My Portfolio at the End of 2021

Happy New Year to you all, and let’s hope that the new year will be a big improvement over the last two for the whole world, which has really suffered during two never-ending pandemic years. However, paradoxically, during these same years we have undertaken a wonderful investing voyage together, which has turned out to be well beyond “successful” in spite of its sharp ups and downs, and we have undertaken it with a spirit of camaraderie and cooperation and working together for the common good that I have rarely before seen in any endeavor.

How did it happen? I suspect that it was because we understood the SaaS world one or two years before almost everyone else. This was when all the “smart” people were saying that our SaaS companies were too highly valued, because they were still applying conventional EV/S to them. We also had the huge advantage of crowd sourcing on our board. It would have been very, very hard for any of us to have the courage to invest as we did as a single individual, but we discussed at length and shared our knowledge and opinions, and it gave us the courage, and the realization that we knew what we were doing. We realized, and recognized, that this was a breed of company that had never existed before in any numbers.

We understood that companies that are leasing software through the cloud, and thus can double capacity almost instantly, that are not selling physical things that require building factories and using capex to increase capacity, that are growing revenue often at 50% to 90% per year, that have 70% to 90% gross margins, that have a subscription model with recurring revenue, that have 125% net retention rates, and that are selling products that all enterprises need in order to adapt to the cloud and the digital world, are going to have much higher valuations than conventional companies. Well, if you think about it, what else would you expect? But at the time few other investors understood it, and many don’t understand it now.

For example, Schwab sends me analyses on my portfolio companies from a renowned analysing firm, and in each report the firm says that my company, that they are analyzing, is a great company, and has great results, and they are full of excitement over it, but unfortunately “it is overpriced and overvalued”. They raise their price target each time, but their price target is always at about half, or three-quarters, of my company’s current stock price. And they’ve been following it up like that through several 100’s of percents of stock price rises, but they never could see their way to recommend it. “Too overvalued.”

To give you an example of us recognizing and getting into these companies early, looking back I see that two years ago, at the end of 2019, I already had Crowdstrike, Datadog, Zoom and Okta making up almost 60% of my portfolio and I’m sure that others on the board were similar. I had about 95% of my portfolio in software subscription, fast growing, recurring revenue, capex light, high margin companies, back when no one with any “sense” would have had such overvalued companies making up such a large part of their portfolios.

And during these two very difficult Covid years, when many conventional companies were struggling just to stay afloat (think airlines, hotel chains, restaurant chains, movie producers and theaters, various retail categories, etc), our companies were thriving. They grew rapidly as more and more customer companies gravitated to the cloud, and they expanded their valuation, as more and more investors came to recognize them. It wasn’t a mystery. So thank goodness for this board, and all the people who contributed, and shared their knowledge, and helped us learn about these companies and understand them. I, for one, would not have had the technical knowledge to understand them without the contributions from all of you.

And remember that there are hundreds, perhaps thousands, of others who are silent on the board due to shyness, or due to feeling that they don’t know enough to contribute, who learn and gain from our posts. I can’t tell you how many emails of appreciation I have received during these last two years, thanking me, and the other contributors to the board, and telling me that they have been able to retire five years earlier than they had expected, or they gained the money to send their daughter to college, or to buy the house they’ve always wanted, or been able to pay for an expensive medical treatment that their parent needed, etc. We are doing good for others as well as ourselves..


Here’s the summary of my portfolio at the end of December and the end of 2021. It was a terrible month, with a sharp continuation of the indiscrimminate sell-off of the companies that are doing well, the rapidly growing companies, especially software companies and a movement into junk “value,” low-growth companies. This lasted until December 14th when we seem to have hit bottom.

We seem to have one or two of these sell-offs every year. The most recent previous one hit bottom in mid-May of this year when my portfolio actually was down 18.5% ytd. You can imagine how scary that was for many of us.

However, my portfolio’s high for this year, on Nov 9th, was up 93.1%. That meant that it had risen an astounding 137% in six months from that scary May bottom to the top. [193.5/81.5 = 2.37 = up 137%]. Just think if I had gotten scared and sold out at that bottom when it felt like the world was coming to an end.

That 93.1% all time high was also up 67% from my portfolio’s previous all time high before the April/May decline. That previous all time high was up 15.9% ytd, which it had hit on Feb 9th, but what is much more important is that my portfolio bottom two weeks ago, at up 30.5%, was up 60% from that May bottom of down 18.5%. Think about that. Sixty percent higher from one bottom to the next!!! In seven months from May to December! That’s the value of staying with your great companies, and not trying to time the market.

Staying invested has won for me. It’s enough work to find and choose great companies without having to guess getting out and getting back in, trying to time the market. (You have to be right on both decisions).

My portfolio finished at up 39.6% for the year 2021 (or at roughly 140% of where I started the year).

It was down 28% from my up 93% high of the year (1.396 divided by 1.93 equals 0.72, equals a 28% drop), but what counts is that it was UP 39.6% for the year even with the drop. That rise was up almost twice the average of the five indexes I follow (82% more actually), after being up thirteen and a half times as much as those indexes last year.

You have to learn to live with these variations. Trying to guess what the market is going to do is crazy-making, no matter what the market timers tell you.

For further discussion of what happened in my portfolio during the month, and how I handled all this, see “December” in the section called “LAST THREE MONTHS REVIEW” below.

Chang88 recently posted a brilliant analogy that he had found (post #81865), and that I have paraphrased and elaborated. Here it is:

The relationship between the company and its stock price is like a man walking his dog off its leash along a country road. Sometimes the dog walks at the same pace as the man. Sometimes it gets excited, or smells a rabbit or squirrel, and runs way out in front of the man, and sometimes it stops to explore a sniff, or runs back to explore some interesting smell. When they arrive at the man’s destination, the man had walked a mile, but the dog ran four miles. The thing to remember is that they always get to the final destination together. In the end, the dog’s results, after all its back and forth, depend on the man’s speed.

In early December our dogs ran back far from where they were a month previously. Can I predict where the dogs will go tomorrow, or even next month? No, I can’t. But I see that the men we are following are in good health, they are intelligent and know where they are going, and they are walking fast to get there, even breaking into a run in some cases, and all are going much faster than the other people along the road. Therefore, as an investor, I choose to ignore the noise and to continue investing in the men, and to not worry much about where the dogs happen to be this minute.


My portfolio closed this month 39.6% (at 139.6% of where it started the year)! Here’s a table of the monthly year-to-date progress of my portfolio for 2021.

