Please turn to slide 6. As previously discussed, we have broadened our focus beyond our core equity strategy into private credit and pre-SPAC merger PIPEs. Since the inception of the company, we continue to focus on expanding and democratizing asset to asset classes and specific investments generally unavailable to the public. For the past few quarters, we have highlighted that the SPAC asset class was growing by record amounts. Last year, there were approximately $81.5 billion of SPAC issuance, and increase from just over $13 billion in 2019. According to SPAC Research, over $116 billion have already been issued in 2001 year-to-date in 387 IPOs. According to Cowen Research 142 SPAC deals have already been announced in 2021. Cowen Research notes that 87 deals have closed through this period which is a substantial increase from 2020. Beyond our existing portfolio, we believe our proprietary access within the SPAC universe has delivered and will continue to surface unique opportunities for SuRo Capital. While investors have had the ability to buy SPAC common shares and warrant in the open market, most investors do not have access to the other parts of the SPAC structures, such as SPAC sponsored equity, sponsor warrants for purchase agreements and PIPES. It has broadly been reported that sponsor equity and warrants are viewed to be highly valuable, and for the most part, only SPAC sponsors have had the opportunity to benefit from them. The favorable economic opportunities within sponsored equity warrants is something we are very focused on delivering to our shareholders. We have now invested in four different SPAC sponsor equity deals to-date. Additionally, PIPE opportunities which we view similarly to pre-IPO investments are occurring at a higher rate now than ever before. According to SPAC Research 427 SPACs are currently looking for companies to effectuate business combinations, which translates into hundreds of pipe opportunities over the next couple of years. In an effort to be a leader in the democratization, we continue to have active dialogue with sponsors and investment banks to participate in both sponsor economics and PIPES. As a result, we are excited to provide shareholders unique access that we believe no other public vehicles presently provide. Recently, the SPAC market as well as a pipe market have exhibited weakness. This has been a result of oversaturation, and unrealistic valuation of some of the announced deals, as well as a regulatory scrutiny that has led to a broad reset in the market, including repricing of certain deals and limited new issues. We believe this current momentary weakness provides an opportunity for us to selectively deploy capital. To this end, during the second quarter we invested in the sponsor economics of Columbia acquisition court. This comes in addition to our Churchill 6 and Churchill 7 sponsor share in Q1. Please turn to slide 7. Columbier Acquisition Corp is a special purpose acquisition company formed by a sponsor team comprised of the Principals of a boutique investment bank, Farvahar capital, and early stage venture capital fund, Torch Capital. With this investment, SuRo has obtained Board representation. The SPAC will leverage the notoriety of celebrities, tastemakers and influencers to grow potential target companies, brand identity, engagement and customer reach. We have seen firsthand that today's customer marketplace can be oversaturated with products and brands that lack differentiation, significant consumer engagement and brand loyalty. In today's digital ecosystem, having a good consumer product is not enough. The brand itself must stand out in order to drive the product to the front of the very crowded shelf. We believe celebrity association and endorsement have the proven power to drive brand awareness, awareness and engagement. However paid celebrity endorsements are expensive and often inauthentic. This consumer understands the transactional nature and is less impressed by that influence. Nevertheless, brands that utilize pacemakers and influencers as partners are often successful in leveraging the celebrity association for brand building. We believe that the respective areas of expertise within our sponsors are complementary and reinforcing to the belief that strategic influencer involvement can differentiate the consumer or technology brand. In addition to Colombier, we're in discussions with other sponsor teams to participate in their sponsored shares and warrants. Please turn to slide 8. Subsequent to quarter end we invested in the sponsor shares of AltC, a SPAC led by the CEO and Co-Founder of OpenAI and Y Combinator President, Sam Altman. Sam's expertize within the venture capital community, combined with Churchill Capital's history of successful SPAC mergers creates a unique opportunity for SuRo Capital. AltC is focused on opportunities in the broader technology safe space, specifically on companies with large addressable markets, a clear path to profitability and potential for inorganic growth. Together with Columbier, AltC, Churchill VI and Churchill VII, we now have interest in four SPAC sponsored shares, with an aggregate investment size of $3.5 million. If business combinations are consummated in these vehicles, these shares in aggregate are presently structured to be worth in excess of $30 million, and would be a return of over 8.5 times our initial investment. To reiterate the