The very first memo I wrote on Commonstock was a cursory muse mentioning Appian.

Today, Appian eclipsed Square as my largest holding. It's been on a huge run in the last month.

Appian helps businesses make apps. They are a leader in low-code automation.

Businesses need a mobile presence, but mobile app development is expensive and time-consuming. Appian allows corporate and government customers develop their own apps and software with minimal in-house tech resources.

A lot of people think Appian is new because they only went public in 2017. But they were founded in 1999, and founder Matt Calkins still owns 45% of the company. They are not a baby startup by any stretch of the imagination. Their market capitalization is at $13.5 billion after a massive run-up in the last month.

Matt Calkins and the other co-founders chose to self-fund the growth of the company through most of its history (1999-2017). Instead of looking for a big exit, they are building a company they see as their life's work. To get a sense of Matt, watch this video.

A wide variety of big businesses. 10% of the Fortune 500 are Appian's customers. Some well known customers include Deloitte, Major League Baseball, Sprint, KPMG, and Enterprise. The US government is also a customer: Homeland Security, the Treasury Department, the Food and Drug Administration, Army, and Air Force are all Appian customers.

Appian "guarantees" that it can train its customer's employees to use the software in just two weeks and guarantees a working app in eight weeks at a cost of $150,000. That sounds like a lot, but if you were to develop your own app, its a steal.

Appian makes revenue two ways: services (one time jobs) and subscriptions. Subscriptions are more important. While services revenue has 32% gross margins, the subscription revenue has margins of 90%. The higher margin subscription revenue is growing a lot faster than services revenue.

Investing in Appian is a bet that businesses will continue to move towards more flexible, app-centric software. You invest in Appian if you believe Appian can get new businesses onboarded quick and then convert them to an ongoing subscription.

Essentially, you're betting that Appian's predictable, consistent subscription revenue will continue to grow. Appian has proven it can do that. Existing customers are paying more to use Appian's platform as time goes on, with a 117% subscription revenue retention rate.

Appian just had a quarter where they beat expectations. Their third-quarter revenue was $77.3 million, which was an increase of 17% from the year-ago quarter. This beat analysts' consensus revenue estimate by 9%. They also had break-even earnings per share which beat Wall Street's consensus estimate of a loss of $0.17 per share.

Time to change gears a little. Appian's stock is up almost 200% in the last month. The stock started performing well going into earnings, and attracted a lot of short interest.

Shorting a stock is when people bet that the share price will go down, so they borrow shares and sell them. When the share price goes down, they buy shares back at a lower price. Then they return the shares they borrowed and pocket the difference.

But Appian's shares didn't go down. They went up. When Appian's performance surprised to the upside, a lot of short sellers had to buy shares at that higher price in order to return the shares they borrowed. Their scramble to buy shares and forestall greater losses added to the upward pressure on the stock's price. This is known as a short squeeze.

The point is, Appian's performance lately has been great, but part of it is due to the short squeeze, and once that dynamic plays out, you could see a sharp drop.

Essentially, all I'm saying is that I don't know if right now is a good time to buy or not. I bought in mid 2018 and have been holding ever since. I am not adding to my position right now. Now that you know more about the company you might add them to your watch-list and look to buy in on a dip.

Personally, as long as it appears businesses are using more app-centric software, and Appian does a good job of signing up new customers and converting them to subscription users, I am a happy investor.

Have you ever heard of Appian $APPN before this? What are some questions you have after learning about them?