**End of Jan 		+  2.5%**
**End of Feb         	+  0.3%**
**End of Mar 		- 13.0%** 
**End of Apr		-  0.2%**
**End of May		+  4.1%**
**End of Jun		+ 16.5%**
**End of Jul		+ 21.9%**
**End of Aug		+ 50.9%**
**End of Sep		+ 71.3%**
**End of Oct		+ 82.8%**
**End of Nov		+ 62.1%**
**End of Dec		+ 39.6%**

If you think about it, since many of us were up more than 200% last year (more than tripling our entire portfolios), it seeemed logical to assume that our stocks (and way of investing) had overshot by a lot, were way overvalued, and would fall back this year. But here we are, at the end of the year, and we are actually up substantial amounts again, in spite of wildly overshooting last year, and living through some large pullbacks.

If you want to see what tough results would look like, I ran into an article mentioning this on Wednesday and I updated it to the end of the year: While U.S. stocks are coming to the end of 2021 on a high note, the ARK ETF family flagship ARK Innovation ETF (ARKK) is down 27.1% this year and is set for its worst annual performance since its start in October 2014.

If you take my portfolio’s results from last year (2020) of up 233.3% (or 3.333 times what it started with), and multiply those results by this year’s up 39.6% gain, you will see that the portfolio has between quadrupled and quintupled in two years. (3.333 x 1.396 = 4.65 times what it started with on Jan 1, 2020).

Remember that this was done with no leverage, no options, no margin, no penny stocks, no fancy stuff, just a concentrated portfolio of high growth companies.

That is such a preposterous and ridiculous result that, as I’ve said before, it’s hard for even me to digest it. As I’ve said before, humans aren’t supposed to get results like that, but our companies keep on turning out extraordinary results. But wait, here come the five year results:


You will hear an incessant chatter from know-nothings telling you that no one can beat the averages and that stock picking doesn’t work, and that books have been written to prove it, and that we will all return to the mean, so I thought that I’d give you some facts about it.

Guess what folks! The books are wrong. Here are my last five years of results compounded, which you can compare against the S&P. Remember that I’m not just picking my results off the wall. I posted my positions and their sizes every month of those five years so any one who wanted to check me out could have done so. It’s real, and others on the board have done approximately the same, some a little better and some a little worse, but in the same range. It can be done, although I strongly doubt that we will ever have another year like 2020.


**2017:  	+  84.2%		$100 becomes $184.20**
**2018:   +  71.4%		$100 becomes $171.40**
**2019 	+  28.4%		$100 becomes $128.40**
**2020  	+ 233.3%		$100 becomes $333.30**
**2021	+  39.6%		$100 becomes $139.60** 

As of last year, in four years, that compounded to 1351%, of what I started with. Now, in five years, those numbers compounded to 1886% of what I started with. That’s not up 88% or even 188%! It’s about nineteen TIMES what I started with in January of 2017, in five years, which is really, really, crazy numbers, (and shows the power of compounding!)

During that time the S&P was up 112% in five years, even with this year’s large gain (large for the S&P). That’s up 112% compared to up 1786%!!! You can add a few percent by adding in dividends, but that doesn’t change the comparison at all.

If you are thinking that that’s impossible and that noone could do that , here is what GauchoRico posted for his four year results: He was up 1,135% while I was up 1,251%.… Pretty much the same thing! It’s not a fluke.

Tell me again that active intelligent stock picking doesn’t work! The only ones who say that are the people who don’t know how to do it.

Read the Knowledgebase several times. And the other articles on the side panel. And the posts with lots of recs by people you trust, and you may learn how to do it too.

I am no good at timing the market and I haven’t tried, but have just stuck with strong, rapidly growing, high-confidence companies. I can’t tell you what the market will do Monday, or next month, or the next three months, or six months, but I can tell you that these companies are very successful, and that I can sleep well with them in my portfolio.

I did make a rather silly prediction 11 days ago that our portfolios had hit the bottom of this current sell-off on Dec 14th. So far that prediction has held up quite well but I didn’t base any of my investing on it. I stayed fully invested throughout (with even a tiny 2% margin) and at no point did it even occur to me to sell out of my positions.

Please don’t base any of your investing on that prediction. It could be proved wrong next week, who knows?


Here are the results year to date:

The S&P 500 (Large Cap)
Closed up 26.9% YTD. (It started the year at 3756 and is now at 4766).

The Russell 2000 (Small and Mid Cap)
Closed up 13.7% YTD. (It started the year at 1975 and is now at 2245).

The IJS ETF (The S&P 600 of Small Cap Value stocks)
Closed up 28.5% YTD. (It started the year at 81.3 and is now at 104.5)

The Dow (Very Large Cap)
Closed up 18.7% YTD. (It started the year at 30606 and is now at 36338).

The Nasdaq (Tech)
Closed up 21.4% (It started the year at 12888 and is now at 15645).

These five indexes averaged up 21.8% for the year 2021. So if you hear talking heads talking about how growth stocks were sold off and you should have been in value or something like that, please remember that (even after the big “sell-off”), our portfolios were up almost twice as much as the average of the indexes.

None of our companies are expected to report in January.


October had no earnings announcements and was a relatively calm month. Upstart, at $390, reached 31.5% of my portfolio at one point but was now down to back to just 26.4% at a price of $322. Datadog was still in second place, and Cloudflare in third after another week in mid-October of announcements of new products and enhancements. After wondering why Cloudflare kept going up I decided to go with the flow and let it rise, which it did, rising to $195 from $134 a month ago. Monday, which I just bought in August, was now in fourth place, and was probably my second highest confidence position, after Upstart [Boy, was I wrong about Upstart in retrospect!] It just took me a while to build a position in Monday because of low volume and a wide spread, and subsequent short sharp movements up and down for no reason except someone buying or selling some shares. Crowdstrike announced that they have formed an alliance with a number of companies, and seemed to be forming a security cloud. I again exited my tiny position in Snowflake, to put the money somewhere else. During the month Lightspeed had to fight off a short attack. Then in the last two weeks it announced a comprehensive restaurant solution and then a retail one, showing that it had apparently incorporated its acquisitions well. Finally, I’d taken a little 3.6% position in a small company that I wasn’t ready to talk about yet.

November had lots of crises. They started when Lightspeed announced a real slowdown that they seemed puzzled about and couldn’t really explain, the price plummeted, and I, among others, sold out in disappointment. The price was already depressed from the short attack in October (which had been mostly nonsense based on mis-statements or typos by the company back in 2018 or 2019), and the share price was further depressed by the sell-off after earnings before I could get out.