SPAC market opportunity is broadly compelling. Furthermore, it is our opinion that we are extremely well positioned to take advantage of this market opportunity and ultimately deliver value to shareholders through this proprietary access. Please turn to slide 9, consistent with this goal, we funded our $10 million commitment that we made in the fourth quarter of 2020 in a pre-SPAC merger PIPE and Churchill Capital II. On June 11 Churchill Capital II announce that it completed its merger with Skillsoft, a global leader in the digital corporate learning market. We believe the same long term structural changes and how education is being consumed by individuals also applies to the corporate learning market, and that Skillsoft is poised to benefit from these tailwinds. With 45 million users with a client base including 70% of the Fortune 1000, Skillsoft is one of the largest corporate learning companies. Now with a significantly delevered balance sheet after this transaction we believe that Skillsoft has a compelling opportunity to scale through organic and inorganic growth and acquisitions. Additionally, with a $1.5 billion pro forma enterprise value, reflecting only a 2.2 times 2022 revenue multiple, based on management's estimates, we believe that the transaction was set up at attractive valuation, particularly compared to Skillsoft's public and private comparable companies. We are excited to support Skillsoft as it enters the next chapter as a public company. In our investment strategies, we continue to see a high volume of opportunities across our core investment strategies. A few industries of focus including e-commerce, retail, financial technology, food technology, transportation and logistics. During the quarter, we made a new investment in Trax and an equity investment in PayJoy. Please turn to slide 10, we made a $10 million equity investment in Trax this quarter via a company sponsored secondary transaction. This secondary transaction was executed alongside the company's Series E financing round, which was completed at an undisclosed valuation. This round was led by BlackRock and SoftBank Investment Advisors with participation with Sony Innovation Fund, and OMERS Ventures. Trax previous series D financing was completed in 2019, at a $1.2 billion valuation. Trax is an analytics and computer vision platform designed to deliver accurate and reliable analysis for CPG companies and retailers by providing insight into what is happening in every retail store. The company's autonomous shelf monitoring system solutions disrupt manual and labor intensive industry practices by turning retail shelf image images into real time actionable insights. These insights enable manufacturers and retailers to control performance gaps, identify category opportunities and increase revenue. Trax's broad blue chip customer base spans 90 plus countries and is diversified across food and beverage, household and personal care, pharmaceuticals, tobacco and retail. Notable Trax customers include Coca Cola, Best Buy, Procter and Gamble, and Heineken. We believe that the trend towards digitization and monetization of traditional retail will continue well beyond the COVID-19 pandemic, and that our investment in Trax is well positioned to benefit from these technological shifts. Please turn to slide 11. Consistent with the rights contained within our loan from our Architect Capital PayJoy SPV, we were offered equity position, participation in PayJoy. The $2.5 million investment in PayJoy made this quarter comes in addition to our existing $10 million commitment to the Architect Capital PayJoy SPV, and entity funding loans to PayJoy. As we've discussed PayJoy is a San Francisco based provider of smartphone locking technology that has raised over $67 million in capital today. According to PitchBook PayJoy's latest series B equity capital raise was led by Greylock Partners in May 2019 with participation from Union Square ventures, and Core Innovation Capital. PayJoy owns a smartphone like locking technology that allows user, usually the direct lenders of the smartphone leases to lock any device where its software is installed. PayJoy has monetized technology by partnering with phone retail in emerging countries to offer leases at the point of sale. Consumers who lease a phone with PayJoy partners commit a portion of the lease in cash upfront and pay the rest of the smartphone lease in weekly installments. If a customer misses a weekly installment PayJoy's technology automatically locks the phone. The technology unlocks the phone if the consumer resumes making his payments. The result of this technology is a powerful incentive mechanism that has produced a history of predictable and stable lease payments. Our $2.5 million investment in conjunction with other key leading investors will help fund PayJoy international expansion. The company has had tremendous success in Mexico, and we look forward to supporting the business as it scales its technology globally. Looking ahead, we believe our portfolio is as well-positioned as ever to drive long term value to both exits and ongoing strategic investments in compelling industries. And opportunities not readily available to public investors. We believe our healthy cash balance puts us in a strong position to deploy against this high volume of attractive opportunities. Thank you for your attention. And with that I will hand it over to Allison.
