Constellation Software: A Business Built To Compound
Constellation Software, a company that acquires small software businesses, has seen significant growth in revenue and cash flow. The company's decentralized structure and disciplined capital allocation framework position it for long-term success.
Constellation Software has been invested in by Rowan Street during the quarter. The company acquires small, mission-critical software businesses serving specific industries. In 2025, Constellation Software's revenue grew 15%, cash flow from operations increased 24%, and free cash flow available to shareholders grew 14%. Despite negative sentiment toward software companies due to AI, Constellation Software's structure and framework enable it to function independently. The company's decentralized structure and deep bench of operators support its long-term compounding potential.
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