Josh Burwick

Long/short equity, growth at reasonable price, tech, venture capital
Josh Burwick
Long/short equity, growth at reasonable price, tech, Venture capital
Contributor since: 2013
Company: Sand Hill East Ventures
Interesting development with Uber re: HipChat.
I was talking to a developer friend yesterday who uses Slack voraciously to communicate with his team and clients. However, Slack does not have ticketing function that Jira has that allows a client to start a ticket and have them follow through on it. So he is contemplating throwing in the towel and using Jira. Are there no plug ins for Slack that can mimic that functionality?
Thanks again for your thoughtful comments. Keep them coming pls.
Thanks for the thoughts. What do you think about them moving up against Slack more and more?
Thanks James. Investors and reporters have been all over TEAM re: building a direct salesforce and they are adamant they dont need one. When they reverse course, it will be a massive mea culpa.
Currently Facebook and Alibaba sport market capitalizations north of $200 billion, $233 bln and $205 bln, respectively. There is no chance they could generate returns in the same ballpark as MSFT (34,186% return) or AMZN (26,000% return) or these companies would be worth tens of trillions of dollars, i.e. size of the US GDP. Even if Facebook were to accelerate it's growth trajectory and returned 1,000% over the next 10-15 years, it would be sporting a market cap of $3 trillion- roughly 15% of US GDP then most likely. Smaller companies like Twitter ($33 bln) have a chance of returning massive returns given their smaller market caps but nothing close to what IPO's of prior tech generations returned.
Thanks for the thoughts.
My comment on Palo Alto being one of the emerging companies in this space refers to thier new technologies such as 'Traps' unveiled recently spawned from their Cyvera acquisition.
I couldn't make a commitment to work full time for PTT and write regularly (ie monthly and even weekly) given my other constraints thus the move to SA where I can write when I have time. Have I had bad picks (BSFT, ECOM) sure but I also have had great picks like FEYE short at the top.
Again thats a Sand Hill East client reference.
I never changed my Linked In profile, dont know what you are talking about.
I have no relationship with Lastline, including any cash or equity. Andy has his own relationships which are under the Sand Hill East umbrella.
I havent written anything on ECOM on SA, it was a PTT pick. I no longer write on PTT. I still like ECOM and yes its been a bad pick.
PTT is Poised to Triple, apologies
I much prefer PANW and its starting to get interesting down here. I love their acquisition of Cyvera, I know the company and their technology is the real deal. PANW has a line item in budgets for firewalls so it's an easy sale and they have a product refresh ahead of them. In addition with Wildfire (APT) they can go into their accounts and upsell it albeit only as a cloud service for a 20% premium. Compare that to FEYE that has no budget line item and is quite pricey.
FEYE is less about price and more about time elapsing. Need to move beyond lockup and the tech growth selloff (if it ever ends).
Speaking of the tech selloff, a new idea of mine that I love on the long side is at an unreal level that I am adding to aggressively on this selloff. Check out PTT and find out the name and why I love it.
Stock still has May 20th lockup coming. I am surprised stock broke 30, I thought $40 was realistic near term downside but then again I didnt see tech coming under attack like this. At today's price stock trades at 9.6x EV to '14 revs and 6.0x '15 still not "cheap"even for a growth stock. For those wanting to own it, you should wait to buy the upside rather than catch the falling knife as FEYE holders like other growth tech holders are being forced to sell here and who knows when that ends.
I think still too early to buy but I have covered my entire position as my downside target was $40. Hopefully others made some money on this one as well. Now time to look for some longs.....
I would use weakness here to cover a good portion of short after the correction. I think ultimate downside to 40 but not the same compelling risk:reward it was when we initiated the sell recommendation
Citigroup initiated on FEYE this am with a Neutral despite the selloff and $60 price target fyi.
Do you mean your cost basis on your long or short?
I never questioned the quality of Mandiant, rather the need to buy vs. continuing to partner especially with a services heavy business.
FEYE has a great solution but so does Last Line at a fraction of the price.
Also PANW with Cyvera will make Wildfire very formidable.
Thx. It seems as though the Target IT folks turned off a certain function because it was giving a lot of false positives.
PANW is getting very interesting now that they have Cyvera. I know Cyvera it is amazing technology and will make PANW very formidable comp to FEYE.
Your math looks right but its 7.5x 2019 expected revenue not earnings. Still very pricey
Lol. Ok then. Who in your opinion is the best software analyst out there? This isn't Keith's wife is it?
To answer a very good question posed that I should have mentioned in the piece. The "big lockup" of the additional 95.6 mln shares is May 20th.
FEYE 2014 revenue is expected to come in around $400mln+ (with Mandiant) divide that into EV of around $10 bln previously and I arrive at 25x. My calculations were when the stock was a good deal higher thus the 30x reference.
FireEye did flash warnings as I stated previously but they were ignored as that setting was providing many false positives with other accounts, etc.. The product is very good, I am not disputing that, but PANW with Cyvera and Last Line are just two companies with very formidable competitive solutions.
I have not changed my short position in the stock since putting it on.
Understood but why did they have them disabled? They were producing a lot of false positives according to folks who were in the loop based on the Business Week article and others.
Thank you
I published the original article 3/14
The thesis remains the same. Actually with PANW buying Cyvera this am the competitive environment just got a lot tougher.
Thanks. PANW buying Cyvera today brings a much more formidable competitive offering now into the hands of a big sales force. Also look at Last Line marketing material on their own website comparing themselves to FEYE-
Prior selloffs were on quarters like this. Last one was a major buying opportunity. Stock has tremendous support down in the 20s as it approaches 2-3x revenue. Even better for the stock now is Oracle wants to expand in the space and BSFT synergies are huge as they own Acme Packet. Also Google relationship holds promise.