I think it's time to admit: palantir has a problem, and it's main problem is that there's a lot of myths and misunderstanding about this company, which are completely taking over the narrative. So in this video i'm going to take the most common ten myths and misunderstandings about palantir and completely debunk them within 30 seconds and obviously investing in a company like palantir with a lot of risks and a lot of volatility is highly speculative. It's not a sure thing, in fact, i don't believe, there's a sure thing on this planet. Besides three things, one, we all pay taxes, two, we all die someday and three i'm going to find my grandpa in a dumpster on new year's morning and jokes aside.

What's the story with helen pierre, on the one hand, it has a cult following, on the other hand, it had the trajectory of shia labeouf's career in the past few weeks. It completely came crashing down and it has as many haters as much as it has fans. It's extremely polarizing: what's the story with the stock, the stock presents a very strong bull case in my opinion, but i think a lot of people completely misunderstand the company and what it's doing and in this video i'm going to take the most common 10 myths about This and i'm going to break them apart, like a shish kebab check this out and just to make it fun, i'm going to assign a grandpa head number to each myth. Five grandpa heads means it's complete nonsense.

While one actually means it's a legitimate risk, we should be concerned about myth number one. Palantir is a well-compensated, well-paid government, consulting contractor. It has no real viable business in the commercial sector. Now this is basically an argument that can be divided into two arguments separately.

One government is the real business. The commercial side is just nonsense and still it's not scalable. It's a consultant business that cannot be really scaled beyond. You know the amount of man hours you can put in the project, essentially consulting versus software.

So, let's start with the government first, while it is true that for the most of its existence, palantir was in fact a government reliant company, still its bread and butter even to this day comes from the government business. However, that being said, the commercial business which only started five years ago in 2016, it didn't exist. So when people say it's a company, that's been around for 20 years. Well, the commercial side just started five years ago in 2016..

So in five years the commercial business went up to being 44 of the entire revenue base of palantir, so saying it has no commercial business, no viable commercial business, while in fact that commercial business is almost at half at the. I want half of the business of volunteer is kind of a five grandpa heads complete nonsense. Now. The second argument i do want to talk about a little bit more in depth.

That is that the business is not scalable. It's consulting. It's not really software. Now there is certain merit to this argument, because companies like salesforce, for example, that started off doing highly customizable software solutions that essentially resembled way more consulting than actual automated software took a long time to transition from customizable software.

All the way to automated software, like we have today with salesforce and crm and all those stuff now, while that is true, that is not really the case for palantir, because their solution is entirely different, in fact, alex carp in 2012 way before he had any concerns About share price when it was a completely private company, in fact, a company that had no desire in publicity, a pure government contractor in 2012. He actually specifically talked about this, and he said i didn't want to build a consulting firm, no interest in this key moment. Here is we didn't want to do this as a service, you could say we have a methodology, we'll build every time we sit down we'll do this one we'll do it each time and we'll charge. You will charge you, but we had this idea.

That is run through our whole company that we will try to get this into a product. My only interest was to build an automated solution to a problem currently being solved by human brain. That was the whole purpose. Why we started palantir and, if you think about it, that is exactly what peter thiel achieved in paypal.

Why people got so much money for their initial business is because they solved the fraud problem they had to dress with anti-fraud, with human beings. No software could catch up with the criminals and the fraudsters until they came up with an automated solution. That was the whole idea why peter thiel and elon musk got paid so much money for that sale. That company solved a human problem by creating ai and a software solution.

That is exactly what they did with volunteer now beyond that look at the data right now we're looking at a company that's on boarding for three to six weeks from the sixth week and onwards. The only things you interact with volunteer for is customer support and maintenance. There is no need for any dedicated teams, just maintenance and customer support. After six weeks, a consulting business does not work like that.

Neither would the results be look at what they did with airbus. Airbus actually improved the production of their a350, the speed and the efficiency by 33. Now their brainiacs their engineers couldn't get it done. In fact, no human could have until a software came in and took an insanely complex process like building an a350 and improved it by 33.

2 million data points per flight per airplane. Now combine that with the warehouse data, where the maintenance team, with the scheduling with everything that goes on inside that airline and any given day we're talking about tens, maybe hundreds of millions of data points, maybe even more no human brain can process it, no matter how Smart, you are, you got ta, have an automated solution to process these amounts of data, so claiming that this is some sort of an elaborate consulting business deserves five grandpa heads, it's as ridiculous, as my grandpa growing wheels and becoming a bicycle highly unlikely. Now the next myth is that palantir's business growth is slowing down and in this respect i have to ask you if you believe that what have you been smoking look at the numbers. Palantir grew 56 billings year over year in the third quarter.

Look 34 new clients in the third quarter, which is a 20 quarter of a quarter. Growth look 54 new deals, valued at one million dollars or more in the third quarter. Out of those 33 deals, which are 5 million plus, if this is what stagnation looks like give me stagnation every single day of the week, this is another five grandpa heads complete nonsense, and now to one of my all-time favorites palantir is insanely overvalued compared to its Competitors now, let's compare them to companies that actually make sense companies that are in data in cloud and software. Let's see what the valuation says: cloudflare is trading at 66.

datadog at 57 snowflake, which is a shovel compared to a spaceship if you're talking snowflake versus valentine at 95.. You know how much palette you're trading for 24., so any arguments saying that planet is overvalued compared to comparable companies is another five grandpa heads complete now. The next argument has to do with the class f shares and i like how they call them. Class f shares.

