1. How I Discovered AppLovin
I first came across AppLovin through a Motley Fool podcast, where they were reviewing the company’s earnings call and unpacking the performance of its advertising technology platform. Given my background in commercial television, I’ve spent years on the inside of the media monetization engine—so I understood immediately what AppLovin was trying to build.
At the time, I had already taken positions in both The Trade Desk and Google—two businesses I view as foundational pillars in the evolution of modern advertising. But AppLovin offered something distinct: a vertically integrated monetization engine with exposure not just to programmatic ad demand, but to the entire mobile and connected TV (CTV) stack—down to the game publisher and app developer layer.
That intrigued me.
2. The Spark: The Full Stack Advantage
AppLovin operates through two synergistic segments:
- Advertising: Their real-time bidding exchange, AppDiscovery, and in-app monetization platform, MAX, drive optimization for app publishers and advertisers alike.
- Apps: A portfolio of owned mobile games, plus a connected TV arm (Wurl), which collectively gives them proprietary first-party data and monetizable inventory.
In a world where digital advertising is becoming increasingly performance-driven, and privacy restrictions are forcing advertisers to move closer to first-party data, AppLovin’s model stands out. They control:
- Supply (via games and apps)
- Demand (via ad exchange and DSP)
- Optimization (via MAX, Adjust, and SparkLabs)
- Measurement (via Adjust and analytics infrastructure)
It’s a modern media monetization flywheel, executed in real-time, across billions of devices.
3. My Investment Process
In 2024, I took an initial 0.5% position in AppLovin—what I call a “get to know the business” stake. From there, I began regular research, comparing their financials, customer base, and tech evolution to peers like The Trade Desk and Google.
I’ve studied the company’s positioning within mobile advertising, in-app bidding, and increasingly in connected TV (CTV)—an area I believe is in early innings of explosive growth.
What I’ve found so far confirms my instincts: AppLovin is a quietly powerful disruptor, with best-in-class tools, high-margin software infrastructure, and an increasingly defensible moat in app monetization.
4. Why AppLovin Over Other AdTechs?
While The Trade Desk dominates in open-web programmatic and Google remains a search and YouTube juggernaut, AppLovin is the category king in the gaming and app monetization stack.
It competes by owning the supply and monetization mechanics—not just reselling impressions. Their MAX platform is the de facto bidding layer for many mobile developers. Their Adjust tool is one of the most widely used attribution and analytics platforms. Their AppLovin Exchange connects this all into a unified RTB ecosystem.
This vertical integration reminds me of what Netflix is to streaming: owning distribution, monetization, and consumer experience—just for ads, not shows.
5. Role in My Portfolio
AppLovin currently lives in my G3 Fund – Transformational Technology, where I make smaller, high-conviction bets on companies showing outsized potential for long-term exponential growth.
So far, the stock has been highly successful, with strong appreciation since my initial buy. But more importantly, it is showing signs of structural strength—operating leverage, improved margins, and expanding ARR across tools like MAX, Adjust, and Wurl.
This is one I’m watching carefully to scale further.
6. Business Model & Moat
AppLovin’s moat is multi-layered:
- Deep integration with mobile developers through MAX and Adjust
- Rich first-party data through app ownership
- High switching costs for monetization infrastructure
- A growing presence in CTV, a secular growth trend
Their ability to monetize owned inventory and third-party inventory simultaneously is rare. It also gives them better unit economics than most competitors.
7. Total Addressable Market (TAM)
AppLovin sits at the crossroads of three high-growth markets:
| Vertical | TAM Estimate | AppLovin Positioning |
|---|---|---|
| Mobile App Monetization | $100+ billion | Market leader in in-app bidding |
| Mobile Attribution & Analytics | $10–15 billion | Strong foothold via Adjust |
| Connected TV (CTV) Programmatic | $50–80 billion | Emerging player via Wurl |
| Mobile Gaming (Owned IP) | $50 billion+ | Proprietary asset base, not just distribution |
Collectively, AppLovin’s platform TAM exceeds $200 billion, and their integrated position allows them to extract greater margin per dollar of ad spend.
8. What I’m Watching
Going forward, I’m tracking:
- Growth in platform software revenue vs. legacy apps
- Margin expansion and capital-light scalability
- Penetration in CTV ad infrastructure
- Evolution of privacy regulations and their impact on IDFA/GAID
- How effectively AppLovin transitions from “ad tech” to monetization infrastructure provider
9. What Would Break My Thesis
Risks I’m mindful of include:
- Regulatory changes (especially around app store access and mobile tracking)
- Competitive response from Google, Unity, or ironSource
- Overdependence on mobile gaming if diversification stalls
- Platform policy changes from Apple or Google that cut access to key signals
That said, AppLovin has proven adaptable—responding swiftly to privacy headwinds and shifting monetization models when needed.
Final Reflection
AppLovin is one of the rare companies I believe is undervalued because it’s misunderstood. It doesn’t fit neatly into the “adtech” or “gaming” categories—because it straddles both, and uses that positioning to build something more robust.
If my children ask one day why I invested in this little-known company with a strange name, I’ll say: “Because they didn’t just run ads—they built the monetization engine behind the world’s fastest-growing digital experiences.”
