WIN's first 6 months activity report meeting: In times like these, companies like Google and Amazon are born

Over 1,000 people attended the first of a series of regular investor video meetings with WIN

• Lack of cash is depressing the valuations of fast-growing companies by 20%-30% while their earnings grow - this is an excellent opportunity for investors and WIN in particular for very high return investments.
• Some investors have not experienced market downturns and have no experience with them - this scares them, and fear in investments is a bad advisor. Now is the best time to make well-planned, strategic investments for the next 3-5 years, and WIN is doing just that.
• Individual investors in riskier assets, and especially those experiencing downward trends in market cycles for the first time, cooled their interest and turned to cash.
• Investors who have been in the market for a longer period remember the previous declines and know that companies like Google and Amazon were born in these.
• The global network of Webit and Founders Games looks for and discovers companies with great potential for growth, and WIN has the opportunity to invest in them.
• WIN is considering raising capital to be able to purchase stakes in the 2022 Founders Games winter season finalists so as not to miss out on exceptional purchase opportunities at low market valuations of highly successful large-cap companies potential for growth.

You can watch a video of the entire meeting here:

On 29.11.2022, the first of the series of regular meetings of WIN with shareholders in the company and investors on the stock exchange was held.

More than 1,000 people attended the meeting, which began with an analysis of the economic situation in the country and the world, characterized by continued high inflation, expectations of an impending recession and rising borrowing costs caused by the tightening of monetary policy by the Federal Reserve and ECB.

However, it was noted that there is a positive trend of slowing down in the rate of decline in equity financing globally. It takes knowledge, foresight and a wide network of contacts to bring the best possible selection of investment opportunities.

Dr. Plamen Rusev also noted the positive news: "Less than a year ago, all venture capital funds were literally fighting for a place in investment rounds of good companies. There was more cash than places to invest it. This led to an extremely high ratings of the companies.

Today - 6-12 m later, companies paid much more attention to the fundamentals, focused on achieving profitability at an earlier stage, and at the same time, the lack of cash pushed their valuations by 20-30%, and somewhere and more. This, from an investor's point of view and especially from WIN's position, makes the current moment favorable for well-planned, strategic investments at a much better price.

Below you can read part of the questions and answers given by Dr. Plamen Rusev.

Q: How does the current economic environment affect WIN's investment strategy?

Plamen Rusev: Successful investments are those that bring returns. In our case, we aim for 10x (in other words, we look at every investment through the prism of whether it can multiply our invested funds tenfold). This is of course not a given, but I am saying how we evaluate companies and make our investment decision. Has that changed? No! But the environment is different now and the market valuations of the companies we are considering investing in are falling. Logically, in such an environment, we make decisions based on the current situation. On the other hand, due to lack of sufficient funding, other, even more attractive companies are appearing, deals with which 6-9 months ago would not even have been available on the market. These are new opportunities for us - some of these outstanding companies are part of the Founders Games 2022 winter season and are top - we'll talk about them later. So we are faced with a dilemma. On the one hand, in order to be able to invest in them and increase WIN's portfolio, we need to increase the capital of the company. But in the current environment of "cash flow" and withdrawal from the capital markets, this option is difficult to implement. If this proves impossible and in order to maximize investor value by now we are considering reducing the investment in the summer finalists to leave some money for the winter finalists. This is of course not optimal at all, because with so little money, such investments in these rounds in which we are involved are very few. And for that we are currently asking all investors if they would take advantage of the opportunities that WIN has and if they would get involved in a potential recent capital increase and by how much so that we can plan and make the most of the market situation right now . This would be a prerequisite for a greater return in a period of 3 to 5 years.

Q: What does this economic environment mean for WIN investors?

Plamen Rusev: With less money we will get a bigger share of the companies in which we invest. But this is no different than what we planned and announced before the IPO. Our investment horizon is 3 to 5 years. In other words, we expect a return on the investments we make today no earlier than the next 36 months. Why? Because there are rules in this industry. You cannot exit an investment earlier than the next 2-3 rounds, because the opposite would be illogical and against the interests of the company. We are entering a "pre-A" or A round and plan to exit our investment after 2-3 rounds (C or D), which are expected to occur over a period of 3 to 5 years. 

