Brown Capital Management highlighted Heartflow, Inc. as a newly initiated position in The Brown Capital Management Small Company Fund’s second-quarter 2026 investor letter. For the quarter ended June 30, the fund returned 26.78%, ahead of the Russell 2000 Growth Index’s 25.71% return, as investors rotated toward smaller companies amid uncertainty over AI spending and tensions in the Middle East. Six holdings gained more than 100%, while more than 41% of the portfolio rose over 30%; the fund nevertheless faced client outflows and workforce reductions. Heartflow, a medical technology company, uses AI-powered software to analyze heart scans and support non-invasive diagnosis and management of coronary artery disease. The company reported 2025 revenue of $176 million, up 40% from 2024, and a GAAP EBIT margin of negative 36%, improved from negative 49%. Heartflow closed at $49.92 on September 28, 2026, with a $4.2 billion market capitalization, a 1.01% monthly decline and a 46.55% one-year gain. The fund cited Heartflow’s $280 million in cash, no debt, clinical and commercial investments, competitive advantages and potential for attractive incremental margins as it grows.