Then we got hit again with Upstart not living up to everyone’s wild expectations, and it sold off mightily. As I wrote on the board in my post called “What I did about Upstart”, I had sold down from a once 31.5% position (which was way too high), to a 23% position prior to earnings, but I took a big hit on what was left. With a little more trimming and the fall in stock price, my position size was now down to a more sane 15.6% position.

In spite of that double whammy “catastrophe”, in a very concentrated portfolio which so many people worry about, I finished November still up 62% year-to-date, which is way above what I could have had with a more diversified portfolio.

The reason that my portfolio was still doing so well, in spite of the massacres in Upstart and Lightspeed, is that four other stocks in my portfolio just kept going up and up and up, and hitting new highs regularly. These were (in alphabetical order), Cloudflare, DataDog, ZoomInfo, and Zscaler.

The money from my sales of Lightspeed and Upstart went mostly into Monday and Amplitude, and some to ZoomInfo. (Amplitude was the little tryout position I talked about last month and is now up to a 6.8% position). I also again have a little 1% position in Snowflake (this must be the 4th time).

Since my last monthly summary, in addition to those from Upstart and Lightspeed, we also had earnings reports from Datadog, ZoomInfo, Monday, Cloudflare and Amplitude.

Datadog, ZoomInfo and Monday blew it away. Cloudflare continued on its merry way of 50% plus revenue growth, but made it clear with new products that it’s trying to become the fourth internet cloud (with AWS, Google and Microsoft). Amplitude had excellent growth but worried some people by not guiding high enough (which was well explained in the conference call). Leading up to earnings Monday rose $90 in a day, but then sold down $80 the next day when they announced that this earnings report satisfied requirements so that their IPO lock-up period was ending. (They have low daily volume so an attempt to sell a substantial number of shares moves the price irrationally).

December. Since my November report we had earnings from Zscaler, Snowflake, SentinelOne, and Crowdstrike. Zscaler had great results. Snowflake and Sentinel just blew it away. Crowdstrike had good “solid” results, but their revenue growth rate fell from 70% to 63% sequentially in spite of all the tailwinds of breaches all over the place, while Sentinel was growing revenue at 127%, just over exactly twice as fast

You mean I was unhappy with 63% growth??? Well Zscaler, Sentinel, and Cloudflare, all of whom also have their oars in cybersecurity, were all accelerating revenue growth (Cloudflare only accelerating a tiny bit, I’ll admit), but Crowd’s growth rate dropped from 70% to 63% in a single quarter, and it has been steadily descending.

I had continued to trim my Upstart position between $220 and $165, but when it got to $140 and below, I decided that this was getting silly, the price was just 35% of its high of a month or two before, and all the news (what there was of it) was good, and I held on to what had gotten down to a 7% position.

To get money to buy my Sentinel position, and build my Snowflake after results, I sold out of my new Amplitude position, which I had been trying to build up, and heavily trimmed Crowdstrike. I have also lightly trimmed DataDog whenever it got over 20% of my portfolio, as I said I would do. I added a tiny bit to Monday, even though it was over a 16% position at the time, because I just can’t resist. ZoomInfo has been a star of my portfolio, down much less off its recent highs in this sell-off than most of my other companies, and has moved up to 3rd place in my portfolio.

Why did I sell out of Amplitude when I needed cash? Well, I felt Amplitude was my least sure company as far as results going forward. They guided so weakly, that we had to hope that they were HUGELY sandbagging, but what if they weren’t? I didn’t have to hope for the results of Snowflake and SentinelOne, where I was putting the money. Simple as that!

But then later in December, I used some money that I was trimming from others (Datadog because it was over 20% of my portfolio, and even some of my favorites like Monday and ZoomInfo, etc), to buy back a position in Amplitude. I’m not always consistent.

For more on the earnings reports see the individual stock summaries below.

Please remember that I could change my mind about any one or more of my positions tomorrow, depending on new information or other factors, and I won’t do another update until the end of the month. Make your own decisions. Don’t just follow mine. I make mistakes at times! Guaranteed!


Here’s how my current positions did in 2021. I’ve arranged them in order of percentage gain. As always, I’ve used the start of the year price for stocks I’ve been in all year, and my initial buy price for stocks I’ve added during the year. I tend to keep buying as the price rises, so my average price is almost always higher than my starting price.

Please remember that these starting prices are from the beginning of 2021, and not from when I originally bought them if I bought them in earlier years.

**DataDog from 98.44 to 178.11	    	up          80.9%** 
**Cloudflare from 75.99 to 131.50	        up	    73.0%**
**Zscaler from 186.70 to 321.33		up	    72.1%	buy in May** 
**Upstart from 92.20 to 151.30	        up	    64.1%	buy in Apr** 
**ZoomInfo from 47.34 to 64.20		up	    35.6%	buy in Apr** 
**Sentinel from 46.99 to $50.49		up	     7.4%	buy in Dec**

**Amplitude from 54.15 to 52.94 		down	     2.2%	buy in Dec (2nd time)** 
**Crowdstrike from 211.82 to 204.75	down 	     3.3%**
**Monday from 360.51 to 308.72		down	    14.4%	buy in Aug**

The clearest thing I can read from this is that Crowdstrike, whose growth was slowing rapidly, actually ended up flat/down on the year, in spite of an average of 69% growth for for the last four quarters, which certainly isn’t a growth rate to apologize for. However that growth rate was down from an average of 86% the four quarters before that. And Crowd’s final growth rate from last quarter was 63%, down 23 percentage points from 86% the same quarter last year.

Now, let’s look back to a year ago. At this time last year Crowd’s last four quarters of growth were up 89%, 85%, 84%, 86%. We had a strong company with an 86% growth rate, and there was no indication that growth would drop so rapidly this year. Crowd was my highest confidence position and had grown to a 34.0% position at the end of last year (2020). Its stockprice had grown 325% in 2020!

Paired with what happened with Upstart this year you can see why I have resolved not to have any more 30% positions and to stick with a maximum of 20%, no matter how much I like the company. Granted, I have Crowd down to a 4% position now, and Upstart down to a 8% position, but I don’t want to have to go through something like that again with a company making up such a large percent of my total portfolio.

Oh, and I’m sure that at some point I will break that rule and let a position grow to well over 20% again. Consistency is not one of my strong points.


