Nakano Investments
Nakano Investments
Quarterly report · Q4 2021 · Nakano & Centerpitch
Confidential
2021-12-31
01 · Overview
Consolidated cash
$631k
-44.6% QoQ
Combined equity
$2.65M
Nakano $2.65M · CP —
Private portfolio (MTM)
$1.28M
on $1.28M invested · $0 returned
Public portfolio (MTM)
$1.91M
$45k unrealized
2021 expenses (ann.)
$28k
$28k YTD

2021 gross returns: 14.9%, or $436.4k (-35.6% YoY). Returns were down this year compared to last. Some of this is due to the tech stock roll out, and the taking of profits that resulted therein (i.e. we didn't have the same amount of risk on). Also, we only had one private payout in 2021, the rump, undersized payment from ValFund II. But the biggest contribution was the lackluster performance of BABA. We put on most of our position at the end of 2020, and have seen nothing but declines since then. We sold out of some in the summer, realizing $111k of losses, but the stock continued to fall. As of the end of the year the stock was at $118 (against our current WA holding price of $215), implying an unrealized loss of another $111k, for a total loss on the position of $222k. Without this position, our return profile would have been similar to 2020 (+22.2%); with it, we made $436.4k against $2,927.9k of WA capital, for a return of +14.7%.

Comparing against market equivalents (QQQ for "Tech", SPY for "Other Stocks", AGG for "Bonds", PSP for "PE/VC", GLD for "Other"), the results show a close tracking of market returns. An imaginary investor starting with $100 at the end of 2016 in the Nakano-weighted market portfolio would have $162.2 after five years; we have $171.3. On an IRR basis, the market portfolio returns 8.8%; Nakano returns 12.5%. Over the last three years (skipping the 2018 down year), market = $170.8 (15.6% IRR); Nakano = $171.3 (23.6% IRR). It pains me to point out that without BABA we'd have $182.5.

In conclusion, our performance isn't lighting any chat boards on fire. Of course, we are underestimating our returns if there are MTM gains in our private portfolio, which we believe there are (the only returns we're showing for the private investments is actual gross cash received back as a percentage of our investment). Our average expense ratio of running Nakano is 62bps; the Nakano-weighted average of an index portfolio would be 95bps, so that is also in our favor, if modestly so. Ultimately, I'd say we've been treading a bit above the water with our capital, while having funded some potentially lucrative private deals. Pretty much what our expectations have been since we opened our eTrade account.

Consolidated cash, quarterly

-$220k$252k$723k$1.2m$1.7m2018201920202021

Balances by account

MSMS: $499,860$500kIBKRIBKR: $109,959$110keTradeeTrade: $16,371$16kWFWF: $4,596$5k
Source: Nakano_Summary_CASH_EXPENSE REPORT_(2026_06_30) DRAFT.xlsx · “Running Cash Balances”
02 · Expenses
Consolidated (Nakano + Centerpitch)
2021 YTD$28,031
Annualized$28,031
2020 full year$23,494
+19.3% YoY (annualized)
2016: $0162017: $5,373172018: $12,647182019: $28,856192020: $23,494202021: $28,031212022: $36,308222023: $50,29523$50k2024: $39,759242025: $26,173252026: $17,25426$17k
Nakano
2021 YTD$28,031
Annualized$28,031
2020 full year$23,494
+19.3% YoY (annualized)
2016: $0162017: $5,373172018: $12,647182019: $28,856192020: $23,494202021: $28,031212022: $36,30822$36k2023: $21,914232024: $7,359242025: $4,631252026: $2,00626$2k
Centerpitch
2021 YTD$0
Annualized$0
2020 full year$0
2016: $0162017: $0172018: $0182019: $0192020: $0202021: $0212022: $0222023: $28,381232024: $32,40024$32k2025: $21,542252026: $15,24726$15k

2021 spend by line item (consolidated)

Office RentOffice Rent: $15,391$15,391CreditcardCreditcard: $6,120$6,120Office FurnitureOffice Furniture: $4,329$4,329Accountant FeesAccountant Fees: $2,500$2,500ErrorError: $1,316$1,316Webpage EmailWebpage Email: $354$354Business ApplicationsBusiness Applications: $249$249Bank Service FeesBank Service Fees: $175$175Video Meeting ServicesVideo Meeting Services: $167$167OtherOther: $62$62

