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Samuel Meciar's avatar
$17.1m follower assets
Portfolio changes - update 15
Hey fam! I Sold $MNDY and $RBLX at the open, both for consolidation reasons:

  • $MNDY I'm exposed to a similar product through $MSFT Project and Planner + $CRM is invested in Monday through Salesforce Ventures, so I'm maintaining a limited exposure.
  • $RBLX - while I like what they are doing, I prefer an exposure to multiple industries at once, if possible. That's what $U offers me with heavy focus on gaming with a huge market share there but also stuff like digital twins, tools for manufacturing, architecture, advertising, even tools for filmmakers, aerospace and a lot more. profitability in focus, promised by management to come in Q4 this year, sooner than anticipated before.

Also sold my initial position in $ZS. As much as I really like the company, I realized I'll be probably better off going for $NET as their product portfolio covers Zero Trust Security and Web Application pretty nicely with Cloudflare One and other products, so I consolidated into the one I like "more".

Samuel Meciar's avatar
$17.1m follower assets
So as I promised, I made some buys today from the proceedings of my sales of $COIN and $COUR I informed you about in my previous post.

I ended up almost doubling my position in $MNDY. Also added to $ADYEN.AS $TWLO $MSFT $NET and $SNOW.

$ADBE remains on my watchlist for adds, I want to add but first let's see their earnings in about a week, particularly looking at their Document Cloud in a context of DocuSign's results, though I have a feeling they won't see much weakness.

Also having $AAPL $PLTR $TEAM $SNOW and $ZS still on my watchlist for future adds.
The Emergence Of Workflow Software (My Pick From $ASAN, $MNDY and $SMAR)
Over the past 3 years and through the pandemic, a handful of apps have achieved mass adoption and become synonymous with general work - Teams, Zoom, Slack. These have specifically tackled communication pain points, and by design and function, have improved the way in which we work.

One ought to ask, what is the next iteration or compliment of these apps? Where else can exceptional UX design solve a bunch of problems in workflow? Are their public market expressions of this?

It's looking like the next trend is about "Project Management" to me. Sure, let's call it PM-SaaS.

By and large, people tend to run into issues when teams grow larger, and projects get more complicated. Anyone who has worked in a team of 20 vs a team of 5 would have noticed the meaningful loss in efficiency that comes with scaling and slow down of execution. There are three public SaaS businesses (stocks below) that are pure plays in solving project management issues in particular. And they haven't yet seen the mass adoption of Teams or Zoom. Where Zoom does $4B in sales annually, these apps do about $300-500m. Prices are about the $8-$15 range per seat, so it's similar, and theoretically - any organization across any industry with more than some minor complexity could benefit from a streamlined Project Management SaaS tool. So there is big potential here. The case studies across any of the IR sites, and independent reviews, point to serious ROI. The best of those studies show game-changing, "oh-wow!" ROI. Increasingly obvious for years now, software continues to eat the world.

The three:
  • Asana ($ASAN) - LTM Sales at $422m, 57% YoY last recorded growth, -30%ish FCF margin
  • Monday(dot)com ($MNDY) - LTM Sales at $358m, 84% YoY last recorded growth, -5 to -10ish% FCF margin
  • Smartsheet ($SMAR) - LTM Sales at $551m, 44%YoY last recorded growth, 0-2%ish FCF margin

There seem to be some private market competitors here, too - notably "ClickUp", which raised $400m at a $4B val in Oct 21. I'll have a go and say that the VCs invested at a >12x CY22 sales round before the brunt of the tech carnage - that woke up everyone to the macro mess. I mention Clickup because that's still a lot of cash runway, which they'll probably be deploying fast now. So it's a competitive threat.

From the three existing public plays on this trend, I like $MNDY the most. It's a little smaller by sales volume, but the growth rates have been excellent while the stock maintains a mild Free Cash Flow burn on an $850m in cash & equivalents balance sheet. Perfectly acceptable to burn $150m this year if you ask me...

