Baron Funds® June 30, 2021 Quarterly Report

“Texans would be without electricity for longer maintain that building. Champlain Towers you won’t need to spend your depreciation than three days to keep the federal government homeowners’ inability to commit to making reserve. Since depreciation is a cost, it should out of their business.” Former Texas Governor timely property investments was likely due to not have a multiple attached to it and be added and Former United States Energy Secretary sticker shock from increasingly costly repair to the value of a property. If you don’t spend Rick Perry. February 18, 2021. projections. Shockingly, an engineering report by depreciation in a given year, it is just deferred outside consultants in 2018 indicated maintenance. It is not eliminated maintenance,” President Trump’s former Energy Secretary Rick deterioration of that seaside building required an Jay continued. Perry made that remark during the severe immediate investment of at least $9 million by February 2021 winter storm that crippled Texas’ Baron has significantly outperformed markets and its middle class and retiree residents. This was to electric power grid. Due to that catastrophic most competitor funds over the long term. We repair the building’s crumbling concrete and electric utility failure, large segments of Texas’ believe one important reason is that Baron chooses rebar foundation that had been damaged by populace were without heat, power, and fresh to invest in businesses that make continual and water for several days. substantial investments in their businesses to make them durable. This is rather than trying The proximate cause of that outage was to maximize their businesses’ earnings in a Texas utilities’ under investment in current period. In fact, we believe we often “weatherizing” their grids. “Weatherizing” have an opportunity to make long-term investments were necessary to protect investments in competitively advantaged those grids during infrequent instances of growth businesses at attractive prices since extreme weather. ERCOT, the Electric their share prices are lower than we think Reliability Council of Texas, at the time, appropriate…because they are making such unlike regulators in other regions at similar investments that penalize their earnings in or higher latitudes, did not allow utilities to the short term! include “weatherizing” investments in their rate bases. Texas utilities, as a result, were One more thing. About 15 years ago my not able to recover the cost of such family and I were building a beach house investments; earn a return on those on Long Island. When our home was under investments; and charge their customers construction, I became worried that its for the higher operating costs of those “…every little thing gonna be all right…” Bob Marley, 1977. capital investments. Therefore, few Texas Ron, David and Michael are excited about returning to our office with utilities made “weatherizing” investments. their colleagues this fall. Baron Capital is a family business that has TABLE OF CONTENTS been putting clients and employees first since March 12, 1982. Letter from Ron 1 It is estimated monthly customer electric Letter from Linda 7 water incursion from the sea and hurricanes over Baron Funds Performance 15 utility bills would have been at least 5% higher Baron Asset Fund 22 had that state’s utilities “weatherized” their 40 years! In 2021, when the estimated costs of Baron Growth Fund 26 systems. The cost of Texas utilities’ failure to the postponed repairs for the 136-unit building Baron Small Cap Fund 33 invest was estimated to be several billion dollars had risen to at least $15 million, its homeowners Baron Opportunity Fund 38 last winter…in addition to dozens of lost lives! association continued to debate and delay Baron Partners Fund 43 investing. Had those repairs not been neglected, Baron Fifth Avenue Growth Fund 49 Members of ERCOT viewed their primary role as the calamity that resulted in at least Baron Focused Growth Fund 55 providing the cheapest energy to markets. This Baron International Growth Fund 62 $100 million in property losses and, even worse, Baron Real Estate Fund 67 was obviously accomplished at the expense of the loss of more than 120 lives…might have building a more durable and resilient utility Baron Emerging Markets Fund 77 been averted. Baron Global Advantage Fund 81 infrastructure. Several ERCOT members have Baron