A comparison I felt compelled to make

I’m of a mind to wait out another few weeks before moving out of MDB… if nothing more than to defer cap gains another year… Neither MDB nor CRWD seems investment-worthy in the short run, but I won’t say either is wrong. We each have our own risk/reward profiles, and the cross-dialog benefits me greatly. For now, COUP and DOCU are collecting additional shares in my portfolio.


Come, let us go down and there confuse their language, so that they may not understand one another’s speech.

So Steppenwulf, if I read you correctly, you agree that Crowdstrike is a much better company to invest in at present, but that you are sticking with Mongo because AT SOME UNKNOWABLE TIME in the next five to ten years Crowdstrike MAY get disrupted (or even IS LIKELY to get disrupted). Did I misunderstand you?

Not exactly. What I’m saying is that these are completely different businesses, and I don’t think Crowdstrike is a better company to invest in at present.

Crowdstrike is a firecracker. It shoots up high fueled by the latest threat protection engine, and they’re getting the low hanging fruit. They’ve got a current advantage and are selling like crazy - TODAY. I’m dealing with a half a dozen competitors at different clients, all of which have a competing product. In the not too distant future - say 1 year, there will be a new company at the top. Crowdstrike won’t disappear - they’ll be one of the contenders. But they’re revenue growth could slow down suddenly, and their multiple will do the same.

Mongo is an airplane. They’re going up slowly, steadily, and they are going to be in the air, at the top of their industry (unless management screws up) for decades. Enterprise customers don’t change all their databases all at once, and they don’t make database decisions at the drop of a hat. This is their crown jewel - this is what Crowdstrike is protecting.

For Crowdstrike, if I invest, I’ll look for a good price to enter, and will always be ready to pull the trigger - they’re risky with a good chance of running out of fuel at any time. You have to get out as soon as you see it. I don’t think this is a 5-10 year scenario - it is a 1-3 year scenario.

Mongo I’m investing in for 20 years, and I review only at earnings. This earnings result was a bit meh, but no change in the thesis, no change in my investment.


I practically salivate at the idea of Mongo becoming the next Oracle. This would be a huge success. But the large operating losses and slowing growth give me pause. Mongo’s rule of forty score looked quite healthy last year when they were growing around 70%. But with the large and growing losses and the slowing growth, the company is starting to look unattractive on a rule of 40 basis.

How can we be confident that Mongo the company will be able to survive and not eventually be consumed by expenses, leaving it vulnerable to takeover?

@BobbyBe - I too think it would be great for Mongo to follow the Oracle trajectory.

The question about profitability is valid - I was hoping to see profitability improving rapidly or more growth this quarter - that’s why I consider it a bit meh. It seems some of this is revenue that is pushed to next quarter.

The thing is, they are looking at a huge opportunity that will last for decades, and if they think it makes more sense to invest now to increase profitability later, they could be right - ask Bezos about this story.

I think the answer here is we depend on the management team. Mongo’s management team has been extraordinary so far, I think:

  • How they won developer mindshare across all platforms - not just enterprise, and not just startups

*How they monetized their open source model with Atlas and subscriptions (which is the problem I still see with ESTC - they still haven’t figured this out thoroughly)

  • How they created a new open source copyright contract to deal with “pirating” of their product by big platforms particularly from China. This was a big bold move by a confident management. By the way, I think the introduction of paid Mongo hosting by Baidu is a fantastic validation of their approach

  • How they set up optional ACID transactions to overcome resistance in enterprises to move to NoSql, and set themselves up to be the db of choice when NoSql becomes the standard for transactional databases also

  • How they built direct cloud capabilities in Atlas that are beyond anything anyone else has

For now I’m going to trust that they know what they are doing, investing in tech and sales today, foregoing smaller earning now in order to get greater earnings in the future.


I don’t think this is a 5-10 year scenario - it is a 1-3 year scenario.

That’s still longer than the attention span of many.

1 Like


You have a great background in the industry. How sure are you that your analysis of these two won’t be off base similar to when you were extremely bullish on PVTL.

Not trying to attack you, please don’t take it as that, but trying to compare your analysis of each.



