N-CSRS/A 1 jf-ncsrsa.htm JACOB FUNDS AMENDED SEMIANNUAL REPORT 2-29-20

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549


FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES




Investment Company Act file number 811-09447



Jacob Funds Inc.
(Exact name of Registrant as specified in charter)



C/O Jacob Asset Management of New York LLC
727 2nd Street #106
Hermosa Beach, CA 90254
(Address of principal executive offices) (Zip code)



Ryan Jacob
C/O Jacob Asset Management of New York LLC
727 2nd Street #106
Hermosa Beach, CA 90254
(Name and address of agent for service)



(424) 237-2164
Registrant's telephone number, including area code



Date of fiscal year end: August 31


Date of reporting period:  February 29, 2020



Item 1. Reports to Stockholders.




Jacob Internet Fund
Jacob Small Cap Growth Fund
Jacob Micro Cap Growth Fund


Semi-Annual Report
February 29, 2020


The Jacob Internet Fund, Jacob Small Cap Growth Fund and
Jacob Micro Cap Growth Fund are mutual funds with the
primary investment objective of long-term growth of capital.

The Jacob Internet Fund has current income as a secondary objective.

Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission “SEC”, paper copies of the Funds’ shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from the Funds (if you invest directly with a Fund) or from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.
 
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications electronically from the Funds by calling 1-888-522-6239 or by contacting your financial intermediary (such as a broker-dealer or bank).
 
You may elect to receive all future reports in paper free of charge. You can request to continue receiving paper copies of your shareholder reports by contacting your financial intermediary or, if you invest directly with a Fund, calling 1-888-522-6239 to let the Fund know of your request. Your election to receive in paper will apply to all Funds held in your account.
 

 
Investment Adviser
Jacob Asset Management of New York LLC

TABLE OF CONTENTS



Letter From the Manager
   
1
 
Industry Breakdowns
   
4
 
Schedules of Investments
   
7
 
Statements of Assets and Liabilities
   
16
 
Statements of Operations
   
17
 
Statements of Changes in Net Assets
   
18
 
Financial Highlights
   
21
 
Notes to the Financial Statements
   
26
 
Additional Information on Fund Expenses
   
39
 
Additional Information
   
41
 



Dear Fellow Investors,
 
For most of this fiscal period, the equity markets performed quite well, with the tailwind of a stronger economy and low interest rates propelling stocks to new highs. However, this positive backdrop recently gave way to new uncertainty with the emergence of a novel coronavirus that is already having a severe effect on the global economy. Past concerns regarding trade relations with China, geopolitical tensions, domestic electoral uncertainty and the direction of interest rates have now become much less relevant to markets grappling with this new crisis. With the spread of the coronavirus now around the world, the impact has been the U.S. stock market’s worst performance since the Great Recession of 2008-2009 and record levels of volatility. We are making adjustments to reflect how the Fund’s holdings may be affected, but we are doing so cautiously given the large number of unknowns associated with how this crisis will evolve, both from a health as well as economic standpoint, the latter being where the ramifications are likely to be longer-lasting. While the dramatic levels of fiscal and monetary stimulus being deployed to help ease the situation and steady the system have been welcomed by the markets, our concerns about high levels of corporate and government leverage will likely only be heightened coming out of the crisis. Still, valuations have reached extreme levels in many areas, including those which should be less susceptible to economic disruption, and we are constructively adding to certain positions and purchasing some new ones, planning to be more aggressive if markets decline further. At this point, avoiding a significant global recession is unlikely, but many asset prices are now clearly reflecting that reality. Ultimately, we believe this is a health crisis, not a financial one, and are hopeful it will be as short-lived as possible.
 
Jacob Internet Fund
 
The Jacob Internet Fund was up 0.03% for the fiscal period ended February 29, 2020, while the NASDAQ rose 8.22%.
 
As reflected in the performance numbers, we had decidedly mixed results across the entire portfolio. Our best performing name, not surprisingly, was Teledoc, up over 115% in the period. A provider of video telehealth services, Teledoc not only has benefitted from the necessity of stay-at-home advisories, but also from the urging of many government officials to utilize telehealth services if available. Another top performing name was Zillow, up over 62% in the period. While they clearly will not benefit from the reduction of home buying activity, we believe that Zillow, in the midst of a dramatic shift in its business model in which the company actually buys and sells houses as opposed to just assisting brokers, could emerge from this crisis in a much stronger competitive position versus its undercapitalized peers. Another online pioneer, Square, was up over 34% in the period, as the company has successfully broadened its ecosystem for small businesses to much more than just payment processing. Another large position in the Fund’s portfolio, vehicle tracking provider Powerfleet, was up more than 30% for the period. Not only has execution been superb, but its transformational acquisition of Pointer Telelocation has gone smoothly, with expected synergies to come in above initial targets.
 
The worst performing name for the Fund in the period was OptimizeRx, a leading ad tech company that serves the health care industry, down over -49%. A leader in delivering ads and prescription coupons through electronic health record services, OptimizeRx had two customer issues at the end of 2019 that resulted in much lower revenues than previously expected. Since then, its business has rebounded nicely, with early success in signing larger enterprise deals that include such features as patient messaging and compliance. Mitek Systems, down over -28% in the period, was negatively affected by legal issues with former partner USAA that could jeopardize some of its intellectual property for mobile check deposits. The Fund subsequently exited the position and it is no longer a holding. We also saw broad weakness among most of our Chinese holdings, with Sina, Leju and Joyy, down -21%, -5% and -3%, respectively. This was not surprising given that China was the origin and first country affected by the coronavirus pandemic. As of this writing, much of China’s economy is now opening again, and we are still very positive on the prospects of our holdings.
 
Jacob Small Cap Growth Fund
 
The Jacob Small Cap Growth Fund was up 7.51% through February 29, 2020 while the Russell 2000 Growth Index rose 1.37%.
 
Many of the Fund’s holding contributed to this significant outperformance, but there were a handful that stood out for their outsized gains. Although one of our smaller positions, Chemocentryx was up over 571% and was the top performer in the period. Clinical results for their lead drug (Avacopan) showed impressive results for the treatment of ANCA-associated vasculitis. As the current standard of care is steroids, if Avacopan treatment had only been as effective, it
1

would have been deemed a success. The superior results explain the dramatic move in the stock price, as it should quickly replace steroids for treatment of this disease, as well as have potential for further indications. Long-time holding iCAD was up an impressive 95% in the period. The rollout of its new ProFound AI software is exceeding expectations, with the distinct benefits of more accurate, quicker readouts for radiologists. Additionally, its Xoft radiation treatment system, which could be the beneficiary of some potential reimbursement changes in treating breast cancer patients, is showing encouraging results in brain cancer, which could demonstrate the possibility of a much broader market opportunity. Teledoc and Zillow were also holdings in Small Cap over the period, but due to their rise in share price, were sold as they have now exceeded the market cap guidelines for this Fund.
 