Discovery Fund 88 since lost their jobs. In the mid-1970s, Hyatt Hotels Corp.’s CEO Baron Durable Advantage Fund 94 Jay Pritzker scoffed at the idea that the most Baron Real Estate Income Fund 99 Board Squabbles at Condominium Delayed important metric to use in valuing hotels was Baron WealthBuilder Fund 108 Repairs. The New York Times. July 4, 2021. EBITDA (earnings before interest, taxes, Baron Health Care Fund 115 Baron FinTech Fund 121 Just like Texas utilities’ choices not to invest in depreciation, and amortization). “Depreciation is Portfolio Holdings 127 “weatherizing” power grids resulted in a cost even if you don’t spend it every year,” Jay catastrophic failure last winter, the tragic and told me. “Things wear out and you must provide nearly unimaginable collapse of the beachside capital to replace and maintain those assets if Champlain Towers condo in Surfside, Florida on you expect them to increase in value.” That is June 24th, was also the result of a failure to the case for hotels, condos, utilities, homes, and BARON invest for several years…in this instance, to other real assets. “It is not realistic to think that FUNDS Letter from Ron

costs seemed much higher than we had appeal to the most talented young engineers as What’s so special about SpaceX? Figuring out anticipated. When I expressed my concerns to an enormous competitive advantage for both how to make space rockets reusable is the short the builders, they told me, “You are the problem. Tesla and SpaceX in their races against time answer. Since the 1960s, our government had Whenever we ask you to choose between two and competitors. been charged hundreds of millions of dollars for options, you choose what is more expensive. We every rocket launched only to watch that rocket We think Elon’s desire to solve really hard can save you money by spending less inside your burn up in the atmosphere after being used only problems for the betterment of humanity is one walls and on the building envelope infrastructure once! “Insane!” “Impossible!” was the reaction of of the things that makes working with him and that no one will ever see.” I responded in accord the cost/plus aerospace industry to Elon’s efforts the thousands of brilliant people he has chosen with the lesson Jay had taught me all those to create a reusable rocket! China’s government to surround himself with so appealing as well as years ago. “That is exactly where we do not want complimented Elon in a Wall Street Journal Tesla’s goal of keeping Planet Earth habitable, to save money. That is where we want to spend editorial after a SpaceX rocket’s successful SpaceX’s goal of making the human species more. A site near the ocean may be a beautiful landing, chiding its own government’s engineers. multiplanetary…just in case, and Neuralink’s goal place to live, but it is an unusually hostile “You have been beaten to accomplish this of improving humankind knowledge and lives. environment to buildings. Please make sure that incredible feat not by a nation state but by an we invest sufficiently to make our home Elon is all about solving problems that are so individual! Congratulations, Elon Musk. China, last…and that you tell us every year what we difficult most don’t even try or give up soon we are 10 years behind.” need to do before repairs and maintenance are after they start. Like building autonomous In 2021, SpaceX will provide 80% of the launches necessary.” driving systems for Tesla’s cars and trucks that from Planet Earth to space. China will provide rely upon software based on visual cues, “Why does it need to be like that?” 12%! SpaceX’ competitive advantage? machine learning, and artificial intelligence Elon Musk. CEO. Tesla. CEO SpaceX. 2021. Reusability! Elon calls it “RRR.” Rapidly reusable rather than lidar and radar hardware. Tesla’s rockets. In a recent industry forum, Elon spoke Elon Musk is the CEO of two leading “disruptive” autonomous driving system is less expensive about problematic tasks SpaceX was resolving. technology businesses in which Baron Funds has than hardware intensive services. It will therefore Like reducing the cost of its SpaceX user interface. significant long-term investments. The first is be available for virtually all cars regardless of Like creating intersatellite communications with electric vehicle, extended range battery, price as a cloud software subscription. Tesla’s no noticeable increase in latency between alternative