Quick Facts
Inception Date:5/21/20047/1/2019
Expense Ratio:1.51%1.36%
Total Net Assets:$150.62 Million  (6/30/21)
Category:Small Cap Growth
Benchmark:Morningstar U.S. Small Growth Index
Related Material:
   Fund Fact Sheet Q2 2021
   PM Commentary Q2 2021
   Summary Prospectus
Recent Media Coverage
Fund Objective & Investment Process

As of October 16, 2020, the name of the Buffalo Emerging Opportunities Fund changed to the Early Stage Growth Fund.

The investment objective of the Buffalo Early Stage Growth Fund is long-term growth of capital. The Fund invests primarily in equity securities, consisting of common stocks, preferred stocks, convertible securities, warrants and rights, of companies that, at the time of purchase by the Fund, are defined as early stage growth companies. Early stage growth companies are defined by the Fund as companies that, at the time of purchase by the Fund, have market capitalizations below the median of the Morningstar US Small Growth Index and are companies that are starting to develop a new product or service or have recently developed a new product or service. As of June 30, 2021, the median market capitalization of the Morningstar U.S. Small Growth Index was $4.2 billion.

The Fund managers seek to identify companies for the Fund’s portfolio that are expected to experience growth based on the identification of long-term, measurable secular trends, and which, as a result, may have potential revenue growth in excess of the gross domestic product growth rate. Companies are screened using in-depth, in-house research to identify premier early-stage growth companies which generally demonstrate:

  • Strong management teams
  • Little or no debt
  • Potential for increasing free cash flow
  • Scalable business models with a competitive advantage
  • Potential for increasing margins
  • Attractive risk/reward given the market framework

We believe investing in an actively-managed portfolio of premier, early-stage, growth companies could lead to growth of capital over time. We look for companies that could benefit from long-term industrial, technological, or general market trends, and are trading at what we view as attractive valuations.

Craig Richard, Portfolio Manager

Morningstar Rating


Overall Morningstar Rating™ of BUFOX based on risk-adjusted returns among 575 Small Growth funds as of 8/31/21.

Investment Style

Performance (%)

As of 8/31/213 MOYTD1 YR3 YR5 YR10 YR15 YRSince Inception
BUFFALO EARLY STAGE GROWTH FUND - Investor4.1414.4348.5921.9723.5518.6212.0511.56
BUFFALO EARLY STAGE GROWTH FUND - Institutional4.2114.5748.8222.1623.7418.8012.2211.73
  Morningstar U.S. Small Growth Index5.974.3431.3014.0017.8315.3311.3811.12
  Morningstar Small Growth Category4.2713.5641.9016.3419.3815.5711.5010.62
As of 6/30/213 MOYTD1 YR3 YR5 YR10 YR15 YRSince Inception
BUFFALO EARLY STAGE GROWTH FUND - Investor7.3715.5562.5125.0026.0217.4411.8711.74
BUFFALO EARLY STAGE GROWTH FUND - Institutional7.4415.6562.7625.1926.2117.6212.0411.91
  Morningstar U.S. Small Growth Index4.794.3443.5117.3319.3713.8611.2111.23
  Morningstar Small Growth Category4.8812.4055.6919.3420.7213.9811.2110.67

BUFFALO EARLY STAGE GROWTH FUND - Investor8.1424.3061.70-7.38-9.4111.0527.18-3.9534.0347.69
BUFFALO EARLY STAGE GROWTH FUND - Institutional8.3024.4861.94-7.24-9.2811.2227.37-3.8134.2047.96
  Morningstar U.S. Small Growth Index-1.0414.5041.862.46-0.189.6123.77-5.6727.6043.52

*As of October 16, 2020, the name of the Buffalo Emerging Opportunities Fund changed to the Early Stage Growth Fund.

For performance prior to 7/1/19 (Inception Date of Institutional Class), performance of the Investor Class shares is used and includes expenses not applicable and lower than those of Investor Class shares.Performance data quoted represents past performance; past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the fund may be lower of higher than the performance quoted and can be obtained here. Performance is annualized for periods greater than 1 year. Each Morningstar category average represents a universe of funds with similar objectives.