The Fund was most negatively affected in the period by our energy and commodity holdings. While individually these positions tended to be small, they are some of the most sensitive to global growth forecasts, and started to significantly underperform as the news from China regarding the coronavirus became more dire. Besides OptimizeRx, the next-worst-performing holding was oil driller Callon Petroleum, down over -44% in the period. Following its merger with Carrizo Oil & Gas, energy prices dropped precipitously, leaving investors questioning its ability to finance future operations. Although it is possible that Callon will be able to weather these prices in the short term, the company may have to undergo a restructuring that will severely impact the equity, so we exited the position. Arch Coal, another victim of lower commodity prices, saw its share price drop over -33% in the period. However, Arch Coal has modest debt, decent free cash flow and significant working capital which distinguishes it from its peers. Mining company Nexa Resources, down over -21% in the period, was also negatively affected by lower zinc prices resulting from lower global demand. Like Arch, Nexa also benefits from a strong balance sheet and cash generation, so we believe they will be able to withstand an extended low pricing environment.
 
Jacob Micro Cap Growth Fund
 
The Jacob Micro Cap Growth Fund performed a bit better than its benchmark, up 7.21% for the fiscal period ended February 29, 2020, while the Russell Micro Cap Growth Index rose 7.01%.
 
We have been relatively pleased that the fund has continued its recent track record of outpacing its benchmark and our direct group of fund peers. Two names that have already been mentioned in this letter – Chemocentryx and iCAD – drove a large portion of the outperformance. We have trimmed both positions but are still very upbeat about the prospects for both companies.
 
Health care companies in general continued to more than pull their weight in our fund, with a number of names in the sector making up our top performers. Diamedica Therapeutics is testing a synthetic protein (KLK1) that could help treat patients in a variety of potential indications, and should have important Phase 2 data from their ischemic stroke trial released in the near future. The stock was up nearly 52% in the period on news it started enrollment in its Phase 2 chronic kidney disease trial as well. Neubase Therapeutics, up over 50% in the period, is an exciting early-stage company focused on getting antisense oligonucleotide compounds developed from its proprietary platform into the clinic, which will hopefully happen by the middle of next year. The company recently released intriguing preclinical data in non-human primates.
 
Other names that contributed positively for the fund were: Habit Restaurants, a higher-end burger chain located mostly in California, which saw a 59% gain, thanks largely due to an acquisition of the company by Yum! Brands; new holding Mamamancini’s, a New Jersey-based food manufacturer, up 60% for the period on news that it would soon be launching a line of its meatballs using plant-based Beyond Meat; and Aspen Aerogels, whose proprietary insulation may have potential use in lithium car batteries. Habit is out of the fund as the acquisition has closed, and we have trimmed Aspen significantly due to concerns about its core energy market.
 
Consumer discretionary made up the largest number of names dotting the Fund’s worst performers for the period. Fortunately, most of them, like soft drink maker Reed’s, down 56% and hotel chain Red Lion, down 42%, were very small positions for the fund. While we still believe in the brands, we have exited both stocks, in addition to our worst performer, women’s fashion chain RTW Retailwinds, down 72% during the period, out of concerns that the environment will likely remain challenged for them for the foreseeable future.
2

Given our concerns about the economy, we remain extremely cautious about investing in companies with overleveraged balance sheets and weak or negative cash flows, which unfortunately are fairly common in our microcap universe.  The goal will be to remain more concentrated in companies that enjoy capable and battle-tested management teams and will either be relatively insulated from broad economic weakness, or have enough financial resources to weather these turbulent conditions.
 
As always, we believe that staying true to our investment philosophy and process is still key to obtaining the best possible long-term investment performance for our shareholders.  Thank you again for your continued confidence and trust. Please stay safe in these difficult times.
 
Ryan Jacob
Chairman and Chief Investment Officer
Portfolio Manager
 
Frank Alexander
Portfolio Manager
 
Darren Chervitz
Portfolio Manager

Past performance is not a guarantee of future results.
 
Performance data reflects fee waivers and in the absence of these waivers performance would be reduced.
 
Diversification does not assure a profit or protect against a loss in a declining market.
 
Must be accompanied or preceded by a prospectus.
 
The opinions expressed above are those of the portfolio manager and are subject to change at any time. Forecasts cannot be guaranteed and should not be considered investment advice.
 
Mutual fund investing involves risk; loss of principal is possible. The Funds invest in foreign securities which involve greater volatility and political, economic and currency risks and differences in accounting methods. These risks are greater in emerging markets. Growth stocks typically are more volatile than value stocks; however, value stocks have a lower expected growth rate in earnings and sales. There are more specific risks inherent in investing in the internet area, particularly with respect to smaller capitalized companies and the high volatility of internet stocks. The Funds can invest in small-and mid-cap securities which involve additional risks such as limited liquidity and greater volatility. Investments in micro capitalization companies may involve greater risks, as these companies tend to have limited product lines, markets and financial or managerial resources. Micro cap stocks often also have a more limited trading market, such that the Adviser may not be able to sell stocks at an optimal time or price. In addition, less frequently-traded securities may be subject to more abrupt price movements than securities of larger capitalized companies. Investments in debt securities typically decrease in value when interest rates rise. This risk is usually greater for longer term debt securities.
 
Fund holdings are subject to change and should not be construed as a recommendation to buy or sell any security. Current and future portfolio holdings are subject to risk.
 
Please refer to the schedules of investments for complete Fund holdings information.
 
The NASDAQ Composite Index is a market capitalization weighted index that is designed to represent performance of the National Market System which includes over 5,000 stocks traded only over-the-counter and not on an exchange. The Russell 2000 Growth Index measures the performance of the small cap growth segment of the U.S. equity universe. It includes those Russell 2000 companies with higher price-to-book ratios and higher forecasted growth values. The Russell Microcap Growth Index measures the performance of the microcap growth segment of the U.S. equity market. It includes those Russell Microcap Index companies with higher price-to-book ratios and higher forecasted growth values.  The S&P 500 is a market capitalization-weighted index of 500 large-capitalization stocks commonly used to represent the U.S. equity market.  Cash flow measures the cash generating capability of a company by adding non-cash charges (e.g. depreciation) and interest expense to pretax income.  It is not possible to invest directly in an index.
 