I now have ten positions which is about the top of my comfort range. Some changes are that I’ve added Sentinel, that Snowflake went from a 1% position to almost 10%, that Crowd has shrunk to my smallest position, that ZoomInfo is up to third place, that I sold all my Amplitude and then bought a good part of it back.

Here are my positions in order of position size, and bunched by size groups.


**Datadog			20.0%**
**Monday			16.7%**

**ZoomInfo		10.4%**
**Zscaler			10.2%**
**Snowflake		 9.6%**
**Sentinel		 9.2%**
**Cloudflare	         8.8%**
**Upstart			 7.9%**

**Amplitude		 5.0%**
**Crowdstrike		 4.0%**

I’ll give you a little capsule of the positions before moving on to the extensive company reviews:

DataDog is in first place and a 20% position, and is high confidence. In fact it’s been in first place for quite a while. It fell a relatively small amount in this pull-back, and is now down only about 10% from its high. I trimmed a little this month when it went over 20% of my portfolio because my experience with large positions well over 20% has been terrible. I will trim as necessary to keep it under 21% at most.

Monday is a 16.7% position in 2nd place. It fell a large percent from its high during the pullback, apparently due to lock-up expiration coinciding with the sell-off. It announced extraordinary results, and it’s very high confidence, but I have enough at 17%. If I add here it might soon be over 20% with a price rise and then I’d be trimming it.

ZoomInfo also only fell moderately from its high. I hadn’t trimmed a share since I started investing in it about five months ago until the week before last, when I was retaking a position in Amplitude. ZoomInfo has moved up to 3rd place, believe it or not, at 10.4%, passing Cloudflare and Upstart on the way recently, because ther stock prices fell lots and its didn’t. No more plans to add or trim.

Zscaler has also been strong, falling less than most from its high, It’s in 4th place at 10.2% of the portfolio. It had extraordinarily good results with accelerating growth earlier this month.

Snowflake. I took my current position at about $350, all in the last six weeks. It’s now a 9.6% position in 5th place. It had great results and it’s pretty high confidence, but still quite highly valued, though not as much as a year ago.

SentinelOne is a new position that I took this month after it announced its extraordinary Oct quarter results. It’s in 6th place at 9.2%.

Cloudflare has been weak, falling 35% from its high with no bad news except its high valuation (which was really very high). It’s in 7th place with a 8.8% position. It’s a high confidence company. I did sell a bunch though at about $164 to raise cash to buy Snowflake and Sentinel, and to bring it down to an 11.5% position, and it fell the rest of the way on its own.

Upstart has been very weak, falling, at its bottom, an incredible 67% from its $390 high. It’s fallen like this because of inflation and interest rate worries, as well as sequential growth disappointing. However, even with the trimming I did, it’s still at 7.9% in 8th place. It’s very cheap at this point (with forward EV/S probably under 10), but since it’s not a SaaS company it is hard to have confidence in future earnings. (Arranging tiny loans for 30 minority owned banks doesn’t sound as if it will move the needle). I don’t see trimming more considering that expectations seem so low, but I don’t see adding at this position size either.

Amplitude was fairly weak and fell about 40% from its high with no bad news. I had sold out for cash for my purchases as it was fairly low confidence. We only had had one earnings report that came 10 days after the IPO, and while revenue growth accelerated to up 72%, they guided very, VERY, cautiously. I didn’t, as of yet, have much history to give me high confidence. Then in the last two weeks I retook a position. It’s now at 5.0% and in 9th place.

Crowdstrike hasn’t moved much in a year and its valuation has fallen considerably in spite of good but rapidly decelerating results.I had been trimming consistently all that time. It seems to be leaving the group of high growth stocks, but we could see a surprise next quarter. It’s in last place and a 4.0% position. (See my discussion above under the section called “THE CLEAREST THING I CAN READ FROM THIS.”)


Please note that when I discuss company results, I almost always use the adjusted values that the companies give.

I’m going to discuss them in mostly alphabetical order but I’ll start with Upstart again. Here are my up to date thoughts and what I’ve done:

In late Sept or early Oct I had over 31.5% of my portfolio in Upstart. I decided I wasn’t comfortable with such a huge position in any one company and over a month and a half I gradually trimmed it in fits and starts, so that, in spite of the price still rising, it was down to 26% at the end of October. By the time we were going into earnings in November I had reduced it to about a 23.4% position, still too large.

Then came earnings. While I was out of my Lightspeed position within 24 hours, I didn’t do that with Upstart. At first I didn’t buy or sell any. I didn’t sell any because I didn’t see a clear need to and I certainly didn’t add any, even after the sell off, because I thought a 20% or high teens position was enough. Especially for a non-SaaS company. But the more I thought about it over the next days, the more the fact that it was consumer facing, macro economics influenced, and a non-SaaS company without recurring revenue, weighed on my mind, and with a combination of a little further sell off, and a little more trimming on my part, it was down to a 15.6% position at the end of November.

In December I had continued to trim my position at prices from $220 down to $165, but when it got to $140 and below, I decided that this was getting silly, the price had fallen 67% from its high of a month or two before, and all the news (what there was of it) was good, and I decided to hold my 7.5% position, which has now grown by stock price rise to 7.9% .

Why didn’t I sell out, the way some others did? Let’s look at some numbers:

Revenue was $228 million, up 250% yoy. To put that into words that are perhaps more intuitive, that’s half way between tripling and quadrupling their revenue yoy! Sure some of us were hoping for even more, but REALLY!

Fee revenue was $210 million, up 235% yoy, again more than tripling.

Transaction volume of loans originated on the platform up 244%, also more than tripling.

Operating income was $28.6 million, up 134%.

Net Income was $57 million up 367%, more than quadrupling and almost quintupling, from $12 million.

Adj EBITDA was $59 million, almost quadrupling from $15.5 million

The Adj EBITDA margin was 26% of revenue, up from 24%.

So why in the world should I have sold out of this company??? These numbers were all beating guidance, net income and adj EBITDA by huge percents, but revenue only by 6%, which disappointed people.

Let’s look at sequential:

Revenue was $194 last quarter, and $228 this quarter, so it “only” rose by 17.5% sequentially. That was below expectations, a low-side outlier for them, but that’s not a trivial gain by any means. Up 17.5% per quarter is a run rate of up 91% per year.

Let’s see what guidance was for next quarter. It was $265 million. If they beat that by 6% (which I would consider the absolute floor), we are talking $281 million, or a 23% sequential gain, or a run rate of up 129% (more than doubling). And, if they just beat by 8%, they will be up 25.5% sequentially, or a run rate of up 148%. Etcetera, you get the picture.

