Zopa, AUGM’s second largest investee (14.2% NAV as of 30 Sept), is a neobank focused on the UK consumer. Zopa is scaling, has become profitable and is looking to grow its loan-book in a consistent manner. Its customer proposition is focused on providing ease and value in poorly served markets. Zopa has a clear vision as to how a combination of scale efficiencies and new products will drive profitability faster and well beyond what can be achieved by balance sheet expansion alone. 2025 will be a year of execution & growth, the benefits of which will start to be reflected in FY25 with the momentum building FY26. SCM’s view is that Zopa has product market fit and business momentum. In our opinion, at a c40% discount to NAV, the market is pricing AUGM as if its leading investees such as Tide (21.7% NAV) and Zopa (14.2% NAV) face significant financial distress. Our deep dives on Tide (published June 24) and Zopa, highlights well financed companies with good product-market fit. Our expectation is for both companies to drive AUGM’s NAV in the coming periods.