Allison Green : Thank you, Mark. I would like to follow Mark's update with a more detailed review of our second quarter investment activity and financial results as of June 30, including recently declared dividends and our current liquidity position. First, I will review our investment activity, please turn to slide 12. During the second quarter we invested a total of $29.8 million in new and follow on investments. New investments during the quarter include a $2.7 million investment in the class B and class W unit of Columbier Sponsor LLC, the sponsor vehicle for Columbier Acquisition Corp; a $10 million investment in class A common shares of Churchill Capital II, whose shares subsequently converted to Skillsoft Corp. common shares after the completion of the business combination between these entities; a $10 million investment in the common shares and the Investec preferred shares of Trax, additional funding an aggregate $2.1 million related to capital calls from our $10 million commitment to Architect Capital PayJoy SPV, $5.1 million of which has been funded to date, and an additional follow-on investment of $5 million in the series C preferred shares of Blink Health. Obviously, all of the SPAC activity in our portfolio is highly accretive, that these transactions are evolving, multistage and highly complex and nuanced in nature. We've spent a great deal of time with our Valuation Committee, our independent valuation firm and our auditors to determine the appropriate fair value for these investments. And all parties are in full agreement on the valuations as presented in the financial statements to be included in our Form 10-Q filing for the second quarter of 2021. During this process, the fair value of two of our portfolio companies currently in the process of a SPAC merger were found to initially had misaligned current value per share calculations. However, these errors were identified and corrected prior to the finalization of our financial statements for the quarter ended June 30, 2021. And our financial statements as discussed are accurately presented, notwithstanding the fact that our financial statements are ultimately correct. As part of Marcum's review of our internal control of our financial reporting, they've advised us of their view that as a technical matter, the foregoing resulted in a material weakness for the quarter ended June 30, 2021. Through this process, we have adopted Marcum's and suggestions for valuations on these current bank transactions as well as any future valuations on SPAC mergers. Please turn to slide 13. This slide highlights our exits made and proceeds received during the second quarter. Most notably, we sold 25% or 782,090 of our Coursera common shares subsequent to the loss of provision on the 25% of our shares being listed after certain pricing conditions were met in May. We sold the shares for approximately $30.7 million of net proceeds resulting in a net realized gain of approximately $26.9 million. We anticipate our 2,346,271 remaining Coursera shares will become freely tradable this Friday. Additionally, during the second quarter we realized approximately $270,000 related to our June 2020 investment in Palantir Lending Trust SPV. These additional proceeds are attributed directly to the equity participation in the underlying collateral. As of today, $10.5 million has been received in the Palantir Lending Trust SPV and 612,290 shares of Palantir common stock comprising the underlying collateral to which we retain an equity interest remains to be sold. As of December 31 2020, the balance of the loan and all guaranteed interest have been fully repaid. Finally, during the quarter we received approximately $352,000 in proceeds from Second Avenue related to the principal repayment and interest on the 15% term loans due December 2023, and $490,000 in net proceeds and realized gains from the exit of our remaining SP Holding Group investment. Please turn to slide 14. Subsequent to quarter end we made a $2.5 million equity investment in the preferred shares of PayJoy, Inc. This is an addition to our continued funding of an additional $2.5 million in the capital calls from our $10 million commitment to Architect Capital PayJoy SPV. Today $551 million of our $10 million dollar commitment to the STB has been funded. We also funded a $250,000 investment in the common share units and private placement units of AltC Sponsor LLC, the sponsor vehicle for the AltC Acquisition Corp. Please turn the slide 15. Segmented by six general investment themes, the top allocation of our investment portfolio at quarter end is to education technology representing approximately 51% of the investment portfolio at fair value. Marketplaces was the second largest category representing approximately 16% of the portfolio. The financial technology and services category accounted for approximately 15% of our investment portfolio and approximately 14% of our portfolio is invested in social mobile companies. Big Data Cloud accounted for approximately 4% of the fair value of our portfolio and sustainability accounted for less than 1% of the