I’d like to make a suggestion of something for you to think about. Instead of focussing on last quarter’s sequential revenue growth coming in at “only” 17.5%, growing from $194 million to $228 million, is it possible that the actual outlier was the insane 60% sequential growth the quarter before, growing from $121 million to $194 million? In other words, a lot of growth coming on all at once, being crammed into that quarter, leaving less in every metric for last quarter? Putting the two quarters together you get 88% growth, which compounds to 37% sequential growth per quarter, and a run rate of up 253% per year.

Going back one more quarter, we had revenue growing by 39%. So they have been growing revenue by 38% compounded for the last three quarters. And it was 34% the quarter before that, so we have them establishing a sequential growth rate of 37% compounded for the last four quarters.

Is it possible that our worry is overblown? Heck, if revenue growth falls to 25% sequential growth per quarter next year, it would still be growing at 144% annualized, or even at 20% per quarter it would be growing at 107%

Should we run away from this company??? This is a company that isn’t at 30 or 50 times revenue, but is one that is under 12 times forward revenue while growing at over 200% yoy. It’s not at the end of its TAM but just starting out up the S shaped curve.

So that’s why I kept Upstart. It’s now just a 7.9% position, but that’s still a meaningful position.

Amplitude was a little try-out in October but it grew into a real position in November. Then in early December I sold out of it to raise cash to buy SentinelOne, but in the last two weeks I took a new position in it again. Yes, I changed my mind twice.

Investor Mookie brought Amplitude to the board on Sept 28, the day of its Direct Listing. A lot of the below comes from Mookie’s write-up.

Amplitude provides data analytics software that allows firms to better understand their customers’ behavior.

Customers incude giants such as Ford, Walmart, BurgerKing, Canal+, UnderArmor, Le Monde, and newer firms such as Square, Hubspot, Smartsheet, instacart and Atlassian.

Competitors include Google Analytics, Adobe, and plenty of companies I am unfamiliar with, but apparently not Datadog.

Datadog is focused on logging and observability inside of systems and infrastructure. How is my system performing? Where are potential anomalies and where are potential cyber attack points?

Amplitude is ‘customer telemetry’ and customer upsell – Where are my customers clicking? What ‘user journey’ do they go on? Where are my opportunities to sell/upsell?

Thus Amplitude helps companies understand customers, and what they are doing, and to convert that understanding into increased sales. This seems to be something that practically any company would be interested in. But I certainly could be wrong.

This is a small company with plenty of room to run. Quarterly revenue was only $45.5 million, accelerating to 72% yoy growth. RPO was $152 million, up 66%. Adj Op Loss was only $2 million (not counting the one-time Direct Listing costs). Adjusted EPS was a loss of 5 cents. Paying Customers were 1417, up 54%. NRR was 121%, up from 119% yoy. And they just appointed someone who was formerly President of IBM and CEO of Red Hat, to their Board of Directors, which gives me the feeling that they are considered a reputable and solid company, or he wouldn’t have accepted.

They also announced an integration with Snowflake so that “anyone who uses Snowflake can be an Amplitude customer in just a few clicks”. This means every member of an organization can use Amplitude to run lightning queries of Snowflake data on the Amplitude platform. This integration speeds up time to insight from days to minutes, expands data accessibility, and maximizes its return on data cloud investments.

As a reminder, they did not sell shares or raise any capital during their direct listing.

They also opened a new data center in Frankfort, in conjunction with AWS, to support customer growth in the EU.

**Cloudflare (NET)**had been a star of my portfolio, almost sextupling, at one point, since I first bought it in 2020. I had been saying that I didn’t understand why it was going up like that. It’s growing revenue steadily at 50% or so, which is certainly a great rate of revenue growth, but it is slower growth than my other positions.

So what was the market seeing that I wasn’t? I suspect that there were two issues. First was that they were putting out new products and enhancements to older products at a rate that has rarely been seen before, and the thesis is that this will enable high growth to continue for many more years than currently expected. The second issue was a perception that this company is on its way to both become a fourth cloud (along with AWS, Azure, and Google), and in another sense take over the cloud world :grinning:.

Well, maybe it is! It continued on its merry way of 50% plus revenue growth. The people pushing the stock up, with what must have been massive buys, obviously believed it. Well in December the price rise finally ended, in conjunction with the pull back in all the high growth software companies. This month Cloudflare fell from a 16% position to a 9% position, partly because I trimmed it some to buy SentinelOne and expand my Snowflake, both of which are growing at rates more than double Cloudflare’s, but also because the stock price fell even more than the rest of my portfolio. It remains a great company and I have no plans to exit it.

Crowdstrike announced their results for the quarter ending in October in December. We expected more revenue growth, considering the well publicized breaches all over the place, but their growth rate fell to 63% from 70% in one quarter, and from 86% yoy. Such a large deceleration was definitely disappointing

“Wait!” you say, “You were disappointed with 63% revenue growth! You’ve got to be kidding!” …You have a point, but “Oh yes!” we were.

You could consider it another good solid quarter. After all, they grew:

Revenue at 63%, and
Subscription revenue at 67%, and
Subscription Gross Margin by a percentage point, and
Free Cash Flow Margin was positive 32.5%, up from 22% sequentially (but flat with a year ago), and that’s a very healthy FCF margin.
They added a huge 1607 subscription customers, and
Total subscription customers were up 75% yoy.

Clearly their company is doing well, but we were still left wondering why, with all the breaches and ransomware all over the place, the company wasn’t growing faster, and the company growth rate was tumbling. Have they hit the dreaded Law of Large Numbers.

In October they announced that they have formed an alliance, the CrowdXDR Alliance with a bunch of other prominent security companies, which indicates, it seems, that they are forming a security cloud. In December they added more companies.

In November they acquired SecureCircle, a SaaS-based cybersecurity service that extends Zero Trust security to data on the endpoint.

They announced in December that the U.S. agency responsible for defending critical infrastructure, The Cybersecurity and Infrastructure Security Agency (CISA), selected CrowdStrike as one of the major platforms to protect the nation’s critical endpoints and workloads.

This was followed by three or four press releases crowing about awards they had won from rating agencies. It was impressive, but it also gave me the feeling that they were trying to reassure their customers and investors.

