Sands Capital - What Matters Most

In this episode of Season 3 of What Matters Most, Sands Capital’s Eduardo Leal explains how Brazil’s Nubank went from startup to the country’s second largest corporation in just 10 years — and the company’s digital-first banking platform.  Join us as we explore how mobile banking is opening financial doors for global citizens and how we believe Nubank is poised to remake the Brazilian banking industry. Show Notes (2:23) The State of Banking for 700 million Latin Americans (4:32) Founder David Vélez’ Story (7:32) How NuBank Serves a Fundamental Need (10:48) A Lean, Mean Business Model (13:45) Overcapitalization: A Good Problem to Have (17:06) How Sands Capital First Spotted NuBank (18:46) Potential Risks to Future Growth (21:01) Could NuBank Expand Beyond Latin America? (22:29) The Next 10 Years Review our podcast season and episode disclosures ⁠⁠⁠⁠here⁠⁠⁠⁠. Learn more about ⁠⁠⁠Sands Capital⁠⁠⁠, sign up for ⁠⁠⁠our newsletter⁠⁠⁠, and ⁠⁠⁠follow us on LinkedIn⁠⁠⁠.

In our first episode of season 3’s What Matters Most, Sands Capital’s Emerson Bluhm explains why Samsara’s integrated hardware and software technology continues to gain market share and why this investment opportunity is aligned with Sands Capital’s philosophy. Join us as we explore the future of real-world operations and why Samsara is poised to become a leader of this ~$4 billion North American market. Show Notes (1:17) From Private Funding to Public Success (3:50) A Software Company that Knows Hardware (4:43) Why Physical Operations is Ripe for Disruption (6:54) Leadership with a Proven Track Record (11:04) The Value of Samsara’s Integrated Platform (16:17) ‘AirTags’ for Cranes, Tools and Everything in Between (19:44) Third-party Integrations and Realtime Decision-making (21:07) Return-on-investment for End Users (22:34) Samsara’s Long-term Growth Potential (24:13) The Stickiness Subscription-based Revenue Learn more about ⁠⁠Sands Capital⁠⁠, sign up for ⁠⁠our newsletter⁠⁠, and ⁠⁠follow us on LinkedIn⁠⁠. Review our podcast season and episode disclosures ⁠⁠here⁠⁠.

If you’ve never thought about investing in IT services, this podcast episode could change your mind. Sands Capital Sr. Research Analyst Eric Black takes you through the investment case for Globant, the world’s largest pure play design-first digital services provider. Asset-light businesses such as Globant can be hard to evaluate, but the opportunities in the 1.5 trillion market of IT Services are undeniable. Eric helps us see why, unpacking the potential of AI, Globant’s strategic business partnerships, and the loyalty the company has generated from the more than 1,500 Fortune 500 and Fortune 2000 companies on its client list. Globant’s cutting-edge software solutions have made their way into products at Disney, ESPN, and Google and are making lives easier around the globe. Episode Transcript Available Here(01:50) Not a labor-cost arbitrage model(03:44) The Disney Magic Band. The Globant product you’ve probably already seen.(05:14) Tech companies don’t do everything in-house. Enter: Globant.(06:59) What makes Globant a growth business?(08:41) A Thought Leader in AI for the last decade and MaganifAI(11:45) The research process into digital transformation(14:31) A one-size-fits-all all approach would be antithetical to the way Globant operates(18:26) The pandemic boost and a global presence(21:51) “Value-added focus” and the power of a leader(25:10) The competitive moat for a huge market and Globant’s potential advantages(28:24) Competitors have the same advantages? Why we like Globant’s pure play angle.(31:19) The disruptors lying in wait(34:21) Staffing costs and flexing to keep margins high and remain profitable(36:25) Researching a company operating in intangibles: what’s different?(39:04) The portfolio managers visit Buenos Aires(40:44) From “why would you invest” to “what’s the insight”?(43:04) Responsible investing in human capital, labor rights and gender diversity(44:49) Nefarious digital technology and cybersecurity - Globant’s response.(49:26) Under the radar companies and enablers of big trends can make for great investments(52:56) Quick recap of Season 2 episodesRelated content from Sands Capital⁠Sign up to receive our monthly Perspectives newsletter: ⁠Our latest thinking on innovation investing, long-term capital, and cultureIn case you missed it: What Matters Most Episode 6: Revolutionizing Public Safety: The Axon Ecosystem⁠Catch our most popular episodes from this season:⁠Kaspi: The Super App Reshaping Kazakhstan’s Financial LandscapeInside Cadence: The Software Powering Semiconductor Breakthroughs⁠Follow What Matters Most⁠ wherever you listen to podcasts and never miss an episode.Learn more about ⁠Sands Capital⁠, sign up for ⁠our newsletter⁠, and ⁠follow us on LinkedIn⁠.Review our podcast season and episode disclosures ⁠here⁠.

