U.S. Global Investors, Inc. (GROW): Business Model Canvas [11-2024 Updated]
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U.S. Global Investors, Inc. (GROW) Bundle
Understanding the business model of U.S. Global Investors, Inc. (GROW) reveals how this financial services firm effectively navigates the complexities of investment management. Through strategic partnerships and a robust set of activities, GROW not only offers diverse investment options but also fosters personalized relationships with clients. This blog post delves into the key components of their Business Model Canvas, showcasing how GROW positions itself to meet the unique needs of various customer segments while maintaining a sustainable revenue stream.
U.S. Global Investors, Inc. (GROW) - Business Model: Key Partnerships
Collaborations with financial institutions
U.S. Global Investors, Inc. (GROW) maintains strategic collaborations with various financial institutions to enhance its investment management capabilities. As of September 30, 2024, total assets under management (AUM) were approximately $1.5 billion, down from $1.8 billion a year earlier. This decline in AUM highlights the importance of these partnerships in attracting new clients and managing existing assets efficiently.
In terms of revenue, advisory fees from ETF clients amounted to $1.8 million for the three months ended September 30, 2024, compared to $2.7 million for the same period in 2023. This decrease underscores the necessity for GROW to leverage its partnerships to stabilize and grow its revenue streams.
Partnerships with regulatory bodies
U.S. Global Investors actively engages with regulatory bodies to ensure compliance with industry standards and regulations. As part of its operational framework, the company adheres to the regulations set forth by the Investment Company Act of 1940, which mandates that investment advisory contracts must be renewed annually. This compliance is critical for maintaining trust and credibility in the investment community.
Moreover, the company has a credit facility of $1.0 million, which is collateralized and remains unutilized as of September 30, 2024. This facility allows GROW to navigate regulatory requirements while ensuring liquidity for its operational needs.
Relationships with investment advisors and brokers
U.S. Global Investors fosters strong relationships with investment advisors and brokers, which are essential for client acquisition and retention. The average investment management fee for equity funds was 77 basis points for the three months ended September 30, 2024, down from 80 basis points a year prior. This slight decrease indicates a competitive landscape where partnerships with advisors and brokers can provide an edge in attracting clients.
The company’s total advisory fees for the three months ended September 30, 2024, were $2.1 million, a decrease of 31.5% compared to the same period in the prior year. This emphasizes the need for GROW to enhance its partnerships to improve its market positioning and revenue generation capabilities.
| Partnership Category | Key Metrics | Details |
|---|---|---|
| Financial Institutions | Total AUM | $1.5 billion (Sept 30, 2024) |
| Regulatory Bodies | Credit Facility | $1.0 million (utilized: $0) |
| Investment Advisors/Brokers | Advisory Fees | $2.1 million (Q3 2024) |
| Investment Advisors/Brokers | Average Management Fee | 77 basis points (Q3 2024) |
U.S. Global Investors, Inc. (GROW) - Business Model: Key Activities
Managing investment funds and portfolios
As of September 30, 2024, U.S. Global Investors managed approximately $1.5 billion in total assets, a decrease from $1.8 billion in the previous year. The average assets under management for the three months ended September 30, 2024, were $1.5 billion, compared to $2.1 billion for the same period in 2023.
The company's investment management services generated operating revenues of $2.2 million for the three months ended September 30, 2024, down from $3.1 million in the same period of 2023, reflecting a decrease of approximately 31.2%. The decline was primarily attributed to a $1.0 million drop in advisory fees, largely due to lower average assets under management.
Providing advisory services for ETFs
U.S. Global Investors provides advisory services for exchange-traded funds (ETFs) that contributed approximately $1.8 million in revenue for the three months ended September 30, 2024, compared to $2.7 million for the same period in 2023. The advisory fees for U.S. Global Investors ETFs decreased by 31.5% year-over-year, primarily due to reduced average assets under management.
The company also recorded $466,000 in advisory fees from USGIF during the same period, slightly down from $506,000 in the previous year. The average investment management fee rate was 62 basis points for the three months ended September 30, 2024.