fair value of our portfolio, as of June 30. Please turn to slide 16. We're pleased to report we ended the second quarter of 2021 with a NAV per share of $16.56. A breakdown of NAV per share as a quarter is shown on slide 16 and it's consistent with our financial reporting. Most notably, the decrease in NAV per share during the second quarter was largely driven by approximately $2.50 per share attributable to dividends declared and paid during the quarter and $0.22 per share attributable to the issuance of common stock from the stock dividend, and approximately $0.08 per share net investment loss. This decrease in NAV per share was partially offset by $1.04 per share attributable to net realized gains on investments, $0.29 per share attributable to net change an unrealized appreciation at quarter end, and $0.01 per share attributable to stock based compensation. I would also like take a moment to review SuRo Capital's current liquidity. We ended the quarter with approximately $226.6 million of liquid assets, including $130.1 million in cash and $96.5 million in public securities subject to certain lack of restrictions as of quarter end. Our cash balance of $130.1 million as of June 30 consisted primarily of the monetization of various portfolio positions throughout 2020 and 2021 to-date. In addition, to proceeds generated during the third quarter 2020 via the APM offering, the $96.5 million of public securities subject to lockup restrictions, held as of June 30, represent our shares in Coursera, Inc., valued at the June 30 2021 closing price of $39.56, plus a discount for lack of marketability related to the current lockup provision, and our shares in Skillsoft Corp., who shares we expect to be readily tradable upon share registration. As of June 30, 2021, there were 26,540,743 shares of the company's common stock outstanding. As of today, there are 26,555,823 shares of the company's common stock outstanding, In addition to the two dividends of $0.25 per share each declared in the first quarter and subsequently paid during the second quarter on May Fourth SuRo Capital's Board of Directors declared a $2.50 per share dividend to be paid in half doc and half cash on June 30 to shareholders of record on May 18. Regarding the results of the May 4 dividend based on a stockholder election, approximately 44% elected or were deemed to have elected to receive the dividend and shares of common stock and received approximately 2 million shares in aggregate and approximately 56% elected to receive the dividend in cash and as a result of the proration received approximately 89% of their dividend in cash, totaling approximately $30 million and approximately 11% in shares of common stock totaling approximately 0.3 million shares. The total dividend amount paid to all stockholders consisted of approximately $30 million in cash and approximately 2.3 million shares of common stock. The number of shares of SuRo Capital's common stock issued to stockholders receiving all or a portion of the dividend and shares of common stock was based on the volume weighted average price per share of SuRo Capital common stock on the NASDAQ capital market on May 12, 13, and 14 2021, with $2.50 dropped by the declared dividends. So volume weighted average price per share less than $2.50 declared dividends which states was approximately $13.07 per share. All 2021 dividends declared to-date are expected to be categorized as net long term capital gains for tax purposes. The related realized gains attributable to the monetization upon sale of equity investments in our portfolio. As Mark mentioned on August 3, SuRo Capital's Board of Directors declared a dividend $2.25 per share payable on September 30, 2021, to the company's common stockholders of record as of the close of business on August 18 2021. The dividend will be paid in half stock and half cash. As described more fully in today's press release, the dividend will be paid in cash or shares of the company's common stock at the election of registered shareholders. Although the total amount of cash to be distributed to all shareholders will be limited to no more than 50% of the total dividends to be paid to all shareholders. This dividend is being paid in accordance with certain applicable Treasury regulations and guidance issued by the IRS to our publicly traded regulated investment company to satisfy its distribution requirements from a distribution paid partly in common stock provided certain other requirements are satisfied. We strongly encourage all shareholders to proactively reach out to the bank broker nominee or platform through which they hold their thorough capital shares to make their desired election outcome known. Only registered shareholders will be directly mailed an Election Form by our transfer agent, American Stock Transfer. SuRo Capital does not process any elections. Most shareholders are not registered shareholders and must proactively make their election known through the bank broker nominee or platform on which they hold SuRo Capital shares. Each registered shareholder will have the opportunity to like to