My $IOT - Samsara thesis
Samsara is a special place with a truly differentiated platform, culture, and strategy. They have a massive opportunity to capture and they are showing no signs of slowing down. They are a true partner of their customers and their rapid innovation, product cadence, and customer feedback loops coupled with a strong strategy and moat make Samsara a truly exceptional business!

Subscribe at https://www.moderngrowthinvesting.com/samsara/ for a full deep dive!
Samsara - $IOT - Launches Integrated Solution with John Deere - $DE - to Digitize Farming Operations
With this new integration, data from Samsara Vehicle Gateways on support vehicles, including vehicle location, heading, speed, and fuel levels, is available on the John Deere Operations Center™ map, an online farm management system that enables access to farm information anytime


Buy Buy Buy!
Going Long and Longer on some of my high conviction names!


Ask me any questions!
Let me preface this by saying I'm also a $PLTR shareholder and am quite bullish.

After ARK sold out of their position, Brett Winton (research director) mentioned a competitor in the private sector as a key concern. It looks like that competitor may have been a company called Data Walk. Who specifically states they have "Far lower costs than products such as Palantir Gotham" right on their homepage: https://datawalk.com/

One of the reasons for my high conviction in the company has been there (apparent) lack of competition. Does this impact your thesis at all, or do you think the emergence of competitors was inevitable considering the data-driven world we're shifting into?
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$IOT killing it
  • Q4 revenue of $125.8 million, representing 66% year-over-year growth
  • Ending ARR of $558.1 million, representing 64% year-over-year growth
  • 806 customers with ARR over $100,000, up 78% year-over-year

Time to increase my position.

Margin /operating outlook? OCF? I find that’s what I’m really looking to find these days, after the SaaS debacle of 2020-21. Throwing money to grow is ubiquitous…but maintaining & growing margins, showing leverage as you grow, and product cadence is the key to sustainable growth (look at $DDOG and $TEAM for example)
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My Wartime Portfolio: 02/24/22
A few notable changes in the past 3-4 months:
  • $RBLX - New position, I see this as a $100B company
  • $NU - New position, A true gem similar to my $AFRM position
  • $IOT - Disrupting fleets and building an IOT monopoly
  • $WRBY - New position, disrupting the vision industry successfully
  • $BIRD - New position, disrupting the footwear industry
  • $AMPL - Powering Product Led Growth for Modern SaaS Businesses
  • $PLTR - Its a privilege to be a part of Peter Thiel's vision for enterprise software

Ask me any questions you have about any of these, looking to learn and add value to the community!
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Samsara - $IOT Long Pitch
Check out my $IOT Samsara Pitch for @commonstock's The Market Pitching Game!

👇

Huge Thanks to @nathanworden for recording and edits!
"The Market" Stock Pitching Game is Tomorrow!
Tomorrow, Feb. 11th at 12:00pm EST is "The Market" — a stock pitching game with live audience participation held over Zoom.

Sign up to get the Zoom link HERE

Audience members get to ask questions of the contestants and vote to decide the best pitch of the night.

What is the best investment idea of the month? The Market will decide!

We have an awesome lineup of pitchers:

@paulcerro — Sweetgreen $SG
@youngmoneycapital — Mitek Systems $MITK
@j10simons — Marqeta $MQ
@apalacios — Airbnb $ABNB
@pat_connolly — Compass $COMP
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$IOT - An IoT monopoly in hypergrowth mode and a long runway
$IOT - Samsara is an IoT monopoly with rapid innovation, product cadence, and customer feedback loops coupled with a strong strategy and moat making Samsara a truly exceptional business

What does Samsara do and What are Samsara's Products?

Samsara has created the Connected Operations Cloud, which allows businesses that depend on physical operations to harness the Internet of Things (IoT) data to develop actionable business insights and improve their operations.

Samsara is solving the problem of opaque operations and disconnected systems. By harnessing recent advancements in IoT connectivity, artificial intelligence (AI), cloud computing, and video imagery, Samsara is enabling the digital transformation of physical operations.
The main applications in their platform are:
  1. Video-Based Safety
  2. Vehicle Telematics
  3. Apps and Driver Workflows
  4. Equipment Monitoring
  5. Site Visibility

The following image gives more details of their products and features

How does Samsara make money?

Samsara generates 98% of revenue from subscriptions to their Connected Operations Cloud, which today includes Applications for video-based safety, vehicle telematics, apps and driver workflows, equipment monitoring, and site visibility.

What is Samsara’s customer value proposition?

Samsara:
  1. Provides a Single Pane of Glass for all IoT Data
  2. Improves Safety and Reduces Costs of Physical operations
  3. Increases Operational Efficiency of Physical operations
  4. Enhances Sustainability of Physical operations

What is Samsara’s Market Opportunity?

Samsara's total addressable market opportunity is approximately $54.6 billion by the end of 2021, growing at a three-year overall compound annual growth rate of approximately 21.0% to $96.9 billion by the end of 2024.

What is Samsara’s Mission?

Samsara's mission: to increase the safety, efficiency, and sustainability of the operations that power our economy.
Samsara has a mission to improve and analyze every aspect of physical operations.
This is a powerful mission statement with a sense of purpose/inspiration. It's also simple and allows room for Samsara to innovate and keep adding adjacencies to their business.

What are Samsara’s People and Culture like?

Samsara has a Differentiated Company Culture in which they innovate quickly in partnership with customers, focus on durable and long-term solutions.

While doing this they work together as a collaborative team and are very entrepreneurial.

What do Samsara’s current Financials look like?

  • Revenue - $493M Q3 2021 ARR
  • Revenue Growth - 68% Q3 2021, I expect this to decelerate
  • Gross Margin - 72% Q3 2021(up from 69% last year, love to see the margin expansion)
  • Earnings Margin - negative 33% Q3 2021, Losses reduced from negative 100% from the previous year. We can see tremendous operating leverage here.
  • Net Cash - $805M raised from IPO and $267M from Q3 2021, kinda crazy
  • EV - $9.2B (Assuming $8B market cap, $1.4B total debt, and $0.267B cash, the debt is over-estimated[includes preferred equity], we will get better numbers from the upcoming quarter results)
  • EV/ARR - 18.6x(much cheaper after we account for IPO cash and updated debt numbers, we will see them soon after this quarter's results)
  • Dollar Based Net Retention Ratio - 115% overall and 125% for customers spending more than $100K
  • LTV: CAC - 8x, incredible for a company so early in its life
  • Customers - 25K overall, 13k+ more than $5K ARR, 700+ customers > $100K ARR

From the below image, we can see that they have done this while significantly decreasing their operating expenses. As they scale further we should see a further decline in this and correspondingly increasing operational leverage.

Meanwhile, we see them growing their ARR consistently (Below image). They have grown 5 times in 2.5 years, crazy

And increase the number of large customers(Below image). They have grown 7.7 times in 2.5 years, crazy

What are my final thoughts on Samsara?

Samsara is a special place with a truly differentiated platform, culture, and strategy. They have a massive opportunity to capture and they are showing no signs of slowing down.
They are a true partner of their customers and their rapid innovation, product cadence, and customer feedback loops coupled with a strong strategy and moat make Samsara a truly exceptional business!
If you like my summary about $IOT check out my deep dive at moderngrowthinvesting.com/samsara/
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