energy and software business Tesla, autonomous driving solutions will ultimately thousands of SpaceX satellites and Earth. This is Inc. The second is the privately owned rocket provide similar functionality to hardware despite those satellites orbiting at 17,000 miles ship, launch, and satellite broadband provider focused services and dramatically reduce the per hour 300 miles above Earth! Getting landing Space Exploration Technologies Corp. 40,000 auto casualties per year in our country. rights for satellite broadband in countries (“SpaceX”). We purchased our shares in Tesla worldwide! And, of course, producing enough from 2014 through 2016 and have since earned Tesla is also the leading developer of inexpensive rockets fast enough to get humankind to Mars. realized and unrealized profits of about 14 times car batteries that last more than 500 miles on a the cost of our investment. We have been single charge. Eliminating expensive cobalt is an Elon was asked by a skeptical interviewer at that investing in SpaceX since 2017 and have since important factor in cost reduction. Even more satellite conference about the complexity of user about doubled our money. We expect Tesla and important is the use of a novel and extremely interface installations. “How can you expect SpaceX to each become substantially larger, complicated dry process in the manufacturing of consumers to install a SpaceX user interface, its more profitable, and much more valuable during battery cathodes. Others tried but were unable antenna dish receiver without a ’truck roll‘ or a the next 10 years. We often say, “we invest in to solve hundreds of issues and, for the most professional installer?” Elon’s answer: “The dish people.” Since talent, motivation, integrity, part, stopped trying. One issue: how in a dry comes in a box that looks like a pizza box. The leadership, and heart are difficult for algorithms process do you precisely apply a thin film of instructions are simple. ’Open the box, point the and most investors to assess, I thought you cathode powder a few microns thick (the UI to the open sky and plug it in’…or, you can might find it interesting for me to describe how thickness of a human hair) in millions of cells plug it in first and then point it to the open sky. we think Elon Musk is different than most with exactly the same result? At Tesla’s recent It doesn’t matter what you do first. That’s it.” executives…and part of why we believe that is a “Battery Day,” its executives described how they “Elon time.” Elon regularly requests his fellow good thing… expected to soon produce battery packs at 56% lower cost with 50% more power (density) in a employees to meet what many feel are unrealistic In addition to being a terrific SNL standup prototype factory 70% smaller! deadlines. “When does this need to happen?” comic host, we think Elon is one of the most “Tomorrow.” In general, what he requests for accomplished and consequential engineers on Tesla, led by Elon, is investing its cash flow to tomorrow happens in a few days…a little longer our planet. In fact, he just might be, as Tina make cars safer, better, faster, and cheaper. This than he initially asked for…but his goals are rarely Turner sang, “Simply the Best.” Elon is also is to broaden its market appeal. Unlike most not achieved. Elon clearly believes that if his likely the most important reason that, manufacturers, Tesla often significantly engineers were asked to complete tasks in a more according to a recent survey published in penalizes short-term profits by replacing realistic timeline, their complicated missions Science Times, Tesla and SpaceX were ranked as equipment and processes that are not as would take much longer and probably cost much “the most attractive firms for leading efficient as possible before Tesla has earned a more. Instead, his fellow employees try to engineering students (to seek employment) in return on these investments. This is to create a respond to Elon’s sense of urgency. His engineers the U.S.” That survey reports “the electric car competitive advantage by constantly lowering have come to believe that given Elon’s company topped the list and the private space costs enabling Tesla to ultimately sell products engineering expertise, if he asks for tasks to be company ranked second.” We regard this at lower prices. completed in a short period of time, there must

2 June 30, 2021 Letter from Ron