receive the dividend in cash or shares of the company's common stock. Registered shareholders electing to receive the dividend and shares the company's common stock will receive their entire dividend in the form of shares of the company's common stock regardless of the elections made by any other shareholders. However, the total amount of cash should be distributed to all shareholders electing to receive their dividends in cash will be limited to no more than 50% of the total amount to be distributed to all shareholders. In the event the amount of cash to be distributed to all shareholders electing to receive the dividend in cash would exceed 50% of the total dividends. Each registered shareholder electing to receive cash will receive a pro rata portion of the total cash to be distributed based on the number of shares held by each such shareholder. The remainder of the dividend in excess of a shareholders pro rata share of the total amount of cash to be distributed will be paid in the form of shares of the company's common stock. The number of shares of our common stock to be issued to shareholders receiving all or a portion of the dividend in shares of our common stock will be based on the volume weighted average price per share of our common stock on the NASDAQ capital market on August 11, 12, and 13, 2021 was $2.25 to reflect the declared dividend. The company will cause to be mailed an election form to receive cash or common stock only to registered shareholders promptly after the August 18 2021 record date. Registered shareholders who are those shareholders who own their stock directly and not through a bank broker or nominee. The completed election form must be received by SuRo Capital Corp.'s transfer agent American Stock Transfer prior to 5 pm Eastern standard time on September 17 2021. Registered shareholders with questions regarding the dividend may call American stock transfer. Registered shareholders who do not make an election will be deemed to have elected to receive 100% of their dividend in shares of the company's common stock. Registered shareholders participating in the company's dividend reinvestment plan will also receive an election form. The investment feature of the dividend reinvestment plan will be suspended for this distribution and will be reinstated after the distribution has been completed. Shareholders who hold their shares through a bank broker or nominee will not receive an election form from the company and should contact their bank broker or nominee for instructions on how to make an election. Shareholders who hold their shares through a bank broker or nominee are encouraged to contact their bank broker nominee and inform them of the election that should be made on the shareholders' behalf. If a shareholders bank broker or nominee on the shareholders behalf, does not kindly return a properly completed election form by the election date, the shareholder will have been deemed to have elected to receive 100% of the dividend in the form of shares of our common stock. Regardless of whether a shareholder receives the dividend in cash, stock or some combination of cash and stock, the entire amount of the dividend will be fully taxable to shareholders and SuRo Capital Corp report the actual tax characteristics of each year's dividends annually to shareholders on the IRS on Form 1099. The date of declaration of any amount of dividends including any future dividends are subject to the sole discretion of SuRo Capital's Board of Directors. The aggregate amount of the dividends declared and paid by SuRo Capital will be fully taxable to stockholders. Tax character of SuRo Capital dividends cannot be finally determined until the close of SuRo Capital's taxable year. SuRo Capital will report the actual tax characteristics of each year's dividends annually to stockholders subsequent to yearend. Registered stockholders with questions regarding declared dividends may call American Stock Transfer at 800-937-5449. Shareholders who hold their shares through a bank broker or nominee are encouraged to contact their bank, broker or nominee for additional details on how their bank broker nominee will process the election on their behalf. Shareholders can find additional information regarding this dividend in the investor relations section of SuRo Capital's website at www.surocapital.com. Year-to-date SuRo Capital has declared approximately $5.25 per share to shareholders for total approximate distributions of over $130 million. That concludes my comments. We would like to thank you for your interest in SuRo Capital. Now I will turn the call over to the operator to start the Q&A session. Operator?
Operator: Thank you. And first we'll go to Kevin Fultz from JMP Securities. Your line is open.
Kevin Fultz : Good afternoon, and thank you for taking my question. Could you provide some commentary on the private code strategy and your satisfaction with investment opportunities and the deal flow that you're seeing there and possibly also touching on the cadence of investment activity we should expect over the next few quarters? Thank you.
