What is Avepoint?
AvePoint is the largest independent software vendor of SaaS solutions to migrate, manage and protect data in Microsoft 365. They are not just a Microsoft partner, they are THE Microsoft Partner. They have won the MSFT Partner Of The Year Award 5 times.
Founded in 2001 and still growing. They have adapted to all the changes seen in software and cloud computing flawlessly. Not many companies have the pliability to adapt to market and technological innovations over the course of 20 years. There aren’t too many 20-year-old technology companies around today, especially ones that are thriving and still innovating, outside of the giant household names.
Taken from their investor presentation: Agility and Invention
We have consistently developed first-to-market solutions – from the days of DocAve CD-ROMs and being the first SharePoint migration vendor, to being one of the first vendors to move our solutions onto Microsoft Cloud as IaaS/PaaS and then SaaS provider, to our recent Policies and Insights SaaS product that is the first to identify, prioritize and enforce actions to prevent the exposure of sensitive information in Microsoft 365.
Flawless Growth and Financials
Here's the dopesauce. There are 212 public software companies and AvePoint is one of 5 that is growing at a rate of more than 25% revenue while maintaining a higher than 10% EBIT margin. The others in this group are ZM, RNG, NOW, TEAM. Take a quick look at the year these companies are having based on their growth and the stay at home environment. Avepoint fits this exact script.
They already have a mega client base of 7 million customers. 25% of the Fortune 500 companies use Avepoint.
AvePoint’s 7 million customers represent a 3% share of Microsoft’s 250 million 365 users. AvePoint believes it can get to 10% share and Microsoft will hit 500 million users in the future, good for 50 million AvePoint future customers.
(TAM) Total Addressable Market: $33 billion by 2022.
They did a subscription based conversion back in 2014 and according to their CEO Dr. Tianyi (TJ) Jiang, 70% of their yearly revenue is already spoken for, leaving tremendous upside for growth. They're already at 30%(!!!) YoY growth this year and looking to repeat that number in 2021.
They have no debt. Cash positive with $250M in reserves. EBIT margins of 10% as mentioned. Rare qualities in the SaaS sector. The company is well over the Rule of 40 (The Rule of 40 states that, at scale, a company's revenue growth rate plus profitability margin should be equal to or greater than 40%.). Another rare quality. This company fucks. 🚀
Valuation
Avepoint will go public through a reverse merger with Apex Technologies in Q1 of 2021. This deal values Avepoint at $2B. In my estimation with currently market climates and demand for growth investing, Avepoint is massively undervalued.
A few of wall street's favorite growth SaaS company valuations:
Fastly (FSLY) - $10.6B Market Cap and $200M Revenue
Cloudflare (NET) - $25B Market Cap and $287M Revenue
Slack (WORK) - $24B Market Cap and $400M Revenue
Datadog (DDOG) - $31B Market Cap and $368M Revenue
Now compare this to Avepoint with its $2B Market Cap and $150M Revenue. There's a huge valuation discrepancy based solely on what wall street investors are willing to pay for growth companies in the tech and stay and home sector especially with COVID. Avepoint has the potential to be a 5-10 bagger.
TL;DR Avepoint is massively undervalued and has the potential to be a 5-10 bagger over the next year should it meet standard growth tech valuations alone. This combined with it's boosted cash on the back of going public and its already flawless financials makes it the perfect company to pocket now!
Disclaimer: I have 530 shares at $13 avg and 500 warrants at $3 avg and will continue to add $500 every week
Submitted December 15, 2020 at 05:55PM by Chewie_Defense https://ift.tt/3nA4xso
