Thank you for the in depth analysis, very helpful.
I also wrote about $MAPS a while ago. Feel free to check my substack (https://substack.com/@swissiechad/p-162543932) and X account. I challenge you on valuation, I think headline numbers look better than they actually are. Still think the set-up is a good one.
In any case, I am still long with unchanged sized (c. 2.5% NAV).
I just read your write-up now. Great piece and really succinct!
With regards to your comments on headline numbers, if you're referring to the part in your write-up where you reference headline numbers looking better than they are, I believe this is a misinterpretation. To clarify, you wrote: "WM Technology consolidates 100% of its financials, but public shareholders only 65% of the economic interest due to the LLC structure and dual-class setup. So while headline multiples look attractive, the actual yield to public shareholders is lower. That’s okay."
I believe this is the wrong interpretation. The share count of 168.2m S/O is inclusive of the economic interests of the original founders via counting the class V shares (see the screenshot in my write-up above under the Capital Structure section pulled from the most recent MAPS investor slide deck).
Note that the Class V shares are paired on a 1:1 basis with the partnership units still held in the LLC by the original founders. Thus, if you're using the 168.2m share count, the economic interests of all parties are being taken into account when referencing market cap and multiples.
Please correct me if you were referring to something else.
You’re absolutely right. Thanks for schooling me here and pointing that out. I had misunderstood the share count and how it already reflects the fully diluted economic interests across both public and insider holders. That clears up the valuation multiple side, much appreciated.
That said, one thing that is important IMO: while EV/EBITDA looks optically cheap, it ignores real cash leakage through tax distributions. These don’t show up in EBITDA but do hit cash flows. If you reclassify from financing cashflows, they reduce the actual free cash flow available to the public shareholders.
So from our investor’s perspective, FCF yield (adjusted for those distributions) gives a cleaner picture of true economic value than headline EV/EBITDA. Not a disagreement, just layering on that nuance for anyone trying to reconcile the optical multiple with actual cash available to equity.
On the tax true-up payments, I completely agree it’s important to take into account given the scenario whereby MAPS stays listed (as outlined in the write-up). It’s also important to keep in mind that these payments would be rendered completely irrelevant in the event of a take-private by the original founders.
$LFLY currently trades OTC on the pink sheets. However, they are going private and cashing out via a 1:500 reverse split. One could make $60 per account at $LFLY's current price (less any trading for OTC stocks) if one were so inclined. They filed to de-register with the SEC and the transaction is imminent.
Thank you for the in depth analysis, very helpful.
I also wrote about $MAPS a while ago. Feel free to check my substack (https://substack.com/@swissiechad/p-162543932) and X account. I challenge you on valuation, I think headline numbers look better than they actually are. Still think the set-up is a good one.
In any case, I am still long with unchanged sized (c. 2.5% NAV).
Appreciate the kind words!
I just read your write-up now. Great piece and really succinct!
With regards to your comments on headline numbers, if you're referring to the part in your write-up where you reference headline numbers looking better than they are, I believe this is a misinterpretation. To clarify, you wrote: "WM Technology consolidates 100% of its financials, but public shareholders only 65% of the economic interest due to the LLC structure and dual-class setup. So while headline multiples look attractive, the actual yield to public shareholders is lower. That’s okay."
I believe this is the wrong interpretation. The share count of 168.2m S/O is inclusive of the economic interests of the original founders via counting the class V shares (see the screenshot in my write-up above under the Capital Structure section pulled from the most recent MAPS investor slide deck).
Note that the Class V shares are paired on a 1:1 basis with the partnership units still held in the LLC by the original founders. Thus, if you're using the 168.2m share count, the economic interests of all parties are being taken into account when referencing market cap and multiples.
Please correct me if you were referring to something else.
Cheers!
You’re absolutely right. Thanks for schooling me here and pointing that out. I had misunderstood the share count and how it already reflects the fully diluted economic interests across both public and insider holders. That clears up the valuation multiple side, much appreciated.
That said, one thing that is important IMO: while EV/EBITDA looks optically cheap, it ignores real cash leakage through tax distributions. These don’t show up in EBITDA but do hit cash flows. If you reclassify from financing cashflows, they reduce the actual free cash flow available to the public shareholders.
So from our investor’s perspective, FCF yield (adjusted for those distributions) gives a cleaner picture of true economic value than headline EV/EBITDA. Not a disagreement, just layering on that nuance for anyone trying to reconcile the optical multiple with actual cash available to equity.
Cheers again for the thoughtful exchange.
No problem at all!
On the tax true-up payments, I completely agree it’s important to take into account given the scenario whereby MAPS stays listed (as outlined in the write-up). It’s also important to keep in mind that these payments would be rendered completely irrelevant in the event of a take-private by the original founders.
$LFLY currently trades OTC on the pink sheets. However, they are going private and cashing out via a 1:500 reverse split. One could make $60 per account at $LFLY's current price (less any trading for OTC stocks) if one were so inclined. They filed to de-register with the SEC and the transaction is imminent.
Long $MAPS. Agree with your thesis generally 👍
Thanks for the $LFLY insight Jake!
Excellent analysis, thank you. Long $MAPS.
Thanks for the kind words!