be a way. “What do we need to do to make this over the next three years. It didn’t take much 7.5% per year! This means that even if you happen?” is the common refrain that follows more than that to convince me that if the invested all your money just before a decade Elon’s requests…which are then somehow Chairman of the Federal Reserve with all the data when stocks underperformed, you would have completed. One more thing. Whatever model his and tools at his disposal couldn’t predict what made 43 times your money over that period. teams first build, it is continually iterated and the “market” would do, it was unlikely others So…despite Civil Rights and Women’s marches improved upon. Materially every year. could either. Which made us focus on investing on Washington…political assassinations… in well managed, competitively advantaged, “Question Everything” was the theme of the impeachments…wars…9/11…the 2008-09 growth businesses…not the “stock market.” 2015 Annual Baron Investment Conference. Financial Crisis…“bear markets”…the 1987 When our portfolio managers and analysts study Although markets made little progress in crash…recessions…inflation…crazy high and businesses and meet with the senior executives the 1970s, many businesses in which I then crazy low interest rates…and the of those businesses before we invest, my recommended our clients invest during that period January 6th Capitol Hill riot bordering on an instruction to them is: “Please ask questions you grew significantly…and their stocks prices insurrection…you name it, U.S. GDP increased would need answered if the welfare of your increased substantially. Among them…Golden about 28X since 1966, and the stock market family was completely dependent upon the Nugget…Tropicana…Walt Disney…Manor Care… grew a little faster! In our opinion this occurred success of the business in which you are McDonalds…Federal Express…Nike…Mattel… because more business models in our capitalist recommending we invest. If that were the case, and…Hyatt. Finally, the last piece of the puzzle. society have changed to “capital light” models what would you need to know about that Investing for the “long term.” Since we invested in (e.g., more recurring revenues and faster business in order to make such a virtually all those businesses when they were technology-driven growth). Those characteristics recommendation? You need to ask questions small-cap companies…and no longer own most are more valuable. about long-term competitive advantages and now that they are much larger…we learned that it In our judgment, the most attractive the talent and ethics of its executives and have was a mistake to “tactically trade” rather than investments you can make on behalf of your them answered. These are more important than “invest for the long term” in terrific businesses and family in order to participate in our country’s questions about how much a business is going to their entrepreneurial executives. economic growth are common stocks. This is earn next quarter or next year or how many When I began my Wall Street career in 1970, the how to offset the decline in the purchasing units were sold in a period, or whether a Dow had just fallen to 800…and a large power of the dollar, which historically has lost transactional investment that can enhance near- percentage of individuals holding investment about half its value every 17 to 20 years. You term investment returns is likely.” Jay believed research positions that I coveted had recently can look it up on Google if you don’t believe me. that most people are reluctant to ask a question become unemployed. That means they were Try the costs of tuition…housing…labor… that they think might make them appear dumb. fired. As a result, getting a job as an analyst in cars…food…vacations…anything you choose… Another important lesson imparted by Jay was the summer of 1969 was not exactly “a piece of 15 years ago…25 years ago…50 years ago. that “There are no dumb questions. The only cake.” When we founded Baron Capital in 1982, Low-cost passive index mutual funds are a dumb question is the one you don’t ask.” the Dow was still 800!!! This was because in reasonable way to achieve market return. That is I am proud and flattered that my friend Will 1982, short-term interest rates, an important a good idea since few active mutual fund Danoff, Fidelity ContraFund’s exceptional factor in determining stock prices and the health managers have been able to