The Funds are distributed by Quasar Distributors, LLC.
3

JACOB INTERNET FUND
INDUSTRY BREAKDOWN AS OF FEBRUARY 29, 2020
(as a percentage of total investments)
(Unaudited)


4

JACOB SMALL CAP GROWTH FUND
INDUSTRY BREAKDOWN AS OF FEBRUARY 29, 2020
(as a percentage of total investments)
(Unaudited)


5

JACOB MICRO CAP GROWTH FUND
INDUSTRY BREAKDOWN AS OF FEBRUARY 29, 2020
(as a percentage of total investments)
(Unaudited)


6

JACOB INTERNET FUND
SCHEDULE OF INVESTMENTS(+)
February 29, 2020 (Unaudited)

Shares
                 
Value
 
   
COMMON STOCKS
         
100.1
%
     
   
Blank Checks
   
1.5
%
             
 
44,300
 
Diamond Eagle Acquisition Corp.—Class A*
                 
$
709,686
 
     
Business Services
   
13.8
%
               
 
26,400
 
JOYY, Inc.—ADR*^
                   
1,424,808
 
 
193,674
 
OptimizeRx Corp.*
                   
1,617,178
 
 
12,000
 
PayPal Holdings, Inc.*
                   
1,295,880
 
 
37,975
 
Zillow Group, Inc.—Class C*
                   
2,119,385
 
                           
6,457,251
 
     
Calculating and Accounting
                       
     
  Machines (No Electronic Computers)
   
5.1
%
               
 
285,700
 
USA Technologies, Inc.*
                   
2,385,595
 
     
Catalog & Mail—Order Houses
   
2.1
%
               
 
4,800
 
Alibaba Group Holding Ltd.—ADR*^
                   
998,400
 
     
Communications Equipment
   
4.1
%
               
 
271,740
 
Powerfleet, Inc.*
                   
1,915,767
 
     
Computer Peripheral Equipment
   
4.3
%
               
 
198,911
 
Immersion Corp.*
                   
1,390,388
 
 
19,400
 
Impinj, Inc.*
                   
596,550
 
                           
1,986,938
 
     
Computer Programing and Data Processing
   
20.7
%
               
 
2,000
 
Alphabet, Inc.—Class C*
                   
2,678,660
 
 
6,800
 
Facebook, Inc.—Class A*
                   
1,308,796
 
 
9,300
 
MongoDB, Inc.—Class A*
                   
1,418,250
 
 
25,500
 
SVMK, Inc.*
                   
464,865
 
 
30,000
 
Tencent Holdings Ltd. (HK) (a)
                   
1,521,141
 
 
69,317
 
Twitter, Inc.*
                   
2,301,324
 
                           
9,693,036
 
     
Direct Mail Advertising Services
   
2.3
%
               
 
95,617
 
SharpSpring, Inc.*
                   
1,090,034
 
     
Electronic Computers
   
1.3
%
               
 
2,300
 
Apple, Inc.
                   
628,728
 
     
Offices & Clinics of Doctors of Medicine
   
0.9
%
               
 
3,500
 
Teladoc Health, Inc.*
                   
437,360
 
     
Patent Owners and Lessors
   
6.0
%
               
 
457,096
 
Digital Turbine, Inc.*
                   
2,801,998
 

The accompanying notes are an integral part of these financial statements.
7

JACOB INTERNET FUND
SCHEDULE OF INVESTMENTS(+) (Continued)
February 29, 2020 (Unaudited)

Shares
                 
Value
 
   
COMMON STOCKS—(Continued)
         
100.1
%
     
   
Personal Services
   
3.6
%
             
 
54,000
 
Yelp, Inc.—Class A*
                 
$
1,688,580
 
     
Prepackaged Software
   
21.7
%
               
 
112,299
 
Inspired Entertainment, Inc.*
                   
583,955
 
 
5,400
 
Paylocity Holding Corp.*
                   
699,408
 
 
37,760
 
SINA Corp.*^
                   
1,236,640
 
 
34,000
 
Square, Inc.—Class A*
                   
2,833,220
 
 
17,700
 
Tabula Rasa HealthCare, Inc.*
                   
994,209
 
 
33,800
 
Twilio, Inc.—Class A*
                   
3,807,232
 
                           
10,154,664
 
     
Radio, Television, and Publishers’ Advertising Representatives
   
4.1
%
               
 
127,600
 
Yext, Inc.*
                   
1,934,416
 
     
Real Estate
   
0.6
%
               
 
159,681
 
Leju Holdings Ltd.—ADR*^
                   
287,442
 
     
Savings Institutions, Federally Chartered
   
3.6
%
               
 
36,585
 
E*TRADE Financial Corp.
                   
1,674,861
 
     
Semiconductors and Related Devices
   
2.1
%
               
 
35,400
 
CEVA, Inc.*
                   
1,005,714
 
     
State Commercial Banks
   
2.3
%
               
 
44,840
 
First Internet Bancorp
                   
1,089,164
 
     
TOTAL COMMON STOCKS (Cost $29,304,238)
                   
46,939,634
 
                               
     
MONEY MARKET FUND
           
0.5
%
       
     
Money Market Fund
   
0.5
%
               
 
237,424
 
First American Government Obligations Fund—Class X, 1.49% (b)
                   
237,424
 
     
TOTAL MONEY MARKET FUND (Cost $237,424)
                   
237,424
 
     
TOTAL INVESTMENTS (Cost $29,541,662)—100.6%
                   
47,177,058
 
     
LIABILITIES IN EXCESS OF OTHER ASSETS—(0.6)%
                   
(289,735
)
     
TOTAL NET ASSETS—100.0%
                 
$
46,887,323
 

*
Non Income Producing.
^
U.S. Dollar-denominated foreign security.
(a)
Level 2 Security. See Note 2.
(b)
7-day yield.
ADR
American Depository Receipt.
(HK)
Security denominated in Hong Kong dollars.  Value translated into U.S. dollars.
(+)
Schedule of Investment is classified using the U.S. Securities and Exchange Commission’s Standard Industrial Classification (SIC) Code List.

