Asset Manager Investing in Global Technology Sector

We're an asset management firm allocating our capital into asset classes benefiting from technological innovation and applications globally. We serve as a family office of a tech professional who has spent over a decade as an entrepreneur, operator, and venture investor across Asia and the US.

Our small team is made up of diverse investment professionals who research, identify, and execute relevant opportunities. We occasionally share some of our investment memos, insights, and analysis here.

Friday, May 8, 2020

Q2.2020 - AppFolio's Simplicity Drives Outperformance

AppFolio (NASDAQ:APPF) is an interesting investment opportunity in the SaaS real estate space. Revenue growth and OCF/Operating Cash Flows have been solid, while the business is profitable. Furthermore, the net profit margin has been in steady expansion as share price more than doubled over the last two years. The share price continued to trend upwards in 2020. It had a ~32% run-up to its YTD-high in February, right before the broader COVID-19 selloff. The stock has fallen by ~20% since then, which creates an attractive entry point to pick it up at a bargain.

AppFolio builds a SaaS offering for only one market, which is the real estate. It has simple pricing, business model, and go-to-market. The simplicity of the business potentially drives the outperformance. Since the IPO in 2015, revenue and shares price have increased by over 3x and 10x, respectively.

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