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Takeaway: Join us Monday February 11th at 12:30pm

EVENT DETAILS:

  • Date & Time: Monday 2/11 @ 12:30PM ET
  • Dial-In & Video Link: To be provided in a follow-up invite
  • Add Call Details to Outlook Calendar: CLICK HERE

Have you heard about the latest enterprise software IPO (not UPWK)? The company was doing pretty well as a private company, started penetrating the enterprise, got together with some VCs to jack S&M spending in an effort to pig-pile the funnel ahead of an IPO, redid all enterprise contracts with higher pricing to provide revenue runway post IPO, went public, then used that cash flow to buy a smaller private company starting to do well…and rinse and repeat? Ask me if you want some examples…[]

Investors love those companies. LOVE. Predetermined monetization and cash flow capture. I can’t say I will always hate them, but these days I barf.

When you predetermine the ending, you preclude the possible.

Game Plan: Find Unit Adoption | UPWK CALL INVITE - UPWK Invite new

I see this kind of capital organization as false security; attempting to pre-engineer the conclusion (valuation), with the penalty of closing the unit adoption market. While this game can work for a period, it can also end suddenly and badly with major revaluations southward when organic unit growth hits a penetration curve wall that no one was looking for.

I much prefer open unit adoption stories. In the case of UPWK I found one. The company is LOWERING the long tail of the take rate and driving functionality higher. The combination of lower cost and higher function in a potentially giant market can drive open ended growth for Upwork. The company’s net expansion rate with clients is not contractual, it is adoption.

UPWK is changing the way to scale a labor force into a flexible, distributed, more agile method. If we are right on this opportunity, and the demographic changes, and if UPWK executes, this is the kind of stock that could be a 10 bagger over a long enough duration.

Join us Monday @ 12:30pm to learn more.

Please call or e-mail with any questions.

Ami Joseph

Managing Director

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Yosef Vaitsblit

Analyst

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