No worries - I don’t feel attacked when my opinions are questioned :slight_smile:

With Pivotal I underestimated the effect of Kubernetes. Unfortunately Pivotal did too. In technology, it’s not always easy to see the effect of a new technology when it comes up. An important point I also forgot is that this was in the area of developer tools, which is a market that is very easy to disrupt - developers are strong influencers and they always run after the latest thing.

Concerning Mongo, generalized databases is not an area that is easy to disrupt. Enterprises are very reluctant to move to something new, because of the risk. Once you win in this market, you tend to keep on winning.

Is it possible something new will come that completely upends this space? Of course. But I can’t imagine a circumstance that a sharp management team at Mongo couldn’t stay on top of. They can build or buy anything new that comes up, long before the new technology has enough time to get a beachhead in the enterprise.

Security is another area which is really easy to disrupt. The over all spend across the enterprise on security tools is usually not that high - a few hundred thousand to a few million for a typical install across a suite of apps or entry points. The big spend is on security personnel internally, so tools that promise to reduce security headcount and/or solve the latest security risks are easy to sell - both business and tech leaders want them.

The thing is that the latest greatest thing doesn’t stay greatest for very long in security tools. What crowdstrike has down is incremental improvements - they have engineered a better mousetrap, but not with some extraordinary technology that can keep them on top of the heap forever. They have to keep innovating and staying on top, and their lead is just not very big, so someone else leapfrogging is not too hard to see.


Steppenwulf was also quick to point out that he never had the confidence in Pivotal that he had in Mongo. As if he did not want to step back his review of Pivotal but that he really had second thoughts about it. So did a lot of people. There was still money to be made on Pivotal. I know I made some.

Microsoft, Google, enterprise royalty were behind Pivotal. Ford created an entire technology group around Pivotal. The U.S. Air Force modernized behind Pivotal. GE spun off a multi billion dollar business that is platformed on Pivotal. It’s economic numbers were great. Going public we all expected that Pivotal would solve its on-boarding problems. Sigh…that never happened. They never attracted more than a few new customers a quarter and Dell has taken them out of their misery very quickly once Dell realized that Pivotal had a sales force that most local Girl Scout troupes could whomp.

I get the feeling that Crowd is not so fragile as some may say. Crowd is creating a platform with networking effect that feeds off the entire infrastructure and not just a simple end point solution to be disrupted by the next big thing.

Valuation wise, Mongo or Crowd. Crowd may actually be less expensive. Not by price to sales but by value of revenues. Presently Crowd has an enterprise value of about $8.9 billion or so. Let’s give them a 25% long-term operating margin. At 40x on this information Crowd needs $890 million in revenues, or a 10x multiple of enterprise value to revenues to virtually reach that point.

Mongo has an enterprise value of around $7 billion. Give it a 40 enterprise value to earnings multiple with 20% long term operating margin (and I tend to think 15% is better but lets stick with 20) and you need $875 million in revenue to equate to that 40 enterprise to virtual earnings number.

Now is Crowd or Mongo more likely to reach their respective figures quicker? Is Crowd or Mongo more likely to have the mature operating margin I put out there? I Crowd or Mongo more likely to exceed the operating margin I put out there? Finally, is Crowd or Mongo likely to have long term hyper-growth and CAP dominance.

I think quite easily all but the last question goes to Crowd. The last question is under dispute. Crowd is attempting to create an infrastructure around its platform, and to get its customers to buy 4 or more packages from this platform. That to me, if successful, is not easily disrupted. A new way of doing things that is clearly materially better will be required to create switching costs. And Crowd has demonstrated that they have capabilities that existing competitors just do not have at present. And fixing 1 or 2 things does not make the competitors equal.

Mongo, I won’t argue with the last one. Their long-term platform dominance seems secure, but their financial progress, although excellent, appears to be of a more moderate nature.

Thus I think that Crowd’s staying power and actual relative cost is being respectively underestimated and over exaggerated; and I think Mongo’s staying power does give it a claim that their revenue may be worth a bit more per margin point than Crowd due to this CAP, but not as much as many here would think if they took a deeper look at Crowd.