outperform their portfolio manager, recently told me that, “I am of our economy, were around 15%. That benchmark indices. the biggest portfolio manager, but you are the extraordinarily high level made investments in Baron Capital is among the few mutual fund best at choosing individuals in whom to invest.” stocks seem unattractive. Rates had been groups that have outperformed the markets over increased by Federal Reserve Chairman Paul “How do we know when ‘irrational the long term. As of June 30, 2021, 16 of 17 Baron Volker to combat inflation. While the Fed’s exuberance’ has unduly escalated asset Funds, representing 98.2% of assets under efforts to curtail inflation were ultimately values to levels which then become subject management (AUM), have outperformed their successful, Volker’s economic “medicine” caused to unexpected and prolonged contractions?” respective passive benchmarks since their an important recession. Federal Reserve Chairman Alan Greenspan. inceptions. Further, 14 of those funds, representing December 5, 1996. Dow Jones Industrial I believed 1982 was a great time to start Baron 98.0% of AUM, rank in the top 17% of their Average: 6,437. Dow Jones Industrial Average Capital because I thought stock prices were only respective Morningstar categories; 11 of those June 30, 2021: 34,500! temporarily depressed and our economy would funds, representing 71.8% of AUM, rank in the top soon grow again. I was right. 8%; and 9 of those funds, representing 34.2% of Fed Chairman Alan Greenspan’s remarks in 1996 AUM, rank in the top 5%. Since 1992, when our clearly suggested he considered stock prices were The stock market increased 43 times from Firm had a $100 million of assets under then too high. This was relative to his forecast of March 12, 1982 to June 30, 2021 when the Dow management, we have earned approximately $49 businesses’ prospects and the Fed’s outlook for reached 34,500. That represents around 10% billion in realized and unrealized profits for our our economy. Regardless, after the Chairman’s compounded rate of return for the past 40 years. clients. As of 6/30/2021, our Firm’s assets under remarks, the Dow Jones Industrial Average Further, from 1970 through June 30, 2021, the management were $53.5 billion. (“Dow”) increased 78% to more than 11,497 markets’ compound rate of return was around

3 Letter from Ron

As of June 30, 2021, Baron Partners Fund’s Since Baron WealthBuilder Fund’s inception in I am excited about the prospects for Baron performance made it number 3 out of 2,205 December 2017, its annualized rate of return has WealthBuilder Fund and expect it to become mutual funds since its conversion to a mutual been 26.49% (Institutional Shares) per year. That one of the largest Baron mutual funds in the fund in 2003.1 Baron Growth Fund’s compares to 16.67% per year for the S&P 500 next 10 years…perhaps even the largest. Index and 12.22% for the MSCI ACWI Index! performance made it number 13 out of 568 We will continue to provide you with 2 Baron WealthBuilder Fund charges no mutual funds since its inception in 1994. Baron information about Baron Funds that we management fee and operating expenses are Small Cap Fund’s performance made it number would like to have if our roles were reversed. capped at 5 bps annually. Of course, the 49 out of 951 mutual funds since its inception in Thank you again for your confidence in 3 underlying Baron Funds in which Baron 1997. Baron Focused Growth Fund’s joining us as investors in Baron mutual funds. performance made it number 121 out of 3,497 WealthBuilder invests charge their management mutual funds since its conversion from a fees and their institutional share class operating Respectfully, partnership in 2008.4 expenses. But that’s it. Baron Global Advantage Fund is in the top 1% Baron WealthBuilder Fund is a diversified fund of its category since its inception. So is Baron that invests in a portfolio of Baron mutual funds Real Estate Fund. Baron WealthBuilder Fund, all but one of which have outperformed their Baron Discovery Fund, Baron Opportunity benchmark indexes since their inceptions. Baron Ronald Baron Fund, and Baron Real Estate Income Fund are WealthBuilder Fund is designed to be attractive CEO and Portfolio Manager in the top 3% of their respective categories since to long-term shareholders saving for their June 30, 2021 inception. (All based on Retail Shares.) retirements, their children’s college