Its mission is simple: protect life, preserve truth, and accelerate justice. As Axon Enterprises innovates to try to achieve that goal, its solutions are rapidly becoming the industry standard. In this episode of What Matters Most, Sands Capital Portfolio Manager and Sr. Research Analyst Danielle Menichella, CFA discusses the business’ journey from Taser maker to artificial intelligence-powered software developer. We’re diving deep into how its wide range of technologies work in tandem, what the future of public safety might look like—and why we believe all of this makes the business an attractive investment opportunity.Episode Transcript ⁠⁠Available Here⁠.(2:22) Axon’s product line, from Tasers to body cameras(6:50) The ethical considerations of investing in a manufacturer of weapons and surveillance equipment(13:55) Eyeing untapped markets and finding opportunities in growing markets overseas(19:55) Using artificial intelligence for faster redactions, transcriptions, and archiving of bodycam footage(21:07) Navigating privacy concerns around surveillance devices and data storage(27:15) Preserving human accountability as public safety technology advances(35:50) The big question for Danielle: To be or not to be tased?Related content from Sands Capital⁠⁠Sign up to receive our monthly Perspectives newsletter: ⁠⁠Our latest thinking on innovation investing, long-term capital, and culture.Catch our most popular episodes from this season:⁠⁠⁠Globant Takes A Design-First Approach to Pure Play Digital Service⁠⁠⁠⁠Kaspi: The Super App Reshaping Kazakhstan’s Financial Landscape⁠⁠Inside Cadence: The Software Powering Semiconductor Breakthroughs⁠⁠Follow What Matters Most⁠⁠ wherever you listen to podcasts and never miss an episode.Learn more about ⁠⁠Sands Capital⁠⁠, sign up for ⁠⁠our newsletter⁠⁠, and ⁠⁠follow us on LinkedIn⁠⁠.Review our podcast season and episode disclosures ⁠⁠here⁠⁠.

Dive into the dynamic world of online sports betting in this episode of What Matters Most. We sit down with Katherine Bates, research analyst at Sands Capital, to discuss the rise and strategies of Flutter, the world's largest online sportsbook and gaming operator. Discover how Flutter is leveraging technology, regulatory changes, and a deep understanding of customer behavior to redefine the betting experience. From the intricacies of in-game betting to the challenges of responsible gambling, this episode offers a compelling glimpse into the high-stakes world of online betting. Tune in to learn more about Flutter's growth formula and its potential impact on the future of global online gambling. Episode Transcript ⁠⁠Available Here⁠.⁠ (2:15) Flutter's Expansion, Mobile Penetration and Convenience (4:07) Flutter's Innovation in Parlay Betting (6:35) Flutter's Position in the Industry (9:26) Flutter's Advantage in Odds Pricing (12:04) The Other Players in the Space (17:10) Customer Acquisition and Competitive Advantages (24:10) Addressing Problem Gambling (31:32) Licensing Fees and League Relationships Related content from Sands Capital Sign up to receive our monthly Perspectives newsletter: ⁠Our latest thinking on innovation investing, long-term capital, and culture. In case you missed it: What Matters Most Episode 9: ⁠Kaspi: The Super App Reshaping Kazakhstan's Financial Landscape Catch our most popular episodes from this season: ⁠Globant Takes A Design-First Approach to Pure Play Digital Service⁠ ⁠⁠Revolutionizing Public Safety: The Axon Ecosystem⁠⁠ ⁠Follow What Matters Most⁠ wherever you listen to podcasts and never miss an episode. Learn more about ⁠Sands Capital⁠, sign up for ⁠our newsletter⁠, and ⁠follow us on LinkedIn⁠. Review our podcast season and episode disclosures ⁠here⁠.

