All Investment Ideas
$994M$1.5B

IPO AppLovin

Tools for mobile app developers
IPO
Medium risk

Revenues in 2019-2020

Invest in IPO AppLovin

This investment idea is no longer available. New applications are not accepted

View more ideas
Investment Idea Details
The Company

AppLovin is a leader in the mobile app industry with a focus on building a software-based platform for mobile app developers to improve the marketing and monetization of their apps. The company also has a globally diversified portfolio of apps—free-to-play mobile games that it operates through its own or partner studios. It was founded in 2012 in California, US.

Business clients include a wide variety of advertisers, from indie developer studios to some of the largest global internet platforms, such as Facebook and Google. While AppLovin has nearly 1,400 business clients, the vast majority of its revenue is derived from Enterprise Clients. Approximately 99% of its revenue came from 172 Enterprise Clients in 2020.

Market Opportunity

Over the past two decades, mobile apps have become integral to the lives of people. Mobile apps offer a wide array of applications, such as allowing users to seamlessly share ideas, make purchases, monitor health, and access entertainment. Based on data from IDC, the total market opportunity for AppLovin to be $189 billion in 2020, growing to $283 billion in 2024, or a 10.6% compound annual growth rate (CAGR).

Most developers lack access to the marketing, monetization, and data analytics tools required to stand out among the more than 4.8 million mobile apps available on the Apple App Store and Google Play Store, according to Statista, or attract sufficient numbers of mobile app users to create and sustain a successful long-term business. SensorTower estimates that 80% of all mobile app downloads were generated by 1% of total developers across both Apple App Store and Google Play Store in the third quarter of 2019. AppLovin is critical to the success of mobile app developers, in particular mobile game developers, solving key marketing and monetization challenges.

Risks

The results of operations are likely to fluctuate from period-to-period, which could cause the market price of shares to decline.

The mobile app ecosystem is intensely competitive. If business clients or users prefer competitors’ products or services, the business, financial condition, and results of operations of AppLovin could be adversely affected.

The mobile app ecosystem is subject to rapid technological change, and if AppLovin does not adapt to, and appropriately allocate resources among, emerging technologies and business models, its business, financial condition, and results of operations could be adversely affected.

Financials

AppLovin has raised a total of $1.4B in funding over 7 rounds from 8 venture capital investors, including Kohlberg Kravis Roberts (KKR) and Streamlined Ventures.

AppLovin plans to sell 25 million shares (10% insider) at a price range of $75 to $85. The company intends to raise as much as $2.1B in an IPO of its common stock at about $30.5B valuation. The company booked $1.5B in revenue in 2020. Gross margin is around 62%. The company is growing at 46% YoY. The company is profitable on a cash flow basis. Free cash flow for in 2020 was a robust $220 million.

AppLovin generates revenue from fees paid by mobile app advertisers, or business clients, that use its software to grow and monetize their apps. It also collects revenue from business clients that purchase the digital advertising inventory of the company’s portfolio of apps.

The competitors of AppLovin include Facebook (FB), Google (GOOG), Twitter (TWTR) and others. One of the direct competitors of AppLovin is Unity Ads. Unity (U) is trading at 35x LTM Sales with revenue growth of 40% and gross margin of 78%. AppLovin is asking investors to pay 20x sales. Due to volatility in the technology sector, this investment idea has a medium potential return of up to 40%.

How IPO Investments Work
1. Collection of funds

2-3 weeks before the start of the company publishes information about the opening of trading: financial statements for 3 years, a description of the company's business, plans for the future, as well as the risks that management sees in their own business. We analyze such offers and publish the best ones. Investors apply for deposits. Before the deadline for applications, you can change the request or cancel it.

Publication
09 Apr
Threshold amount
$50
2. Buy shares

We submit one large application for the purchase of shares by pre-subscription with reduced price to large investors. The application may be rejected in part or in full. Over the past three years, our applications have been rejected only three times. The next day, or every other day, we'll know at what price and at what percentage the order is executed, and we'll post it on «The my investment page».

Submit applications before
13 Apr
3. Start Bidding

The price of shares is rising from the first day due to the demand of investors deprived of the opportunity to buy shares before trading. Most of the stocks we've been recommending buying over the past three years have been starting to trade on the stock exchange at tens of percent higher than the price at which customers bought the shares. There comes a Lock up period when it is forbidden to sell shares purchased by subscription. Typically lasts 3 months.

Start Bidding
15 Apr
Return forecast
Medium (up to 40%)
4. Receiving profit

After the expiration of the Lock Up period, the investment is automatically closed and the investor receives a profit on account of the deduction commissions UT. You can always view the results of your past investments in investment archive.

End
19 Jul
Early profit fixation

Although no shares are allowed to be sold during the lock-up period, our traders seek to offer investors fixed profit by way of using various financial instruments, including forwards, options, short positions etc.

From the investor’s point of view this means that he or she may close an investment by paying a certain part of its value (as a rule, approximately 15 percent). This is due to high prices for the instruments which are employed to ensure availability of fixed profit. As such, you shall press any relevant button in the Investor Account as soon as it is active.

The closing procedure is similar to commencement of investment business. You shall file a bid which is executed within a business day by UT. So, your investment is closed at the price currently prevailing on the stock exchange. However, we rarely recommend using this feature, since upon expiry of an applicable lock-up period the average performance is higher.

Fee

FOR ENTRY

3 per cent of the share price. This fee is charged as soon as your investment bid is confirmed.

FOR EXIT

1.75 per cent of the purchase price paid for your shares as soon as trading is closed. This fee is charged upon closure of any relevant investment.

SUCCESS

20 per cent of the profit your derive. This fee is charged only if you show positive performance as of the moment any relevant investment is closed.

TO EARLY EXIT

Usually, 15 per cent (depends on the stock exchange environment). It is calculated per each investment individually.

Advantages Enjoyed by Those Investing with United Traders

RELIABILITY

Our risk managers ensure proper support throughout the entire transaction.

IN THE PROFIT FROM THE FIRST DAY

Such an approach allows it to limit extra risks related to bankruptcy of start-ups and considerably increase profit vs investors purchasing shares on open Market.

LOW ENTRY THRESHOLD

Millions of dollars are required to buy shares on a subscription basis. We have generated a pool of traders and investors which enables any newbie to participate in any transaction as aforesaid by investing just USD50 or more.

Invest in IPO AppLovin

This investment idea is no longer available. New applications are not accepted

View more ideas