Financial Data and Key Metrics Changes - Trinity Capital reported $75.6 million in total investment income, a 22% year-over-year increase, and $37 million in net investment income, representing a 29% increase compared to Q3 of last year [2][11] - The net asset value (NAV) grew 8% quarter-over-quarter to a record $998 million, with a year-over-year increase of 32% [2][12] - The return on equity was 15.3%, among the highest in the Business Development Company (BDC) space, with a weighted average effective portfolio yield of 15% [11][12] Business Line Data and Key Metrics Changes - The company funded $471 million in Q3, bringing year-to-date investments to $1.1 billion, nearly matching all of 2024's total [3] - The investment pipeline remains robust, with $773 million of new commitments in Q3 and $1.2 billion in total unfunded commitments as of quarter-end [3][4] - Non-accruals remained steady at 1% of the total debt portfolio, with four companies on non-accrual status [15] Market Data and Key Metrics Changes - Portfolio companies collectively raised $2.3 billion in equity capital during Q3, indicating strong borrower performance and access to capital [15] - The largest industry concentration in the portfolio is finance and insurance, accounting for 15% of the portfolio at cost, diversified across 20 borrowers [15] Company Strategy and Development Direction - Trinity Capital is focused on building a scalable platform that can drive earnings and NAV growth, with a commitment to disciplined underwriting and a diversified portfolio across five business verticals [8][10] - The company is strategically raising equity, debt, and off-balance sheet vehicles to fuel growth, including a new joint venture with a large asset manager [6][10] - The management structure aligns interests with shareholders, promoting a commitment to delivering consistent dividends and long-term value [8][9] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the opportunities in the private credit market, highlighting a robust investment pipeline and the potential for incremental upside from warrant positions in portfolio companies [3][10] - The impact of rate cuts on the business has been limited, with most loans including interest rate floors, which helps maintain income levels [5][10] - The company remains focused on maintaining strong credit quality and disciplined underwriting practices [4][15] Other Important Information - The company raised $83 million of equity through its ATM program at a 19% average premium to NAV during Q3 [12] - The net leverage ratio increased slightly to 1.18 times at quarter-end, with no debt maturities until August 2026 [12] Q&A Session Summary Question: Current capacity in off-balance sheet vehicles - Management indicated that there is currently about $200 million of capacity in the new vehicle, with other vehicles being approximately 75% funded [20][24] Question: Capacity of the team for origination and management - Management stated that they have been hiring in advance of growth needs and are currently well-positioned to manage existing verticals without immediate need for additional resources [28][29] Question: Competition in various verticals and deal spreads - Management noted that they do not see the same rate compression as other markets, with their niche verticals experiencing less competition [30][31] Question: Increase in compensation expenses - Management explained that the increase in compensation expenses is due to team growth and the establishment of a new office in the U.K. [37] Question: Portfolio health and watch credits - Management reported a significant decrease in watch credits, indicating improved portfolio health, with overall performance remaining strong [38][63] Question: Nomad Health investment write-off - Management clarified that a significant portion of the Nomad Health investment was converted to equity, and while the remaining debt is on non-accrual, they remain optimistic about the company's future [42][45] Question: Exposure to consumer receivables - Management confirmed that the portfolio has very low exposure to consumer receivables, with a focus on B2B financing [49] Question: Future leverage ratio plans - Management indicated plans to lower the leverage ratio over time, focusing on creating liquidity and generating new income through managed funds [66]