Conducting market research and analysis
U.S. Global Investors focuses on conducting thorough market research and analysis to inform its investment strategies. As part of its investment activities, the company utilizes various valuation techniques, including the binomial lattice model for fair value estimations of its investments. As of September 30, 2024, the company's investments measured at fair value were approximately $14.9 million.
The company reported net investment income of $917,000 for the three months ended September 30, 2024, compared to a net loss of $513,000 for the same period in 2023, indicating a significant recovery attributed to improved market conditions and investment performance.
| Key Financial Metrics | September 30, 2024 | September 30, 2023 |
|---|---|---|
| Total Assets Under Management | $1.5 billion | $1.8 billion |
| Average Assets Under Management | $1.5 billion | $2.1 billion |
| ETF Advisory Revenue | $1.8 million | $2.7 million |
| Total Operating Revenue | $2.2 million | $3.1 million |
| Net Investment Income (Loss) | $917,000 | ($513,000) |
U.S. Global Investors, Inc. (GROW) - Business Model: Key Resources
Experienced financial analysts and advisors
The company employs a team of skilled financial analysts and advisors who provide investment management services. As of September 30, 2024, U.S. Global Investors reported a net income of $315,000 for the quarter, a significant improvement from a net loss of $176,000 in the same quarter of the previous year. The average investment management fee for the equity funds was 77 basis points for the three months ended September 30, 2024.
Technology platforms for trading and management
U.S. Global Investors utilizes advanced technology platforms to facilitate trading and investment management. The company maintains investments in trading securities at fair value amounting to approximately $11.2 million as of September 30, 2024. The trading securities consist of equity and debt securities, with specific fair values outlined as follows:
| Type of Security | Cost ($ thousands) | Unrealized Gains (Losses) ($ thousands) | Fair Value ($ thousands) |
|---|---|---|---|
| Equities - International | 762 | (415) | 347 |
| Equities - Domestic | 45 | (45) | 0 |
| Mutual funds - Fixed income | 9,869 | (156) | 9,713 |
| Mutual funds - Global equity | 929 | (71) | 858 |
| Total | 11,605 | (687) | 10,918 |
Capital for investments and operations
As of September 30, 2024, U.S. Global Investors had approximately $27.3 million in cash and cash equivalents. The company reported total assets of $51.1 million, with total liabilities of $2.7 million. The company's net working capital stood at approximately $38.2 million, indicating a current ratio of 21.0 to 1, showcasing its strong liquidity position. The company also has access to a $1.0 million credit facility, which remains unutilized.
U.S. Global Investors, Inc. (GROW) - Business Model: Value Propositions
Diverse investment options for clients
U.S. Global Investors offers a range of investment products including exchange-traded funds (ETFs) and mutual funds. As of September 30, 2024, total assets under management, including ETF and USGIF clients, were approximately $1.5 billion, a decrease from $1.8 billion at the same time in 2023. The firm manages multiple ETFs such as the U.S. Global Jets ETF (ticker JETS) and U.S. Global GO GOLD and Precious Metal Miners ETF (ticker GOAU), providing a diversified investment approach across different sectors.
| Investment Product | Assets Under Management (AUM) | Management Fees |
|---|---|---|
| U.S. Global Jets ETF (JETS) | Varies | 0.60% of average net assets |
| U.S. Global GO GOLD ETF (GOAU) | Varies | 0.60% of average net assets |
| U.S. Global Sea to Sky Cargo ETF (SEA) | Varies | 0.69% of average net assets |
Expertise in managing U.S. and international assets
The company has demonstrated expertise in managing both domestic and international assets, with a strong focus on sectors such as natural resources and emerging markets. For the three months ended September 30, 2024, operating revenues from investment management services totaled $2.157 million, with a notable contribution of $1.764 million from ETF advisory fees. U.S. Global Investors has also seen a market appreciation in assets, with a reported increase of $28.416 million in total assets under management during the same period.
| Revenue Source | Three Months Ended September 30, 2024 (in thousands) | Three Months Ended September 30, 2023 (in thousands) |
|---|---|---|
| ETF Advisory Fees | $1,764 | $2,709 |
| USGIF Advisory Fees | $466 | $506 |
| Total Operating Revenue | $2,157 | $3,133 |
Commitment to transparency and compliance
U.S. Global Investors emphasizes a strong commitment to transparency and regulatory compliance. The company adheres to strict guidelines and reporting standards, ensuring investors have clear visibility into their investments and the associated risks. In the latest financial report, the company noted a tax expense of $121,000 for the three months ended September 30, 2024, reflecting its commitment to regulatory compliance. Furthermore, the Board has authorized a monthly dividend of $0.0075 per share, showcasing its dedication to returning value to shareholders.