tuition, weddings, or first homes. We are hopeful after P.S. Baron WealthBuilder Fund’s inception date was reading this Letter from Ron that foundations, Baron Capital was founded on March 12, December 29, 2017. Baron WealthBuilder Fund endowments, sovereign wealth funds, and 1982… was conceived to enable investors to obtain corporate pension plans with long-term So, we are celebrating our business’ 40th exposures to and the performance of many investment horizons will also find Baron Anniversary in 2022…and, we haven’t held our Baron mutual funds by investing in just one WealthBuilder Fund attractive. Especially those annual conference either this year or last due fund. Based on its since inception performance, institutional entities that need to meet unfunded to Covid…and, this is the Roaring Twenties… Baron WealthBuilder Fund (Institutional Shares) liabilities, which, due to actuarial assumptions, So, if I were you, I wouldn’t miss our 29th Annual was the number 2 fund out of the 149 funds in require 7% annual returns that few have Baron Investment Conference on November 4, the Morningstar Allocation – 85%+ Equity achieved. Please note that there is no guarantee 2022 at the Metropolitan Opera House in Category. that this return will be met. Lincoln Center, New York City. …just sayin’…

1 This is a hypothetical ranking created by Baron Capital using Morningstar data and is as of 6/30/2021. There are 2,205 share classes in these nine Morningstar Categories for the period from 4/30/2003 to 6/30/2021. 2 This is a hypothetical ranking created by Baron Capital using Morningstar data and is as of 6/30/2021. Baron Growth Fund’s Retail Share class was launched on 12/31/1994. There are 568 share classes in these nine Morningstar Categories for the period from 12/31/1994 to 6/30/2021. 3 This is a hypothetical ranking created by Baron Capital using Morningstar data and is as of 6/30/2021. There are 951 share classes in these nine Morningstar Categories for the period from 9/30/1997 to 6/30/2021. 4 This is a hypothetical ranking created by Baron Capital using Morningstar data and is as of 6/30/2021. There are 3,497 share classes in these nine Morningstar Categories for the period from 6/30/2008 to 6/30/2021. Note, the peer group used for these analyses include all U.S. equity share classes in Morningstar Direct domiciled in the U.S., including obsolete funds, index funds, and ETFs. The individual Morningstar Categories used for this analysis are the Morningstar Large Blend, Large Growth, Large Value, Mid-Cap Blend, Mid-Cap Growth, Mid-Cap Value, Small Blend, Small Growth, and Small Value Categories. The Morningstar Small Growth Category consisted of 612, 505, and 379 share classes for the 1-, 5-, and 10-year time periods. Morningstar ranked Baron Small Cap Fund in the 74th,42nd,50th, and 17th percentiles for the 1-, 5-, 10-year, and since inception periods, respectively. The Fund launched 9/30/1997, and the category consisted of 92 share classes. The Morningstar Mid-Cap Growth Category consisted of 579, 489, and 379 share classes for the 1-, 5-, and 10-year periods. Morningstar ranked Baron Growth Fund in the 47th,35th,40th, and 8th percentiles for the 1-, 5-, 10-year, and since inception periods, respectively. The Fund launched 12/31/1994, and the category consisted of 54 share classes. Morningstar ranked Baron Focused Growth Fund in the 3rd,2nd,3rd, and 5th percentiles for the 1-, 5-, 10-year, and since conversion periods, respectively. The Fund converted into a mutual Fund 6/30/2008, and the category consisted of 316 share classes. The Morningstar Large Growth Category consisted of 1,239, 1,024, and 761 share classes for the 1-, 5-, and 10-year periods. Morningstar ranked Baron Partners Fund in the 1st,2nd,1st, and 1st percentiles for the 1-, 5-, 10-year, and since conversion periods, respectively. The Fund converted into a mutual Fund 4/30/2003, and the category consisted of 422 share classes. Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectuses contain this and other information about the Funds. You may obtain them from the Funds’ distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing.

4 June 30, 2021 Letter from Ron

Baron Funds (Institutional Shares) and Benchmark Performance 6/30/2021