My Take: In spite of all the great announcements, the stock price has been dribbling down. In fact it’s close to where it closed a year ago. It’s down to a 4.0% position in 10th place in my portfolio. I’m holding my position, but I continued to trim a tiny bit here and there for cash. I think expectations are really low, and the stock might do well in response to results that are better than expected next quarter, but I’m not sure that we will see any acceleration at all. It’s fading out of being a high growth company but it has started making a lot of money in Free Cash Flow and Net Profit, so I don’t feel in any rush to sell out.

DataDog is in first place currently in my portfolio at 20.0%. They posted outstanding Sept quarter results in November. Revenue growth was up 75% yoy, and had accelerated from up 67% yoy in the June quarter, which in turn had accelerated from up 51% in the March quarter. Operating Cash Flow was $67 million, up from $52 million sequentially. Free Cash Flow was $57 million, up from $42 million sequentially. They are doing just fine.

Monday AGAIN had one of those quarters that just seemed perfect! In their second quarter as a public company they reported revenue up 95% (up from 94% sequentially). They help people work together and cooperate, and yes, I know that there are lots of other companies in that field, but none that I know of growing revenue at 95%. Monday continues in second place, behind Datadog, at 16.7%.

The number of enterprise customers over $50,000 was 613, up 231% from 185 a year ago. That’s not a misprint! … 613 up from 185 are the real numbers. NRR was 130%, up from 125% in June and 121% in March. Adjusted gross margins topped 90%. They seem to be rapidly moving towards profitabilty with Adj Operating Margins coming in at minus 11%, greatly improved from minus 72% a year ago, and there’s lots more good stuff, but I’ll let you research the rest. Pay attention and be careful of the buying process if you decide to buy any as it is a high price/low volume stock, with a wide spread between bid and asked.

SentinelOne Well there have been so many posts on Sentinel that I won’t go into great detail, but merely say that they had an absolute blowout. I overcame my hesitation and now have a 9% position, in 6th place, but actually 3rd place through 8th place are all tightly grouped between 8.0% and 10.4%. Here are some of the numbers that made me change my mind:

Revenue was $56.0 million, up 128% from $24.6 million yoy

Revenue growth progress for the last six quarters has been yoy growth of 96%, 103%, 97%, 108%, 121%, and now 127%, so accelerating every quarter except the last Jan quarter (3 quarters ago)

Revenue growth sequentially was up 22.3%, from last quarter’s $45.8 million. That’s a run rate of up 124%.

Annualized recurring revenue (ARR) was up 131% to $237 million from $103 million a year ago.

Total customer count grew more than 75% yoy from 3350 to over 6,000 customers, adding 600 this quarter.

Customers with ARR over $100K grew 140% year-over-year to 416 from 173 a year ago.

Dollar-based net revenue retention rate hit a new high of 130%, up from 115% a year ago.

Adj gross margin was 67%, up from 58% a year ago

Adj operating margin was minus 69% of revenue, improved from minus 102% a year ago. Not only that but the last three quarters the Adj op margin has been -127%, -98%, and -69%. Clearly improving.

Cash was $1.7 billion so they are clearly not going to run out of money

Snowflake. As with Sentinel just above, Snowflake also blew it away in their October results, and I built my 1% position to a 9.2% position in 6th place. Why? Here are some of the results:

Total revenue of $334 million, up 110%, and up 23% sequentially.
Product revenue of $312.5 million, up 110%
Adj Prod Rev Gross Margin was 75%
RPO of $1.8 billion, up 94% yoy
Total customers were 5,416
Customers over $1 million were 148, up 128% from 65, and up 28% sequentially from 116.
Net revenue retention rate of 173% !
Op Margin was 2.5%, hitting positive territory long before they had guided
Op Cash Flow was $15.5 million
Op Cash Flow Margin was 4.6%
Adj Free Cash Flow was $21.5 million or 6.4% of Revenue
Adj EPS was 4 cents, up from a loss of 28 cents a year ago

Continued international expansion resulted in product revenue from the EMEA and APJ regions up 174% and up 219% yoy.

Guidance for product revenue next quarter was up 96%, which probably means it will be over 100% again.

Conference Call – Just about every analyst said something like “amazing” or “fantastic” or “terrific” or “unbelievable results”.

ZoomInfo. My position has grown to 10.4% which puts it in 3rd place.

To quote the Morgan Stanley analyst in the March quarter Conference Call:

…all the growth metrics are accelerating up and to the right. Is it fair to say that there’s a fundamental shift that’s happening right now, and that shift is actually accelerating in its pace?

What was the analyst referring to? Well their yoy revenue growth, which had been going along at a pedestrian 42%, 40%, 41%, all of a sudden, in the December 2020 quarter, accelerated to 45%, followed by 48% in the March quarter of this year, 57% in the June quarter and now 60% in the Sept quarter. These are rates it had never seen before. International revenue is growing at 80%. Operating cash flow was $46.5 million, and Free Cash Flow was $73 million.

Here is some of the business development news:

Our Intent products, which find consumption patterns to help go to market teams identify and gauge prospects, experienced significant growth with active users growing more than 5x yoy.
Acquired RingLead, a leading provider of data orchestration and revenue operations automation.
After the acquisition in July, we announced our first integrations with platform in September, allowing customers to transcribe and analyze calls taken in ZoomInfo Engage, access Chorus’ Momentum Insights within our platform, and unlock our business-to-business data and insights for the Chorus offering.
Our board of directors unanimously approved the move to a single class of common stock, with one vote per share.
Closed the quarter with more than 25,000 customers, and more than 1,250 customers over $100,000, who now represent more than 40% of our overall ACV with the ACV from that cohort growing by more than 85% yoy.

International continues to be a success story. We had international revenue growth greater than 80% yoy, with international representing more than 11% of our overall business or over $80 million on an annualized basis. We now cover nearly all businesses with more than 100 employees in Europe.

In ZoomInfo Recruiter, we added a number of new features to improve the user experience and open up the platform for more integrations. While still early and small, we more than doubled the number of recruiter customers… sequentially!!!.

We’re again raising our financial guidance for the year. We now expect to deliver revenue growth of 54% in 2021 with organic growth of 50% at the midpoint

Saul: Well, I feel that this is one of my only companies that is clearly undervalued.

Zscaleris in 4th place with a 10.2% position. It had excellent October quarter results, announced a month ago.

Revenue: $230.5 million, up 62%, accelerating from 52% last year, and 57% last quarter
Revenue growth sequentially was up 17%, accelerating from up 12% last quarter and up 13% a year ago.
Billings were up 71% from $145 million to $248 million yoy. A year ago they were only up 64%.
Gross Margin was 81%.
Op Cash flow was $93 million, up from $54 million last year
Free cash flow was $83 million, up from $42 million last year !!!.
Free cash flow margin was 36% of revenue.

