Chrysalis Investments is a listed fund that owns stakes in fast-growing technology companies, led by Starling Bank, Smart Pension and Klarna. After two years of share buybacks, it is now selling its whole portfolio over three years and plans to go into liquidation afterwards. Its shares closed at 64.0p on 9 October 2026, against a net asset value (NAV, the value of its holdings per share) of 131.09p at 30 June 2026.
A fund holding a few big tech stakes
Chrysalis says it backs high-growth, innovative businesses that can transform their sectors. It holds mostly private companies and one listed one, Klarna. By March 2026 its top three holdings made up about 83.5% of NAV.
Starling is a UK bank that also sells its banking software, Engine, to other banks. Engine customers include Tangerine Bank in Canada and SBS Bank in New Zealand. Smart Pension runs UK workplace pension schemes. Klarna is the payments group listed in New York. At 30 June 2026 these were worth £356m, £136m and £57m, out of £630m of net assets.
Until August 2026 an outside adviser, Chrysalis Investment Partners, ran the portfolio. 29 Jan 2024 30 Jun 2026 30 Jan 2026 3 Aug 2026
A 54% discount and a plan to shrink it
In the year to September 2023, NAV per share fell 8.9% to 134.65p. The shares closed at 62.2p, a 54% discount to that value.
In October 2023 the board proposed a Capital Allocation Policy. It would hold a £50m cash reserve, buy back up to £100m of shares and distribute up to 25% of net cash profits on sales. By January 2025 the stated commitment was at least 25% of net realised gains.
Shareholders approved the company's continuation in March 2024. In April 2024 the advisory team, Richard Watts and Nick Williamson, left Jupiter Asset Management to set up their own firm. 29 Jan 2024 13 Oct 2023 10 Jan 2025 30 Jan 2025
Selling winners to buy back shares
The cash came from exits. SoftBank bought Graphcore. Visa paid £79m upfront for Featurespace, and WPP paid about £48m for InfoSum. A £70m Barclays loan added more. Buybacks began on 26 September 2024.
By September 2025 NAV per share was 171.65p, up 21.5% on the year, and the shares were up 30% to 121.2p. Klarna listed in New York at $40 a share that month. The company had returned £102m by December 2025.
wefox, a European insurance business, was the weak spot. Its funding crisis forced a restructuring. In July 2024 the adviser said wefox would need no further investment, yet the company put in about £17m in the following year, and €7m more in April 2026. 12 Jul 2024 25 Sep 2024 26 Sep 2024 19 Dec 2024 3 Apr 2025 19 Dec 2025 10 Sep 2025 29 Jul 2024 30 Jun 2026
Shareholders ask for a way out
A group of shareholders, led by the largest, wanted no new investments and faster disposals. The board consulted holders of about 60% of the shares. In December 2025 it proposed selling the portfolio over three years and returning the proceeds.
Shareholders approved the new policy on 24 March 2026, with about 98% in favour. The company will go into voluntary liquidation once the assets are sold. The adviser was served notice on 20 February 2026.
The shares still stood at a wide discount, which the board acknowledged. 19 Dec 2025 20 Feb 2026 24 Mar 2026 30 Jun 2026
“Despite this progress, the discount to NAV against which the Company's shares trade remains material and the Board recognizes the need to do more to remedy this situation.” 19 Dec 2025
Markets turn, valuations fall
In the six months to March 2026 NAV per share fell 22% to 133.94p, and the shares fell 33% to 81.4p. Klarna's share price dropped 63% over the period, and Starling's peer group fell about 20%. Klarna, Starling and wefox drove most of the write-down.
An error in the valuer's wefox calculation, found by the auditor, cut NAV by a further 3.33p. Management says the fall reflects peer-group prices, not trading.
The buyback stopped on 30 April 2026 after £117.4m. In June the company repaid the Barclays loan using Klarna and Wise sales. 30 Jan 2026 30 Jun 2026 5 May 2026
Concentration, discounts and valuation risk
Buybacks added about 9p to NAV per share in the year to September 2025. They did not close the discount, which widened to about 39% by March 2026 and 44% in late June. The board says the discount is too wide.
Selling off a portfolio concentrates it. Most of the value now rests on Starling, and valuations track listed peer groups, which swung sharply in 2026. The valuer's wefox error shows how uncertain private valuations are. 19 Dec 2025 30 Jun 2026
“Concentration in the portfolio is an unavoidable by-product of the strategy to liquidate investments within the portfolio.” 30 Jun 2026
A smaller board and a cheaper structure
Andrew Haining chairs the board. Sam Dobbyn joined on 20 February 2026 and leads portfolio management, taking seats or observer roles at portfolio companies. Directors Simon Holden and Tim Cruttenden resigned on 30 September 2026, taking the board from six to four.
The company has run itself since 21 August 2026. It expects portfolio management to cost about £2m in the first year, against £4.6m in the 12 months to March 2026.
Haining, Dobbyn and Holden each bought roughly £50,000 of shares in May 2026.
The record is mixed. The board returned the promised £100m, and exits came at or above carrying value. The Klarna listing, expected in 2024, came in September 2025. wefox needed more money than first forecast. 20 Feb 2026 30 Jun 2026 21 Aug 2026 30 Sep 2026 7 May 2026 12 May 2026 18 May 2026 29 Jul 2024 10 Sep 2025
Selling Klarna, redeeming shares
NAV per share was 131.09p at 30 June 2026. On 28 September the company reported a £34m Klarna sale. It is retaining £9m as an operating buffer and returning £25m by compulsorily redeeming 19.7m shares, 4.1% of the total, at 127.0p each. About 461m shares remain, and the redemption money was due by 9 October.
The shares closed September at 68.9p and were at 64.0p on 9 October. Asset Value Investors raised its holding to 20.1% on 28 September.
In June the company paid £8.5m for more Smart Pension shares. Starling's board was reshaped, with Colin Bell becoming chair. 3 Aug 2026 28 Sep 2026 30 Sep 2026 30 Jun 2026
Three years to sell the portfolio
The plan is to sell the holdings by February 2029 and return the proceeds. The board's stated aim is to return NAV while maximising the internal rate of return, the annual rate of gain. Future payouts depend on cash realisations.
The board is working with fellow shareholders in the portfolio companies to create liquidity, and sees capital markets as an option for Starling. wefox has a complex capital structure and debt, and the company says it needs careful management. wefox has funding to about the end of 2027. 20 Feb 2026 30 Jun 2026 3 Aug 2026
“The Board remains focused on maximising value for shareholders through the realisation of the portfolio over the next three years.” 30 Jun 2026
Written by AI from Chrysalis Investments Limited's own announcements since Oct 2023 · every paragraph links to its sources