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Investment firm Tern (LON:TERN) says the pace of growth is increasing in its portfolio of companies as it revealed an increase in total assets at the end of 2015.
The company invests in cloud and mobile IT firms and it owns 95% of Internet of things (IoT) and M2M security specialist Cryptosoft.
It has also invested in Flexiant, software for cloud management, Push Technology, a data distributor, and Seal Software, which specialises in analysing contract data.
As at the end of 2015, Tern's total assets stood at £1.82mln compared to £1.4mln at the end of 2014, while net assets were also up to around £1.7mln from £943,631.
The company posted turnover in the year of £162,500, up from £41,000 in 2014 but the net loss widened to around £185,000 from £53,695 in 2014 due to increased costs and a share-based payment.
Angus Forrest, Tern's executive chairman, said: "Tern has achieved much in its first two years including establishing a portfolio of prospering private information technology companies.
"As our portfolio companies become more established, so the pace of their growth is increasing."
Forrest added that the group was excited by the sales pipeline, which has been growing since September last year, with opportunities in both North America and Europe being developed, with some close to launch.
It is in discussions with several global companies on Cryptosoft contracts - the data security platform - but timescales are difficult to estimate accurately, he added.
Speaking to Proactive, he said he was confident there will be activity on this front in this current half (to June 30).
And he added that any sale for Tern will be substantial as the companies it is talking to are global players with sales that run into millions of sterling or dollars.
"We have got a business model which incorporates Cryptosoft within their (the big firm’s) product,” he explained.
"Once we've had the one-off cost of developing it, it's then replicated as many times as they can sell their product which means the revenues for us will be substantial and all of these products will be sold in large volumes," said Forrest.
He added the firm believed it would also lead to companies approaching to buy Cryptosoft, as it will then become critical to their own offerings.
Last year, the Cryptosoft management was bolstered and a new chief executive started in July. Since then, a vice president of Global sales has been found and new VP of Sales in North America who is due to start in the first quarter of 2016.
The IoT is where machines pass data and instructions between each other without the need for human intervention and Cryptosoft claims to be the only supplier with a peer reviewed, market proven software security product for M2M applications that works across the range of IT systems.
"The Internet of Things is going to be bigger than e-commerce and mobile," said Forrest, adding that a key area was the safety of signals and data.
Earlier, he also said there had been interest in its portfolio companies from larger firms, which should lead to at least one sale in 2016.
He added: "Now, with Cryptosoft's management team in place, Tern is able to look for other investment opportunities, which match Tern's criteria and those sought by our shareholders. In 2016, Tern will be actively investigating such opportunities."
Tern shares eased 4.44% to stand at 10.75p each.