Now, I'd be lying if I say that Monday is definitively the better product from the category of businesses on hand. As far as I can tell, while the SaaS offerings are differentiated by design, there really is no clearly right answer for a software buyer to choose one of the three over the others. These three are the cream of the crop, though, going by alternative sources. All that said, I can say with some confidence that this rather brutal macro environment is going to separate the businesses that manage cash well from those that don't. The ability to spend on sales is still paramount to achieving widening moats + network effects. Thus the cash ammunition needed for market capture is extremely important. Asana has lesser balance sheet cash funds at $280m against deep burn, putting them at a strategic disadvantage. Smartsheet is perfectly fine ($400m and no burn) but doesn't have the hypergrowth sales + profit mix that Monday does. To add, when Smartsheet was doing $350m in sales a few quarters ago, they weren't growing as fast as Monday is now. Something about Monday is working extremely well, leading to rapid and perhaps network-effect driven adoption. Users certainly seem to love the software and may be championing it to others on Monday's behalf.

Part of the reason why Monday has such disciplined profit metrics is due to the fact that the company is based out of Israel, founded by an Israeli chap. Salaries for engineers that make up the bulk of expenses are lesser than in Silicon Valley - but the quality of engineering has seemingly still produced a class-leading product. Monday has a financial advantage by way of geography. With some luck, the timing of Monday's IPO was opportune enough to raise significant cash, and as for the 2021 quarters, they were actually FCF generative. The plan to engage in some burn for market capture is an intentional and well-reasoned one. Seemingly contrarian given macro, but smart in order to capitalize on their strategic advantages over competitors during a period where the others shall feel greater pain. Probabilistically, Monday seems well equipped to handle a recession should it come.

As for the valuation multiples:

Monday is the more expensive one on "next-twelve month" metrics at 8.3x EV/S, but I think the premium well justified given what I just talked about. I think it should be much higher.

At least for now, $MNDY seems like the way to go. I'm long Monday, with no positions on the other stocks mentioned.

Other Comments.
I wouldn't write off $SMAR as a more value-oriented play given the current price and yet large market opportunity at hand. If one would like to hedge the macro thoroughly, going partially short $ASAN would make for a very sensible hedge if you're extra bearish on the economy. I think software multiples have compressed more than enough, and a lot of these businesses are going to prove their resilience through this period.
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$MNDY is my favorite of these as well, but I actually own shares of this company because I feel it offers a fundamentally different product. Their WorkOS platform is so flexible that teams can just do more with it. And I think between these companies Monday has the best opportunity to become more than just a work management product.

Also Monday seems to be capturing the enterprise market better than Asana, which is definitely a growth catalyst.
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Top Losers Today @ 11am
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Beaten-down 2021 IPOs
I love avoiding new initial public offerings for their first couple of earnings reports as a publicly-traded company -- but even more so, I love revisiting them after this 6-12 months.

Life as a newly public company is rough as expectations from analysts are wonky, and management is adjusting to a new lifestyle of increased scrutiny.

With this in mind, here's a list of 2021 IPOs I'm watching that have traded down since going public.

$RSKD Riskified -74% | $PATH UiPath -67% | $COOK Traeger -66% | $BIRD Allbirds -65% | $MQ Marqueta -64% | $CPNG Coupang -62% | $OLO Olo -56% | $COIN Coinbase -53% | $APP Applovin -51% | $EXFY Expensify -44% | $USER UserTesting -42% | $BMBL Bumble -42% | $WRBY Warby Parker -40% | $AFRM Affirm -39% | $WEBR Weber -37% | $NU Nu -31%| $RBLX Roblox -30% | $SEMR SEMrush -27% | $FIGS FIGS -27% | $MNDY Monday -13% | $DOCN DigitalOcean -11% | $CFLT Confluent -8% | $GLBE Global-e Online -6% |

Curious to hear what you all may like the most from these?

Out of this list, four are part of my Core 34 group of holdings that I aim to add to the most here in 2022.

Have a good weekend, friendly humans.
With of the four from my core 34 do you like the most?
42%Coupang
31%Roblox
15%DigitalOcean
10%Global-e Online
19 VotesPoll ended on: 05/02/22
Is Monday.com ($MNDY) truly pioneering a new style of software?
That's what management claims. This company has nearly doubled revenue each of the last two years, suggesting that this software is more than just a niche fad. They have differentiated themselves from competitors by providing an open WorkOS platform composed of building blocks, allowing customers to create their own customized workflows.