Explore digital innovation in Kazakhstan in this episode of What Matters Most, in which we spotlight Kaspi’s compelling super app ecosystem, which boasts nearly 70% of the country’s adult population as daily active users. Sands Capital Research Analyst Brian Crofton guides us through Kaspi’s growth into the country’s premier digital financial services company. Uncover the distinct challenges and prospects of operating and investing in Kazakhstan, a geopolitically intriguing emerging market, and learn how Kaspi is revolutionizing the financial sector, boosting consumer interaction as it cleverly layers its platform, and hoping to accelerate the future of digital finance. Episode Transcript Available Here. (02:18) What is a fintech, really? And the story of Kaspi’s super app transformation (04:26) An overview of the three main business lines and a strong business model (09:00) “Now let’s plop it [the business model] into Kazakhstan.” (18:03) Synergies across the network and Brian’s favorite insight into Kaspi (20:08) Mechanics of the business: An initial public offering (twice) and the Baring Vostok connection (25:38) Brian breaks down Kaspi’s relationship with Kazakhstan and Kazakhstan’s relationship with the elephant in the room. (32:23) Investing in businesses domiciled in Kazakhstan comes with some additional research. (35:48) Growth opportunities for Kaspi and the potential to reach maximum penetration (40:27) Careful not to understate the potential value of layering new services on an existing platform Related content from Sands Capital Sign up to receive our monthly Perspectives newsletter: Our latest thinking on innovation investing, long-term capital, and culture In case you missed it: What Matters Most Episode 8: Inside Cadence: The Software Powering Semiconductor Breakthroughs. Catch our most popular episodes from this season: Globant Takes A Design-First Approach to Pure Play Digital Service ⁠Revolutionizing Public Safety: The Axon Ecosystem⁠ Follow What Matters Most wherever you listen to podcasts and never miss an episode. Learn more about Sands Capital, sign up for our newsletter, and follow us on LinkedIn. Review our podcast season and episode disclosures here.

In this episode of What Matters Most, Sands Capital Sr. Research Analyst Daniel Pilling takes us on a deep dive into the world of Cadence, the leading software provider in the semiconductor industry. From the evolution of semiconductor design to the potential of generative AI, we explore the intricate processes and challenges in chip design. We delve into the cyclical nature of the semiconductor industry, the value addition in both leading edge and analog chips, and the strategic role Cadence plays in this dynamic ecosystem. With their software integrated into the manufacturing process of semiconductors, Cadence has the potential to shape the future of the industry. Episode Transcript ⁠Available Here⁠. Show Notes: (00:53) Cadence’s two offerings (03:00) Overview of the semiconductor manufacturing process (if you didn’t listen to the Entegris episode) and the three-legged stool analogy (05:34) Electronic design automation (EDA) tools and evolution of semiconductor design process (09:52) Physical limitations, shrinking transistors, and the laws of physics (13:04) Error reduction, adapting to increasing complexity, and generative AI (17:17) Daniel’s five- to 10-year view on whether AI is a future alternative to EDA (19:00) Who actually uses Cadence software? (21:49) A counter to the cyclical nature of the semiconductor industry (23:31) The value added in analog chips, and legacy Cadence software (25:58) Frequency of chip re-architecting (28:22) Management team and a second act (30:55) Risks and how Cadence can benefit from the Jevons Paradox (34:25) Daniel’s not worried about “the wall of worry.” (36:05) The end of Moore’s Law and the paradigm shift to quantum chips (40:36) How did Daniel become an investor? (44:44) Daniel’s closing hypothesis and conviction in investments Related content from Sands Capital Business Breakdowns Podcast: Daniel Pilling - Entegris: Solutions for Semiconductors ⁠Sign up to receive our monthly Perspectives newsletter: ⁠Our latest thinking on innovation investing, long-term capital, and culture In case you missed it: What Matters Most Episode 7: Globant Takes A Design-First Approach to Pure Play Digital Service Catch our most popular episodes from this season: Kaspi: The Super App Reshaping Kazakhstan’s Financial Landscape ⁠⁠Revolutionizing Public Safety: The Axon Ecosystem⁠⁠ Follow What Matters Most⁠ wherever you listen to podcasts and never miss an episode. Learn more about ⁠Sands Capital⁠, sign up for ⁠our newsletter⁠, and ⁠follow us on LinkedIn⁠. Review our podcast season and episode disclosures ⁠here⁠.

This episode of What Matters Most dives into the evolutionary journey of Visa, a titan in the payments industry. Discover how the company continues to thrive by enabling innovation. Join Sands Capital Portfolio Managers Sunil Thakor and Michael Raab as they unpack the company's history, technology, and the formidable network that cements its position as an industry leader. From IPO to the present, we dissect the anatomy of Visa's enduring success. https://www.sandscapital.com/WMM-Disclosure

Reliance Industries’ portfolio of products and services touches almost every person in India on a daily basis—and fueled by favorable micro and macro trends, the company shows no signs of slowing down. In this episode, Sands Capital senior analyst Matt Luneburg, CFA explains why Sands Capital has a strong conviction in Reliance. https://www.sandscapital.com/WMM-Disclosure

