Billionaire Chamath Palihapitiya’s Portfolio, Stock Picks and Investment Ideas

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In this article we will take a look at the 10 best stock picks and investments of billionaire Chamath Palihapitiya. Click to skip our detailed discussion on Palihapitiya’s investment strategy and go directly to 5 Best Stock Picks and Investments Of Billionaire Chamath Palihapitiya.

Chamath Palihapitiya is a Sri Lankan-origin Canadian-American billionaire who founded a California-based venture capital firm named Social Capital in 2011. Although an electrical engineer by academic degree, the 44-year-old Palihapitiya has had an illustrious career in the finance industry over the past two decades. His stock picks and investments as head of Social Capital have outperformed the S&P 500 — a stock index that Palihapitiya believes is the benchmark for industry leaders — by more than 1.3 percentage points over the past few years.

Palihapitiya held important positions at American tech firms AOL and Facebook before becoming a venture capitalist. His firm has a diverse portfolio of investments in healthcare, financial services, education, consumer products, frontier, and enterprise sectors. In 2020, the Canadian-American investor debuted the Social Capital Hedosophia Holdings Corp. V (NYSE: IPOE), a special purpose acquisition company (SPAC), that has since facilitated mergers, share exchanges, asset acquisitions, and initial public offerings (IPOs), of several businesses.

SPACs have been a hot item in Wall Street over the past year and a half. Statistics released by SPAC Insider, a website offering trusted information on SPACs in the market, reveal that initial public offerings facilitated by SPACs raised more than $83 billion in 2020 and more than $97 billion in the first three months of 2021. Both numbers are more than double the total amount raised by SPAC-facilitated IPOs in the ten years preceding 2020. According to a report in Forbes magazine, SPACs have made ten new billionaires over the past year.

Palihapitiya has been a beneficiary of this boom. In late 2019, he was the sponsor of a firm that merged with private spaceflight company Virgin Galactic just before an initial public offering worth $2.3 billion that created Virgin Galactic Holdings, Inc.(NYSE: SPCE). Last month, the former Facebook executive sold personal stake in the company for $213 million. He has also facilitated the IPO of health insurance firm Clover Health Investments, Corp. (NASDAQ: CLOV) a deal from which he made more than $280 million on a $25,000 investment, stirring controversy in the media.

The venture capitalist has gained a huge fan following on social media as his investment exploits have gone public. He has more than a million followers on social networking platform Twitter and appears regularly on American news media to offer opinions on the finance and technology industry. At the start of the year, Palihapitiya appeared to back meme stock rallies on Twitter and regularly engaged in criticism of fellow venture capitalists. Analysts accused him of stoking volatility, but the billionaire said the fluctuations offered SPACs, which are often backed by hedge funds, the opportunity to implement lessons learned from the pandemic.

Chamath Palihapitiya portfolio stocks and ideas

At present, the entire hedge fund industry is feeling the reverberations of the changing financial landscape. Its reputation has been tarnished in the last decade, during which its hedged returns couldn’t keep up with the unhedged returns of the market indices. On the other hand, Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017. Between March 2017 and February 26th 2021 our monthly newsletter’s stock picks returned 197.2%, vs. 72.4% for the SPY. Our stock picks outperformed the market by more than 124 percentage points (see the details here). We were also able to identify in advance a select group of hedge fund holdings that significantly underperformed the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 16th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.

With this context in mind, here is a look at the top 10 stocks picks, investments, and portfolio of billionaire Chamath Palihapitiya. We talk about the companies Chamath Palihapitiya invested in by taking a look at his portfolio. These investments will give you an insight into the mind of the billionaire and also shed some light on the broader areas and sectors he’s bullish on.

10. Yammer

Yammer is a free social-networking service that is used for private communications with organizations. Users, who are identified by their specific internet domains, are added to networks based on their email addresses so that access to the company network is protected. The company was bought for more than $1 billion by American technology giant Microsoft Corporation (NASDAQ: MSFT) in 2012 and incorporated into enterprise offerings of Microsoft software products like Office 365 and Microsoft 365.

