Hi All, I have been following this board for the last six months, i am quite shy to write it up. One of the beautiful things i found till date on investing is this board. I like this quote phrased by Chris, "Give a man a fish and you feed him for a day; teach a man to fish and you feed him for a lifetime" Since it is my first post, please correct me if any mistakes. BRZE: Braze was founded to assist organizations in automating and analyzing their customer communications and engagement efforts, competing with Adobe, Salesforce etc. Listed on NASDAQ yesterday with IPO priced at $65 per share and closed at $96 after hours. Current market cap nearly $8 billion. Financials: Six months ended ================ Revenue: July31,2020 July31,2021 YoY 67.9M 103M 53% Gross margin(%): 64% 66% 43M 69M loss from operation 12M 25M Fiscal year: =========== Revenue: FY2020 FY2021 YoY 96.4M 150M 56% Gross margin(%): 63% 64% 60M 95M loss from operation 33M 32M customer growth: Jan31,2020 Jan31,2021 Jul31,2021 720 898 1119 YoY : 24% Customer with ARR of $50000: Jan31,2020 Jan31,2021 Jul31,2021 45 71 82 YoY: 57% Net dollar retention rate for all customers: Jan31,2020 Jan31,2021 Jul31,2021 126% 123% 125% Net dollar retention rate for customer with ARR of $500,000 Jan31,2020 Jan31,2021 Jul31,2021 127 133 135 Free cash flow: =============== fiscal year 2020 fiscal year 2021 9.9M 10.4M six months ended July 31, 2020 July 31, 2021 3.0M 10.3M From my initial analysis, this company is performing in a competitive space with 50% yoy growth and net loss for the fiscal year getting improved and fcf also improving. Looking forward to year from others. Thanks, Jose.
Customer with ARR of $50000:
Jan31,2020 Jan31,2021 Jul31,2021
45 71 82
The above needs correction. This should be “Customers with ARR of $500,000” as per the S1.
A shout out here to Jose for bringing Braze Inc to the board in this thread.
They announced after the close yesterday (I had a small position thanks to Jose).
Bert Hochfeld wrote about them and it’s now on S.A. here:
Note that he wrote this prior to yesterday’s earnings, but until today was only available to his subscribers.
An update from their first ER as a public company yesterday (release plus conf call notes):
Revenue: $63.97M, up 62.6% YoY, +15% QoQ. Non-GAAP EPS of -$.16 beats by $.44
DBNER=126%; ARR (customers >$500k) of 136%
$304M of RPO; $199M of cRPO.
Big improvements in FCF (slightly negative still but not far from positive).
Guidance of 53% YoY for next quarter at midpoint of guidance.
Some discussion of Twilio as a partner, but also TWLO plan to enter Customer Engagement market as a competitor.
These numbers are very good and I’d encourage a peak at Bert’s writeup as a starting point.
Here is what I have:
YoY revenue growth, most recent last: 48%, 50%, 55%, 63%
QoQ revenue growth, was 17% seq the prior quarter, now 14%
gaap Gross margin: 66%(I think), now 70%
DBNR: 125 and 135% (total vs larger custs), now 126 and 136%
Non-Gaap operating margin is currently -8%
FCF is -5.5%
Customers increase 48% YoY and 13% seq to 1,247
Customers north of 500k, increase 45% YoY and 18% seq to 97.
Revenue+FCF jumped from 45 to 58.
What I did not like, happy to see other takes:
–Guidance is essentially flat sequentially and generally there seems to be seasonality here;
–Gross margin likely to walk back next quarter per call;
–Guiding for larger non-gaap operating loss of -25% (is this a page from S’s book? Guide for awful move then deliver a strong one?).
Even so, across 9 quantitative metrics in a head-on-comparison of 27 companies I run for myself, it comes as #24 overall vs 16 for AMPL and 13 for S.
My understanding is that BRZE offers a comprehensive, multi-channel customer engagement platform that relies on first party data and that TWLO is currently the provider of some of this data, on the one hand. On the other hand, it is also my understanding that TWLO is building Engage as precisely that solution to marketing ROI leveraging Segment and sitting upstream from BRZE. TWLO would have two other huge advantages: an army of developers and a huge pile of cash. If this is so, then one of the two product analysts that I read (one on BRZE and one on TWLO Engage) has to be wrong or maybe someone can explain how the two can co-exist. Thanks!
My understanding is that BRZE offers a comprehensive, multi-channel customer engagement platform that relies on first party data and that TWLO is currently the provider of some of this data…
Based on my understanding and research, I found that BRZE does NOT rely on TWLO for that first party data but rather BRZE has its own system for first party data. However, they do use TWLO in some way to send out messages (SMS, emails etc) https://www.braze.com/partners/technology-partners/twilio.
I agree with you that BRZE is competing with TWLO’s Segment and these are very similar products.
Disclaimer - 1% position in BRZE