When Liberty Media bought the commercial rights to Formula One in 2017, it set a plan into motion: to transform this auto racing sport into a truly global phenomenon, backed by a strong brand and high-profile commercial partners. Sands Capital technology analyst Ben Betcher, CFA explains in this episode of What Matters Most, how Formula One’s tech-like business model differentiates it from other professional sports, and why it continues to drive interest from many investors. Show Notes (1:16) The business transformation of Formula One (5:44) Understanding brand partners’ roles: From Mercedes to Amazon Web Services (8:30) How the linear vs. streaming sea change impacts growth opportunity (11:44) The Formula One platform: a tech-like business model (13:30) Soaring team valuations (15:54) The checkered history of Formula One (17:39) An asset-light business approach (18:07) Formula One’s competitive advantage (20:38) The strength of a young and diverse audience (21:25) Risks: rival leagues? sustainability? (23:59) Improving monetization: The gamble of Las Vegas (26:17) Growth drivers of promotion, sponsorship, advertising (33:30) How Sands Capital analyzed and vetted Formula One as an investment opportunity Disclosures: https://www.sandscapital.com/WMM-Disclosure

In a world where more than 500 million people battle known and undiagnosed diabetes, Dexcom stands out. This trailblazer in continuous glucose monitoring is on track for substantial growth amid evolving diabetes detection and treatment. In this episode, Senior Research Analyst Jenny Goldsmith, CFA details how Dexcom’s state-of-the-art software and predictive algorithms are revolutionizing diabetes care and why Goldsmith believes Dexcom’s distinctive edge translates into investment opportunities. www.sandscapital.com/WMM-Disclosure

Nearly every factory has room for more automation, with greater penetration in existing industries and expansion into new industries expected over the next decade. Sands Capital’s Suni Thakor and Danielle Menichella discuss why Keyence, a factory automation market leader that specializes in sensor and sensor systems, will likely be a beneficiary of that growth and what makes the company so unique within its sector. Transcript available here. (01:41) Reasons for factory automation (03:08) Why Keyence is special (05:20) Keyence’s attractive business space and high margins (07:09) Trends in global automation (08:54) Future sources of Keyence’s growth (09:49) Impact of supply chain issues on Keyence (12:48) Incorporating a business in the portfolio (17:14) Frontline research on the company and the industry (18:59) Portfolio managers and research analysts work together (20:35) What’s a “cobot”? (21:39) Keyence’s approach to ESG (24:04) Suni on the importance of conviction for investment professionals Related content from Sands Capital ⁠⁠Sign up to receive our monthly Perspectives newsletter: ⁠⁠Our latest thinking on innovation investing, long-term capital, and culture. Season 3 is now live! • ⁠Samsara: Steering the Future with Integrated Fleet Technology⁠ In case you missed it: What Matters Most Episode 11: ⁠Unearthing Value: A Deep Dive Into Titan, India’s Jewelry Giant Catch our most popular episodes from Season 2 ⁠Globant Takes A Design-First Approach to Pure Play Digital Service⁠⁠ ⁠⁠⁠Revolutionizing Public Safety: The Axon Ecosystem⁠⁠⁠ Kaspi: The Super App Reshaping Kazakhstan’s Financial Landscape ⁠⁠Follow What Matters Most⁠⁠ wherever you listen to podcasts and never miss an episode. Learn more about ⁠⁠Sands Capital⁠⁠, sign up for ⁠⁠our newsletter⁠⁠, and ⁠⁠follow us on LinkedIn⁠⁠. Review our podcast season and episode disclosures ⁠⁠here⁠⁠.

Growth investing often focuses on innovation, but Sands Capital’s Michael Raab and Matthew Luneburg show Rentokil as an example of a growth business that favors refining what’s already working. Rentokil, a pest control industry leader, has consolidated its technician service routes to achieve efficiencies and a significant competitive advantage. Listen as Michael and Matt talk about how we built conviction in what may seem an unlikely investment for Sands Capital. https://www.sandscapital.com/WMM-Disclosure

Listen as we discuss the fascinating growth story of Bio-Techne, a life sciences company that supplies over 500,0000 tools that power new scientific breakthroughs. Sands Capital’s Daniel Cheng and Sunil Thakor detail how Bio-Techne's diversified exposure to one of the most dynamic secular growth trends sets it apart, and why it's a high-conviction business for Sands Capital. https://www.sandscapital.com/WMM-Disclosure

Aptiv supplies computer technology to half of the world’s electrified vehicles. Next year they’ll lead the market in active safety solutions. Sands Capital’s Danielle Menichella and Dave Levanson discuss why we invest in Aptiv rather than trying to pick a winner from the crowded auto manufacturers race. https://www.sandscapital.com/WMM-Disclosure

