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adam

T2 · manager / operator

Co-founder and CEO of AppLovin (APP), a $100B+ market cap mobile advertising and marketing platform. Former derivatives trader who built the company from zero to public company, navigating a 92% post-IPO drawdown and recovery via Axon 2.0 model architecture.

2 calls·1 name·100% bull·last heard last month·Sourcery VC
track record

no scored calls yet — needs a stated position or a categorical verdict, with a matured window vs SPY

top calls

highest conviction · one per company
1sthigh conviction
$APPAppLovin

AppLovin CEO outlines $1T path: $30B+ cash flow via AI-driven ad engine and vertical expansion

AppLovin's Axon 2.0 deep learning model delivers more accurate predictions at lower GPU compute cost, enabling profitable performance advertising at scale. With $7B+ EBITDA run rate, 75% cash conversion, and a lean 100-person engineering team whose productivity is multiplied by AI, the company aims to expand from gaming into e-commerce, connected TV, and open web to reach $30B+ annual cash flow required for a $1T valuation.

Sourcery VC2026-08episode →

most discussed · click a bar to filter

  • $APP

recurring themes

  • Advertising2
  • Public Markets & Valuation2
2 total
$APP
···
AppLovin
HIGHadam·Sourcery VC·last month·How AppLovin Built a $100B Ad Machine
AppLovin CEO outlines $1T path: $30B+ cash flow via AI-driven ad engine and vertical expansion
AppLovin's Axon 2.0 deep learning model delivers more accurate predictions at lower GPU compute cost, enabling profitable performance advertising at scale. With $7B+ EBITDA run rate, 75% cash conversion, and a lean 100-person engineering team whose productivity is multiplied by AI, the company aims to expand from gaming into e-commerce, connected TV, and open web to reach $30B+ annual cash flow required for a $1T valuation.
"We probably on an EBITDA basis, I think we're over a 7 billion run rate and we generate somewhere around 75% cash off the EBITDA dollar... To take it from this scale up and be wor…"
62:00
$APP
···
AppLovin
HIGHadam·Sourcery VC·last month·How AppLovin Built a $100B Ad Machine
AppLovin CEO outlines path to $30B+ cash flow and trillion-dollar valuation
AppLovin's Axon 2.0 deep learning model enables superior ad targeting across gaming and e-commerce, with a lean 100-person engineering team amplified by AI tools. The company generates ~$7B EBITDA run rate with 75% cash conversion, and management believes expanding into connected TV and open web can unlock the $30B+ annual cash flow needed for a trillion-dollar valuation.
"We probably on an EBITDA basis, I think we're over a 7 billion run rate and we generate somewhere around 75% cash off the EBITDA dollar... To take it from this scale up and be wor…"
63:00
8
Advertisingtailwind
Performance ad model creates aligned incentives: advertisers only scale when they profit, eliminating sales friction
AppLovin's platform closes the full conversion loop — from ad engagement through install, retention, and revenue — giving advertisers real-time ROAS visibility. When ROAS works, advertisers autonomously increase spend without sales pressure. This self-serve, data-driven model attracts long-tail SMBs with large P&Ls that traditional sales teams ignore.
8
Advertisingtailwind
Performance advertising shifts from gaming to e-commerce and connected TV via first-party data loops
AppLovin leverages 60-second immersive playable ads in mobile games to harvest rich engagement data (10 min/day per user), then closes the conversion loop with advertiser-shared purchase/revenue data. The same model architecture generalizes to e-commerce (heads of household, 30-50yo demographic) and is being extended to connected TV and open web video — top-of-funnel discovery channels where users don't know what they want, creating alpha for early advertisers who learn the platform's unique user behavior.
7
Public Markets & Valuationtailwind
Buyback conviction during 92% drawdown: cash flow + fixed-dollar SBC + no IR = self-funded recovery
When AppLovin dropped 92% post-IPO, management avoided investor relations and instead deployed all free cash flow into share repurchases while capping stock-based compensation in fixed dollar terms (preventing dilution death spiral). The bet paid off after Axon 2.0 proved the growth thesis. This playbook — cash generation + conviction + lean cap table — is rare in software and suggests a template for other beaten-up quality compounds.
7
Public Markets & Valuationtailwind
Cash-flow-positive compounders can self-fund recovery from 90% drawdowns via buybacks
When AppLovin dropped 92% post-IPO, it avoided the dilution death spiral by capping stock-based compensation in fixed dollar terms, generating massive free cash flow, and aggressively buying back shares — becoming its own best investor. This only works for algorithmic businesses with low marginal cost of revenue growth (no go-to-market hiring needed), unlike enterprise SaaS where low stock prices force layoffs and private equity take-private transactions.