Intuit

Overview

Intuit is an American software company best known for QuickBooks (accounting software for small businesses), TurboTax (personal tax preparation), and the acquired Mailchimp (email marketing platform). The company is a leading provider of financial management software for consumers and small businesses.

Fundsmith's Experience

The Mailchimp Mistake

Fundsmith sold Intuit a few years ago after what Smith called an "incredibly bad acquisition of a marketing company called Mailchimp, where we thought they paid three times the right price and that it wasn't in their area of expertise."

The AI Bubble Effect

Smith explained the subsequent trajectory:

"The shares went up initially because they were going to be an 'AI beneficiary.' They've now cratered and we've started buying them."

The Moral Tale

"The acquisition is sufficiently bad that they've now started reporting numbers ex-Mailchimp. That's how bad it is. We'd like to believe they've learned their lesson."

Why Fundsmith Is Back In

Despite the mistakes, Fundsmith sees value:

• Core business (QuickBooks, TurboTax) remains strong
• Mailchimp problems are now fully exposed and written down
• Valuation has reset after the AI beneficiary speculation faded

Key Lessons

1. Acquisitions at wrong price: Mailchimp bought at 3x fair value
2. Outside area of expertise: Marketing software outside Intuit's core competency
3. AI speculation bubbles: Stock surged on "AI beneficiary" narrative, then crashed
4. Disclosure as signal: Reporting "ex-Mailchimp" numbers signals the problem is contained

Related Concepts

• capital-allocation — Why acquisition discipline matters
• quality-investing — Staying within circle of competence

Related People

• terry-smith — Fundsmith's CIO who shared this case study