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, June 26, 2020

Q2.2020 - Cerence: Secular Growth Opportunity In Automotive AI Market


  • With AI-based virtual assistants becoming more mainstream, Cerence will continue to benefit from the secular demand from the automakers across all tiers.
  • The company has a deep moat and leadership in the automotive AI industry, having spent 20+ years building relationships with major automakers. BMW, Audi, and Ford are all customers.
  • Its fundamentals are rock-solid. Revenue grew 23% YoY in Q2, with operating and EBITDA margins at ~30%.


We believe that Cerence (CRNC), the market-leading provider of automotive AI technology, will continue benefiting from the secular growth of automotive AI-based virtual assistants and maintain its leading position for the foreseeable future. Despite being founded in 2019 as a result of a spin-off from Nuance (NUAN), the conversational AI company we have also rated highly, Cerence has spent over 20 years in the automotive industry as a combined entity, perfecting its technology solutions and developing relationships with the major automakers. At present, we see two medium-term key catalysts in the business as we initiate our coverage with an Overweight rating.

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