| Financial Metric | Value |
|---|---|
| Monthly Dividend per Share | $0.0075 |
| Expected Cash Dividends (Oct-Dec 2024) | $309,000 |
| Tax Expense (Q3 2024) | $121,000 |
U.S. Global Investors, Inc. (GROW) - Business Model: Customer Relationships
Personalized client advisory services
U.S. Global Investors, Inc. offers personalized client advisory services that cater to the specific investment needs of its clients. The company manages approximately $1.5 billion in assets under management (AUM) as of September 30, 2024, which reflects a decrease from $1.8 billion a year prior. The advisory services include tailored investment strategies aimed at optimizing client portfolios based on individual risk profiles and financial goals.
Regular performance reporting and updates
Clients receive regular performance reports, which detail the performance of their investments and overall portfolio. For the three months ended September 30, 2024, U.S. Global reported operating revenues of $2.157 million, a decline of $1 million, or 31.2%, compared to $3.133 million for the same period in 2023. This decrease was primarily attributed to lower average assets under management and a reduction in advisory fees, indicating a strong emphasis on maintaining transparent communication regarding performance metrics.
Educational resources for investors
U.S. Global Investors provides educational resources to empower its clients. These resources include webinars, investment newsletters, and market analysis reports. The company aims to enhance investor knowledge and confidence, which is critical in a volatile market environment. As part of its commitment to investor education, U.S. Global has developed a robust online platform that includes insights into market trends and investment strategies.
| Performance Metric | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Assets Under Management (AUM) | $1.5 billion | $1.8 billion | -16.7% |
| Operating Revenues | $2.157 million | $3.133 million | -31.2% |
| Net Income | $315,000 | $(176,000) | Positive Change |
| Client Advisory Fees | $2.127 million | $3.103 million | -31.5% |
U.S. Global Investors, Inc. (GROW) - Business Model: Channels
Company website for information and services
The official website of U.S. Global Investors, Inc. serves as a key channel for delivering information and services to clients. It includes detailed descriptions of their investment products, funds, and services, along with performance data. As of September 30, 2024, the total assets under management (AUM) were approximately $1.5 billion, down from $1.8 billion at the same time in 2023, reflecting a decrease of $208.9 million.
Financial advisors and brokers for client acquisition
U.S. Global Investors relies on financial advisors and brokers as significant channels for client acquisition. The company's advisory fees totaled $2.1 million for the three months ended September 30, 2024, a decrease of $1.0 million or 31.2% compared to $3.1 million in the same period of 2023. This decline was primarily due to lower average assets under management, particularly in their ETFs, which saw a drop in average AUM from $2.1 billion in 2023 to $1.5 billion in 2024.
Digital marketing and social media outreach
Digital marketing and social media outreach are increasingly important channels for U.S. Global Investors. The company utilizes various online platforms to engage with potential investors and promote its services. Advertising expenses for the three months ended September 30, 2024, were reported at $109,000, an increase from $81,000 in the same period in 2023. This investment reflects a strategic focus on enhancing brand visibility and attracting new clients through digital means.
| Channel Type | Details | Performance Metrics |
|---|---|---|
| Company Website | Information on investment products and performance data | Total AUM: $1.5 billion (Sept 2024) |
| Financial Advisors and Brokers | Key for client acquisition | Advisory Fees: $2.1 million (Q3 2024) |
| Digital Marketing and Social Media | Engagement with potential investors | Advertising Expenses: $109,000 (Q3 2024) |
U.S. Global Investors, Inc. (GROW) - Business Model: Customer Segments
Individual retail investors
U.S. Global Investors, Inc. offers investment solutions tailored for individual retail investors, primarily through its exchange-traded funds (ETFs) and mutual funds. As of September 30, 2024, the company managed approximately $1.5 billion in assets under management (AUM). The average investment management fee for ETFs was 0.77%.