One thing we can see with the recent IPOs, is they have done what many of their predecessors did, with Twilio that grand daddy of this (Zen as well), Veev did it, SHOP has had its sparks, I remember when ISRG did it, and that is go boom after IPO and then have a substantial crash, and then boom go up again as the fundamentals get behind the valuation again (all with never really getting cheap enough).

Mongo has already been through that. Crowd is going through it. In the end, Crowd wins hands down on financials and business momentum. It is debatable if Crowd might have similar staying power in regard to long term hypergrowth and staying power as Mongo has. I think the answer is perhaps not if you go 5 years out, but until then, they look pretty equal to me in that regard.

Winner Crowd given the totality of circumstances. Since 5 years out is totally unknown I will deal with that in 2 to 3 years and revisit.



Now is Crowd or Mongo more likely to reach their respective figures quicker?

“Quicker” is only a part of the question and a single end-point misses the point. We might agree that CRWD has the better upward trajectory for the moment, but the various posters on this subject have been suggesting that our confidence in that trajectory continuing indefinitely should be lower if only for the nature of the business that they are in. Their product is simply not one that becomes deeply embedded in the way a company does business and thus is subject to disruption at any time if someone else comes up with better security technology … which companies seem to do with some regularity … indeed, CRWD is an example of a company doing this.

Whereas, MDB’s product is something that tends to be deeply embedded in the way a company does business and any company that has made a serious commitment is going to find it expensive and difficult to switch to another product. Moreover, unless the choice of MDB was poorly informed in the first place, it may even be unlikely that an equivalently functional alternative is available or likely to arise.

Timeframe is, of course, relevant here. Neither is likely to move substantially from their current trajectory in a couple of months. But, going beyond that, it seems less likely that MDB will have a near term disruption in the next year or two than is potentially there for CRWD. CRWD may be the faster horse today, but you may have to know when to get off since any company with these high valuations is subject to dramatic correction if news changes. Indeed, this is one of my running issues with the kind of company discussed here. In many cases, if one gets on board reasonably early and remains tuned to developments, then one can have a significant retraction and still come out very nicely ahead overall. But, if one takes one time getting convinced, then one risks buying in near the high.


I don’t think this is a 5-10 year scenario - it is a 1-3 year scenario.

That’s still longer than the attention span of many.

Three years is a couple of lifetimes on this board. Two years ago (Nov 2017) these were Saul’s positions in his month-end summary. There is NO overlap with his most recent (Nov 2019) summary. (Alteryx appeared the next month.)

Shopify    15.6%
Square     13.7%
Arista	   11.3%
Hubspot	   10.6%
Nutanix	    9.9%
LGI Homes   9.1%
Nvidia	    7.9%
Talend	    7.4%
Ubiquiti    6.1%
Wix	    3.8%
Splunk	    2.6%
Nektar	    0.9%
Align       0.7%


Would be interesting to see how that portfolio would have performed since then… but I’m too lazy to do that.


Of those listed, only SHOP has gone off to greater things. Splunk has done okay. The rest have collapsed. So no matter the process in place, it worked. Replace what should be sold (except for SHOP and Saul was not the only one doing that) with what was far better to invest in. Things like AYX and MDB and OKTA.

What is Saul had just stuck out of principle in that port? Nary a good result would he have.

There are reasons to sell. As Saul demonstrates they are not perfect but they are pretty good. I still regret only going 50% SHOP during my holding period of it. I certainly don’t regret selling Nvidia and ANET at the top after a very nice holding period. But as I spoke of in real time, it was time to find some “accelerant” to the port again. My only mistake in doing so was subsequently playing earnings for Nvidia and Pivotal. Spot on on when to sell and what I bought next.

Should have stuck w the process completely (meaning no playing earnings) of when to sell and buy. But we all need a kick in the keester f time to time to jar that lesson back home.

The process includes buying and selling and using a 5 year window to fetter that process will not improve your returns. Occasionally you may sell a SHOP early but you also won’t stick w a Pivotal or a Pure or a Talend or Nvidia (past its prime that it will probably recapture againnat some point).



Sometimes the gyrations around a single earnings call can cloud judgement on whether one’s investment thesis is intact, uncertain or broken.