Singapore-based mobile gaming and ecommerce company Sea has created multiple runways for long-term growth for Southeast Asia’s largest internet and technology company based on market cap. Sands Capital Senior Portfolio Manager Neil Kansari describes how our deep research helped us discover Sea’s visionary management and diversified growth strategy and led us to invest in the company’s IPO. https://www.sandscapital.com/WMM-Disclosure

How did DoorDash break through the crowded field of last-mile logistics to hold one of 2020’s biggest public offerings? Sands Capital analysts Katherine Okon and Barron Martin share the story of the differentiated strategies that led to DoorDash’s more than 200% gross order value growth last year. Listen as they make the case for even more investment opportunities going forward. https://www.sandscapital.com/WMM-Disclosure

In 2018, World Bank reported that just 21% of Latin American adults borrowed from a financial institution. This key insight spelled tremendous potential growth for MercadoLibre, the Argentine commence innovator. Director of Research Perry Williams and Research Analyst Judy Jiao go deep on how we built on this insight to identify MercadoLibre’spotential for vast business growth and to revolutionize quality of life in Latin America. https://www.sandscapital.com/WMM-Disclosure

As artificial intelligence (AI) becomes a part of oureveryday lives, making sure it’s transparent and unbiased has become a high priority for businesses, governments, and ordinary people. In this episode of What Matters Most, Scott Frederick, a Sands Capital managing partner, explains howsoftware startup Credo AI is helping to keep AI models responsible. Join us as we look at how Credo AI aims to lead the way  in this vital new field. Show Notes:(2:10) AI Has Evolved Over Decades(4:48) Responsible AI vs. Ethical AI(9:29) Simplifying AI Governance with Credo AI(14:10) Can Agents and Artificial Superintelligence beTransparent?(18:27) Solving the Alignment Problem(20:16) Industries Ripe for Credo AI’s Solution(22:14) Market Timing and Other Potential Headwinds(24:53) How Big of a Market Could AI Governance Be? Review our podcast season and episode disclosures ⁠⁠⁠⁠⁠here⁠⁠⁠⁠⁠. Learn more about ⁠⁠⁠⁠Sands Capital⁠⁠⁠⁠, sign up for ⁠⁠⁠⁠our newsletter⁠⁠⁠⁠, and ⁠⁠⁠⁠follow us on LinkedIn⁠⁠⁠⁠.

You’ll find semiconductors in just about every device with a plug, a power button, or a battery. In this episode of What Matters Most, Sands Capital research analyst Daniel Pilling explains why Entegris, a critical player in the global semiconductor industry, is seeing rapid growth as the demand for artificial intelligence (AI) and machine learning intensifies. Transcript available here. (00:01:37) From vacuum tubes to artificial intelligence (AI) in 80 years—a quick history of semiconductors (00:04:51) How small is a nanometer really? Moore’s Law in action, shrinking chip circuitry. (00:07:33) Exponential complexity in chipmaking. Skyscrapers and bread? (00:09:00) But actually, how do you make a semiconductor? (00:15:18) Entegris: chemicals or technology analysts? Who covers it and why? (00:18:56) “One throat to choke”? And the chokepoint explained. (00:26:28) Why consumables have less “lumpy” capital expenditures (00:26:51) Chips that power EVs [electric vehicles] (00:30:22) Don’t bet on the winner in this market, and what to do instead. (00:33:57) Advantages and industry talent finding an employer of choice (00:40:32) The iPhone moment and where AI is going from here (00:42:17) Outlook for Entegris and semiconductor growth Related content from Sands Capital ⁠⁠Sign up to receive our monthly Perspectives newsletter: ⁠⁠Our latest thinking on innovation investing, long-term capital, and culture More from Daniel Pilling: Gen AI: Hype or Megatrend, Inside Cadence: The Software Powering Semiconductor Breakthroughs Season 3 is now live! Samsara: Steering the Future with Integrated Fleet Technology Catch our most popular episodes from last season: ⁠⁠Globant Takes A Design-First Approach to Pure Play Digital Service⁠⁠ ⁠⁠⁠Revolutionizing Public Safety: The Axon Ecosystem⁠⁠⁠ Kaspi: The Super App Reshaping Kazakhstan’s Financial Landscape ⁠⁠Follow What Matters Most⁠⁠ wherever you listen to podcasts and never miss an episode. Learn more about ⁠⁠Sands Capital⁠⁠, sign up for ⁠⁠our newsletter⁠⁠, and ⁠⁠follow us on LinkedIn⁠⁠. Review our podcast season and episode disclosures ⁠⁠here⁠⁠.