ay were breaking down AppLovin.

2021/05/21

Today were breaking down AppLovin. Sign up here. My guest is Alex Danco from Shopify - who you may remember from our Business Breakdown on Shopify in 2021. The company has been allocating cash flow between unconventional wells, conventional wells, and debt reduction in recent years. To break down Anduril, Im joined by the companys CEO and co-founder. Our hope with this mini series is to give you an understanding of the businesses that underpin our modern lives, giving us an almost magical, ubiquitous connected existence.

. Please enjoy this breakdown of AppLovin.

Read our research on AppLovin's history, business model, and competitive positioning. To help break down Baytex, Im joined by oil and gas investor.

The business also owns some of the most popular mobile games in the world, which they use to feed richer data into their software platform. and this is the next installment in our Business Breakdowns mini-series focused on Digital Infrastructure, where we are breaking down a handful of companies that are key players in the digital infrastructure asset class. [00:57:30] - Lessons for investors, builders, and where to learn more about Afterpays story; To break down Block, Im joined by payments expert and investor at TDM Growth Partners. In the 1900s the company evolved away from their roots in gunpowder and dynamite and it's hard to find an industry they havent touched since then. For those who havent listened, I think youll enjoy that one in tandem with this. Over the coming months, we will breakdown a handful of companies that are key players in the digital infrastructure asset class. Try Daloopa for free at daloopa.com/Patrick. Please enjoy this breakdown of Anchorage Digital.

Editors note: this conversation was recorded before the field for this weeks inaugural LIV golf invitational event was announced. Founded in 2012, AppLovin provides a platform for developers to market and monetize their mobile apps. They report over $8 trillion in assets under custody and a market cap scratching $120 billion but I think the most fascinating part about this breakdown is the strategic pivot taken by Schwab. Find out why a majority of the top firms are using Tegus on a daily basis. I am Compound248 and today we are pleased to announce and kick-off a Business Breakdowns mini-series focused on Digital Infrastructure. We cover what it means to operate as a bank vs online broker, how Charles Schwab himself grew this business out of a newsletter, and whats on the horizon for Schwab in the future. Like a flywheel, but in reverse. [00:02:52] - [First question] - What is Afterpay and what it does, [00:07:07] - Size and scope of Afterpay today, [00:08:27] - The founding story and their growth being such a young company, [00:12:11] - History of the buy now pay later industry, [00:13:34] - How their payment models tend to work and how these companies make money, [00:16:35] - Unit economics, transaction structure and how money is made, [00:21:44] - How Afterpay drives leads to people via their app and merchant aggregation, [00:23:39] - An early focus on fashion and expanding beyond their core clientele, [00:27:13] - Cost of sales and thoughts on taking more credit risk, [00:31:54] - Losses as a part of cost of sales and interest, [00:33:48] - Unique things that Afterpay can do given their business model that others cant, [00:35:21] - Growth levers for this business, [00:38:29] - Other major things theyre spending money on and their acquisition by Block, [00:44:28] - The competitive landscape in the BNPL industry, [00:47:54] - Afterpays flywheel and how theyve built it better than others, [00:49:34] - Whether or not regulation plays a role in this space, [00:52:21] - What will have gone right in the next five years to ensure Afterpays growth curve, [00:55:01] - What will have happened if Afterpays growth doesnt work out in the future, [00:56:31] - Whether or not interest rate risk could turn south for them, [00:57:30] - Lessons for investors, builders, and where to learn more about Afterpays story; Buy Now, Pay Later. Get started with Coinbase Prime today at coinbase.com/prime. To break down Schwab, I am joined by Holland Advisors Founder and Portfolio Manager, Andrew Hollingworth. , co-founder of golf media business No Laying Up. This inaugural episode of the Digital Infrastructure Business Breakdowns mini series will begin with one of the broadest, most important companies in the industry, DigitalBridge. Founded in the UK in 1905 under the name Wilsdorf & Davis, Rolex has become the leading name in luxury watches. A primer on AppLovin's business model and how it helps game developers monetize and market their games. Its a business you may not recognize but have likely interacted with.

