| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| 37.6% | - | 44.2% |
Tim Gallagher's Unconventional Value portfolio returned 44.2% in H1 2026, extending a multi-year run of exceptional performance with 320% cumulative returns since inception. The portfolio underwent significant repositioning as Gallagher trimmed his largest holding, Planet Labs, due to untenable valuations despite strong business fundamentals. He redeployed proceeds primarily into Pagaya, now his largest position, which he views as a data network positioned to benefit from AI transformation of consumer lending infrastructure over the next decade. At 8-12x earnings for a business expected to compound at 15-20%+ annually, he sees compelling value. He also added to Remitly, a cross-border remittance platform demonstrating strong operating leverage with 45%+ incremental margins, and initiated a position in MNTN, a CTV advertising platform serving SMBs trading at less than 5x EBITDA despite 63% customer growth. The portfolio remains concentrated in small-cap fintech and advertising infrastructure plays with strong unit economics. Gallagher maintains conviction that active stock picking can continue to generate outperformance through identifying mispriced opportunities created by market volatility and differing opinions.
Tim Gallagher runs a concentrated portfolio of small-cap growth companies with strong unit economics and operating leverage, focusing on businesses transforming their industries through technology and data advantages, particularly in fintech and advertising infrastructure.
The manager remains convicted in the opportunity for active investors to outperform the market over the long term through stock picking. While acknowledging that the absolute level of outperformance from recent years will not continue forever and that drawdowns happen, the manager believes that as long as differing opinions about company values cause people to transact, there will always be an opportunity to outperform. The manager does not believe it is getting any harder to find opportunities.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jul 27 2026 | 2026 Q2 | MNTN, PGY, PL, RELY | Advertising, AI, Data Services, Fintech, growth, small caps, value |
PL PGY RELY MNTN |
Gallagher repositioned his concentrated small-cap portfolio in H1 2026, trimming Planet Labs on valuation concerns and redeploying into Pagaya at 8-12x earnings, a fintech data network positioned for AI-driven lending transformation. He added to Remitly's high-margin remittance platform and initiated MNTN, a CTV ad platform at 5x EBITDA. The portfolio targets mispriced growth companies with strong unit economics and operating leverage. |
| Feb 22 2026 | 2025 Q4 | AMZN, HIMS, PGY, PL, RELY, SPIR, THRY, UPST, WISE.L, WU, XMTR | AI, Fintech, growth, SaaS, Satellites, small cap, technology, value |
PL THRY RELY |
Concentrated growth investor delivered 98.9% returns in 2025 through patient capital approach focused on durable competitive advantages. Portfolio organized by time horizon with Planet, Xometry, and Pagaya as core infinite duration holdings. Added Remitly and Thryv while trimming Planet on valuation. Bullish on long-term opportunities as short-term focused markets create advantages for patient investors. |
| Aug 15 2025 | 2025 Q2 | PGY, PL, RELY, SPIR, THRY, UPST, XMTR | AI, Concentration, Fintech, growth, SaaS, small caps, technology |
PL PGY THRYV XMTR RELY PL PGY UPST THRY SPIR XMTR RELY |
Concentrated growth portfolio delivering 20% annual returns through differentiated businesses with strong competitive moats. Key themes include AI-driven consumer credit disruption via Pagaya and Upstart, satellite data monetization through Planet Labs, and digital marketplace transformation via Xometry. Manager maintains long-term conviction despite volatility, focusing on fundamental business progression over market sentiment in emerging growth companies. |
| Jan 19 2025 | 2024 Q4 | PGY, PL, QQQ, SPIR, SPY, UPST, XMTR | Data, growth, small caps, SPACs, technology, value | - | Young investor with infinite time horizon runs concentrated portfolio of busted SPACs and secular growth companies. Delivered 73.2% returns in 2024 after recovering from 2022 losses. Portfolio companies transitioning from cash-burning to cash-generating in 2025, representing potential shift from market suspicion to legitimacy. |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2026 Q2 |
AIAI is transforming consumer lending infrastructure over the next decade. Pagaya's unique multi-asset class data from 30+ partners provides a distinct advantage as AI models become commoditized. Differentiation in data will grow in importance as AI becomes the default in underwriting, fraud detection, and servicing. |