And lots more like that, accelerating but not in the same class as SentinelOne (which does have the advantage of being considerably smaller, I’ll admit.


We started our current investing spurt in the beginning of 2017, about five years ago.

When you sign on to the board you’ll see in the middle of the screen a little icon that says “<< 7 days >>” click on it down to where it says “365 days”, and go back 5 years (5 clicks). Back then our board was a twentieth of the size it is now, at most. The first page I came to had a total of 45 recs on an entire page of 20 posts, or an average of a little over two recs per post. A post with 25 recs was unusual, 50 was uncommon, and 100 was really rare. We also had many fewer posts each day.

As an example, until just a few months ago we had NEVER, EVER, had a post with more recs than the high 300’s. Yet earlier this month I had a ordinary post, just a post about what I had done about a stock, that had over 660 recs. That is crazy!

Our success has flooded us with new posters and readers (that’s you, most likely), so you can see we have to limit our posts to meaningful ones to avoid flooding the board and destroying it. I may at times seem arbitrary in deleting posts but that’s why it’s necessary.

Thanks for your cooperation

Let me remind you first, that I have NO IDEA what our stocks will do next month. I’m terrible on predictions. But I know that the businesses of our companies will do just fine for the most part.

I feel that my portfolio is made up of a bunch of great companies. But that’s just my opinion, and I can’t say often enough that I’m not a techie and I don’t really understand what most of them actually do at all ! I just know what great results look like. I figure that if their customers clearly like them and keep buying their products in hugely increasing amounts, they must have something going for them and, as I’ve often said, I follow the money, the results. And I listen to smart people about the prospects of these companies.

When I take a regular position in a stock, it’s always with the idea of holding it indefinitely, or as long as circumstances seem appropriate, and never with a price goal or with the idea of trying to make a few points and selling. I do, of course, eventually exit. Sometimes it’s after months, and sometimes after years, but I’m talking about what my intention is when I buy.

I do sometimes take a tiny position in a company to put it on my radar and get me to learn more about it. I’m not trying to trade it and make money on it, I’m just trying to decide if I want to keep it long term. If I do try out a stock in a small position and later decide that it’s not what I want, I sell it without hesitation, and I really don’t care whether I gain a dollar or lose one. I just sell out to put the money somewhere better. If I decide to keep it, I add to my position and build it into a regular position.

You should never try to just follow what I’m doing without making up your own mind about a stock. First of all, you may have a completely different financial picture than I have. Different income, different assets, different debts, different expenses, different financial responsibilities, etc. Besides, in these monthly summaries I’m giving you a static picture of where I am currently, but I may change my mind about a position during the month. In fact, I not infrequently do, and I make changes in the position. I usually don’t announce these changes until the end of the month, and if I’m busy or have some personal emergency I might not announce them even then. And besides, I sometimes make mistakes, even big ones! Don’t just follow me blindly! I’m an old guy and won’t be around forever. The key is to learn how to do this for yourself.

Since I began in 1989, my entire portfolio has grown enormously. If you are new to the board and want to find out how I did it, and how you can try to do it yourself, I’d suggest you read the Knowledgebase, which is a compilation of my “words of wisdom”, and definitely worth reading (a couple of times) if you haven’t yet.

A link to the Knowledgebase is at the top of the Announcements panel that is on the right side of every page on this board.

For some additions to the Knowledgebase, bringing it up to date, I’d advise reading several other posts linked to on the panel, especially:

How I Pick a Company to Invest In,
Why My Investing Criteria Have Changed,
Why It Really is Different.
Illogical Investing Fallacies

I hope this has been helpful.



This is an addnedum to my End of 2021 report. There were two issues I meant to discuss but neglected to mention.

The companies currently in my portfolio are growing their revenue from about 50% to over 200%. (That was Cloudflare at the low end and Upstart at the high, but Snowflake was up 110%, and Sentinel more than that, and Monday was up 90%). Let’s be conservative and say they averaged about 75% to 80% revenue growth. I’m not giving an exact calculation as this is just illustrative.

Meanwhile my portfolio value “only” grew 40%. That certainly brings average “valuation” down. Crowdstrike, for instance, probably grew revenue 70% on the year, and their profitability considerably more than that, but their stock price was actually down a few percent for the year.

And if my portfolio compounds another 40% in 2022, let me tell you that I’ll be very happy with that. Remember that I averaged “just” 32% growth for all those years, and I remember also how 32% compounded insanely!

I explain clearly in the Knowledgebase how I calculate my investing returns so that adding or subtracting money from the investing accounts won’t affect my investing percentages.

In other words, if I start with $100,000 and gain $40,000 in six months investing I was “up 40% ytd.” If I then added $20,000 from another source, and had $160,000 in the account, my investing is NOT suddenly up 60% ytd. My investing was still up 40%.

Or if, instead, I pull out $30,000 for living expenses, and only have $110,000 left in my investing account, that DOESN’T mean my investing only gained 10% ytd. It still gained 40% and I am still up 40% ytd. I recalculate to make what I report a true value of my investing percentage gains or losses, as described in the Knowledgebase.

Okay that’s my investing results. Now let’s look at my portfolio value. I retired in mid 1996. That is 25½ years ago. For 25½ years my family has been living off what I make in the stock market. I have no other source of revenue besides the neglible amount from Social Security. No job, no pensions, nothing.

So what did I have to pull money out of the stock market for? Everything! Groceries, gasoline, electricity bills, water bills, telephone bills, buying new automobiles over 25 years, theatre tickets, eating at restaurants, charitable donations, tips to delivery guys, buying a condo, buying a couple of houses over the years, apartment rentals before that, furniture, computers, kindles, iphones, telephone service, appliances (new dishwasher, oven, etc), clothes for all of us (my daughter was only 8 years old when I retired), sending our daughter to college and for a master’s degree, helping her and my older son with gifts over the years, new eye glasses, bicycles, airline tickets, ski trips, doctor and dentist bills, etc, etc, etc.

So what does that mean? It means the amount left in my portfolio is a lot less than it would be if I was working and didn’t have to withdraw from the investing account.