The accompanying notes are an integral part of these financial statements.
8

JACOB SMALL CAP GROWTH FUND
SCHEDULE OF INVESTMENTS(+)
February 29, 2020 (Unaudited)

Shares
                 
Value
 
   
COMMON STOCKS
         
100.0
%
     
   
Biological Products, (No Diagnostic Substances)
   
3.6
%
             
 
15,600
 
Aerie Pharmaceuticals, Inc.*
                 
$
273,000
 
 
1,800
 
Krystal Biotech, Inc.*
                   
96,210
 
 
8,400
 
Mesoblast Ltd.—ADR*^
                   
59,556
 
 
17,000
 
Precision BioSciences, Inc.*
                   
136,170
 
                           
564,936
 
     
Bituminous Coal and Lignite Surface Mining
   
2.4
%
               
 
7,400
 
Arch Coal, Inc.—Class A
                   
372,590
 
     
Blank Checks
   
1.6
%
               
 
15,700
 
Diamond Eagle Acquisition Corp.—Class A*
                   
251,514
 
     
Business Services
   
6.6
%
               
 
8,800
 
JOYY, Inc.—ADR*^
                   
474,936
 
 
66,600
 
OptimizeRx Corp.*
                   
556,110
 
                           
1,031,046
 
     
Calculating and Accounting
                       
     
  Machines (No Electronic Computers)
   
5.2
%
               
 
97,900
 
USA Technologies, Inc.*
                   
817,465
 
     
Chemical and Fertilizer Mineral Mining
   
1.9
%
               
 
39,200
 
Nexa Resources SA^
                   
287,728
 
     
Computer Peripheral Equipment
   
4.4
%
               
 
68,700
 
Immersion Corp.*
                   
480,213
 
 
6,900
 
Impinj, Inc.*
                   
212,175
 
                           
692,388
 
     
Computer Programming & Data Processing
   
3.9
%
               
 
3,000
 
MongoDB, Inc.—Class A*
                   
457,500
 
 
8,500
 
SVMK, Inc.*
                   
154,955
 
                           
612,455
 
     
Crude Petroleum and Natural Gas
   
1.8
%
               
 
75,000
 
Callon Petroleum Co.*
                   
170,250
 
 
80,000
 
Ring Energy, Inc.*
                   
112,800
 
                           
283,050
 
     
Eating Places
   
2.2
%
               
 
10,400
 
BJ’s Restaurants, Inc.
                   
342,680
 
     
Family Clothing Stores
   
4.2
%
               
 
40,000
 
American Eagle Outfitters, Inc.
                   
515,200
 

The accompanying notes are an integral part of these financial statements.
9

JACOB SMALL CAP GROWTH FUND
SCHEDULE OF INVESTMENTS(+) (Continued)
February 29, 2020 (Unaudited)

Shares
                 
Value
 
   
COMMON STOCKS—(Continued)
         
100.0
%
     
   
Family Clothing Stores—(Continued)
   
4.2
%
             
 
6,000
 
Urban Outfitters, Inc.*
                 
$
141,060
 
                           
656,260
 
     
Industrial Organic Chemicals
   
4.2
%
               
 
57,046
 
Codexis, Inc.*
                   
664,586
 
     
Medical Laboratories
   
0.8
%
               
 
5,167
 
CareDx, Inc.*
                   
120,443
 
     
Miscellaneous Business Services
   
2.7
%
               
 
7,800
 
NV5 Global, Inc.*
                   
417,534
 
     
Offices & Clinics of Doctors of Medicine
   
1.0
%
               
 
1,200
 
Teladoc Health, Inc.*
                   
149,952
 
     
Patent Owners & Lessors
   
4.4
%
               
 
112,500
 
Digital Turbine, Inc.*
                   
689,625
 
     
Personal Services
   
3.6
%
               
 
18,000
 
Yelp, Inc.—Class A*
                   
562,860
 
     
Pharmaceutical Preparations
   
11.1
%
               
 
4,600
 
Apellis Pharmaceuticals, Inc.*
                   
159,252
 
 
10,000
 
ChemoCentryx, Inc.*
                   
447,500
 
 
11,834
 
Esperion Therapeutics, Inc.*
                   
597,499
 
 
31,500
 
Harrow Health, Inc.*
                   
173,880
 
 
50,000
 
NeuBase Therapeutics, Inc.*
                   
357,000
 
                           
1,735,131
 
     
Prepackaged Software
   
7.7
%
               
 
39,600
 
Inspired Entertainment, Inc.*
                   
205,920
 
 
1,800
 
Paylocity Holding Corp.*
                   
233,136
 
 
13,000
 
SINA Corp.*^
                   
425,750
 
 
6,000
 
Tabula Rasa HealthCare, Inc.*
                   
337,020
 
                           
1,201,826
 
     
Radio, Television, and Publishers’ Advertising Representatives
   
4.2
%
               
 
43,400
 
Yext, Inc.*
                   
657,944
 
     
Real Estate
   
3.2
%
               
 
95,800
 
Leju Holdings Ltd.—ADR*^
                   
172,450
 
 
17,670
 
Rafael Holdings, Inc.—Class B*
                   
331,489
 
                           
503,939
 

The accompanying notes are an integral part of these financial statements.
10

JACOB SMALL CAP GROWTH FUND
SCHEDULE OF INVESTMENTS(+) (Continued)
February 29, 2020 (Unaudited)

Shares
                 
Value
 
   
COMMON STOCKS—(Continued)
         
100.0
%
     
   
Savings Institutions, Not Federally Chartered
   
0.8
%
             
 
8,070
 
First Northwest Bancorp
                 
$
128,474
 
     
Semiconductors and Related Devices
   
2.1
%
               
 
11,800
 
CEVA, Inc.*
                   
335,238
 
     
State Commercial Banks
   
2.4
%
               
 
15,470
 
First Internet Bancorp
                   
375,766
 
     
Surgical and Medical Instruments and Apparatus
   
14.0
%
               
 
144,800
 
Alphatec Holdings, Inc.*
                   
847,080
 
 
90,000
 
iCAD, Inc.*
                   
1,198,800
 
 
6,200
 
Intersect ENT, Inc.*
                   
147,932
 
                           
2,193,812
 
     
TOTAL COMMON STOCKS (Cost $13,548,121)
                   
15,649,242
 
                               



WARRANTS




   
0.0
%  


 
12,750
 
TearLab Corp.*(a)
                   
 
     
TOTAL WARRANTS (Cost $0)
                   
 
                               
     
MONEY MARKET FUND
           
0.2
%
       
     
Money Market Fund
   
0.2
%
               
 
36,270
 
First American Government Obligations Fund—Class X, 1.49% (b)
                   
36,270
 
     
TOTAL MONEY MARKET FUND (Cost $36,270)
                   
36,270
 
     
TOTAL INVESTMENTS (Cost $13,584,391)—100.2%
                   
15,685,512
 
     
LIABILITIES IN EXCESS OF OTHER ASSETS—(0.2)%
                   
(29,947
)
     
TOTAL NET ASSETS—100.0%
                 
$
15,655,565
 

*
Non Income Producing.
^
U.S. Dollar-denominated foreign security.
(a)
Level 3 Security. See Note 2.
(b)
7-day yield.
ADR
American Depository Receipt.
(+)
Schedule of Investment is classified using the U.S. Securities and Exchange Commission’s
 
Standard Industrial Classification (SIC) Code List.