$MNDY currently holds a full 5% position in the growth account, but $ASAN and $TEAM both provided a high degree of competition for a spot in the portfolio. For fellow investors who have done their fair share of research in the work management space, how do you feel about the competition between these three companies?

In this article, I discuss my reasoning for owning the stock as well as some risks that could derail this growth story. As always, all content is free and I encourage readers to share their opinion on all stocks discussed.

all $ASAN $MNDY $TEAM have great products both feature-wise and when looking at reviews, though I recently found a combination of $MNDY and $TEAM fitting the best for me as the overlap isn't too huge but still covers a lot of optionality than let's say a combination of $ASAN and $MNDY.
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Samuel Meciar's avatar
$17.1m follower assets
Sam's portfolio review
Hello CommonStock, I saw multiple posts from my fellow colleagues sharing their portfolios, explaining their intent and seeking feedback from the community. I believe this is a great place to share knowledge and learn, we all have something to gain one from another, so I thought it'd be a great idea to do my iteration of this concept.

Here's my portfolio:

To put things into a perspective, I'm 19yo student whose mission is to invest in a great tech businesses that change our life for the better.

My portfolio is built around these themes:

  • 5G
  • AI
  • AR/VR
  • Blockchain Technology
  • Cloud Computing
  • Cybersecurity
  • Creativity
  • Digital Commerce
  • Digital Advertising
  • Digital Education
  • Fintech
  • Gaming
  • Gig Economy
  • Internet of Things
  • Modern Enterprise
  • Robotics
  • Renewable Energy
  • Streaming
  • Semiconductors
  • Telehealth

My portfolio therefore consists of mainly high growth, disruptive technology companies. A simple reason why is that I know technologies the best from all sectors and I believe its a very diverse approach in order to catch most of our civilized world progress as those technologies pretty much are used across sectors, whether we talk agriculture, mining, etc. The goal of the portfolio is to invest in great companies who I can let run for years to come which can eventually secure me an earlier retirement 😃

I like to invest in:
  • software companies primarily with an expected growth of greater than 15% over a few years out, so basically there's a greater chance they can outperform the market even without a multiple expansion
  • companies with a great culture and great ratings from employees across Glassdoor/Comparably
  • founder-led mission driven companies with significant insider ownership
  • companies producing FCF or at least those who I believe will produce FCFs in the future
  • leaders in their respective sectors (so the best of bread)

It's worth mentioning that I plan to make some changes to my portfolio soon, so this isn't a final look, and so to make this clear, I plan to:


------------------------------------------------------------------------------------------

I'm looking forward to hear your thoughts, suggestions and answer your questions, if there are any 😃
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Samuel Meciar's avatar
$17.1m follower assets
Hot seats
As Q1 earnings arrive, I have my set of holdings I'll cut or will be looking to cut depending on the performance and results posted by those... I was thinking about a bit of a consolidation in my corporate enterprise allocation, and decided to:


There seems to be nothing wrong with those names, I just thought like there's a pretty substantial overlap between them and so I decided to cut some and strengthen those other names.

And then on the other hand I have $DOCU -- I'll be really closely watching the execution of Agreement Cloud, as this is a substantial part of my thesis and they seem to have some problems there for a couple of quarters already... If I'll see just another underperformance on that part I'll be selling for $ADBE or one of the other names I want to add to my portfolio but yet didn't buy any.

Secondly, there's $ZM. Still a leader in this market, but I'm seeing some evolution of competitors in this pretty competitive space, and so I'll be closely watching what they have to say about the competition and put their numbers into a perspective. Will decide then what to do.

Notably, I'll be looking to listen to $OKTA's earnings call to see the effects of their breach and how they answer questions on their reaction to the fact.
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Commonstock is a social network that amplifies the knowledge of the best investors, verified by actual track records for signal over noise. Community members can link their existing brokerage accounts and share their real time portfolio, performance and trades (by percent only, dollar amounts never shared). Commonstock is not a brokerage, but a social layer on top of existing brokerages helping to create more engaged and informed investors.