I have an assumption why they did it. I think it's kind of funny now class f shares in palantir are very unique. Nobody has that kind of structure. In fact, a lot of people criticize volunteer for having those shares because it basically bridges the way corporate government works.

In essence, the founders of this company have for life control over everything. That's going on in this company and forever has video rights for everything that might ever come up. No board members, no new investors. Nobody could ever take over the control of planeteer from alex carr, peter thiel and steven coin.

It is what it is. They control the company for life. That's the whole idea of class f shares certain people, don't like it, because you can't dilute it. You can't sell it.

You can't do with it and if you believe that fine invest in something else, i for one trust alex. I trust peter deal read zero to one he'll trust him too. I want these guys to have control, not some corporate suit. That's gon na go over their head and make bad decisions that will destroy the company.

For me, that's a huge bonus. That's not even a bad thing, so i'm gon na give this four grandpa heads, because i understand it's a little bit different that what the corporate structure usually looks like. But for me i like alex - and i like peter - and i want them to make the decisions. So for me, it's actually a good thing and now to one of my favorites, the company is siphoning investors money by deluding the shares.

Just in the past year, they issued 12 more new shares, deluding you now. I understand where people are coming from with this, because you know it seems like a bad thing where you're getting diluted, you're just intuitive right, but it shows a little bit of a lack of understanding of how corporate structure works. Delusion is not always bad if we have a partner coming in and putting a lot of money into the company, a lot of new working capital and he's getting percentage in the company. You are getting diluted, but now you own more basically by having less shares.

Instead of owning 50 of the company by two partners, now we have three partners only 33, but the third partner just brought in a hundred million dollars, and now we each own one-third of 33 million dollars more than we owned before. So it's not always a bad thing. Obviously, here there's no money involved. So here the delusion comes internally from the stock-based compensation.

Essentially, the company is issuing stock compensation to its employees to retain them in the company, which is diluting the share base of the entire shareholders. I understand thing is: if you want to compete for the top one percent of employees in the market, you're competing with the tesla with the facebook, with google, with amazon you're competing with the top of the line, companies that can outpay you every day. Piloteer can't compete with payment with the big boys it's impossible and if they try they're going to lose by a million cuts because they can never compete with the tesla or google or in amazon, they cannot not financially. What they can do is actually give you a piece of the pie and say hey if you're a rock star, if you're a top one percent, we'll keep you by giving you a piece of the pie and if you stay eventually you're going to bring us up To that level of the amazon, the google and the tesla, because if you want to get to that level, you need the top 10 employees and there's no way you can get them by just settling for the top 15 20 employees.

You got to go for the cream, you got ta go for the best and for that you got ta, give them a piece of the pie, but for you, as an investor, it's actually a good thing, because you're retaining employees long term, because once they leave those Options expire, so they have to stay if they wan na enjoy the benefits the fruits of their labor. It's actually a good thing if you understand how employee stock based competition works, and now, let's talk about profitability. The main argument against volunteers that they're not generating bottom line profits thing is: you have to be a little bit of an idiot to think that look at the numbers. Free cash flow for q3 was 157 million dollars.

Look at this total 400 million in free cash flow by end of 2021.. Now, even though we do have free cash flow, why aren't we getting dividends? Why don't? We have the actual profits in the bottom line in the books on the balance sheet on the income statements. Well, that is because the company is reinvesting that money back into research and development back into building a sales force infrastructure to basically market their new foundry business. Back into the crypto foundry that they're building right now into a hundred different things that they're building i'd rather that money that they actually make that free cash flow go back into research and development and marketing as a parental investor.

I honestly don't want any profits. I want every single cent to go back to get reinvested into the company to grow it to the level of the tesla's, the google's on the amazons. That's the only way you can do it and looking for profits and dividends at this stage. It's kind of ridiculous, but tom, it's a 20 year old company.

We should get some profits. No, it's not it's not a 20 year old company, it's another five grandpa heads, the government. Business is actually 18 years old, but the commercial business just started in 2016. Five years ago, so it's essentially two separate business units, which are completely different.

The commercial business is only five years old. I can't expect profits, especially in this sort of business, but wait look at what's going on right now. The company q3 revenue growth that should give you an insight of where the company is headed: 36 percent increase year over year, q3, q1. First, nine months, 44 revenue growth year over year, 1.1 billion government revenues up 34 commercial revenues up 37.

If you don't see this as progression, if you don't see this as growth, then you should be in another stock. Now, let's talk about the final argument, i can't understand their business, hence the company's trash. Well, it doesn't matter. If you understand it or not, palantir could not care less, and the thing is, if you can't see a flying cinderblock going towards the entire business intelligence market that is piloteer.

Well, while we're going to be rich you're going to be applying for jobs, selling video games out of your van in your mama's basement, see you later alligator it's getting a little bit hot in here. I have to undress so hope. You don't mind me changing out of my tracksuit hold on. Oh, this is better.

The lights in here are crazy. Okay.