WIN, on the other hand, was created at the beginning of the storm we are witnessing now. 6 months later - valuations continue to fall and we are in no rush to make investments before the best terms for our shareholders are achieved. This does not mean that we are missing opportunities - on the contrary - many new ones are emerging and with even greater potential at a better price.

Q: How are investment decisions made?

Plamen Rusev: WIN is a company that has very clearly written rules for making an investment decision. perhaps one of the clearest on the market at all. We tap into the collective intelligence of over 200 investors who evaluate companies and select the best in 5 rounds. After this happens, there is a process of final research and evaluation of the company and a detailed analysis of the goals and objectives set in the first round of Founders Games and what was achieved 6 months later. If everything is fine after this detailed analysis, we proceed with the investment. In the meantime, we help companies grow, connect them with other investors and partners, and get their perspective as well. Nothing in this process is left to chance and involves a lot of research and analysis. When all the checks are successful - we join the round, and our condition is that WIN has exactly the same conditions as those of the leading investor, in other words, we make it so that, although we invest several times less money, our conditions are the same as the highest participant in the round. Thus we guarantee even our smallest shareholder that his 4 BGN (we have one) will buy exactly as much as the 4 BGN of someone who invests 3 million times more money! This is WIN's unique positioning in the market and provides tremendous value to our shareholders. 

Q: Let's talk about investments. Where did WIN invest in the first 6 months?

Plamen Rusev: After the analyzes I spoke about above, at its meeting, the Board of Directors of WIN decided to invest in 3 of the 5 Founders Games finalists. 

At the moment, one of these investments is fully closed - the one in VUZ. 

VUZ is the world leader in digital experiences in XR and Metaverse, enabling users to stream and watch with a new level of immersive realism.

In investments, it is not important to just put some money, but to invest it with many other top investors who are also interested and thus become a guarantor for the future of the company and future and successful rounds. In the case of VUZ, WIN invested in a US$20 million round alongside  Caruso Ventures, e& capital (Etisalat before the name change – one of the world's largest telecom groups, which recently bought almost 10% of Vodafone), Dubai Future District Fund (the Sheikha's Fund of Dubai), Vision Ventures VC Fund, SRMG,  Elbert Capital, Yasta Partners, Faith Capital and Panthera Capital.

For your information, Dan Caruso, the founder of Caruso Ventures, is an entrepreneur who founded 3 companies, each of which reached a value of US$10 billion - a good environment to start a company ( at least) unicorn.

Each month since VUZ was announced as a finalist for the Founders Games summer season (late June 2022) has been stronger than the last, marking serious growth. October is the strongest month yet with revenue reaching over 187% year-over-year growth.

The company is working on a clear and structured plan to achieve profitability in 2023

VUZ also announced its ideas for annual subscription plans via credit card and apple/pay, which will bring a much higher share of revenue (and an increase in gross margin) of 95% with a subscription fee of $45. Until now, the company shares its revenue with the telecoms, through which it monetizes under much different conditions. The team started providing content “behind the scenes” at the World Cup.

The company is in talks with La Liga, Manchester City, Manchester United and Real Madrid FC, with these partners expected to support expansion into Europe as well.

Q: What about the other finalists and when should we expect investment in them and in which ones and on what terms will WIN invest?

Plamen Rusev: Shortly after being announced as a finalist at the “Founders Games”, the French company EcoTree closed a 12 million euro round, to support its development towards enforcement and as a leading European supplier of nature-based solutions. EcoTree received investment from new partners Société Générale Ventures, Financière Fonds Privés and Famae Impact. Previous investors and shareholders, the Accurafy fund and Épopée Gestion, also confirmed their confidence, respectively reinvesting and remaining active in the capital until the original investors Finistère Angels were bought out.

The funds will provide current and future customers with even greater access to sustainable forests that sequester carbon, promote biodiversity and generate economic returns. EcoTree will also increase its range of alternative solutions for carbon removal and biodiversity.

With foundations laid in France, Denmark, Sweden, the UK, Belgium and the Netherlands, EcoTree will continue to expand commercially across Europe by investing in new nature projects across the continent and marketing and communications in new national markets. EcoTree will also continue to invest in research and technology to provide cutting-edge solutions to individuals and businesses and especially for corporate customers to fully leverage the impact of their environmental and ESG initiatives with EcoTree.< /p>

WIN has reached an agreement to invest in EcoTree, but is currently awaiting confirmation of the achievement of the revenue projections made in 2022. When achieved, WIN will proceed to finalizing the investment in the company.