AI Data Lending Underwriting |
FinTechPagaya connects borrowers and investors through bank and fintech partnerships, enabling partners to retain customers without balance sheet risk. Remitly is gaining market share in cross-border remittances at the expense of banks and incumbents. Stablecoins are viewed as a rail that will enhance rather than threaten Remitly's business model. |
Payments Lending Remittances Digital Banking | |
AdvertisingMNTN is bringing SMBs into the large, growing CTV advertising market by lowering barriers to entry. The platform has tripled revenue since 2021 while expanding gross margins from mid-60s to 80%. Customer growth of 63% in 2025 and net expansion above 115% demonstrate strong value proposition despite looming competition from Amazon and AppLovin. |
CTV Ad Tech SMB Digital Advertising | |
Data ServicesPagaya is positioned as a data network at its core, with unique multi-asset class data collected from application flow of over 30 partners. This data advantage will only grow in importance as AI models become more commoditized, providing sustainable differentiation in the consumer lending infrastructure market. |
Data Networks AI Infrastructure | |
| 2025 Q4 |
SatellitePlanet is building a database business through its daily Earth scan, creating operational infrastructure that customers build workflows around. The manager believes Planet is becoming the default system of record for monitoring Earth, positioning it to capture significant economic power as the geospatial industry evolves toward integrated solutions. |
Satellite Geospatial Earth Monitoring Database Infrastructure |
AIAI is viewed as both opportunity and threat across portfolio companies. For Thryv, AI implementation is accelerating product velocity and forming a tailwind in the near term, though longer-term disruption remains uncertain. Planet benefits from being viewed as an AI winner by the market. |
AI Automation Product Development | |
FintechRemitly continues taking market share in remittances with strong unit economics, while stablecoins represent a technical enabler for faster, cheaper payments rather than a fundamental threat. The manager expects stablecoin benefits to be distributed across the industry and captured by customers. |
Remittances Payments Stablecoins Financial Services | |
ManufacturingXometry reached positive cash flow and continues building the largest network of manufacturing buyers and suppliers globally. The platform business model benefits from network effects as it scales. |
Manufacturing Platform Network Effects | |
| 2025 Q2 |
AIAI is viewed as an accelerant to value unlock across multiple portfolio companies. Planet Labs benefits from AI in moving up the value chain to deliver solutions rather than raw data. Consumer credit companies like Pagaya and Upstart use AI as a perfectly matched solution for the massive opportunity in consumer credit. Xometry's business is enabled by an AI instant quoting engine that allows for a new business model category. |
Consumer Credit Data Analytics Automation Digital Transformation Machine Learning |
Consumer FinanceThe manager sees consumer credit as a massive opportunity where AI is a perfectly matched solution, expecting the industry to evolve significantly over time. Both Pagaya and Upstart are positioned as major winners from this reshuffling, with each company approaching the problem slightly differently but with similarly thoughtful business models backed by focused execution. |
Credit Lending FinTech Risk Assessment Digital Lending | |
Digital TransformationMultiple portfolio companies are digitizing massive analog industries. Xometry is digitizing the custom parts buying process, transforming a tedious analog process into a digital marketplace. Thryv is executing a print to SaaS business model transition, leveraging relationships with small business owners to capitalize on SMB demand evolution towards SaaS. |
SaaS Marketplaces Automation Business Model Transition Technology Adoption | |
SatellitesPlanet Labs operates the largest fleet of earth observation satellites and has been the only company to image the entire Earth every day for eight years. This dataset represents a core, daily compounding advantage. The manager believes the economic value of this data will increase non-linearly over the next decade as the gap between value created and captured narrows. |
Earth Observation Data Space Technology Remote Sensing Geospatial | |
| 2024 Q4 |