Annualized Annualized Benchmark Return Return Since Fund Since Fund Inception Average Annualized Returns Annual Fund Primary BenchmarkInception Inception Date 1-Year 3-Year 5-Year 10-YearExpense Ratio Net Assets SMALL CAP Baron Growth Fund Russell 2000 Growth Index 14.24% 9.22% 12/31/1994 46.19% 21.39% 20.92% 14.92% 1.04%(3) $9.00 billion Baron Small Cap Fund Russell 2000 Growth Index 11.65% 7.66% 9/30/1997 47.60% 20.66% 21.50% 14.20% 1.05%(3) $5.41 billion Baron Discovery Fund† Russell 2000 Growth Index 21.55% 13.23% 9/30/2013 70.06% 27.97% 30.53% N/A 1.08%(3) $2.00 billion SMALL/MID CAP Baron Focused Growth Fund(1) Russell 2500 Growth Index 14.48% 9.59% 5/31/1996 95.00% 39.58% 31.55% 18.44% 1.07%(4) $689.65 million MID CAP Baron Asset Fund Russell Midcap Growth Index 12.56% 11.19%(2) 6/12/1987 36.04% 21.91% 21.70% 15.73% 1.05%(3) $6.24 billion LARGE CAP Baron Fifth Avenue Growth Fund Russell 1000 Growth Index 12.25% 12.42% 4/30/2004 35.34% 25.94% 27.32% 18.67% 0.78%/0.75%(3)(6) $840.14 million Baron Durable Advantage Fund S&P 500 Index 18.93% 16.67% 12/29/2017 36.55% 21.14% N/A N/A 2.40%/0.70%(3)(7) $28.85 million ALL CAP Baron Partners Fund(1) Russell Midcap Growth Index 16.39% 11.03% 1/31/1992 119.55% 47.64% 38.45% 23.88% 1.30%(4)(5) $6.89 billion Baron Opportunity Fund† Russell 3000 Growth Index 11.01% 7.01% 2/29/2000 61.18% 38.62% 35.19% 19.39% 1.08%(3) $1.62 billion INTERNATIONAL Baron Emerging Markets Fund MSCI EM Index 7.24% 4.16% 12/31/2010 42.40% 12.76% 12.66% 7.70% 1.09%(4) $8.68 billion Baron Global Advantage Fund† MSCI ACWI Index 21.07% 11.10% 4/30/2012 45.78% 34.78% 33.68% N/A 0.92%/0.90%(4)(8) $2.90 billion Baron International Growth Fund MSCI ACWI ex USA Index 13.11% 8.50% 12/31/2008 44.18% 15.73% 16.50% 9.79% 1.01%/0.95%(4)(9) $722.10 million SECTOR Baron Real Estate Fund MSCI USA IMI Extended Real Estate Index 17.44% 13.00% 12/31/2009 61.07% 25.42% 20.49% 16.63% 1.08%(4) $1.78 billion Baron Real Estate Income Fund MSCI US REIT Index 17.01% 7.69% 12/29/2017 44.69% 20.18% N/A N/A 3.45%/0.80%(4)(10) $73.57 million Baron Health Care Fund Russell 3000 Health Care Index 27.14% 17.98% 4/30/2018 46.51% 26.81% N/A N/A 1.45%/0.85%(4)(11) $172.68 million Baron FinTech Fund S&P 500 Index 42.27% 23.03% 12/31/2019 46.93% N/A N/A N/A 2.43%/0.95%(12) $61.87 million EQUITY ALLOCATION Baron WealthBuilder Fund S&P 500 Index 26.49% 16.67% 12/29/2017 61.32% 28.45% N/A N/A 1.22%/1.11%(4)(13) $430.96 million

(1) Reflects the actual fees and expenses that were charged when the Funds were partnerships. The predecessor partnerships charged a 20% performance fee (Baron Partners Fund) or a 15% performance fee (Baron Focused Growth Fund) after reaching a certain performance benchmark. If the annual returns for the Funds did not reflect the performance fee for the years the predecessor partnerships charged a performance fee, returns would be higher. The Funds’ shareholders are not charged a performance fee. (2) For the period June 30, 1987 to June 30, 2021. (3) As of 9/30/2020. (4) As of 12/31/2020. (5) Comprised of operating expenses of 1.05% and interest expenses of 0.25%. (6) Annual expense ratio was 0.78%, but the net annual expense ratio was 0.75% (net of Adviser’s fee waivers). (7) Annual expense ratio was 2.40%, but the net annual expense ratio was 0.70% (net of Adviser’s fee waivers). (8) Annual expense ratio was 0.92%, but the net annual expense ratio was 0.90% (net of Adviser’s fee waivers). (9) Annual expense ratio was 1.01%, but the net annual expense ratio was 0.95% (net of Adviser’s fee waivers). (10) Annual expense ratio was 3.45%, but the net annual expense ratio was 0.80% (net of Adviser’s fee waivers). (11) Annual expense ratio was 1.45%, but the net annual expense ratio was 0.85% (net of Adviser’s fee waivers). (12) Annual expense ratio was 2.43%, but the net annual expense ratio was 0.95% (net of Adviser’s fee waivers). (13) Annual expense ratio was 1.22%, but the net annual expense ratio was 1.11% (includes acquired fund fees and expenses, net of the Adviser’s fee waivers). † The Fund’s historical performance was impacted by gains from IPOs. There is no guarantee that these results can be repeated or that the Fund’s level of participation in IPOs will be the same in the future. The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original cost. The Adviser reimburses certain Baron Fund expenses pursuant to a contract expiring on August 29, 2031, unless renewed for another 11-year term and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted. For performance information current to the most recent month end, visit www.BaronFunds.com or call 1-800-99BARON.