2021 expenses: $27.9k (+18.5% YoY). Office rent was slightly up due to Rad's annual inflation adjustment and the 0.5% increase in sales tax. This is true every year, so is expected. The big increase was in Office Furniture; we had to buy an additional desk and chair this year, which we've never done before. Subscriptions were also up (this is where the credit card bill is shown, so there is a little "marketing" or whatever we should accurately call our rugby event in DC), while legal/accounting was down, largely offsetting each other. Ultimately, the increase in net spend this year from last can be accounted for by the furniture spending, which was a one-off. Still, total expense remained low on an Expense Ratio basis, at 73bps.

Source: Nakano_Summary_CASH_EXPENSE REPORT_(2026_06_30) DRAFT.xlsx · Expenses_Summary / Expenses_Nakano / Expenses_Centerpitch · full tables in the appendix · annualization holds Accountant Fees, State/City Fees, Client Entertainment, and Internal Events at actuals
03 · Equity balances
Nakano Investments LLC
Total equity$2,654,236
Design target (D/W)80 / 20
Drexler $2,124,236 (80.0%)Wiesner $530,000 (20.0%)
$0$717k$1.4m$2.1m$2.9m20172018201920202021
Centerpitch Investments LLC

no data

Source: Nakano_Summary_CASH_EXPENSE REPORT_(2026_06_30) DRAFT.xlsx · Nakano_Equity / Centerpitch_Equity
04 · Private portfolio

Private deals done: 4, or $587.9k (+35.0% YoY). A blend of upsizing and new deals circumscribed our 2021. We significantly increased our common equity position in ScreenMeet to almost $575k, a 2.5x goosing. In addition, we put another €50k (~$63k) into NextAlim via a convertible bond ahead of their expected IPO, bringing our total position to €100k (~$120k). The new deals comprised a $50k piece of Assembly Authority, a white glove installation company mostly focused on playgrounds, and a $100k investment in Bloom Intelligence, a digital advertising firm. In total, this was our busiest year in the private arena.

DealFirst fundingInvestedCash receivedRemaining valueMOICOutperformance case
Nakano Investments LLC
ScreenMeet
Cloud-native remote support SaaS (Principal: Ben Lilienthal)
Jun 2021$574,999—$574,9991.00×—
Northfield
Residential real-estate development (Principal: Patrick Zalupski)
Aug 2020$250,000—$250,0001.00×—
Smartemis
Veterinary services — France, Germany (Principal: Bill Hughson)
Mar 2022$185,490—$185,4901.00×—
NextAlim
May 2021$120,426—$120,4261.00×—
BloomIntel
Restaurant marketing — Bloom Intelligence (Principal: Will Wilson)
Aug 2021$100,000—$100,0001.00×—
TAAEquity
Apr 2021$50,000—$50,0001.00×—
Nakano subtotal$1,280,915$0$1,280,9151.00×
Consolidated$1,280,915$0$1,280,9151.00×

Invested (light) vs total value — paler segment is cash already returned

ScreenMeetScreenMeet invested: $574,999$575kScreenMeet remaining value: $574,999$575kNorthfieldNorthfield invested: $250,000$250kNorthfield remaining value: $250,000$250kSmartemisSmartemis invested: $185,490$185kSmartemis remaining value: $185,490$185kNextAlimNextAlim invested: $120,426$120kNextAlim remaining value: $120,426$120kBloomIntelBloomIntel invested: $100,000$100kBloomIntel remaining value: $100,000$100kTAAEquityTAAEquity invested: $50,000$50kTAAEquity remaining value: $50,000$50k
Source: Nakano_Portfolio_Data.xlsx · Deal_Registry / Deal_Transactions / Deal_Valuations · marks are total deal value (report-sourced); Remaining value = mark − cash received, which is what counts toward portfolio value (received cash already sits in the cash accounts) · MOIC = total value / invested · deals, marks, and cash received are as of the report date · open deals with no dated mark yet are carried at cost
05 · Public portfolio

All public securities are held at Nakano Investments (eTrade and Interactive Brokers). Centerpitch holds no public positions.

