Here’s how my vision of Samsara has evolved.
I first took my position between $17.50 and $20.00 roughly 10 months ago. This is still most of my current position except for a little that I have added after the last earnings report. Along the way I added a little and trimmed a little around the edges, but my position has grown on its own as the stock price has risen. It’s currently a 22.6% position,
At that time I saw Samsara as a little interesting niche play, providing a valuable monitoring service to trucking companies, with an immediate ROI (“For every truck for which we provide monitoring for you, we will charge you $400 per year but you will save $2500 per year in idling expense alone, not even counting fewer accidents, lower insurance, etc.”). Who could turn that down ???
But oh, how that “niche” has grown! as Samsara has segued into a platform provider and its TAM has exploded.
First of all, that platform has ensured that their customers are almost “locked in” as they would have to make major changes their businesses in order to move to another provider (if there even was another provider who had the experience, and data library, and could provide an equivalent service).
Second, it’s no longer just trucking companies. They are providing their services and platform now to major airlines for God’s sake! You may say “What for?” Well if a plane takes off late because they can’t find a baggage cart to load the baggage, or the bus to transport passengers to the plane or from the plane, that plane’s next flight takes off late too, as do other flights, and it snowballs throughout the day and becomes very expensive for the airline.
And Samsara, that little niche company servicing just trucking companies, now has major cities as customers, like Houston, the fourth largest city in the US, and like the the city of New Orleans which signed up Samsara for all 41 departments. They are also already working with the State of New Jersey Transit Dept, the cities of Fresno CA, Mobile AL, Memphis TN, Allentown PA, and Washington DC, among others.
In fact 87% of Q3 net new ACV was from non-transportation verticals. Yes, 87%!!!
And 17% of Q3 net new ACV was from international verticals.
And their new platform product Mobile Experience Management got $1 million in ARR in its first couple of months of availability.
This “little niche company” now has ARR over $1 billion, and I see it continuing to grow to become a monster of a huge company. I’m in awe about this company! It seems to me to be going to the moon. It’s very different from Celsius, for instance, or ELF, both of which I feel I have to watch carefully, or even Monday or Trade Desk.
Let me quote from what the Goldman-Sachs guy said at the conference call:
“That’s an unbelievable benchmark you’ve reached. Very few companies have been able to grow at that pace and hit a $1 billion in revenue and keep the momentum growing…
“The non-transportation mix of net new ARR is very high. Clearly, the end markets are diversifying and opening up in ways that I at least had not thought about!
"What does that tell you about the TAM for the company? Because it’s no longer just the fleet management, telematics type opportunities, it’s something much bigger than that…
“How do you think about the product strategy and go-to-market strategy as with time it really becomes something different and bigger than what I, at least, thought it was, which was more telematics and vehicle-related? But it seems like your process workflow automation works for many kinds of business processes that are outside of the core domain… “Congratulations ! Thank you so much.”
He was as much in awe as I am! He sounded as if he couldn’t believe HIS eyes either.