Research

Box's win of Federal Certification increases odds of material differentiation for Other Prospective Users

View above about Issue: Odds that Box is One of a Few Alternatives for its Other Prospective Users

The company announced through a press-release that they were able to obtain FedRamp High certification and expand its GxP validation offering for federal and life sciences customers respectively. Shortly after this announcement, on 9/24/2020, Box received an Authority to Operate (ATO) from the Department of Veterans Affairs, which will be using the company's cloud management software primarily for the Department's staff and doctors. This certification allows Box to continue their expansion into federal departments, with the company already working with organizations such as the USDA Farm Production and Conservation and Forest Service, the Food and Drug Administration, the Department of Justice, and the District of Columbia Government.
Research

BOX cross-selling strategy delivers stronger customer economics for Current Paying Users

View above about Issue: Peak monthly revenue per user if One & Only for Current Paying Users

BOX's increasing ability to up-sell and cross-sell existing clients on additional products and services shows a significantly improved contract value, net retention rates, and gross margins. In the company's recent 2020 investor day presentation, the company highlighted the increase in large client adoption rates of new products. On top of this, the company reports that a client with 2+ add-ons increases average customer ARR from ~$30K to ~$315K, while also increasing net retention rate from ~90% to ~125%.
Research

BOX has consistently shown they can upsell Current Paying Users

View above about Issue: Peak monthly revenue per user if One of a Few for Current Paying Users

BOX has seen strong historical tailwinds supporting their product add-ons for large clients. The company reported that over 70% of their $100K+ contracts chose to add on ancillary BOX services and products. Additionally, BOX's smaller contracts - those ranging from $10K to $100K - have a 49% add-on rate. Overall, both rates have increased greatly from Q1 2018, with add-on rate for smaller contracts increasing from 27%. This growth reflects an almost 82% jump. This trend overall suggests BOX has been increasing their ability to up-sell and further monetize existing clients and users through their broader IP and product portfolio offerings.
Research

Value investors can apply their discipline to growth businesses if they embrace tools for assessing uncertainty

View above about Issue: Value of Quantifying Stories in Scenarios

Many value investors view uncertainty as "bad" and "something to be avoided", and it is this perspective that has led them away from investing in growth companies, where you have to grapple with forecasting the future and towards investing in mature companies with tangible assets. The truth is that uncertainty is a feature of investing, not a bug, and that it always exists, even with the most mature, established companies, albeit in smaller doses . . . To deal with that uncertainty, value investors need to expand their tool boxes to include basic statistical tools, from probability distributions to decision trees to Monte Carlo simulations.
Research

ADT puts more force behind their push to improve their smart home security market

View above about Issue: Odds that ADT is a radical improvement for its current residential customers

ADT (NYSE: ADT), a leading provider of security, automation, and smart home solutions serving consumer and business customers in the United States, today named Derrick Dicoi as Senior Vice President and Chief Strategy Officer, effective immediately. In this role, Dicoi will be responsible for leading ADT’s long and intermediate-term strategic planning and execution.
Research

People who are right a lot also change their mind a lot, incrementally

View above about Issue: Value of Quantifying Stories in Scenarios

For years, psychologists, political scientists and businesspeople alike have studied how individuals change their mind—and, more specifically, how they revise the probabilities in their head. An example of this revision is when we see a dark sky from the window at noon and project that the chances of rain have gone up from 40 to 80 percent. Changing one’s assessment can be a sign of open-mindedness. As Amazon founder Jeff Bezos has noted, people who are right a lot also change their mind a lot.
Research

ADT could gain more momentum in untapped residential markets as Google reduces their Nest offering and puts more support into ADT for their future in smart home security

View above about Issue: Odds of being materially better than alternatives in untapped residentials markets

Google has discontinued its Google Nest Secure alarm system...And the company announced a $450 million investment in security company ADT in August, saying that Nest devices will “become the cornerstone of ADT’s smart home offering
Research

HVR could capture up to ~30% of OR - High Risk, similar to Canvas or Blackboard in higher education

View above about Issue: Peak market share if HVR is One & Only in OR - High Risk

As of July 6th, our data partner LISTedTECH informs us that Canvas is now the primary LMS in more US colleges and universities than Blackboard Learn. By a margin of two; Canvas has 1,218 installations, while Blackboard Learn has 1,216. Statistically speaking, the two companies are tied for US market share: they each have 28%.
Research

There are >800k police officers that could take HVR's resuscitation course

View above about Issue: Prospective subscriptions in Resuscitation

There are more than 800,000 sworn law enforcement officers now serving in the United States, which is the highest figure ever.