Mark Klein : Sure. We are actively seeing flow in the private creditors' credit strategy be bespoke and absolutely proprietary. We continue to evaluate opportunities and have seen as good a set of deal flow in that as we would have anticipated and are evaluating several as we speak. Thank you.
Operator: And we'll pause just for a moment to compose our other questions. Right, and it looks like next we'll go to Alex Paris from Barrington Research. Your line is open.
Alex Paris : Hey, guys, thanks for taking my question. Just had a couple, there's a lot of information obviously within the prepared comments. First off on Coursera, how many shares did you say you have currently after selling the first tranche earlier this year?
Mark Klein : Wait, well, we did say, Alex -- and thank you for your question. We have $87 million worth price of $39.56 as of last quarter during the last quarter plus a discount. Allison, if you have the exact count.
Allison Green : So we've retained 75% of our initial position. So we have remaining 2,346,271 remaining corporate shares, as of security and as of today that we feel will be freely tradable on Friday. Thank you.
Operator: Next we'll go to Jon Hickman from Ladenburg. Your line is open.
Jon Hickman : Could you could you run through the Skillsoft thing? Again, you participated in a PIPE and in return you got shares of the merged company. And when will those be freely traded tradable, I mean?
Mark Klein : Sure, we made a commitment to invest in a PIPE in Skillsoft, which is Churchill Capital. Two at the end of last year, we joined process who did a $500 million part of the pipeline. Obviously there are large and well respected investor in online learning and other digital strategies. That merger was completed earlier this earlier at the end of Q2, and the registration statement has just been filed and is not deemed effective yet. And once it's deemed effective we'd be able to freely trade it. Thank you, John.
Operator: And next we'll go to Mihir Meswani from HMC Capital. Your line is open.
Mihir Meswani: Hey, guys. Thanks for taking the call. Just a quick question with regard to current share price. I think you closed today a little over $12.24. Any plans on doing a stock buyback to close the roughly 28% discount?
Mark Klein : Sure. Thank you for your question. As you know, we have actively been involved in buying back stock through direct buybacks or through tenders. We still have a fairly large approved buyback available to us by our Board of Directors. I think we've demonstrated in the past that we've utilized that, where we're we believe that was the most appropriate use of our capital to drive the share count when it made sense. We will continue to evaluate that. Obviously, we are in a situation we're actually doing a great deal of distributions, having just distributing $5.25 to our shareholders as well. We believe that our communication strategy, our investment performance, should take hold, as well. But we actively always were looking at the best way to enhance shareholder value. And we obviously have deployed, share, buy up share buybacks is one of the methodologies to achieve that. Thank you.
Operator: Next, we'll go to Lou Greif from Morgan Stanley. Your line is open.
Louis Greifenstein : On regulations, but about the pipeline, I think about
Mark Klein : So thanks for calling, Lou. Unfortunately, you're coming in and out. But I think you're asking me if we have the ability to deploy the capital that we have, is our pipeline robust enough to be able to do that, given market conditions, etc. At the onset of my prepared remarks, we're seeing more opportunities than ever before, in this quarter, this is the most opportunities that we've evaluated and diligence than, we've done ever. So our deal flow is extremely robust. We are obviously selective and judicious in the deployment of our capital, given where markets are and what our valuation is, but our competence to be able to deploy the capital or opportunities to deploy the capital is extremely high. But we are conscious on valuation, and we make sure that we do it in an appropriate fashion. Thank you.
Operator: And at this time, I'll turn it back to management for closing remarks.
Mark Klein: Well, thank you all very much. It was a lengthy call, we appreciate it. Obviously, there is an awful lot going on in our portfolio. We're very fortunate to have the successes that we've been enjoying, and that -- in the recent successes and numerous of our portfolio companies either being acquired or going public, we do find the investment pipeline to be as robust or more robust than ever. And we are highly excited and highly engaged about the future of our fund. So we appreciate all your support and thank you all for taking the time to be with us this afternoon.
Operator: This does conclude our call for today. Thank you for your participation. You may now disconnect.