Take DDOG’s recent backslapping for example with that big bump post earnings…quite a battle on this board over its significance as you may recall.

Pre-earnings the stock traded at $34.4…and yesterday…traded at $34.8…all that consternation and backslapping wiped away. Everything in between was just noise.

CRWD trades BELOW its IPO price (opened at $63.7 and now at $47.5…down 25% from its IPO)…so does DDOG (opened at $40 and now at $34.8…down 13% from its IPO).

MDB trades Over 4 times its IPO price…(in comparison to the same time frame for CRWD IPO, it has gone down from 166 to 129…down 22%…less than CRWD) and in comparison to DDOG IPO timeframe (131 down to 129) it is essentially flat (also less than what has happened to DDOG).

Which of these three would you have wanted to hold???


That portfolio, if balanced equally, would’ve generated about 25% p.a for the past TWO years.

Ubiquiti - 100% p.a.
SQ: 38% p.a
HUBS: 37%
SPLK: 58%
WIX: 33%

Actual losers were Talend, Nvidia, and ANET.

So not bad, but when compared to what Saul et al. have done in those 2 years, it truly pales into insignificance. It pays to be attentive to your companies and ruthless, as Saul regularly demonstrates.

I’m sticking with MDB but starting to warm up to Zoom.


A most excellent thread! Actually two intertwined threads, comparing MongoDB vs. CrowdStrike Holdings interests principally the business owner and the LTBH investor while comparing MDB vs. CRWD interests principally the shorter attention span investor.

One example is profitability

I had bought back into MDB in October, and then sold out yesterday. I’m not willing, in this environment, to wait upon a thesis that might play out that far in the future on a company currently not making a profit. Do they have an actual plan on how to become profitable, or are they just hoping that “growth” will eventually bring the profits in? I don’t have that kind of patience, especially with tech companies.

Yes, bjuraz, they, like Elastic, seem to have no interest in moving towards profitability. Or even breakeven.


The question about profitability is valid - I was hoping to see profitability improving rapidly or more growth this quarter - that’s why I consider it a bit meh. It seems some of this is revenue that is pushed to next quarter.

The thing is, they are looking at a huge opportunity that will last for decades, and if they think it makes more sense to invest now to increase profitability later, they could be right - ask Bezos about this story.

Going back to my favorite SaaS Guru, David Skok, he points out that the one very important metric is CAC vs. LTV. If security - CrowdStrike - is short lived they need to attain profitability soon. If database - MongoDB - is long lived they should defer profitability to some optimal time in the future, Amazon being the poster child of deferred profitability.

This makes comparing the two investments problematic because it’s apples to aardvarks, depending on the investor’s strategy. There is a book with the title “What Works on Wall Street” by James O’Shaughnessy and there is the newsletter “What’s Working on Wall Street Now” by Louis Navellier. These illustrate the long term vs. the quarterly approach to investing. This being Saul’s board I would think that here CRWD wins out.

Denny Schlesinger


Looking at CAC,

MDB is gaining about 1000 customers per quarter, the same as a year ago, and they are spending 50% more on S&M.

CRWD is up 112% on customers, and spent 40% more on S@M.

MDB is spending more to get each customer, CRWD less.



MDB is spending more to get each customer, CRWD less.

CAC, by itself, is not meaningful, it needs to be coupled with LTV. If LTV is twice as high then CAC twice as high is a wash (sort of).

Denny Schlesinger


If the LTV of MDB’s customers is greater than that of CRWD’s, then the higher CAC will be worth it.

Given that database customers tend to be “stickier” than security customers (based on the foregoing discussion), the LTV of MDB’s customers could be significantly more than that of CRWD’s customers.



I’m not saying MDB shouldn’t be spending the extra marketing spend.

This thread is a comparison between MDB and CRWD.

MDB is spending more to get each new customer, I’m sure it’s justified based on their LTV.

CRWD is having customers come to them and their cost to acquire each customer is dropping.

If the LTV of each customer set hasn’t changed much, MDB is getting longer payback periods. Trend is heading the wrong way.

CRWD’s payback period is dropping quickly.

Do you want to have to work harder to get each new customer, or do you want them to beat down your door so they can buy?

It could be temporary, who knows.