For long-term investors, finding companies that are helping build a new, innovative future that will better society over the next 10 years is usually a good strategy. However, it can be difficult to put this strategy into practice.
Companies can build our future for the better in many ways, and these three companies are working on different aspects to improve it as a whole. Here's how Matterport (MTTR -1.11%), Twilio (TWLO -0.73%), and Fiverr (FVRR -1.81%) are building our future, and how we will benefit from it.
Image source: Getty Images.
Matterport: Building the metaverse
Matterport is enabling companies to bring "digital twins" of buildings and spaces in real life to the cloud. By simply taking a 3-D picture of your space, you can upload a digital version to the cloud, which enables you to do a variety of things with it. Whether you need to analyze the building to optimize efficiency, allow potential customers to take a 3-D tour of the space, or enhance an e-commerce experience by letting consumers shop from the digital image of your store, Matterport can help you do this.
Much of society believes that the metaverse will become a part of our future because of its simplicity and usefulness, and Matterport is making this shift easier than ever. It has already begun seeing strong adoption from big-name customers like H&M and Airbnb, along with 439,000 other subscribers. The company's third-quarter spaces under management grew 62% to 6.2 million, and its revenue reached $28 million. Matterport is gushing cash, losing $168 million in Q3 alone, and its free cash flow isn't pretty either at negative $27 million. The company's cash balance is, however, near $149 million.
While the company's path to profitability is not the brightest, there is no doubt that as the metaverse grows in popularity, Matterport will be at the forefront of the shift. Not only do Matterport's products create immense value for consumers looking to optimize their spaces today, but they provide an opportunity to bring the real world to the cloud, and eventually the metaverse, in the future.
Twilio: Building customer relationships
Twilio enables seamless, easy communication between customers and companies, making sure that the customer has a positive experience. If you cannot contact your DoorDash driver or your Airbnb host -- both of which are Twilio customers -- it can be difficult to enjoy your experience. In a world where fast online communication is becoming increasingly critical in our lives, Twilio is helping build it out.
Twilio has seen immense success from its efforts, with recent Q3 revenue reaching $740 million, representing growth of 64%. Its customer count topped 250,000, and its net retention rate reached 131% in Q3. Its net loss increased year over year from 26% of revenue to 30%, but the company has nearly $1.5 billion in cash to subsidize its Q3 net loss of $224 million.
The company trades at 21 times sales, which is high. Even for up-and-coming stocks that are growing fast, 21 times sales can be pricey. On the other hand, this stock could continue its high growth for a long time. The company has been acquiring businesses to enhance its offerings, so Twilio has become one of the major players in its space, and it plans on keeping that position. The company has reportedly spent $210 million on R&D in Q3, indicating that its growth in this market will not stagnate anytime soon.
Fiverr: Building a new standard of work
Another part of our future that has changed drastically over the past two years is how we work. Side hustles and freelance work have drastically increased in popularity and only grew more prevalent when freelance work could be done from home during the pandemic. As we slowly move away from the pandemic, freelance work and working from home have remained important, partly thanks to Fiverr.
The company reports earnings on Nov. 10, and it hopes to continue its winning ways. Clearly, Fiverr has seen tremendous success from the pandemic trends, and it continued growing even when economies started to reopen -- growing revenue 60% year over year in the second quarter of 2021. The number of buyers on the platform has increased -- reaching 4 million, growing 43% year over year in Q2. The spend per buyer also grew, jumping 23% to $226. The company guided for 30% to 38% year-over-year revenue growth for Q3 -- reaching $68 million to $72 million -- and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $2.5 million to $3.5 million.
While the company's growth might be slowing down a little bit and decreasing sequentially, Fiverr still has plenty of room for growth. As the market leader and fastest-growing player in this market -- outpacing its competitor Upwork -- Fiverr is perfectly positioned to reinforce freelance and work-from-home jobs, which have the potential to become a bigger part of the way we work in the future.