Alver (Switzerland)

Swiss Foodtech company Alver was among the finalists of the summer edition of the Founders Games. 

Alver has entered patents for dark fermentation, by which it removes the taste, color and smell of algae (those who have tried Spirulina know exactly what it is about) as such creates a highly nutritious protein that has already been called the world's most sustainable protein. 

After the outbreak of COVID-19, Alver's co-founders noticed a growing number of people seeking immune-boosting superfoods like Chlorella and Spirulina. Alver's Golden Chlorella is high in zinc, magnesium, phosphorus, vitamin B and carotenoids, which are very important for supporting the immune system. Alver products have become the invisible mask and sales have doubled since 2020.

Many customers have switched from Spirulina and Green Chlorella to Alver's Golden Chlorella because it is so much easier to incorporate into everyday meals for the whole family. < /span>

In 2022, the company is expected to double its revenue directly in 2021.

WIN connected Alver with the company Smart Organic and they produced first samples with Alver's protein, which also validated the feasibility of applying the product in production. As of now, Alver does not yet have a lead investor for this fourth investment round, and if one is available, WIN will participate in the round. Meanwhile, the founders made a correction in their expected valuation of the company, with the new one about 30% lower.

Q: There was an extraordinary general meeting of WIN shareholders recently. What decisions were made and why?

Plamen Rusev: By decision of the Board of Directors of the Company dated 29.08.2022, in connection with the commitments undertaken by Plamen Rusev in favor of the shareholders, at an extraordinary general meeting of shareholders (EGM) on 25.10.2022, along with other points, the following better conditions for WIN shareholders were voted on and adopted: < /p>

• WIN management will be entitled to carry only if all the capital raised has already been returned to investors either in the form of a dividend or provided that the exchange price of 1 share is equal to or higher than the weighted average issue price of all issued shares.
• The management fee that WIN pays to Webit Management, which until now was calculated according to the formula 2.5% of the WIN portfolio valuation, has changed and is calculated according to the formula 2.5% of the attracted capital. 
• The formula for calculating a liquidation share from WIN to management has also been changed in favor of shareholders by adding a condition for the return of all capital raised and only after this payment of a 20% liquidation share to the management.

On November 8, 2022, the amended Company Statute was announced in the Commercial Register and the Register of Non-Profit Legal Entities. 

B: What are the next investments you are looking at?

Flame: In mid-January 2023, during the week of the World Economic Forum in Davos, the finalists for the winter season will be announced of Founders Games 2022.

As of today, some of the companies that passed the 3rd round and got the right to appear in the semi-finals are already known, and accordingly among them will be the finalists of the Founders Games, Winter season 2022.

B: Can you give examples of the companies in which, when raising a financial resource, shareholders could invest and WIN could buy shares?

Plamen Rusev: 

• CH4Global (Australia) manufactures a feed additive that completely (100%) blocks methane emissions from cattle . Cattle and cattle farming is the biggest methane polluter on the planet. Its completely risk-free blocking alone is perhaps one of the greatest achievements in the field at all. But with a dose of only 15 g per day, the CH4Global product has another added value – not only blocks the release of methane, but by retaining the carbon compound in the body, it increases the production of meat and milk by 10% to 15%, which makes the purchase of the product by farmers absolutely logical. CH4Global have protected their discoveries with patents. All tests have been successfully completed and market implementation is expected in 2023.
• Chari (Morocco) is a B2B e-commerce application for traditional neighborhood stores, allowing them to order any consumer goods they sell and receive free delivery while availing financial services. Chari has a geographical footprint in French-speaking Africa. Chari's revenue increased by more than 400% in 2021 compared to 2020, and in 2022 the growth is expected to be even greater.

• InoBat (Slovakia) specializes in pioneering research, development, manufacturing and supply of premium innovative electric batteries custom designed to meet the specific requirements of global mainstream and specialist OEMs in the automotive, commercial, motor and aerospace industries sectors. Among the investors so far are the World Bank, with an investment round worth $100M to come. On November 14, 2022: InoBat Auto ("InoBat"), the European pioneer in research and development, engineering, manufacturing and recycling of batteries for electric vehicles, signed protocols and declarations of intent with the Government of the Republic of Serbia for the construction of new gigafactory in Serbia. This initiative is supported by the IFC (International Finance Corporation of the World Bank) through its early-stage project development commitment with InoBat to establish a new EV battery plant in Central and South-Eastern Europe, signed in January this year. Ana Brnabic, Prime Minister of the Serbian Government commented: “This is an important milestone for Serbia in positioning our country as a major player in a sustainable and green future and among the leading European players in this highly innovative and ground-breaking strategic industrial sector.”