Here’s an easy way to think about it: Every thousand dollars that I had to withdraw to cover expenses in the second half of 1996 didn’t get go compound for the next 25 years. That means for every thousand withdrawn there were many tens of thousands that aren’t in the investing portfolio now. And for every thousand dollars that I had to withdraw for living expenses in 1997, those thousands of dollars didn’t get to compound for the next 24 years either, meaning many more tens of thousands of dollars that didn’t make it to the investing portfolio, and on and on.

What does this mean for you? It means that if you are planning on retiring early, make sure you have enough money that your yearly expenses will be covered by your gains even on a slow year and there’s a little more at the end of the year than there was at the beginning. If your investing nest egg starts shrinking you will need even better results the next year, or it can disappear rapidly. You want the balance in your investing account to keep rising (after living expenses are taken out) every year, until, hopefully you can live through a mild to moderate down year and still have considerably more than you started with when you retired.

Best to you all,



What I was trying to say, and didn’t say clearly enough, is that my investing portfolio (dollar-wise), isn’t up nearly as much, anything like as much, as my investing results are up over the years, (percentage-wise)! It simply can’t be if you are living off your investment income!



Thanks so much for sharing this Saul! I find it really inspiring that you were able to retire so long ago while supporting a family and having great quality of life. If this question is not appropriate for the forum please disregard and remove, but early on in your retirement years did you have a hard cap on your spending regardless of performance (e.g. 4% rule)? Or did you mainly play it by ear, meaning in years with great returns you’d spend a lot more (e.g. 7% of your portfolio), and bad years you’d spend a lot less (e.g. 2% of your portfolio)?


but early on in your retirement years did you have a hard cap on your spending regardless of performance (e.g. 4% rule)? Or did you mainly play it by ear, meaning in years with great returns you’d spend a lot more (e.g. 7% of your portfolio), and bad years you’d spend a lot less (e.g. 2% of your portfolio)?

THIS IS OFF-TOPIC SO LET’S NOT ADD TO THIS THREAD. Contact me off board if you must.

Hi tier88,
I play it by ear, but not at all by percentages. It had more to do with what I was comfortable spending at the time. For example we bought a vacation home in Provence in early 2000 and I never thought about what percent of my portfolio it cost, but when I looked just now I see that I had been up 115.5% in 1999! I think that that example explains it better than anything else I could say.


Hello Saul,

I’ll keep this short but that does not downplay my appreciation for your willingness to share and teach. I myself am a high school math teacher along with a business class who has expressed interest in learning the stock market so everything you preach and teach helps immensely.

I am building my own spreadsheets attempting to track companies better but cannot for the life of me understand why my ZI YoY revenue growth does not match what you or anyone has recently posted.

You have stated this a few times recently: "And what does the revenue growth actually look like? The last eight quarters revenue growth look like this: 42%, 40%, 41% (bouncing around in the low 40’s). And then they caught fire: 46%, 48%, 57%, 60%, so they have really been accelerating.

Sequential gives a similar picture: 8, 7, 11, 13, 10, 14, 14."

The part that gives me pause is that my sequential numbers match but my last 4 quarters show YoY of 53%, 50%, 57%, 60%. Our 4Q20 and 1Q21 YoY don’t match. Admittedly, I took those two percentages straight from the earnings report and I could say my 4Q20 is off due to the $2M from acquisitions but it seems everyone is backing out growth from acquisitions already as it is a mild point of contention.

At the end of the day, regardless of whose numbers we use, ZI seems like they firing on all cylinders. I would just like to get a bit more educated as to what I am missing.

Sincere appreciation,
Cory Needham


You have stated this a few times recently: “And what does the ZoomInfo revenue growth actually look like? The last eight quarters revenue growth look like this: 42%, 40%, 41% (bouncing around in the low 40’s). And then they caught fire: 46%, 48%, 57%, 60%, so they have really been accelerating. Sequential gives a similar picture: 8, 7, 11, 13, 10, 14, 14.”

The part that gives me pause is that my sequential numbers match but my last 4 quarters show YoY of 53%, 50%, 57%, 60%. Our 4Q20 and 1Q21 YoY don’t match… At the end of the day, regardless of whose numbers we use, ZI seems like they firing on all cylinders. I would just like to get a bit more educated as to what I am missing.

Hi Cory,

I looked and sure enough they reported the numbers you gave. I don’t remember where I got the numbers I used but I couldn’t find them. However, I agree with your conclusion: “regardless of whose numbers we use, ZI seems like they firing on all cylinders”.

While researching I did find another interesting bit of information. In a recent post I wrote

Some of its new and expansion customers in the last three quarters include Okta, SAP, Toyota, Zoom, Docusign, Shopify, Uber, Forbes, Motorola, Staples, Office Depot, Marathon Oil, AmazonBusiness (part of Amazon).

Think about that! Shopify? Zoom? Okta? SAP? Toyota? These are companies that can hire the best, and are smart enough to find the best.

Well, I just found out that they added Cloudflare this quarter to that list of impressive customers.




Hi Cory,

I had the same question. If you go to the end of each earning release, they have a table with adjusted revenue, which is adjusted for the acquisitions they made. I do not understand how they came up with the adjusted values but when I used those adjusted numbers, I got the YoY growth that Saul got. Hope that helps.



I found the anomaly as I also had the numbers that Saul had.

The revenue numbers differ because they calculated and published a non-gaap number called “allocated combined receipts” in addition to their revenue number to show their organic revenue growth and not to inflate their revenue growth in the eyes of investors. I used this number in all of my calcs as it shows the organic story. They published it until Q3 2020 (see their results prezzo’s) and defined it as:

“We define Allocated Combined Receipts as the combined receipts of our Company and companies that we have acquired allocated to the period of service delivery. We calculate Allocated Combined Receipts as the sum of (i) revenue, (ii) revenue recorded by acquired companies prior to our acquisitions of them, and (iii) the impact of fair value adjustments to acquired unearned revenue related to services billed by an acquired company prior to its acquisition. Management uses this measure to evaluate organic growth of the business period over period, as if we had operated as a single entity and excluding the impact of acquisitions or adjustments due to purchase accounting. Organic growth in current and future periods is driven by sales to new customers and the addition of additional subscriptions and functionality to existing customers, offset by customer cancellations or reduced subscriptions upon renewal. We believe that it is important to evaluate growth on this organic basis, as it is an indication of the success of our services from the customer’s perspective that is not impacted by corporate events such as acquisitions or the fair value estimates of acquired unearned revenue. We believe this measure is useful to investors because it illustrates the trends in our organic revenue growth and allows investors to analyze the drivers of revenue on the same basis as management.”