But AppLovin didnt give MoPub customers much time to migrate to MAX, just 90 days. Please enjoy this business breakdown of Fanatics. During its Q1 earnings call on Wednesday, AppLovin told investors it expects revenue from its software business, which includes AppDiscovery (a marketing platform), MAX (in-app bidding software) and Compass (analytics within MAX) to hit $2 billion by 2023. Going forward, the company plans to prioritize its software platform and focus less on its apps business. Daloopa streamlines a major pain point for investors. Web3 Breakdowns is a property of Colossus, LLC. , co-founder and President of Anchorage Digital. This episode originally ran in our. So, no, it did not go well. Jesse Pujji - A Primer on Performance Marketing, Jesse Pujji is the Founder & CEO of Gateway X. Please enjoy this breakdown of Dino Polska. We cover how revenue mechanics affect ad campaigns, why long sales funnels often offer the greatest opportunities for differentiation, and the various channels and strategies available for performance marketing. Test Daloopa for free at daloopa.com/Patrick. Digital Infrastructure powers that experience.

To help break down Baytex, Im joined by oil and gas investor, Josh Young, of Bison Interests. Berkshire Hathaway is one of the largest businesses in the world and run by arguably the most famous investors of our time, Warren Buffett and Charlie Munger. This episode is brought to you by Daloopa. To break down Schwab, I am joined by Holland Advisors Founder and Portfolio Manager.

Released Daloopa streamlines a major pain point for investors.

We cover what it means to sit at the center of the capital system and the various ways a bank facilitates risk management and risk transfer. [01:05:38] - Where Romeen would direct people to go for further study; To break down Fanatics, I am joined by an early investor.

We cover the major components of AppLovin, how the mobile games business feeds their software platform, and the importance of staying nimble while experiencing rapid growth. Scale and Loyalty are More Important Online than Offline. We discuss the history of the defense industry, how Andurils business is counter positioned against the legacy cost-plus model, and what Brian has learned about selling to the DoD. Test Daloopa for free at daloopa.com/Patrick. While the online brokerage market has been decimated in recent years from fee compression, Schwab has been pivoting their business model to that of a traditional bank. Follow us on Twitter: @bizbreakdowns | @JoinColossus, [00:02:23] - [First question] - The history of Diploma, what they do, and whats attractive about their business model, [00:04:39] - Size and scale of the business and their market capitalization, [00:07:03] - Overview of what their life sciences business vertical looks like, [00:10:00] - The cyclicality of the seals and controls business verticals, [00:13:45] - Returns on invested capital and thoughts on the capital intensity of seals, [00:15:06] - What allows their businesses to keep growing and what characterizes a strong acquisition target for Diploma, [00:19:14] - An example of how Diploma fits into the value chain, [00:21:24] - How Diploma acquires for low multiples when making acquisitions, [00:23:41] - How they drive quantitative and qualitative returns in their acquisitions, [00:27:35] - What management is like at Diploma and their longevity in the business, [00:33:19] - Overview of their competitive landscape, [00:35:27] - What the business does with extra cash flow in the absence of M&A activity, [00:38:01] - What Charlie finds special about Diploma and what has him excited for the future, [00:41:22] - The key risks in each vertical and what worries him about them, [00:48:07] - Lessons for investors, business executives and operators from the Diploma story. [00:35:56] - Having one platform is beneficial but why isnt it a more popular approach? [00:02:27] - [First question] - What the PGA Tour is, its size today, and how it generates revenue, [00:06:04] - Defining what the Tiger Tax is and its implications, [00:08:04] - When the PGA Tour was founded and the key moments leading up to today, [00:15:40] - Deane Beman: Golfs Driving Force; Changing the format of the Tour into a non-profit, [00:17:24] - Being a member run organization and player influence over the board, [00:18:23] - Overview of the business structure and model of the PGA Tour, [00:22:27] - Reasons for the 72 hole stroke-play format, [00:24:43] - The distribution of over a billion dollars of revenue, [00:27:59] - Why their capital allocation is unique and their incentive programs, [00:31:37] - Unique pension structures of their deferred compensation plan, [00:34:30] - The Champions Tour as a secondary way to make a living after the PGA tour, [00:36:07] - Rival SGL and PGL tours and how they are trying to disrupt the PGA tour, [00:44:42] - Having a legacy name advantage to bring players and capital in, [00:47:47] - Relying on growing viewership, ratings, and new sponsors over time, [00:52:48] - Paths to becoming a more successful tour amidst the new startup tours, [00:55:07] - Netflixs partnership with the PGA Tour to try and bring in new viewers, [00:56:54] - The most surprising lessons about the PGA Tour hes learned. Daloopa streamlines a major pain point for investors. If youve recently bought sports apparel online, you interacted with Fanatics. Founded in 2017 by Palmer Luckey, who previously built and sold Oculus to Facebook, Anduril has achieved the rare feat of challenging the established order in the defense industry. Diploma is a specialist distributor of medical equipment and industrial components listed in the UK. , an investor in the business and Head of Equities at, This is Dom Cooke and today we are breaking down the PGA Tour.

