Tech innovation continues to accelerate, creating significant secular growth opportunities for long-term investors. In Tech Bytes: Edition 1, the Fundamental Equity Technology Team shares their views and insights in response to top-of-mind questions from clients, including the cyclicality of internet companies, acceleration in digital payments, resilience of the software industry, growing digitization of small and medium-sized businesses (SMBs), and valuations of tech initial public offerings (IPOs). The team comprises 16 investors with an average of 15 years of experience, and manages over $12bn in dedicated technology portfolios (as of November 30th, 2020).
- We address client concerns about internet company cyclicality, and discuss why we believe internet companies remain resilient, as shown by positive earnings reports and good spending discipline.
- The COVID-19 health crisis accelerated the adoption of digital payments globally. Our PMs explain why we believe adoption is accelerating in existing and new markets, across a variety of payments channels, and ways in which the digital payments ecosystem is expanding in the U.S. and around the world.
- Software companies have been a top contributor to the tech sector’s strong performance in 2020. The PMs discuss the attributes of the software industry that have led to its performance, such as the rise of Software-as-a-Service companies and increased innovation.
- The COVID-19 pandemic has had a significant impact on small and medium-sized businesses (SMBs). Our Tech PMs examine SMBs’ response to COVID-19, as SMBs raced to digitize their businesses and utilize new technologies to remain competitive.
- Finally, one of the most popular questions we get asked by clients is how we value technology company IPOs. The Tech PMs discuss their process of investing in tech IPOs, what attributes they look for in a company, and how they approach valuations.