The accompanying notes are an integral part of these financial statements.
11

JACOB MICRO CAP GROWTH FUND
SCHEDULE OF INVESTMENTS(+)
February 29, 2020 (Unaudited)

Shares
                 
Value
 
   
COMMON STOCKS
         
97.5
%
     
   
Advertising
   
0.5
%
             
 
297,428
 
IZEA Worldwide, Inc.*
                 
$
73,019
 
     
Apparel and Accessory Stores
   
1.8
%
               
 
162,000
 
RTW RetailWinds, Inc.*
                   
45,376
 
 
33,800
 
Tilly’s, Inc.—Class A
                   
219,700
 
                           
265,076
 
     
Biological Products, (No Diagnostic Substances)
   
3.7
%
               
 
50,000
 
IMV, Inc.*^
                   
110,000
 
 
5,900
 
Krystal Biotech, Inc.*
                   
315,355
 
 
15,000
 
Precision BioSciences, Inc.*
                   
120,150
 
                           
545,505
 
     
Bottled & Canned Soft Drinks & Carbonated Waters
   
0.2
%
               
 
40,000
 
Reed’s, Inc.*
                   
32,520
 
     
Business Services
   
4.5
%
               
 
64,793
 
OptimizeRx Corp.*
                   
541,022
 
 
300,000
 
Score Media and Gaming, Inc.—(CAD)*
                   
127,398
 
                           
668,420
 
     
Calculating and Accounting
                       
     
  Machines (No Electronic Computers)
   
5.5
%
               
 
97,000
 
USA Technologies, Inc.*
                   
809,950
 
     
Communications Equipment
   
5.1
%
               
 
107,599
 
Powerfleet, Inc.*
                   
758,573
 
     
Computer & Office Equipment
   
2.1
%
               
 
21,000
 
IntriCon Corp.*
                   
312,480
 
     
Computer Communications Equipment
   
2.2
%
               
 
100,879
 
Lantronix, Inc.*
                   
325,839
 
     
Computer Peripheral Equipment
   
6.6
%
               
 
64,000
 
Identiv, Inc.*
                   
293,120
 
 
68,174
 
Immersion Corp.*
                   
476,536
 
 
6,500
 
Impinj, Inc.*
                   
199,875
 
                           
969,531
 
     
Direct Mail Advertising Services
   
2.3
%
               
 
29,915
 
SharpSpring, Inc.*
                   
341,031
 

The accompanying notes are an integral part of these financial statements.
12

JACOB MICRO CAP GROWTH FUND
SCHEDULE OF INVESTMENTS(+) (Continued)
February 29, 2020 (Unaudited)

Shares
                 
Value
 
   
COMMON STOCKS—(Continued)
         
97.5
%
     
   
Eating Places
   
5.0
%
             
 
9,500
 
BJ’s Restaurants, Inc.
                 
$
313,025
 
 
30,000
 
The Habit Restaurants, Inc.—Class A*
                   
418,800
 
                           
731,825
 
     
Gold and Silver Ores
   
0.8
%
               
 
440,000
 
Solitario Zinc Corp.*
                   
124,300
 
     
Hobby, Toy & Game Shops
   
3.2
%
               
 
123,000
 
Build-A-Bear Workshop, Inc.*
                   
468,630
 
     
Industrial Organic Chemicals
   
4.2
%
               
 
53,006
 
Codexis, Inc.*
                   
617,520
 
     
Lumber and Other Construction Materials
   
1.9
%
               
 
36,000
 
Aspen Aerogels, Inc.*
                   
286,200
 
     
Management Consulting Services
   
1.4
%
               
 
110,000
 
Medicine Man Technologies, Inc.*
                   
206,800
 
     
Medical Laboratories
   
0.8
%
               
 
5,033
 
CareDx, Inc.*
                   
117,319
 
     
Medicinal Chemicals and Botanical Products
   
0.6
%
               
 
22,000
 
ChromaDex Corp.*
                   
81,180
 
     
Mining & Quarrying of Nonmetallic Mineral (No Fuels)
   
1.1
%
               
 
160,000
 
Azimut Exploration, Inc.*^
                   
160,000
 
     
Patent Owners and Lessors
   
4.6
%
               
 
111,300
 
Digital Turbine, Inc.*
                   
682,269
 
     
Pharmaceutical Preparations
   
13.2
%
               
 
17,000
 
Arcturus Therapeutics Holdings, Inc.*
                   
235,450
 
 
165,000
 
Athersys, Inc.*
                   
198,000
 
 
9,700
 
ChemoCentryx, Inc.*
                   
434,075
 
 
55,000
 
DiaMedica Therapeutics, Inc.*
                   
248,600
 
 
5,500
 
Esperion Therapeutics, Inc.*
                   
277,695
 
 
25,889
 
Harrow Health, Inc.*
                   
142,907
 
 
40,500
 
NeuBase Therapeutics, Inc.*
                   
289,170
 
 
11,200
 
Omeros Corp.*
                   
133,392
 
                           
1,959,289
 

The accompanying notes are an integral part of these financial statements.
13

JACOB MICRO CAP GROWTH FUND
SCHEDULE OF INVESTMENTS(+) (Continued)
February 29, 2020 (Unaudited)

Shares
                 
Value
 
   
COMMON STOCKS—(Continued)
         
97.5
%
     
   
Prepackaged Software
   
2.2
%
             
 
37,900
 
Inspired Entertainment, Inc.*
                 
$
197,080
 
 
75,000
 
Qumu Corp.*
                   
126,750
 
                           
323,830
 
     
Real Estate
   
3.7
%
               
 
136,619
 
Leju Holdings Ltd.—ADR*^
                   
245,928
 
 
16,130
 
Rafael Holdings, Inc.—Class B*
                   
302,599
 
                           
548,527
 
     
Sausages & Other Prepared Meal Products
   
1.1
%
               
 
131,600
 
MamaMancini’s Holdings, Inc.*
                   
164,500
 
     
Savings Institutions, Not Federally Chartered
   
0.8
%
               
 
7,338
 
First Northwest Bancorp
                   
116,821
 
     
Semiconductors and Related Devices
   
2.5
%
               
 
10,940
 
CEVA, Inc.*
                   
310,806
 
 
160,000
 
Netlist, Inc.*
                   
51,920
 
                           
362,726
 
     
State Commercial Banks
   
2.4
%
               
 
14,615
 
First Internet Bancorp
                   
354,998
 
     
Surgical and Medical Instruments and Apparatus
   
13.5
%
               
 
105,500
 
Alphatec Holdings, Inc.*
                   
617,175
 
 
93,160
 
iCAD, Inc.*
                   
1,240,891
 
 
6,000
 
Intersect ENT, Inc.*
                   
143,160
 
                           
2,001,226
 
     
TOTAL COMMON STOCKS (Cost $12,012,050)
                   