• Porotech (UK) is the manufacturer of the world's first commercial microLED epi-wafer . MicroLED is the next big leap forward for displays on large-panel TVs, smartwatches and VR/AR glasses. However, achieving the required high-performance full-color ultra-fine-pitch pixels has proven challenging at the material, device, and system levels.
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  Based on PoroGaN technology® and DPTTM, Porotech's product provides an entirely new engineered material platform for micro display construction. Thanks to its superior material properties and functionalities, it allows all three primary colors, especially the difficult red for conventional technology, to be made with the same GaN material and integrated into a single wafer or even a single pixel by completely eliminating sub-pixels. from the micro display architecture. It not only offers scalability for mass production and flexibility for process upgrades, but also simplicity for system integration and supply chain resilience. The founders of Porotech are a professor and a doctor from the University of Cambridge. The company's revenue is growing by 500% in 2021 compared to 2020, and similar growth is expected in 2022. The company plans an initial public offering in 2025.

• Pomelo (Argentina) builds a new generation and fully regional fintech infrastructure for Latin America. It is extremely difficult to start and even more so to scale fintech in Latin America. Each market has different regulation and local incumbents do not have the infrastructure required by technology companies. This is the biggest challenge the founders have faced while building one of the most successful fintech companies in Latin America over the past few years. The company is in the portfolio of legendary venture capital funds Sequoia and Tiger Global.

• Bansen Labs (USA) creates technology that enables people with disabilities to interact with the world on their own terms. An estimated 1 billion people live with long-term disabilities, but they are underserved and face barriers that limit access and inclusion in society. People with disabilities face disproportionate unemployment, which leads to isolation and poverty. By creating an interface that allows people with disabilities to use all forms of technology in a way that works for them, it provides not only access to technology, but also access to other people. Access to technology - in our technology-dominated age - means access to work, relationships and community. It builds bridges for the one billion people around the world with disabilities who are often isolated! The company's revenue is growing by more than 250% for 2021 compared to 2020, and in 2022 the forecasts are just as optimistic.

• 1DROP (Switzerland) saving lives through better, faster surveillance of the patient's health. 1DROP enables personalized healthcare by providing actionable health information that is accessible to everyone, everywhere. After just one drop of sample and a few minutes, 1DROP sends the results of the diagnostic test to the patient's mobile phone. 1DROP makes this a reality: 1. 1DROP chip onto which a drop of sample (usually blood) is applied; 2. A portable 1DROP analyzer that quantifies multiple biomarkers from the 1DROP chip within minutes; 3. A 1DROP application that is synchronized with the 1DROP cloud and shares data with electronic health records (EHR), streamlining clinical workflows by providing real-time, anywhere access to patient diagnostic results. 1DROP's revenue grows by about 30% every year.

• Elephant in a Box (USA) is an innovative materials company specializing in honeycomb structures for furniture and construction. Their patented technology has been used in furniture manufacturing through their Elephant in a Box brand for 3 years and is on the way to being adopted by major furniture brands such as IKEA. You could say that the company creates “Gore-Tex material” for furniture and construction. The company's revenues grow by about 300% in 2021 compared to 2020, and after a potential contract with IKEA, expectations for 2022 and 2023 are even more optimistic. 

• Fazla Gıda (Turkey) is supported by global organizations such as UNDP, MIT Solve and EBRD; The company offers comprehensive and technology-based solutions for food waste management in accordance with the food recovery hierarchy and connects the surplus with the right partner that offers the highest financial, environmental and social value. Putting technology at the heart of its business model, the platform creates a unique management system where food businesses can manage all their unsold, excess inventory from one place. 
  The company's revenue is up 1155% (11.55x increase) for 2021 vs. 2022 and the outlook for 2022 is just as good. The company plans to expand throughout Europe.

  The meeting ended with questions and answers from the shareholders.

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