Baron Fifth Avenue Growth Fund on Datadog, Inc.
Thesis
The Fund believes Datadog is a structural beneficiary of AI adoption, cloud migration, faster application deployment, and increasingly complex technology infrastructure. Revenue accelerated to 32% year over year, marking a fourth consecutive quarter of acceleration, while margins and free cash flow exceeded expectations. Growth was broad-based across both traditional customers and the company's expanding cohort of AI-native customers, while net revenue retention also reaccelerated. The Fund believes these broadening growth drivers reinforce the company's long-term investment thesis.
“We view observability as a structural beneficiary of the AI buildout”