A bit of an overreaction from the market in my opinion. The key...

A bit of an overreaction from the market in my opinion. The key when looking through these numbers is to look through the FY21 numbers which were artificially boosted by a huge COVID bounce (firstly all of ecomm benefit from this, secondly in RedBubble's case they specifically benefited from 50 mill plus of mask sales).


This shows a business that is growing nicely and consistently. Q4 already just about breaking YoY growth. However I'm a bit wary of the GPAPA number which indicates they've been buying a lot of this revenue by increasing paid marketing spend. I'm going to keep a close eye on this number over the next couple of quarters.

The big mistake management have made is not treating FY21 as an exceptional year- but rather scaling headcount and OpEx as if that were normal. I'd hope to see OpEx spending growth slow now to allow revenue to 'catch up'

Valuation is still crazy in my opinion. 90m of cash on the balance sheet (albeit some of this is probably going to disappear over next 12 months), no debt, gives an enterprise value of $155m for a company making $183m in gross profit last year.

I'd like to see management focus on:
1. Building geographic diversification. The biz is too reliant on US revenue.
2. Getting new and exciting products onto the marketplace. Artists can only sell what you offer.
3. Keep OpEx under control. You can see on LinkedIn they've hired lots of big hitters from Amazon etc - but need to pause for breath imo, and let revenue catch up.

I think the brand building spending is a good idea - RedBubble brand recognition is very low in most of the world- and it provides a good alternative to paid acquisition which a lot of Ecomm players are struggling with post Apple's iOS tracking changes.