Open positions (MTM)
$1.91M
$45k vs cost
Realized G/L, 2021 YTD
$408k
+ $59k dividends
eTrade NAV
$1.92M
broker-reported, Dec 31
IBKR NAV
$109k
broker-reported, Dec 31

NAV bridge: open positions $1.91M + eTrade cash $16k + IBKR cash $110k (margin loan) = $2.03M ≈ combined broker NAV $2.03M — brokerage NAV nets cash and margin against the securities.

Daily marks — securities value by account

$0$748k$1.5m$2.2m$3.0m20202021
TotaleTradeIBKR

Performance vs indexes (time-weighted)

CumulativeCAGR2021 YTD
Portfolio+51.6%+17.3%+42.4%
Blended benchmark+68.0%+22.0%+28.7%
S&P 500+75.9%+24.2%+28.7%
MSCI ACWI+56.8%+18.8%+18.7%
Japan (EWJ)+31.4%+11.0%+1.2%
Europe (VGK)+39.1%+13.5%+16.9%

Time-weighted: daily returns of the securities book chained with buys/sells neutralized as external flows; dividends and option premiums count as return. Base 100 on 2019-05-24. The blended benchmark applies the portfolio's own daily bucket weights to matching index returns (US equities→SPY, Japan equities→EWJ, Europe equities→VGK, China equities→MCHI, US bonds/bills→BIL, Crypto→ETH-USD; dividend-adjusted USD ETFs). Current mix: US equities 100%. T-bill discounts recognize at purchase; delisted names (ALRN, LUMO) excluded.

Open positions

TickerQtyCost basisLast price (local)MTM (USD)GainWeight
eTrade
ABBV2,000$212,237$135.40$270,800+27.6%14.2%
GS
Goldman Sachs Group
600$196,135$382.55$229,530+17.0%12.0%
CVS1,500$115,393$103.16$154,740+34.1%8.1%
JNJ900$138,599$171.07$153,963+11.1%8.1%
MO3,000$141,842$47.39$142,170+0.2%7.5%
NEE
NextEra Energy
1,500$117,981$93.36$140,040+18.7%7.3%
SBLK6,000$119,131$22.67$136,020+14.2%7.1%
C2,000$141,818$60.39$120,780-14.8%6.3%
GLD625$106,413$170.96$106,850+0.4%5.6%
BABA850$195,507$118.79$100,972-48.4%5.3%
SLRC3,500$58,150$18.43$64,505+10.9%3.4%
NVDA200$61,278$294.11$58,822-4.0%3.1%
CMPS2,500$79,610$22.10$55,250-30.6%2.9%
FMC400$44,479$109.89$43,956-1.2%2.3%
BX300$42,262$129.39$38,817-8.2%2.0%
LMT100$32,995$355.41$35,541+7.7%1.9%
MSFT80$26,559$336.32$26,906+1.3%1.4%
UEC
Uranium Energy
8,000$31,420$3.35$26,800-14.7%1.4%
eTrade subtotal$1,861,807$1,906,461

Realized results by year

201920202021Total
Realized G/L$33k$169k$408k$610k
Dividends$10k$23k$59k$92k

Net public investments made: -22k shares, or $1,001.4k (down -81.7% YoY). The theme of the year in these positions has been two-fold: 1) the lack of reasonable fixed income investments (our bond purchases declined from ~$2m in 2020 to $28.7k in 2021, and that small amount only via the IVOL ETF); and 2) a shift out of tech stocks and into dividend stocks toward the end of the year. We continue to make some "punts" which are over-represented in the number of shares in the data (since they tend to be smaller stocks), but in fact only comprise a small portion of our holdings on a value basis ($218k out of $1,925k as of YE 2021). The new investments here were SBLK (a shipping company), SEDG (a solar power company), UEC (a uranium miner), and CMPS (a psilocybin-focused pharma firm).

