Last week on the Rule Breaker Investing podcast, Motley Fool co-founder David Gardner reviewed the performance of two sets of his buy-and-hold stock picks: one set with a five-year horizon, and one that he recommended we hold for a year. This week, he offers up a new handful of recommendations, and the theme that came to his mind was Motley Fool Explorer, which is one of the premium services that competitively cherry-picks stocks from the Supernova universe.

So David is offering five hidden gems from the 210 Foolish holdings -- long-term market beaters that have never been part of a Real Money mission that have market caps below $10 billion and brand names most people won't recognize. And he thinks you should hold them for the next three years or more. His final pick is Blackbaud (NASDAQ:BLKB), which provides software and services especially designed for nonprofits.

A full transcript follows the video.

This video was recorded on Sept. 13, 2017.

David Gardner: "Hidden Gem" No. 5: And stock No. 5. Again, I like these stocks for the next three-plus years going forward. We'll be checking with them year by year as we go by. Stock No. 5 is Blackbaud. The ticker symbol is BLKB. Blackbaud has a market cap of $4 billion today, so right around the same size as Littelfuse. The risk rating on Blackbaud is 11.

Blackbaud I first picked in November 2006, so we're talking about 11 years ago almost. The stock, over that time, has gone from $23.38 to $85.11. It's up 264%. The market over the same time up 125%. So of all the five stocks I presented this week, this has been the biggest winner. It's ahead of the market averages by about 140% over the now almost 11 years that we've bought and held Blackbaud.

I first heard about Blackbaud because my brother Tom and I spoke at a conference. We keynoted a conference for them. I was like, "Who are these guys?" I think we were in Charleston, South Carolina which, by the way, is where I'm going to be. I will be in Charleston, South Carolina right at the start of October. If you're a Motley Fool ONE member, perhaps you'll be joining in at that event.

Well, I was in Charleston, South Carolina about 12 years ago, or so, speaking with Tom at a Blackbaud conference and I learned a lot about the company at that time that I appreciated. If you work in the not-for-profit area, and many of you no doubt do, it's a huge area of the world today.

Blackbaud is, among many, the preferred platform for managing the database of the business, because after all there is a business aspect of the business that you're running as a not-for-profit. So they started with a product called The Raiser's Edge, which is a big platform for Blackbaud helping people raise money, track it, and keep up with all the database stats you want on your donors. That kind of thing. And once you get a product like that into a not-for-profit and they like it, they're probably just going to renew it year after year, and Blackbaud has been a beneficiary of it.

So I led off this week's show with Ultimate Software, which is also one of those subscription-based [we hope you'll renew us from one year to the next] businesses, in that case helping out human capital management. Here we have basically helping out not-for-profits. So if you like not-for-profits -- a lot of us do -- then this company is supporting them, and this company has built a pretty good business by serving them. And so that's what Blackbaud does.

And in addition to some of the traits I just mentioned that I appreciate about Blackbaud, I'll just point out one more, and that is that this company is the leader at what it does. Well, I can't say that they're kind of the Windows 95 of the world, going back to a time when Microsoft utterly dominated everyone's operating system. They're not really the Windows 95, necessarily, of the not-for-profit world, but they are a clear-branded leader within that space with a lot of customers who appreciate what they do.

So I like leaders. If you're not the lead husky, as I said to Patrick O'Shaughnessy on his podcast this week ... once again one of my favorite lines ... if you're not the lead husky, the view never changes. I love the lead huskies. This is a company that is a leader. Everybody else is trying to play catch-up, and they're taking the world and their industry, often, to new, interesting places as they continue to innovate.

Teresa Kersten is an employee of LinkedIn and is a member of The Motley Fool's board of directors. LinkedIn is owned by Microsoft. David Gardner has no position in any of the stocks mentioned. The Motley Fool recommends Blackbaud, Littelfuse, and Ultimate Software Group. The Motley Fool has a disclosure policy.