After a lot of consideration last night and this morning I am sad to say I am no longer a holder.. I could see this Microsoft product creating a headwind for Dropsuite which negatively impacts their growth and churn. I see that as unlikely, maybe a 25% probability, although it's impossible to know without being a fly on the wall at the offices of their many MSP partners. I said just yesterday morning that one of the risks is that partners find convenience in consolidating the number of companies' products they offer, and Microsoft is a major (no doubt the biggest) company they sell products of. There is also the added benefit of the AI product, which I am sure will be easy for MSPs to market to their customers, if they make a fatter margin selling the Microsoft product, they will be motivated to switch to it for that reason as well. Considering we are still at a price that was an ATH 2 months ago, and more importantly we are at a valuation which implies a long runway of revenue and profit growth to justify it, I've taken the opportunity to exit at 29c and sit on the sidelines to watch this one play out for a couple of quarters. I'm counting myself lucky that I made the crazy decision to exit during the AFR hype and only re-entered yesterday as it made the decision to exit psychologically much easier.
I have held Dropsuite for almost 3 years and considered it my favorite investment, I have great respect for Charif and wish the best for him and current shareholders, hopefully I will be rejoining the bandwagon in 6 months' time at a higher price. Sorry to be so negative, I just think it's only fair to be consistent in sharing my thoughts as it seems many have been following and appreciating my posts. I'll be interested to hear others' considered thoughts on Microsoft Vs Dropsuite.
DSE Price at posting:
29.5¢ Sentiment: Sell Disclosure: Not Held
