We’ve made it to the end of another quarter, and as always, that means there have been some updates to the Spaceship Universe Portfolio.
We’ve bought two new stocks: Uber and Cloudflare.
Cloudflare
Cloudflare is a global cloud platform with a range of network services, which at their core do two jobs: speed up and protect websites.
In fact, on any given day, Cloudflare might see more than 1 billion unique IP addresses, from their data centres in 200 cities, in more than 95 countries, across the world.
Cloudflare brings in customers with free services such as DDoS attack mitigation (security) and a CDN service (speed). Customers can then move up through pricing tiers for premium services. Well known businesses such as Shopify, IBM and L’oreal use Cloudflare services.
Cloudflare is also leveraging their services to help company intranets and teams that use the internet to do their job. This increases Cloudflare’s addressable market, as companies increasingly rely on the cloud and working remotely.
We like Cloudflare because we believe its large customer base — the company has around 2.8 million customers total — leads to a strong network effect. And because between 5% and 13% of internet traffic runs through Cloudflare, they can continually learn and optimise their services, and replace hardware with this continually learning software.
We also feel it has a strong management team, with two of its three co-founders still at the helm.
With these pros in mind, we decided Cloudflare was the right choice.
Uber
Just as “Google” became a verb, so has “Uber.”
This isn’t surprising, given the ridesharing company has 111 million monthly active platform consumers, in more than 900 cities, across 69 countries, enabling 21 million trips a day.
Of course, Uber is more than just a ridesharing platform. Its Uber Eats platform is one of the largest in the world, and Uber’s CEO, Dara Khosrowshahi, has made no bones about the fact Uber is investing “aggressively” in the business, globally, where it thinks it can win.
This leads us to why we like Uber. Its brand value and network effect are strong. And given ridesharing is still a small market — Uber accounts for less than 1% of all miles driven globally, as per its 2019 prospectus — there’s a lot of opportunity still.
While autonomous driving is a risk to Uber, it’s also an opportunity, and one that Uber is pursuing. In fact, some believe self-driving cars are the key to unlocking Uber’s profitability.
If you have any thoughts on these two new stocks, we’d love to hear from you.
Spaceship Index Portfolio
For customers in the Spaceship Index Portfolio, things are a little different.
The Spaceship Index Portfolio is made up of around 100 of some of the largest ASX listed companies by market capitalisation, and around 100 of some of the largest global companies by market capitalisation.
If a company moves in or out of the Spaceship Index Portfolio, it will be because its market capitalisation has changed, not because we have made the decision to buy or sell it.
The Spaceship Universe Portfolio invests in Cloudflare, Shopify and Uber at the time of writing.
The Spaceship Index Portfolio invests in IBM and L’oreal at the time of writing.
Important! We’re sharing with you our thoughts on the companies in which Spaceship Voyager invests for your informational purposes only. We think it’s important (and interesting!) to let you know what’s happening with Spaceship Voyager’s investments. However, we are not making recommendations to buy or sell holdings in a specific company. Past performance isn’t a reliable indicator or guarantee of future performance.