3 Year Risk Metrics
BUFOX vs Morningstar U.S. Small Growth Index (As of 6/30/21)
Upside Capture114.65
Downside Capture91.69
Sharpe Ratio0.94
Hypothetical Growth of $10,000
This chart illustrates the performance of a hypothetical $10,000 investment made in the Fund on the Inception Date. Assumes reinvestment of dividends and capital gains. This chart does not imply future performance.


Portfolio Characteristics
(As of 6/30/21) 
# of Holdings67
Median Market Cap$1.60 B
Weighted Average Market Cap$2.56 B
3-Yr Annualized Turnover Ratio38.23%
% of Holdings with Free Cash Flow64.18%
Active Share92.63%
Top 10 Holdings
HoldingTickerSector% of Net
Open Lending Corp.LPROFinancial Services2.59%
NV5 GlobalNVEEIndustrials2.50%
OmnicellOMCLHealth Care2.31%
Patrick IndustriesPATKConsumer Discretionary1.94%
Compass DiversifiedCODIIndustrials1.87%
Absolute Software CorpABSTTechnology1.86%
As of 3/31/21. Top 10 Holdings for the quarter are not disclosed until 60 days after quarter end. Fund holdings are subject to change and are not recommendations to buy or sell any securities.
Sector Weighting
As of 6/30/21. Security weightings are subject to change and are not recommendations to buy or sell any securities. Sector Allocation may not equal 100% due to rounding.
Market Capitalization
As of 6/30/21. Market Cap percentages may not equal 100% due to rounding.


Craig Richard, CFA
Portfolio Manager

19 Years of Experience

 View full bio

Doug Cartwright, CFA
Portfolio Manager

15 Years of Experience

 View full bio



(As of 6/30/21) — Equity markets moved higher for the fifth consecutive quarter, as the S&P 500 Index returned 8.55%, raising the year-to-date return to 15.25%. The COVID-19 vaccine rollout has helped fuel an economic comeback while corporate earnings are improving. The vaccine adoption around the world is encouraging, and over 50% of the U.S. population is now vaccinated. Capital markets continued to be supported by significant spending from Congress and aggressive monetary policy from the Federal Reserve (the Fed). The 2nd quarter was marked by outperformance of growth stocks, overcoming investor concerns of rising inflation and potential interest rate hikes in the prior quarter. Hawkish comments from the Fed replaced inflation worries with concerns about the magnitude and duration of the economic recovery. Long duration growth companies were beneficiaries as yields on the 10-Year and 30-Year Treasuries declined during the period after climbing for the previous four months.

The broad market Russell 3000 Index advanced 8.24% in the quarter. Growth stocks outperformed Value stocks, as the Russell 3000 Growth Index surged 11.38% compared to the Russell 3000 Value Index gain of 5.16%. Relative performance was correlated with market cap size in the quarter, as the large cap Russell 1000 Index returned 8.54%, the Russell Midcap Index advanced 7.50%, the small cap Russell 2000 Index returned 4.29%, and the Russell Microcap Index finished 4.14% higher.

All economic sectors produced positive returns during the period with the exception of Telecom Services. Real Estate, Information Technology, and Energy led the advance followed by Financials and Health Care. More defensive areas, such as Telecom Services, Utilities, and Consumer Staples, trailed on a relative basis.


(As of 6/30/21) — During the quarter the Buffalo Early Stage Growth Fund (BUFOX) generated a return of 7.37%, exceeding the Morningstar U.S. Small Growth Index’s (the Fund’s primary benchmark) return of 4.79%. On a trailing 12-month basis, the Fund returned 62.51%. This compared favorably to the primary benchmark return of 43.51%.

The 2nd quarter continued the strong calendar year 2021 returns, as the U.S. continues to recover from the COVID-19 pandemic. As of this writing, 59.4% of individuals in the U.S. over the age of 18 in the U.S. have been fully vaccinated. Additionally, the primary metric we have watched during the global pandemic, hospitalizations, stands at 16,000 individuals in the U.S. While this has risen somewhat due to the emergence of the Delta variant, it remains substantially below the January 2021 peak of 125,000.

The Fund’s outperformance in the quarter was driven by solid returns versus the benchmark in the Consumer Discretionary and Healthcare sectors, with returns of 19.1% and 12.8%, respectively, in those sectors.