Source: Nakano_Portfolio_Data.xlsx · Public_Trades / Prices / Account_NAV · daily marks: nakano_reporting daily_marks engine (month-ends tie IBKR PortfolioAnalyst within ±1.1%)
06 · Appendix — expense detail
Consolidated
Line item20162017201820192020202120222023202420252026Total
Office Rent4,17014,77815,06515,39115,85516,63814,64116,0617,327119,925
Office Furniture4,3292,9413,40010,670
Office Supplies0
Office-Related Expenses4,17014,77815,06519,72118,79520,03814,64116,0617,327130,595
Webpage Email3934805781803541925227282,3451,5257,295
Subscriptions13,0978191,5894395,945
Video Meeting Services1581671481541611731841,145
Business Applications2492494413831201,442
Other Business Services2252402149625
Operational Expenses3935015783387706434,2142,0904,6292,29716,452
Client Entertainment8,0448,9702,0152,48821,517
Internal Events4,5063,1058608,471
Business Travel1,1575,4386,595
Client Expenses13,70717,5142,0153,34836,584
Legal Fees2,3768391,4591642785,115
Accountant Fees2,8901,8002,5002,5001,6002,5002,5002,5003,85022,640
State/City Fees751693192782821,122
Bank Service Fees295110175382611512341101,866
Wire Fees2252402901006065425501,455
Foreign Currency Charges20323702244
Advisory and Fees2255,5813,2244,3382,7372,5293,1143,3883,0124,29432,443
Other Expenses2,8811,400991,580
Error7061,1391,316681643844
Miscellaneous2,1752611,316780643736
Creditcard4,7552,3958,1024,0156,12014,3408,4412,1271,0991251,382
Total Expenses5,37312,64728,85623,49428,03136,30850,29539,75926,17317,254268,191
Nakano
Line item20162017201820192020202120222023202420252026Total
Office Rent4,17014,77815,06515,39115,8556,37471,633
Office Furniture4,3292,9413,40010,670
Office Supplies0
Office-Related Expenses4,17014,77815,06519,72118,7959,77482,303
Webpage Email3934805781803541925226782,3451,5257,246
Subscriptions1402393873541,723
Video Meeting Services1581671481541611731841,145
Business Applications2492493362781201,232
Other Business Services225274
Operational Expenses3935015783387706431,4141,5103,5111,76311,419
Client Entertainment3,3233,323
Internal Events2,5254222,946
Business Travel3,3223,322
Client Expenses7993,7432,944
Legal Fees2,3768391,4591641394,976
Accountant Fees2,8901,8002,5002,5001,6002,50013,790
State/City Fees75169319144706
Bank Service Fees2951101753825801802341101,706
Wire Fees2252402901006065980
Foreign Currency Charges203210228
Advisory and Fees2255,5813,2244,3382,7372,5293,0832023425522,187
Other Expenses2,8811,4001,481
Error7061,1391,3162131,096
Miscellaneous2,1752611,316213384
Creditcard4,7552,3958,1024,0156,12014,3408,4412,1271,0991251,382
Total Expenses5,37312,64728,85623,49428,03136,30821,9147,3594,6312,006170,620
Centerpitch
Line item20162017201820192020202120222023202420252026Total
Office Rent10,26414,64116,0617,32748,292
Office Furniture0
Office Supplies0
Office-Related Expenses10,26414,64116,0617,32748,292
Webpage Email5050
Subscriptions2,6954267163854,222
Video Meeting Services0
Business Applications105105210
Other Business Services402149551
Operational Expenses2,8005801,1185345,032
Client Entertainment11,3688,9702,0152,48824,841
Internal Events1,9822,6848605,525
Business Travel1,1572,1173,274
Client Expenses14,50613,7712,0153,34833,640
Legal Fees139139
Accountant Fees2,5002,5003,8508,850
State/City Fees278139416
Bank Service Fees31129160
Wire Fees42550475
Foreign Currency Charges216216
Advisory and Fees313,4082,7784,03910,256
Other Expenses9999
Error681429252
Miscellaneous780429351
Creditcard0
Total Expenses28,38132,40021,54215,24797,571
Sources: Nakano_Summary_CASH_EXPENSE REPORT_(2026_06_30) DRAFT.xlsx · Nakano_Portfolio_Data.xlsx · unmarked private deals carried at zero.