SPACsManager has decent concentration in busted SPACs - companies that went public at too high valuations and have been left for dead. Some entities might possess solid business models, good leadership, and promising prospects; it will just take longer than expected to justify exorbitant valuations. |
SPACs Valuations Public Markets |
AIManager views data as God while AI may be king. Companies with massive, unique, and valuable datasets should accrue significant value as they build platforms and applications enabled by recent AI developments. Training data as a moat concept is experimental but promising. |
AI Data Training Data Platforms |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Jul 27, 2026 | Fund Letters | Unconventional Value | PL | Planet Labs | Aerospace & Defense | Application Software | Neutral | New York Stock Exchange | concentration risk, Geospatial Data, Portfolio Management, Position Trimming, Satellite Imagery, Valuation Discipline | Login |
| Jul 27, 2026 | Fund Letters | Unconventional Value | PGY | Pagaya Technologies | Software - Infrastructure | Financial Exchanges & Data | Bull | NASDAQ | AI, Asset-backed securities, consumer lending, Data Network, Fintech, machine learning, network effects, operating leverage, platform, Value | Login |
| Jul 27, 2026 | Fund Letters | Unconventional Value | RELY | Remitly Global | Software - Infrastructure | Transaction & Payment Processing Services | Bull | NASDAQ | Cross Border Payments, Digital Native, Fintech, growth, market share gains, operating leverage, Remittances, stablecoins | Login |
| Jul 27, 2026 | Fund Letters | Unconventional Value | MNTN | MNTN | Software - Application | Interactive Media & Services | Bull | NASDAQ | adtech, AI, Connected tv, CTV Advertising, Net Expansion, platform, Post-IPO, SaaS, SMB, Value | Login |
| Feb 22, 2026 | Fund Letters | Tim Gallagher | PL | Planet Labs PBC | Industrials | Research & Consulting Services | Bull | New York Stock Exchange | Data, Geospatial, Satellites, Scalability, valuation, Workflow | Login |
| Feb 22, 2026 | Fund Letters | Tim Gallagher | THRY | Thryv Holdings, Inc. | Information Technology | Application Software | Bull | NASDAQ | cashflow, debt, SaaS, Software, turnaround, valuation | Login |
| Feb 22, 2026 | Fund Letters | Tim Gallagher | RELY | Remitly Global, Inc. | Financials | Transaction & Payment Processing Services | Bull | NASDAQ | Fintech, growth, Margins, Remittances, Transaction Processing, Unit economics | Login |
| Aug 15, 2025 | Fund Letters | Tim Gallagher | PL | Planet Labs PBC | Industrials | Aerospace & Defense | Bull | New York Stock Exchange | AI, Data Monetization, Earth Observation, Satellite Imagery, Unique Asset | Login |
| Aug 15, 2025 | Fund Letters | Tim Gallagher | PGY | Pagaya Technologies Ltd. | Financials | Consumer Finance | Bull | NASDAQ | AI, Consumer credit, Fintech, founder-led, Market Disconnect | Login |
| Aug 15, 2025 | Fund Letters | Tim Gallagher | THRYV | Thryv Holdings, Inc. | Communication Services | Interactive Media & Services | Bull | NASDAQ | Joe Walsh, Management Play, profitable growth, SaaS Transition, SMB | Login |
| Aug 15, 2025 | Fund Letters | Tim Gallagher | XMTR | Xometry, Inc. | Industrials | Trading Companies & Distributors | Bull | NASDAQ | AI, Digital Marketplace, disruption, manufacturing, network effects | Login |
| Aug 15, 2025 | Fund Letters | Tim Gallagher | RELY | Remitly Global, Inc. | Information Technology | IT Services | Bull | NASDAQ | contrarian, digital payments, Fintech, Remittance, secular growth | Login |
| Aug 14, 2025 | Fund Letters | Unconventional Value | PL | Planet Labs PBC | Information Technology | Technology Hardware, Storage & Peripherals | Bull | NYSE | AI Analytics, Constellation, Data Monetization, Earth Observation, Geospatial Data, remote sensing, Satellite Imaging | Login |
| Aug 14, 2025 | Fund Letters | Unconventional Value | PGY | Pagaya Technologies Ltd. | Financials | Consumer Finance | Bull | NASDAQ | AI Credit, Alternative Lending, consumer finance, Credit Underwriting, financial technology, Fintech, founder-led | Login |
| Aug 14, 2025 | Fund Letters | Unconventional Value | UPST | Upstart Holdings, Inc. | Financials | Consumer Finance | Bull | NASDAQ | AI Credit, Alternative Lending, Bank Partnerships, consumer finance, Credit Underwriting, Fintech, machine learning | Login |
| Aug 14, 2025 | Fund Letters | Unconventional Value | THRY | Thryv Holdings, Inc. | Communication Services | Interactive Media & Services | Bull | NASDAQ | business transformation, Local Marketing, Management Quality, Print-to-Digital, SaaS Transition, small business, SMB software | Login |