Institutional investors and pension funds
The firm also services institutional investors and pension funds, providing tailored investment management services. For the three months ended September 30, 2024, U.S. Global Investors generated $393,000 in advisory fees from institutional clients, with total operating revenues from investment management services amounting to $2.157 million.
International investors seeking U.S. market access
U.S. Global Investors attracts international investors looking to access U.S. markets. The company's strategic focus includes marketing its ETFs and mutual funds to global clients. As of September 30, 2024, the company reported total net assets of approximately $1.5 billion, a decrease from $1.8 billion in the prior year, reflecting market conditions and investor sentiment.
| Customer Segment | Assets Under Management (AUM) | Average Management Fee | Advisory Fees (Q3 2024) |
|---|---|---|---|
| Individual Retail Investors | $1.5 billion | 0.77% | N/A |
| Institutional Investors and Pension Funds | N/A | N/A | $393,000 |
| International Investors | $1.5 billion | N/A | N/A |
U.S. Global Investors, Inc. (GROW) - Business Model: Cost Structure
Employee compensation and benefits
The employee compensation and benefits for U.S. Global Investors, Inc. amounted to $1,081,000 for the three months ended September 30, 2024. This represents a decrease from $1,274,000 for the same period in 2023.
Operational costs including technology and compliance
Operational costs, encompassing general and administrative expenses, totaled $1,503,000 for the three months ended September 30, 2024, slightly increasing from $1,501,000 in the same period of the previous year. Additionally, depreciation expenses were reported at $22,000 for the same period, down from $61,000 in 2023.
Marketing and advertising expenses
Marketing and advertising expenses increased to $109,000 for the three months ended September 30, 2024, compared to $81,000 for the same period in 2023.
| Cost Component | 2024 Amount (in $) | 2023 Amount (in $) |
|---|---|---|
| Employee Compensation and Benefits | 1,081,000 | 1,274,000 |
| General and Administrative Costs | 1,503,000 | 1,501,000 |
| Depreciation | 22,000 | 61,000 |
| Marketing and Advertising Expenses | 109,000 | 81,000 |
U.S. Global Investors, Inc. (GROW) - Business Model: Revenue Streams
Advisory fees from asset management
For the three months ended September 30, 2024, U.S. Global Investors, Inc. reported total advisory fees of $2.127 million. This includes $1.764 million from ETF advisory fees and $0.466 million from USGIF advisory fees. In comparison, for the same period in 2023, the total advisory fees were $3.103 million, reflecting a decrease of approximately 31.5% year-over-year.
| Year | ETF Advisory Fees | USGIF Advisory Fees | Total Advisory Fees |
|---|---|---|---|
| 2024 | $1.764 million | $0.466 million | $2.127 million |
| 2023 | $2.709 million | $0.506 million | $3.103 million |
Performance fees based on fund performance
The performance fee structure for U.S. Global Investors is designed to adjust based on the performance of their funds compared to designated benchmark indices. For the three months ended September 30, 2024, the performance fees received were $(0.103 million), reflecting a slight decrease from $(0.112 million) in the same quarter of 2023. The performance fee is a fulcrum fee that adjusts by 0.25% for differences of 5% or more in performance.
| Year | Performance Fees |
|---|---|
| 2024 | $(0.103 million) |
| 2023 | $(0.112 million) |
Income from investment securities and trading
As of September 30, 2024, U.S. Global Investors reported net investment income of $0.917 million, compared to a net loss of $(0.513 million) for the same period in 2023. This income is derived from various investments, including realized gains on debt securities of $0.203 million. The company's trading securities had a fair value of $11.166 million as of September 30, 2024.
| Year | Net Investment Income | Realized Gains on Debt Securities | Fair Value of Trading Securities |
|---|---|---|---|
| 2024 | $0.917 million | $0.203 million | $11.166 million |
| 2023 | $(0.513 million) | $0.336 million | Not available |
Updated on 16 Nov 2024
Resources:
- U.S. Global Investors, Inc. (GROW) Financial Statements – Access the full quarterly financial statements for Q1 2025 to get an in-depth view of U.S. Global Investors, Inc. (GROW)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View U.S. Global Investors, Inc. (GROW)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.