In 2019, Microsoft announced that Yammer was being integrated into a larger product called Microsoft Teams, a business communication platform developed by the tech giant. Yammer had managed to raise more than $142 million in funding before it was acquired by Microsoft. It was founded in 2008 by David Oliver Sacks. Initially, the company only started as a work communication application for a social media firm but eventually transitioned to a more open model that favored businesses all over the globe. Yammer is tenth on our list of top 10 best stock picks, investments, and portfolio of billionaire Chamath Palihapitiya.

9. Slack Technologies, Inc. (NYSE: WORK)

Slack Technologies, Inc. (NYSE: WORK) is a California-based business technology platform that offers software to bring people, data, and applications together for a smoother organizational workflow. The company went public in 2019 through a direct stock listing with an opening price that equated to a market cap of well over $23 billion. Late last year, salesforce.com, inc. (NYSE: CRM) purchased Slack Technologies for close to $28 billion. Slack operates in the US, UK, Japan, Canada, Australia, India, and France.

The company posted more than $900 million in revenue earlier this year. Last month, Slack announced that it was testing new audio and video message features built on the success of social media apps like Clubhouse and Snapchat. Slack is short for Search Log of All Communication and Knowledge. The company managed to raise close to $1 billion in funding before it went public. The Salesforce purchase of Slack pits the two companies against rival Microsoft products like Microsoft Teams. Slack is ninth on our list of top 10 best stock picks, investments, and portfolio of billionaire Chamath Palihapitiya.

8. Wave

Wave is a Toronto-based financial company services and software company that primarily serves small businesses. The company offers several products that include accounting tools, payment mechanisms, and other finance software. In July 2019, Wave was purchased by Kansas-based financial planning platform H&R Block, Inc.(NYSE: HRB) in a $405 million deal. The move was seen by analysts as an attempt by the Kansas company to expand its presence in the small business market across the United States.

Wave, known as Wave Financial before the acquisition, managed to raise more than $70 million from investors. Social Capital was one of the investors. Even though most accounting and invoicing needs are automated through Wave products, it does not support tax inclusive pricing. The company does not disclose its revenue which is rumored to be in the tens of millions. Wave is eighth on our list of top 10 best stock picks, investments, and portfolio of billionaire Chamath Palihapitiya.

7. SVMK Inc. (NASDAQ: SVMK)

SVMK Inc. (NASDAQ: SVMK) is a California-based online survey development software firm. The company ranks 7th on our list of top 10 best stock picks, investments, and portfolio of billionaire Chamath Palihapitiya. It is also known as SurveyMonkey. The company has more than 20 million active users and works in more than 340,000 organizational domains. It was founded by Ryan Finley and Chris Finley in 2009. The company went public in 2018, starting trade at $12 per share, a number that went up 43% by the ending of trading. The firm has purchased other survey tools like Precision Polling, Wufoo, Zoomerang, Clicktools, and Fluidware over the years to stay ahead of competition.

It has a market cap of more than $2 billion and posted $101 million in revenue for the last quarter of 2020. The firm has a 29% enterprise sales revenue against the total revenue. Last month, the company announced a partnership with the Eva Longoria Foundation (ELF) to help provide young businesswomen free resources to make their businesses more profitable. The company said it would provide women access to their surveys to help them devise better business strategies.

6. Propeller Health

Propeller Health is a Wisconsin-based digital health firm that focuses on patients that have chronic respiratory disease. The company also develops products that help people with chronic respiratory disease or asthma better manage their condition in partnership with the healthcare services the firm provides. The firm operates in the US, Europe and Asia. In 2019, California-based medical equipment firm ResMed Inc. (NYSE: RMD) purchased Propeller Health for $225 million.

In August 2020, the company announced plans to expand into Japan under a partnership with Swiss healthcare firm Novartis. Under the deal, the asthma patients using Novartis medicine in Japan to help with their conditions would be able to use the products of Propeller Health to digitally manage their health. For example, sensors attached to inhalers that send usage statistics to smartphones will be able to help patients manage their condition. The company is 6th on our list of top 10 best stock picks, investments, and portfolio of billionaire Chamath Palihapitiya.

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Disclosure: None. 10 Best Stock Picks and Investments of Billionaire Chamath Palihapitiya is originally published on Insider Monkey.