Today’s episode continues our conversation with Captain Twilio. Our guest, a financial professional and a friend of Akram’s, invests personally in a very concentrated fashion. Last time, we spoke about his previous position, Netflix. This time, we cover his current position, that’s a single position, Twilio. Akram and he talk about why he’s so confident in the stock, the risks of such concentration, and how to think about SaaS companies or really any sort of company in the current market.

 

Topics Covered

- 5:00 minute mark – The initial TWLO long case and the inherent risks from the start 

- 12:30 – The Uber ‘gift’ and the shift to selling to firms; and Flex 

- 15:30 – The value of new technologies – cost savings – and do they really deliver? 

- 18:15 – Uneconomic end markets for Twilio – a risk? 

- 21:00 – The dynamics of pricing models, and Twilio’s competitiveness 

- 28:00 – The relative value of valuation vs. focus 

- 31:45 – What cost savings means for TAM analysis, and the importance of TAM analysis (or its limits) 

- 36:00 – Wild IPO pricing and what it means 

- 40:15 – Why the concentration 

- 45:40 – Survivorship bias and growth investing 

- 49:00 – Market multiples and the importance of company culture 

- 53:30 – Revisiting the macro element, and what sort of 100-year events are happening 

- 59:00 – Echoes of 2000 

- 1:01:00 – If things go back to normal, what happens to SaaS 

- 1:07:00 – Risk to Q2 earnings season and guidance