This is Matt Reustle and today we are breaking down Take-Two Interactive Software. If you listened to our Business Breakdown on Electronic Arts, Take Two is another giant in the video game publishing space. They are best known for their Grand Theft Auto and 2K franchise. To break down Take-Two I'm joined by Eric Kress, principal at Gossamer Consulting Group. Eric spent multiple decades inside the video game market, both as an investor and as an operator, and we tap into his perspective from both sides of the table. We drill into historic IP, the strategy behind new releases and what mobile means for the market, and specifically for Take Two. Please enjoy this breakdown of Take-Two. For the full show notes, transcript, and links to the best content to learn more, check out the episode page here. ----- This episode is brought to you by Tegus, the modern research platform for leading investors. Tired of running your own expert calls to get up to speed on a company? Tegus lets you ramp faster and find answers to critical questions more efficiently than any alternative method. The gold standard for research, the Tegus platform delivers unmatched access to timely, qualitative insights through the largest and most differentiated expert call transcript database. With over 60,000 transcripts spanning 22,000 public and private companies, investors can accelerate their fundamental research process by discovering highly-differentiated and reliable insights that can’t be found anywhere else in the market. As a listener, drive your next investment thesis forward with Tegus for free at tegus.co/patrick. ----- Business Breakdowns is a property of Colossus, LLC. For more episodes of Business Breakdowns, visit joincolossus.com/episodes. Stay up to date on all our podcasts by signing up to Colossus Weekly, our quick dive every Sunday highlighting the top business and investing concepts from our podcasts and the best of what we read that week. Sign up here. Follow us on Twitter: @JoinColossus | @patrick_oshag | @jspujji | @zbfuss | @ReustleMatt | @domcooke Show Notes (00:02:35) - (First question) - Brief overview of Take-Two (00:03:32) - Take-Two's acquisition of Zynga represents a significant push into mobile gaming (00:05:05) - Mobile gaming faces challenges from Apple's IDFA removal and Google's changes (00:06:37) - Apple's privacy changes benefit them but hurt mobile publishers (00:07:50) - How Take-Two evolved from PC and console to mobile (00:10:48) - Console and PC target AAA games; mobile reaches a broader, less premium market (00:12:53) - Creating new iconic AAA gaming IP is nearly impossible due to high costs (00:15:08) - Big IP success in gaming historically depended on retail relationships and distribution (00:17:39) - Sports games have almost 100% revenue visibility; others like GTA fluctuate (00:19:31) - GTA's next release is anticipated and guaranteed to sell millions, but post-launch is uncertain (00:25:24) - Risk of new console alignment affects expectations for next GTA game release (00:27:57) - Updating titles for different consoles has become less complicated with PC architecture (00:29:44) - Pricing at $60-$70; new tech may boost in-game spending (00:31:30) - GTA's mature nature makes in-game advertising tough (00:32:59) - NBA license with 2K is a partnership, not exclusive (00:35:28) - Take-Two lacks profitable titles beyond GTA and 2K (00:37:57) - EA smartly bought Respawn and built studios; Take-Two lacks similar capability (00:39:29) - Gaming industry consolidated to fewer franchises; similar to film industry's trend (00:44:07) - Zynga's acquisition was ill-timed; it's a declining asset with no value (00:47:32) - Microsoft's deal may lead to Amazon or Comcast buying Take-Two (00:50:11) - Valuing these businesses often relies on traditional PE methods (00:52:06) - Key risks for Take-Two are overhyped GTA expectations and service burnout (00:53:37) - Lessons learned from studying Take-Two

This is Zack Fuss, an investor at Irenic Capital. Today, we're breaking down Argenx, an immunology company founded in 2008 by its three founding partners. Today, it's a $30 billion company set to produce over a billion dollars in sales. They're known for their skill in developing antibodies for complex disease targets and owe a large part of their medical breakthroughs to llamas, which have similar antibodies in their immune system to those found in humans.  To break down Argenx, I'm joined by Julia Angeles, an investment manager at Baillie Gifford. Throughout this conversation, we'll discuss how Argenx navigates the complex world of drug development, clinical trials, regulatory approvals, and the ultimate commercialization of autoimmune therapies. We'll also learn more about their transition from a venture capital backed business to its 2017 IPO, and today, a meaningful revenue generating business. We hope you enjoy this business breakdown. Note: This conversation was recorded on 19 July 2023. For the full show notes, transcript, and links to the best content to learn more, check out the episode page here.  ----- This episode is brought to you by Tegus, the modern research platform for leading investors. Stretch your research budget with flexible expert calls you can trust. At a fraction of the cost of traditional expert networks, Tegus customers pay only what an expert charges – with zero markups and no confusing call credits – netting an average 70% savings. Don’t want to conduct a full hour call? Tegus offers the ability to schedule 30-minutes, an offer you won’t find anywhere else. And they don’t stop there. With white-glove custom sourcing for every project and robust compliance measures, including a dedicated 50+ analyst team that vets every call transcript, Tegus ensures your privacy and protection. As the industry innovator for qualitative insights, Tegus helps you find the right experts you need at a quality and speed that can’t be matched. For a limited time, as a listener, you can trial Tegus for free by visiting tegus.co/patrick. ----- Business Breakdowns is a property of Colossus, LLC. For more episodes of Business Breakdowns, visit joincolossus.com/episodes. Stay up to date on all our podcasts by signing up to Colossus Weekly, our quick dive every Sunday highlighting the top business and investing concepts from our podcasts and the best of what we read that week. Sign up here. Follow us on Twitter: @JoinColossus | @patrick_oshag | @jspujji | @zbfuss | @ReustleMatt | @domcooke Shownotes (00:03:49) - (First question) - Ways the immune system protects us and fails us (00:06:00) - Current patient treatments and evolving solutions to existing problems  (00:07:52) - The key difference between how the biotech community is addressing big diseases versus autoimmune disorders (00:09:55) - What sparked Julia’s interest in Argenx (00:14:01) - Explanation how we use animal antibodies to help research progression (00:15:25) - The foundations of the business (00:17:57) - The evolution of the business and its commercial success thus far (00:20:22) - Transitioning from lab antibodies to a commercial product ready for consumers (00:23:42) - The infrastructure needed to maintain and grow Argenx (00:26:43) - Indicators of commercial success (00:29:27) - The basic revenue model for this business type (00:30:49) - Go to market strategies for developed drugs  (00:34:39) - Pricing and patient protection of these newly developed drugs  (00:37:46) - Cures versus creating treatments with recurring revenue streams (00:39:38) - The importance of the current team composition  (00:41:44) - Julia’s perspective on what they are willing to invest to grow the company (00:43:49) - Normalized profitability for biotech companies such as this (00:45:59) - Potential risks to the current business model (00:49:22) - Lessons learned from studying Argenx