14,409,904
 
                               
     
WARRANTS
           
0.0
%
       
 
9,750
 
TearLab Corp.*(a)
                   
 
     
TOTAL WARRANTS (Cost $0)
                   
 

The accompanying notes are an integral part of these financial statements.
14

JACOB MICRO CAP GROWTH FUND
SCHEDULE OF INVESTMENTS(+) (Continued)
February 29, 2020 (Unaudited)

Shares
                 
Value
 
   
MONEY MARKET FUND
         
6.5
%
     
   
Money Market Fund
   
6.5
%
             
 
964,100
 
First American Government Obligations Fund—Class X, 1.49% (b)
                 
$
964,100
 
     
TOTAL MONEY MARKET FUND (Cost $964,100)
                   
964,100
 
     
TOTAL INVESTMENTS (Cost $12,976,150)—104.0%
                   
15,374,004
 
     
LIABILITIES IN EXCESS OF OTHER ASSETS—(4.0)%
                   
(589,344
)
     
TOTAL NET ASSETS—100.0%
                 
$
14,784,660
 

*
Non Income Producing.
^
U.S. Dollar-denominated foreign security.
(a)
Level 3 Security. See Note 2.
(b)
7-day yield.
ADR
American Depository Receipt.
(CAD)
Security denominated in Canadian dollars. Value translated into U.S. Dollars.
(+)
Schedule of Investment is classified using the U.S. Securities and Exchange Commission’s Standard Industrial Classification (SIC) Code List.

The accompanying notes are an integral part of these financial statements.
15

JACOB FUNDS INC.
STATEMENTS OF ASSETS AND LIABILITIES
February 29, 2020 (Unaudited)
         
Jacob
   
Jacob
 
   
Jacob
   
Small Cap
   
Micro Cap
 
   
Internet Fund
   
Growth Fund
   
Growth Fund
 
Assets:
                 
Investments, at value (cost $29,541,662, $13,584,391 and
                 
  $12,976,150, respectively)
 
$
47,177,058
   
$
15,685,512
   
$
15,374,004
 
Receivable for capital shares sold
   
12,816
     
     
1,288
 
Receivable for investments sold
   
376,904
     
245,988
     
104,672
 
Dividend and interest receivable
   
6,674
     
474
     
1,363
 
Prepaid expenses and other assets
   
17,089
     
21,490
     
22,407
 
Total Assets
   
47,590,541
     
15,953,464
     
15,503,734
 
                         
Liabilities:
                       
Payable for securities purchased
   
459,852
     
248,071
     
224,489
 
Payable for capital shares repurchased
   
102,387
     
     
454,387
 
Payable for investment adviser fees
   
50,290
     
5,849
     
6,562
 
Payable for distribution and shareholder
                       
  servicing expenses – Investor Class (See Note 7)
   
7,838
     
1,176
     
13
 
Accrued audit fees
   
7,957
     
7,957
     
7,957
 
Accrued directors fees
   
15,352
     
3,664
     
2,572
 
Accrued expenses and other liabilities
   
59,542
     
31,182
     
23,094
 
Total Liabilities
   
703,218
     
297,899
     
719,074
 
Net Assets
 
$
46,887,323
   
$
15,655,565
   
$
14,784,660
 
                         
Net Assets Consist Of:
                       
Capital Stock
 
$
27,787,778
   
$
12,535,009
   
$
11,957,652
 
Total distributable earnings
   
19,099,545
     
3,120,556
     
2,827,008
 
Total Net Assets
 
$
46,887,323
   
$
15,655,565
   
$
14,784,660
 
                         
Institutional Class(1)
                       
Net Assets
 
$
   
$
11,166,213
   
$
10,650,934
 
Shares outstanding (20 billion shares of $0.001 par value authorized)
   
     
445,324
     
515,388
 
Net asset value, redemption price and offering price per share(2)
 
$
   
$
25.07
   
$
20.67
 
Investor Class
                       
Net Assets
 
$
46,887,323
   
$
4,489,352
   
$
4,133,726
 
Shares outstanding (20 billion shares of $0.001 par value authorized)
   
10,152,024
     
182,699
     
218,835
 
Net asset value, redemption price and offering price per share(2)
 
$
4.62
   
$
24.57
   
$
18.89
 
_______________
 
(1)
The Internet Fund currently offers Investor Class shares only. See Note 1.
(2)
Redemption of shares held less than 30 days may be charged a 2% redemption fee. See Note 3.

The accompanying notes are an integral part of these financial statements.
16

JACOB FUNDS INC.
STATEMENTS OF OPERATIONS
For the Six Months Ended February 29, 2020 (Unaudited)
         
Jacob
   
Jacob
 
   
Jacob
   
Small Cap
   
Micro Cap
 
   
Internet Fund
   
Growth Fund
   
Growth Fund
 
Investment Income:
                 
Dividend income
 
$
18,753
   
$
16,293
   
$
34,498
 
Interest income
   
6,377
     
733
     
5,907
 
Total Investment Income
   
25,130
     
17,026
     
40,405
 
                         
Expenses:
                       
Investment advisor fees
   
298,358
     
64,226
     
79,504
 
Distribution and shareholder servicing expenses – Investor Class (See Note 7)
   
59,672
     
5,876
     
5,092
 
Administration fees
   
30,576
     
20,711
     
19,764
 
Fund accounting fees
   
14,383
     
17,326
     
17,590
 
Transfer agent fees
   
60,055
     
33,497
     
30,534
 
Custody fees
   
3,498
     
3,708
     
3,663
 
Federal and state registration
   
11,806
     
17,323
     
18,192
 
Insurance expense
   
5,052
     
1,902
     
1,272
 
Audit fees
   
7,957
     
7,957
     
7,957
 
Legal fees
   
71,642
     
12,287
     
10,118
 
Printing and mailing of reports to shareholders
   
9,707
     
3,907
     
2,760
 
Directors’ fees
   
31,900
     
9,109
     
8,579
 
Miscellaneous expenses
   
8,077
     
2,839
     
2,605
 
Total Expenses
   
612,683
     
200,668
     
207,630
 
Expense Waiver (See Note 6)
   
     
(37,065
)
   
