I know this is repetitive but repetition is the mother of mastery.
With past high allocation, big winners here - Shopify, Twilio, Zoom, CrowdStrike, Cloudflare, Upstart, no one ever worried about complexity or had to work hard just to figure it out how they work.
Solazyme, Nutanix, Teladoc all come to mind as more complex stories. Even relative under-performer Snowflake, same is true.
When the CEO can’t cleanly, simply and directly articulate exactly what he’s doing and how it works, it is a flag so red it matches Kim Jong Un’s underpants.
The formula for trouble is this: Complexity + Alleged Giant TAM = Monstrous Loss.
Bad communication is a symptom of a story that’s grown too complex. Cloudflare is a massive undertaking, and no doubt there is epic complexity in the infrastructure, processes, software, hardware etc needed to build that globe circling monster. But they relentlessly stick to three core values that define their vision of a “better” Internet - speed, reliability, security. And all their epic innovation fits neatly into these three lanes. So exactly what Prince, Zatyln and CTO Cummings are doing always feels in control. The complexity is not an issue.
A martial arts principle is to never go faster than you can control. To me, having watched clips of Levchin - brilliant as he is - ramble to the point of laughing at his own long-windedness is not good.
The gamble one takes on this is that the complexity is an advantage. That if the individual investor is smarter than everyone else they can solve the puzzle and unlock hidden value. This of course could and may work here, but it makes no sense to me to try to take the rocky, winding up path up the mountain when we have such solid, simple, straight forward ones - MNDY, ZI, UPST, CRWD, LSPD - to walk.
Wish all AFRM investors luck, but at best it’s a divergence from what’s worked and inevitably a much riskier path. Lastly, I’ll just point out Saul is a Harvard educated former math champ. If it’s too complex for him, you best be one smart **********er to get this right.
This simpleton Fool taking a hard pass. And like with the car company we dare not name, I didn’t lose a cent missing out on that. And won’t lose a wink of sleep if miss out on this as I know why I’m passing.
BD