Try Visible Alpha for free by visiting visiblealpha.com/breakdowns, [00:02:55] - [First question] What Adyen is and what they do, [00:05:54] - General overview of how payment processing works, [00:07:29] - Flow of a transaction and how they manifest, [00:09:52] - How the business generates revenue and their revenue model, [00:11:25] - Where Adyen sits in the industry and the size of it today, [00:13:37] - The reality of processing 50-60% of their addressable market, [00:16:19] - What about their culture and founding story makes them so nimble, [00:21:18] - The competitive strengths of the business and their innovative solutions, [00:24:07] - Key revenue drivers for Adyen, [00:26:01] - What is it about Adyens business structure that enables them to grow so rapidly while still being profitable, [00:32:44] - What gives Adyen its competitive advantage over other payment providers. We discuss the history of the defense industry, how Andurils business is counter positioned against the legacy cost-plus model, and what Brian has learned about selling to the DoD.

Seth covers what separates commodity chemicals from specialty chemicals, we get some quick chemistry lessons on what's happening to create these well-known products like Nylon and Tyvek, and why after all of the years as a behemoth in the industry, DuPont has "unbundled" into several independent companies. More than 90% of MoPub publishers have made the transition, which nets out at just over 700 million daily active users in one exchange, Foroughi said.

[00:50:06] - Key differences between Stripe and Adyen, [00:56:23] - Lessons learned from studying Adyen and what payment service builders can learn from them, For the full show notes, transcript, and links to the best content to learn more, check out the episode page, Business Breakdowns is a property of Colossus, LLC.

For listeners unfamiliar with Web3 Breakdowns, the concept was inspired by Business Breakdowns but intended to be a place fully dedicated to the emerging ecosystem around blockchains, crypto assets, and everything that makes up Web3. The goal is to eventually operate the apps business at 20% higher EBITDA margins, which is more in line with typical game developers. Performance suffered, so customers spent less. We cover how buy-now-pay-later compares to traditional credit cards, what differentiates Afterpay from direct peers, and how each player of its ecosystem benefits from its offering. To breakdown Afterpay, I am joined by investor Joe Magyer.

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Having personally worked at Goldman for a decade it was great to go through the inner workings of a bank with Marc. For the full show notes, transcript, and links to mentioned content, check out the episode page here.

[00:12:18] - The strategy behind marketing luxury products; of Sohra Peak Capital Partners. To break down DuPont, we are joined by Seth Goldstein from Morningstar. Stay up to date on all our podcasts by signing up to Colossus Weekly, our quick dive every Sunday highlighting the top business and investing concepts from our podcasts and the best of what we read that week. My guest today is Diogo Monica, co-founder and President of Anchorage Digital. Daloopa uses AI to find every KPI disclosed - from charts, to text, and even from footnotes of investor presentations. For more episodes of Business Breakdowns, visit joincolossus.com/episodes. For more episodes of Business Breakdowns, visit, Stay up to date on all our podcasts by signing up to Colossus Weekly, our quick dive every Sunday highlighting the top business and investing concepts from our podcasts and the best of what we read that week. The impact to Unitys business will be roughly $110 million this year, with no carryover impact to 2023, and Riccitiello said fixing the issue is a top priority. [00:33:34] - Comparing the ghost drone system to predator drones, [00:38:40] - Guiding principles as a firm and deciding on their product roadmap, [00:43:25] - An overview of their product lineup and what theyve built so far, [00:48:13] - Having an open innovation policy to promote competition, [00:49:37] - The nuance of politics when it comes to building and running their business, [00:51:56] - Most difficult decisions hes had to make through Andurils history, [00:53:51] - How he overcame Andurils lowest points and biggest challenges, [00:58:38] - Thoughts on effectively compounding hardware innovation, [01:02:23] - A moment hes most proud of and regrets most in Andurils history, [01:04:20] - Lessons learned from observing Palantir and SpaceX, [01:08:37] - The kindest thing anyone has ever done for him. For the full show notes, transcript, and links to mentioned content, check out the episode page, To break down Goldman, I am joined by longtime financials analyst, . Deven has been an investor in Fanatics since 2011. Chris is the President and CIO of Semper Augustus and has gone as deep on Berkshire as anyone Ive ever encountered, making him the perfect person to do this with. Please enjoy this excellent Breakdown of Rolex. This is Matt Reustle and today were breaking down Baytex Energy. ; Changing the format of the Tour into a non-profit. To break down Anduril, Im joined by the companys CEO and co-founder, Brian Schimpf. Unity, which has a suite of products and services for app developers and content creators (UA, monetization, player engagement tools, etcetera), plummeted after alerting investors to issues with Audience Pinpointer, the machine learning tool at the heart of its strategy for dealing with Apples privacy changes. An asset class that undergirds and powers all modern digitally connected experiences.