| Aug 14, 2025 | Fund Letters | Unconventional Value | SPIR | Spire Global, Inc. | Information Technology | Technology Hardware, Storage & Peripherals | Neutral | NYSE | Data Analytics, Earth Observation, Founder Risk, leadership transition, satellite constellation, Space Analytics, Space-to-Cloud | Login |
| Aug 14, 2025 | Fund Letters | Unconventional Value | XMTR | Xometry, Inc. | Industrials | Commercial Services & Supplies | Bull | NASDAQ | AI Quoting, Custom Manufacturing, Digital Marketplace, Industrial automation, Manufacturing Digitization, network effects, On-Demand Production | Login |
| Aug 14, 2025 | Fund Letters | Unconventional Value | RELY | Remitly Global, Inc. | Information Technology | IT Services | Bull | NASDAQ | Cross Border Payments, Digital Remittance, Financial Inclusion, Fintech, Immigrant Services, money transfer, Secular Disruption | Login |
| TICKER | COMMENTARY |
|---|---|
| PL | The biggest decision was to trim my stake in Planet Labs. It has been my largest position for much of the last four years and the single largest driver of my returns thus far. In short, I felt the valuation was untenable, and Planet's future returns would be increasingly divorced from the fundamental progression of the business. I did not want to sell out of the position entirely given my belief in great companies surprising to the upside, but it had reached a point where my portfolio-wide return expectations felt increasingly beholden to it. I was comfortable with this when the stock was at $2 or $3 but not at $30, $40, or even $50 (briefly). |
| PGY | I rolled much of the proceeds from Planet into Pagaya, my largest position today. Pagaya is in the business of connecting borrowers and investors; it does not interact with borrowers directly, however, instead partnering with banks and fintechs to underwrite their application flow. Partners agree to this because Pagaya shares fee income while enabling them to retain and win more customers without taking balance sheet risk. The value proposition to investors is more fluid and directly dependent on meeting their required return. Given the rapid growth of its funding base, I feel comfortable with how Pagaya is delivering on that investor promise. I like the business model, but the thesis is built on a broader foundation: over the next decade, I believe the infrastructure for consumer lending (think fraud, underwriting, servicing, etc.) will be transformed by AI, and Pagaya stands to win from AI becoming the default. Its unique, multi-asset class data, collected from the application flow of over 30 partners (including those approved by the lender's own models) is a distinct advantage, and while AI models may become more commoditized over time, differentiation in data will only continue to grow in importance. At its core, I think of Pagaya as a data network. There are a few points to note on the business model. First, Pagaya uses pre-funded ABS, raising capital from investors prior to originating loans. This eliminates the liquidity risk faced by many similar companies. Second, reaching consumers through partners yields a more efficient growth model; the business grows by adding new partners and cross-selling existing partners rather than scaling marketing spend. The impact of these two factors can be seen from the company's consistent expansion during the credit contraction in 2022 and 2023. As with any volume-based revenue model, the business also benefits from built-in operating leverage. As network volume grows, so too does fee revenue without corresponding increases in a largely fixed cost base. The company has all the resourcing needed to support new partner onboarding requirements, and tech spend has remained roughly flat for the last three years. I think the market's central misunderstanding is conflating the recent slowdown in growth with a fundamental weakness in the business model. Slowing growth is a direct result of the decision to step back from single-family rentals; the headline numbers obscure network volume continuing to grow north of 20%. Further, the emphasis on growth today misses the biggest contributor to future growth: network expansion. Pagaya has shared an expectation of adding at least eight partners this year, well ahead of the long-term guide of 2-4 new partners annually. The ramp of these partners over the next few years provides visibility into durable growth. Another factor that contributed to the timing of my investment is Pagaya's expansion beyond simply being a second-look option. In 2025, new products (i.e., not second-look, or decline monetization as they call it) accounted for 44% of network volume and 50% of FRLPC (gross profit) in 2025. This is the beginning of Pagaya's transformation into a broader technology platform serving lenders of all kinds. Multi-product partners already account for ~70% of network volume despite only representing ~30% of the partners. There is a lot of room to run. Of course, the question of why now always returns to a measure of valuation. If we assume 2026 net income lands somewhere in the guided range of $110-160mn of net income, at a market cap just above $1bn, as it remained throughout much of the first half of the year, I paid ~8-12x earnings. For a business that I believe can compound at 15-20%+ over the long haul, I don't think you can get a much better deal than that. |
| RELY | Early this year, I also took the opportunity to increase my investment in Remitly. Remitly is a cross-border remittance app. Similar to Pagaya, it is a volume-based business with natural operating leverage. That leverage has been on full display recently, with incremental operating margins north of 45% in the last two quarters while send volume continues to grow over 30%. Remittances are a massive, fragmented market, and Remitly is a bet on execution. I believe it can continue to accumulate market share at the expense of banks (too expensive, poor customer experience), incumbents (channel conflict, not digital-native) and other fintechs (sub-scale). My impression is the remittance category has fallen out of favor over fears of stablecoins. I think this fear is misplaced, and stablecoins are likely to enhance Remitly's business model, not to mention it will be years before they represent a critical mass of any type of money movement. Stablecoins are ultimately a rail, and until consumers are using stablecoins to pay for everyday goods and services (unlikely anytime soon), they pose more an opportunity than a threat. I expect Remitly can grow 15-20%+ for years to come while growing into a mature 20%+ margin. |
| MNTN | Earlier this year, I also purchased a stake in MNTN. A 2025 IPO still struggling to find a steady shareholder base, the stock has drifted lower for much of the past year and today sits at $8 and change, down almost 70% from IPO. Adtech is a notoriously competitive space, producing precious few winners in the public markets. But I believe there is a real opportunity for MNTN, and you don't have to believe much to earn a good return. MNTN is a performance advertising platform for connected television (CTV) serving primarily small-to-medium businesses. The recent trajectory of the stock price directly contrasts the results of the business. Since 2021, revenue has more than tripled; gross margins have marched from the mid-60s to around 80%; and operating margin has flipped from -11% to nearly 14%. The company has been cash flow positive for at least the last three years and holds nearly a third of its market cap in net cash on the balance sheet. MNTN is bringing an underserved customer segment (SMBs) into a large, growing market still underpenetrated in its own right (CTV advertising). 95% of customers have never advertised on TV before; it's building a market in its own right, not stealing share from incumbents. MNTN's simplicity is its edge; it collapses all the tools needed to run a TV campaign into an intuitive platform tailor-made for small business marketers. In short, it's lowering the barrier to entry. The value proposition is evident from rapid customer uptake and consistently growing spend. Customers grew 63% in 2025 on the back of 56% growth in 2024, with inbound sales cycles shortening from 19 days to 11 days. Net expansion rate has remained above 115% for the last three quarters and was 108% in 2024. Customers are leaning into the platform over time, and new roll-outs such as QuickFrame AI (AI-powered video creation and production) should only strengthen its value to marketers. Of course, the central question is around looming competition. Advertising giants from Amazon to AppLovin and everyone in between are making inroads into the CTV ecosystem and will eventually, if they aren't already, target SMBs. However, it seems like the adverse effects of such competition are largely priced in. I expect the business to do around $100mn in EBITDA this year with negligible capex; call it a $650mn market cap less around $200mn of cash on hand, I'm comfortable paying less than 5x EBITDA for a business that has shown no signs of slowing growth and is tackling such a massive opportunity. Make no mistake, it is one to watch closely, but I'm excited how the next few years as a public company will shape the stock. |
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