Second engine igniting off the first: an unplanned-for adjacent revenue stream has started paying, and management is now
The model's full reasoning — Q3 2019 call → NOWe need to determine if management describes a second, distinct way of making money that emerged from existing operations, is already generating real paying business, and is being deliberately grown. Key points from transcript: - The company is transitioning from perpetual licenses to subscriptions. That's a business model change, not a second avenue. - They mention construction as a focus, and they acquired PlanGrid. But that's an acquisition, not emerging from existing operations. However, they also have BIM 360 which is part of their cloud offerings. They talk about cloud ARR growth, BIM 360 strength. But is that a second avenue? It's part of their product portfolio, not a separate stream from existing assets. They also mention eStore, but that's a sales channel. - They talk about "maintenance to subscription" program, but that's part of the transition. - They mention "EBAs" (Enterprise Business Agreements) as a way of selling, but that's a sales model. - They mention "collections" which are bundles of products, but that's product packaging. The question asks: "a SECOND, DISTINCT WAY OF MAKING MONEY has recently emerged FROM the company's existing operations, assets, customers, or capabilities - an additional revenue avenue that grew out of what the company already does rather than a separate diversification - AND that this second avenue is ALREADY GENERATING REAL PAYING BUSINESS today while management is now deliberately putting effort or resources behind growing it?" Looking for something like: they built a technology for internal use and now sell it, or they have a data asset they monetize, or they leverage their customer base to sell a different kind of service. In the transcript, they talk about "cloud" offerings like BIM 360 and Fusion. But these are part of their product line, not a separate avenue. They also talk about "construction" as a focus, but they are acquiring PlanGrid to expand there, which is an acquisition, not organic. They mention "eStore" as a digital sales channel, but that's a distribution method. They mention "unbilled deferred revenue" and "EBAs" but again, these are sales models. The only thing that might qualify is if they are monetizing something like their data or platform. But they don't describe that.
| Ticker | Company | Call | Date | Call grade |
|---|---|---|---|---|
| M | Macy's, Inc. | Q4 2022 | 2023-03-02 | D |
| CMLS | Cumulus Media Inc. | Q3 2022 | 2022-10-28 | D |
| GDRX | GoodRx Holdings, Inc. | Q2 2022 | 2022-08-08 | F |
| SOPH | SOPHiA GENETICS SA | Q4 2021 | 2022-03-15 | C |
| SLQT | SelectQuote, Inc. | Q2 2022 | 2022-02-07 | F |
| LC | LendingClub Corporation | Q4 2021 | 2022-01-26 | A |
| IRBT | iRobot Corporation | Q3 2021 | 2021-10-28 | D |
| T | AT&T Inc. | Q3 2018 | 2018-10-24 | C+ |
| LRN | Stride, Inc. | Q1 2019 | 2018-10-23 | B |
| MITK | Mitek Systems, Inc. | Q4 2017 | 2017-11-07 | C+ |
| IONS | Ionis Pharmaceuticals, Inc. | Q1 2017 | 2017-05-09 | C |
LRN · Q1 2019 → YESThe question is: Does management describe a SECOND, DISTINCT WAY OF MAKING MONEY that has recently emerged FROM the company's existing operations, assets, customers, or capabilities - an additional re...YES The transcript shows career readiness as a distinct second revenue avenue that emerged directly from the existing MPS business: students already enrolled in Managed Public Schools are being moved into career readiness programs (over 5,000 students), and the initiative is built on the same platform, curriculum, and student base. Management explicitly describes it as a “career readiness line of business” and “robust career readiness business” that is already generating paying enrollments today while they are deliberately investing resources—dedicated executives, reallocation of funds, and plans to drive a major portion of next year’s enrollment growth.
M · Q4 2022 → YESThe question is: Does management describe a SECOND, DISTINCT WAY OF MAKING MONEY that has recently emerged FROM the company's existing operations, assets, customers, or capabilities - an additional re...YES The transcript shows that Macy’s Marketplace is explicitly described as a distinct new revenue avenue that emerged directly from their existing e-commerce operations and customer base (macys.com, cross-shoppers, and omnichannel platform). Jeff Gennette states it “captures incremental sales opportunity,” “drives a larger average order value,” “allows us to quickly move into new and adjacent categories without inventory risk,” and “attracts a new younger customer,” while management is actively scaling it by adding 2,000 brands in 2023 and launching Bloomingdale’s marketplace in the back half.
GDRX · Q2 2022 → YESThe question is: Does management describe a SECOND, DISTINCT WAY OF MAKING MONEY that has recently emerged FROM the company's existing operations, assets, customers, or capabilities - an additional re...YES The transcript shows that Pharma Manufacturer Solutions is the second distinct revenue avenue that emerged from GoodRx’s existing operations. Trevor explicitly states: “Our distinct ability to reach both consumers and providers continues to be recognized by manufacturers as evidenced by the strong growth.” This capability originated from the core prescription-transactions platform and user base 3 years earlier (when other offerings were only ~5% of revenue). In Q2 2022 it generated $26.6 million (102% YoY growth) and is already producing real paying business.