✅ Buy Alert - 2nd Buy, Public Safety SaaS Platform 4% Free cash flow yield for 20% CAGR 4yr Forward Growth

20% organic growth + x% from new found M&A allocation. No debts, 30% free cash flow margin. Thrive in a fragile world.

Today, I bought a sleep well business that:

• Scores 14/20 points on my sleep well checklist. (vs. 12.8 average)

• 30% free cash flow margin with over 10% of market cap in cash (net debt).

• Possesses deep and widening moats - scale/cost, switching costs, brand, and incredibly high barriers to entry.

• This SaaS platform has multiple growth levers (organic, product cross-sell, geography, M&A)

• Due to the recent CEO transition, budget delays, and procurement process issues in government contracts, the market is underappreciating the quality and expecting a free cash flow growth of just 7.5% CAGR over the next decade, compared to an achievable 15% CAGR.

I am buying this business for the second time today because it adds a unique defensive angle (an anti-fragility quality) to the Sleep Well Portfolio. Together with CrowdStrike (SWI #1) and Fortinet (SWI #12), form a highly defensive utility for the portfolio (15% of the portfolio) in the event the world goes into chaos (I hope not).

In case you missed it, recently, I reviewed the FY2025 Sleep Well Portfolio. A good place for you know what to expect.

Let’s examine what I bought today and how it fits the Sleep Well Portfolio.