Investment Review day 40 of 50: Fiverr $FVRR (sold)
Fiverr is a leading global marketplace for digital services, breaking the boundaries of traditional employment and allowing talented individuals to share their skills on a flexible platform.
I badly misjudged $FVRR, with an Oct 2020 investment thesis that the company would benefit from the tailwind of remote working. Things seemed to be playing out nicely, and in early 2021 I DCA’d into my position. That was very likely the absolute valuation peak for the company. 🤕
Growth stalled, and the company’s excessive take rate seemed to offer poor value to Fiverr gig workers, but the real nail in the coffin was perhaps the advent of AI – tools such as ChatGPT, Gemini, and Midjourney, which could produce high-quality outputs that mitigated the need for many of the services provided on Fiverr’s two-sided marketplace.
I had an interesting debate with a friend and fellow $FVRR shareholder two years ago. I argued that even with a significant drawdown, it was still better to free up the remaining capital from this failed investment to redeploy into a high-conviction holding, he argued for more of a wait and see approach.
We went in different directions, and in Nov 2022 I sold for an 86% loss and he held. Thus far, I’ve been proven correct (the important lesson that ‘what goes down can still go lower’), but even if the company salvages a recovery from current levels, perhaps the bigger benefit of selling is that it’s one less distraction in an already complex investment portfolio. It isn’t just money tied up, it’s attention span and emotional bandwidth…
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I’m putting my holdings under the microscope. Over the next 50 days I’ll break down my whole investment portfolio. Wins, losses, and the ‘why’ behind it all. And on day 50 I’m going to share my full portfolio so you can see how my strategies played out in the real world over the last twenty years and what we can all learn together. Follow along for the journey! #StockAnalysis #50daychallenge #remoteworking #AI