(56,968
)
Net Expenses
   
612,683
     
163,603
     
150,662
 
Net Investment Loss
   
(587,553
)
   
(146,577
)
   
(110,257
)
                         
Realized and Unrealized Gain on Investments:
                       
Net realized gain on investments
   
4,637,287
     
2,063,206
     
1,035,368
 
Change in net unrealized appreciation/depreciation on investments
   
(4,050,112
)
   
(740,548
)
   
(93,468
)
Net realized and unrealized gain on investments
   
587,175
     
1,322,658
     
941,900
 
Net Increase (Decrease) in Net Assets Resulting from Operations
 
$
(378
)
 
$
1,176,081
   
$
831,643
 

The accompanying notes are an integral part of these financial statements.
17

JACOB FUNDS INC.
JACOB INTERNET FUND
STATEMENTS OF CHANGES IN NET ASSETS
   
Six Months Ended
       
   
February 29, 2020
   
Year Ended
 
   
(Unaudited)
   
August 31, 2019
 
Operations:
           
Net investment loss
 
$
(587,553
)
 
$
(1,002,420
)
Net realized gain on investment transactions
   
4,637,287
     
7,290,117
 
Change in net unrealized appreciation/depreciation on investments
   
(4,050,112
)
   
(4,335,824
)
Net increase (decrease) in net assets resulting from operations
   
(378
)
   
1,951,873
 
                 
Distributions to Shareholders:
               
Net dividends and distributions to shareholders
   
(5,360,215
)
   
(3,389,843
)
                 
Capital Share Transactions: (Note 3)
               
Proceeds from shares sold
   
574,432
     
2,687,576
 
Proceeds from reinvestment of distribution
   
5,136,769
     
3,286,016
 
Cost of shares redeemed
   
(3,228,942
)
   
(6,012,187
)
Redemption fees
   
118
     
1,640
 
Net increase (decrease) in net assets resulting from capital share transactions
   
2,482,377
     
(36,955
)
                 
Net Decrease in Net Assets
   
(2,878,216
)
   
(1,474,925
)
Net Assets:
               
Beginning of period/year
   
49,765,539
     
51,240,464
 
End of period/year
 
$
46,887,323
   
$
49,765,539
 

The accompanying notes are an integral part of these financial statements.
18

JACOB FUNDS INC.
JACOB SMALL CAP GROWTH FUND
STATEMENTS OF CHANGES IN NET ASSETS
   
Six Months Ended
       
   
February 29, 2020
   
Year Ended
 
   
(Unaudited)
   
August 31, 2019
 
Operations:
           
Net investment loss
 
$
(146,577
)
 
$
(291,082
)
Net realized gain on investment transactions
   
2,063,206
     
1,534,426
 
Change in net unrealized appreciation/depreciation on investments
   
(740,548
)
   
(4,650,575
)
Net increase (decrease) in net assets resulting from operations
   
1,176,081
     
(3,407,231
)
                 
Distributions to Shareholders:
               
Net dividends and distributions to shareholders
   
(421,908
)
   
(185,341
)
                 
Capital Share Transactions: (Note 3)
               
Proceeds from shares sold
   
101,129
     
2,020,659
 
Proceeds from reinvestment of distribution
   
409,749
     
180,320
 
Cost of shares redeemed
   
(972,949
)
   
(4,284,941
)
Redemption fees
   
     
3,377
 
Net decrease in net assets resulting from capital share transactions
   
(462,071
)
   
(2,080,585
)
                 
Net Increase (Decrease) in Net Assets
   
292,102
     
(5,673,157
)
Net Assets:
               
Beginning of period/year
   
15,363,463
     
21,036,620
 
End of period/year
 
$
15,655,565
   
$
15,363,463
 

The accompanying notes are an integral part of these financial statements.
19

JACOB FUNDS INC.
JACOB MICRO CAP GROWTH FUND
STATEMENTS OF CHANGES IN NET ASSETS
   
Six Months Ended
       
   
February 29, 2020
   
Year Ended
 
   
(Unaudited)
   
August 31, 2019
 
Operations:
           
Net investment loss
 
$
(110,257
)
 
$
(208,054
)
Net realized gain on investment transactions
   
1,035,368
     
1,469,686
 
Change in net unrealized appreciation/depreciation on investments
   
(93,468
)
   
(771,840
)
Net increase in net assets resulting from operations
   
831,643
     
489,792
 
                 
Capital Share Transactions: (Note 3)
               
Proceeds from shares sold
   
2,487,985
     
4,766,646
 
Cost of shares redeemed
   
(2,631,778
)
   
(3,118,002
)
Redemption fees
   
2,802
     
3,235
 
Net increase (decrease) in net assets resulting from capital share transactions
   
(140,991
)
   
1,651,879
 
                 
Net Increase in Net Assets
   
690,652
     
2,141,671
 
Net Assets:
               
Beginning of period/year
   
14,094,008
     
11,952,337
 
End of period/year
 
$
14,784,660
   
$
14,094,008
 

The accompanying notes are an integral part of these financial statements.
20

JACOB FUNDS INC.
JACOB INTERNET FUND – INVESTOR CLASS
FINANCIAL HIGHLIGHTS

The table below sets forth financial data for a share of the Fund outstanding throughout each period/year presented.
 
   
Six Months Ended
   
Year Ended August 31,
 
   
February 29, 2020
   
2019
   
2018
   
2017
   
2016
   
2015
 
   
(Unaudited)
                               
Per Share Data:
                                   
Net asset value, beginning of period/year
 
$
5.22
   
$
5.40
   
$
4.76
   
$
4.39
   
$
3.96
   
$
4.51
 
   
Income (loss) from investment operations:
 
Net investment loss
   
(0.06
)(4)
   
(0.10
)(4)
   
(0.11
)(4)
   
(0.10
)(4)
   
(0.10
)(1)
   
(0.08
)(1)
Net realized and unrealized gain (loss)
                                               
  on investment transactions
   
0.03
     
0.29
     
1.31
     
0.67
     
1.02
     
(0.03
)
Total from investment operations
   
(0.03
)
   
0.19
     
1.20
     
0.57
     
0.92
     
(0.11
)
Less distributions from net realized gains
   
(0.57
)
   
(0.37
)
   
(0.56
)
   
(0.20
)
   
(0.49
)
   
(0.44
)
Paid in capital from redemption fees(2)(5)
   
0.00
     
0.00
     
0.00
     
0.00
     
0.00
     
0.00
 
Net asset value, end of period/year
 
$
4.62
   
$
5.22
   
$
5.40
   
$
4.76
   
$
4.39
   
$
3.96
 
Total return
   
0.03
%(6)
   