Individual standouts in the quarter included 1847 Goedeker (Goedeker) and Mimecast. Goedeker was a new holding for the Fund in the quarter, as we participated in an equity offering whereby Goedeker raised over $200 million. The proceeds were used to acquire Appliances Connection, the largest online appliance retailer in the U.S. The combined entity will benefit from increased purchasing power with vendors, along with planned fulfillment center expansion, which will decrease shipping costs. Home Depot and Lowe’s do not carry the breadth and depth of mid-to-high end appliances that Goedeker focuses on, providing Goedeker the opportunity to continue to grow in a niche with no dominant competitor. Today online retail penetration of appliances is less than 5% and we believe this will provide Goedeker a long runway for growth if they are able to effectively execute.

Mimecast has been a multi-year holding for the Fund, dating back to its initial public offering in November 2015. The company is a leading global provider of email security. The global pandemic caused some headwinds for Mimecast, as its core customer base of small and mid-size businesses were distracted and pulled back on email security spending. During the quarter, Mimecast communicated that they have seen an improvement in the economic environment and that they are having continued success moving up market into more enterprise-sized customers. Additionally, its primary competitor, ProofPoint, was acquired by private equity firm Thoma Bravo for more than 10 times next 12 months revenue and more than 40 times free cash flow. By comparison, Mimecast currently trades at around 5 times 2022 revenue estimates and 25 times trailing 12-month free cash flow. Given the valuation disparity and the likelihood of some operational disruption (at a minimum, cost reductions) at Proofpoint during the ownership transition, we continue to like the set-up for Mimecast going forward.

The Fund ended the quarter with 66 holdings. We added 5 new holdings and sold out of 3 during the period.


(As of 6/30/21) — The Delta variant, a highly contagious SARS-Cov-2 strain, and inflation are the current U.S. headlines along with the ongoing market obsession of the potential timing of the Federal Reserve beginning to step off the gas pedal.

So far, economic activity in the U.S. remains strong. Personal income is well above pre-COVID levels and household net worth is at record levels, meaning that the consumer is strong. Additionally, the M2 money supply is at a record level at $20.4 trillion, meaning credit is readily available. The nearly $5 trillion increase in the money supply since the onset of the pandemic compares to the previous $5 trillion rise, which took place over the course of eight years. While the market may become unsettled from time to time, we believe there is a strong backstop given the financial strength of the U.S. consumer.

Regardless of economic headlines, our job remains to find attractive small cap companies that have not been fully appreciated by the market or are mispriced due to recent results or events. We believe less investor interest in our segment of the market creates opportunity for us to uncover value.

The Fund typically invests at the smaller end of the small cap growth spectrum, and the managers continue to seek companies with sustainable growth due to secular growth trends or innovative or disruptive products.

The Buffalo Early Stage Growth Fund is focused primarily on identifying innovation within U.S. companies with primarily North American revenue bases. With an active share of greater than 95%, the Fund will continue to offer a distinct offering from the Index and category peers.

The opinions expressed are those of the Portfolio Manager(s) and are subject to change, are not guaranteed and should not be considered recommendations to buy or sell any security. Earnings growth is not representative of the fund’s future performance.


General Account
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Retirement Information
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Fundamental Approach

We get to know the companies we invest in and learn how they run their business.

Top-Down & Bottom-Up

We identify Top-Down broad, secular growth trends and search for companies from the Bottom-Up.

Proprietary Philosophy

We construct our portfolios based on our own proprietary investment strategy.

Disciplined Investing

Sticking to our disciplined investment strategy ensures we maintain a consistent, balanced approach.

The Morningstar Rating™ for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating™ for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating™ metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.

The Buffalo Early Stage Growth Fund (BUFOX) received 4 stars among 575 for the three-year, 4 stars among 506 for the five-year, and 4 stars among 380 Small Growth funds for the ten-year period ending 8/31/21.

In each Morningstar Category, the 10% of funds with the lowest measured risk are described as Low Risk, the next 22.5% Below Average, the middle 35% Average, the next 22.5% Above Average, and the top 10% High. Morningstar Risk is measured for up to three time periods (three, five, and 10 years). These separate measures are then weighted and averaged to produce an overall measure for the fund. Funds with less than three years of performance history are not rated. ©2021 Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results. The Morningstar Style Box™ reveals a fund’s investment strategy by showing its investment style and market capitalization based on the fund’s portfolio holdings.