All rights Please enjoy this breakdown of Anduril. Owned by a Foundation and run as a non-profit entity, little is known about Rolex. Founded in the thick of the Industrial Revolution, McKinsey set about professionalizing the way businesses were managed. Daloopa updates these KPIs and data points in your existing Excel models in one click, regardless of your source or format. We cover how Facebook successfully navigated the transition from desktop to mobile, what drives the value of its network, and dive deep into the Facebook ad ecosystem. This is Matt Reustle and today we are breaking down the financial institution known as Charles Schwab. [00:04:22] - [First question] - What digital infrastructure means and how it came to be, [00:09:58] - The nuance of digital infrastructure and how big the addressable opportunity set is, [00:12:47] - How DigitalBridge became the company it is today, [00:19:06] - How he thinks about portioning the fee and value creation economics between shareholders and employees, [00:23:15] - The differences between their earlier funds and current funds from how the economics split within the team and owners, [00:25:53] - A look into their balance sheet today between funds and operating assets, [00:28:39] - How big the digital infrastructure space could be in the future from an IM standpoint, [00:30:41] - Their US and non-US opportunity set and how towers and mobile infrastructure compare and contrast across their verticals, [00:34:03] - How DigitalBridge professionals operate with portfolio companies and how they add value to them, [00:38:47] - Changes in standard growth and the slow downs in the Hyperscale or Telco side of the business, [00:40:37] - If Edge competes with their core assets and how it works across all of their portfolio companies, [00:42:21] - Where we are on the 5G rollout and how it touches their businesses, [00:43:39] - His view on building out Edge and data center capacity from a DigitalBridge standpoint, [00:45:35] - How the competitive environment and risk and return profiles have shifted, [00:46:33] - How inflation affects the business and how he manages lease renewal, [00:50:19] - If Elon Musk building Starlink is a threat or an opportunity, [00:52:12] - How DigitalBridge thinks about consumer facing digital infrastructure, [00:54:48] - What could happen to lead to their success and business evolution in the future, [00:56:28] - Two key lessons hed give as advice to someone looking to build and lead a company. But dig a little deeper and youll find a high-quality operator generating significant free cash flow through a mix of organic and inorganic growth channels. Please enjoy my conversation with Alex Danco. My guest is, from Shopify - who you may remember from our Business Breakdown on Shopify in 2021. When you take Baytex and everything thats happening within that business, it offers a perfect lens to view the historically boom and bust industry of oil production. Founded in Sydney Australia in 2015, Afterpay was a rapid success in the buy-now-pay-later market before being acquired by Block for $29bn in 2021. The team at Visible Alpha built a platform to analyze consensus data and financial metrics on over 6,000 public traded companies. [00:31:10] - Are we heading to a future where warfare is mostly machine against machine? Today, Schwab makes the majority of their money earning interest on customer cash deposits. This episode is presented by Visible Alpha. This wasn't a name on our radar at Colossus but the more we dug into the story, the more intrigued we became. reserved. Our conversation focuses on a new concept, tokengated commerce, and how Shopify is building around this theme. ----- Business Breakdowns is a property of Colossus, LLC.

This episode is brought to you by Visible Alpha. , a McKinsey alum and the current President of Metasys Technologies. Adyen was founded in Amsterdam in 2006 by a group of payments entrepreneurs who had already built and sold a business in this space.

Today's episode was originally featured in our, feed. Founded in 2012, AppLovin provides a platform for developers to market and monetize their mobile apps. This episode is brought to you by Scribe. Anduril builds high tech defense systems for the US Department of Defense and its allies.