4.61
%
   
28.12
%
   
13.65
%
   
25.31
%
   
-2.14
%
                                                 
Supplemental data and ratios:
 
Net assets, end of period/year (in thousands)
 
$
46,887
   
$
49,766
   
$
51,240
   
$
43,606
   
$
43,518
   
$
38,860
 
Ratio of operating expenses
                                               
  to average net assets(3)
   
2.57
%(7)
   
2.32
%
   
2.42
%
   
2.38
%
   
2.60
%
   
2.46
%
Ratio of net investment loss
                                               
  to average net assets(3)
   
(2.46
)%(7)
   
(2.08
)%
   
(2.16
)%
   
(2.15
)%
   
(2.47
)%
   
(1.93
)%
Portfolio turnover rate
   
21
%(6)
   
50
%
   
46
%
   
46
%
   
43
%
   
50
%
_______________
 
(1)
Net investment loss per share is calculated using ending balances prior to consideration of adjustments for permanent book and tax differences.
(2)
Less than $0.01 per share.
(3)
For the period September 1, 2011 through January 2, 2021, the Adviser has contractually agreed to waive its advisory fee in an amount up to an annual rate of 0.10% of the Fund’s average daily net assets, to the extent that the Fund’s gross operating expense ratio exceeds 2.95%, excluding any taxes, interest, brokerage fees, acquired fund fees and expenses, and extraordinary expenses.
(4)
Net investment loss per share represents net investment loss divided by the average shares outstanding throughout the period/year.
(5)
Paid in capital from redemption fees per share represents redemption fees divided by the average shares outstanding throughout the period/year.
(6)
Not annualized
(7)
Annualized.

The accompanying notes are an integral part of these financial statements.
21

JACOB FUNDS INC.
JACOB SMALL CAP GROWTH FUND – INSTITUTIONAL CLASS
FINANCIAL HIGHLIGHTS

The table below sets forth financial data for a share of the Fund outstanding throughout each period/year presented.
 
   
Six Months Ended
   
Year Ended August 31,
 
   
February 29, 2020
   
2019
   
2018
   
2017
   
2016(1)
   
2015
 
   
(Unaudited)
                               
Per Share Data:
                                   
Net asset value, beginning of period/year
 
$
23.91
   
$
28.81
   
$
18.52
   
$
16.82
   
$
18.95
   
$
19.01
 
   
Income (loss) from investment operations:
 
Net investment loss(2)
   
(0.22
)
   
(0.39
)
   
(0.34
)
   
(0.27
)
   
(0.29
)
   
(0.36
)
Net realized and unrealized gain (loss)
                                               
  on investment transactions
   
2.05
     
(4.26
)
   
10.63
     
1.97
     
(1.73
)
   
0.30
(3) 
Total from investment operations
   
1.83
     
(4.65
)
   
10.29
     
1.70
     
(2.02
)
   
(0.06
)
Less distributions from net realized gains
   
(0.67
)
   
(0.25
)
   
     
     
     
 
Less distributions from return of capital
   
     
     
     
     
(0.11
)
   
 
Paid in capital from redemption fees(8)
   
     
     
0.00
(7) 
   
     
     
 
Net asset value, end of period/year
 
$
25.07
   
$
23.91
   
$
28.81
   
$
18.52
   
$
16.82
   
$
18.95
 
Total return
   
7.67
%(9)
   
-16.17
%
   
55.56
%
   
10.11
%(4)
   
-10.64
%(4)
   
-0.32
%
                                                 
Supplemental data and ratios:
 
Net assets, end of period/year (in thousands)
 
$
11,166
   
$
10,825
   
$
14,621
   
$
10,480
   
$
12,012
   
$
9,367
 
Ratio of gross operating expenses
                                               
  (prior to waiver) to average net assets
   
2.43
%(10)
   
2.22
%
   
2.46
%
   
2.59
%
   
2.94
%
   
2.17
%
Ratio of net operating expenses
                                               
  (after waiver) to average net assets(5)
   
1.95
%(10)
   
1.95
%
   
1.95
%
   
1.95
%
   
2.04
%
   
1.95
%
Ratio of net investment loss
                                               
  (prior to waiver) to average net assets
   
(2.22
)%(10)
   
(1.81
)%
   
(2.04
)%
   
(2.19
)%
   
(2.80
)%
   
(2.00
)%
Ratio of net investment loss
                                               
  (after waiver) to average net assets(5)
   
(1.74
)%(10)
   
(1.54
)%
   
(1.53
)%
   
(1.55
)%
   
(1.90
)%
   
(1.78
)%
Portfolio turnover rate(6)
   
43
%(9)
   
88
%
   
81
%
   
60
%
   
58
%
   
84
%
_______________
 
(1)
On August 29, 2016, Investor Class shares of the Jacob Wisdom Fund series of Jacob Funds Inc. were reorganized into Institutional Class Shares of the Small Cap Growth Fund. See Note 8.
(2)
Net investment loss per share represents net investment loss divided by the average shares outstanding throughout the period/year.
(3)
Due to timing of capital share transactions, the per share amount of net realized and unrealized gain on investment transactions varies from the amount shown in the statement of changes in net assets.
(4)
Includes adjustments in accordance with GAAP and, consequently, the net asset values used for financial reporting purposes and the returns based upon those net asset values may differ from the net asset values and returns for the shareholder transactions.
(5)
The Adviser has contractually agreed, effective November 12, 2012 (date of reorganization) through January 2, 2021, to waive up to 100% of its advisory fee to the extent that the Fund’s gross operating expense ratio exceeds 1.95%, excluding any taxes, interest, brokerage fees, acquired fund fees and expenses, and extraordinary expenses.
(6)
Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between classes of shares issued.
(7)
Less than $0.01 per share.
(8)
Paid in capital from redemption fees per share represents redemption fees divided by the average shares outstanding throughout the period/year.
(9)
Not annualized
(10)
Annualized.

The accompanying notes are an integral part of these financial statements.
22

JACOB FUNDS INC.
JACOB SMALL CAP GROWTH FUND – INVESTOR CLASS
FINANCIAL HIGHLIGHTS

The table below sets forth financial data for a share of the Fund outstanding throughout each period/year presented.
 
   
Six Months Ended
   
Year Ended August 31,
 
   
February 29, 2020
   
2019
   
2018
   
2017
   
2016
   
2015
 
   
(Unaudited)
                               
Per Share Data:
                                   
Net asset value, beginning of period/year
 
$
23.48
   
$
28.36
   
$
18.28
   
$
16.66
   
$
18.81
   
$
18.91