5 Letter from Ron

Performance for the Institutional Shares prior to 5/29/2009 is based on the performance of the Retail Shares, which have a distribution fee. The Institutional Shares do not have a distribution fee. If the annual returns for the Institutional Shares prior to 5/29/2009 did not reflect this fee, the returns would be higher. Discovery Fund’s 2Q 2021, YTD, 1-, 3- and 5-year, Global Advantage Fund’s YTD, 1-, 3- and 5-year, Opportunity Fund’s 3-, 5- and 10-year, and Real Estate Fund’s 2Q 2021 historical performance were impacted by gains from IPOs and there is no guarantee that these results can be repeated or that the Funds’ level of participation in IPOs will be the same in the future. Risks: All investments are subject to risk and may lose value Portfolio holdings as a percentage of net assets as of June 30, 2021 for securities mentioned are as follows: Hyatt Hotels Corp. – Baron Asset Fund (0.7%), Baron Partners Fund (3.0%*), Baron Focused Growth Fund (3.8%); Tesla, Inc. – Baron Opportunity Fund (2.8%), Baron Partners Fund (38.1%*), Baron Focused Growth Fund (31.6%); Space Exploration Technologies Corp. – Baron Asset Fund (0.6%), Baron Opportunity Fund (0.7%), Baron Partners Fund (4.3%*), Baron Fifth Avenue Growth Fund (0.2%), Baron Focused Growth Fund (3.7%), Baron Global Advantage Fund (0.3%). * % of Long Positions. Portfolio holdings are subject to change. Current and future portfolio holdings are subject to risk. Ranking information provided is calculated for the Retail Share Class and is as of 6/30/2021. The number of share classes in each category may vary depending on the date that Baron downloaded information from Morningstar Direct. Morningstar calculates its category average performance and rankings using its Fractional Weighting methodology. Morningstar rankings are based on total returns and do not include sales charges. Total returns account for management, administrative, and 12b-1 fees and other costs automatically deducted from fund assets. The Morningstar Large Growth Category consisted of 1,239, 1,024, and 761 share classes for the 1-, 5-, and 10-year periods. Morningstar ranked Baron Opportunity Fund in the 2nd,3rd,9th,and3rd percentiles for the 1-, 5-, 10-year, and since inception periods, respectively. The Fund launched 2/29/2000, and the category consisted of 269 share classes. Morningstar ranked Baron Partners Fund in the 1st,2nd,1st,and1st percentiles for the 1-, 5-, 10-year, and since conversion periods, respectively. The Fund converted into a mutual Fund 4/30/2003, and the category consisted of 422 share classes. The Morningstar Mid-Cap Growth Category consisted of 579, 489, and 379 share classes for the 1-, 5-, and 10-year periods. Morningstar ranked Baron Asset Fund in the 93rd,28th,20th and 17th percentiles for the 1-, 5-, 10-year, and since inception periods, respectively. The Fund launched 6/12/1987, and the category consisted of 19 share classes. Morningstar ranked Baron Growth Fund in the 47th,35th,40th,and8th percentiles for the 1-, 5-, 10-year, and since inception periods, respectively. The Fund launched 12/31/1994, and the category consisted of 54 share classes. Morningstar ranked Baron Focused Growth Fund in the 3rd,2nd,3rd,and5th percentiles for the 1-, 5-, 10-year, and since conversion periods, respectively. The Fund converted into a mutual Fund 6/30/2008, and the category consisted of 316 share classes. The Morningstar Small Growth Category consisted of 612, 505, and 379 share classes for the 1-, 5-, and 10-year time periods. Morningstar ranked Baron Small Cap Fund in the 74th,42nd,50th,and17th percentiles for the 1-, 5-, 10-year, and since inception periods, respectively. The Fund launched 9/30/1997, and the category consisted of 92 share classes. Morningstar ranked Baron Discovery Fund in the 14th,6th,and2nd percentiles for the 1-, 5-year, and since inception periods, respectively. The Fund launched 9/30/2013, and the category consisted of 432 share classes. The Morningstar Real Estate Category consisted of 246, 199, and 143 share classes for the 1-, 5-, and 10-year time periods. Morningstar ranked Baron Real Estate Fund in the 2nd,1st,1st,and1st percentiles for the 1-, 5-, 10-year, and since inception periods, respectively. The Fund launched 12/31/2009, and the category consisted of 128 share classes. Morningstar ranked BaronRealEstateIncomeFundin the 11th and 3rd percentiles for the 1-year and since inception periods, respectively. The Fund launched 12/29/2017, and the category consisted of 221 share classes. The Morningstar Foreign Large Growth Category consisted of 445, 323, 225, and 202 share classes for the 1-, 5-, 10-year, and since inception (12/31/2008) periods. Morningstar ranked Baron International Growth Fund in the 10th,16th,19th,and11th percentiles, respectively. The Morningstar Diversified Emerging Markets Category consisted of 789, 602, 306, and 280 share classes for the 1-, 5-, 10-year, and since inception (12/31/2010) periods. Morningstar ranked Baron Emerging Markets Fund in the 47th,45th,5th,and7th percentiles, respectively. The Morningstar World Large-Stock Growth Category consisted of 352, 263, and 175 share classes for the 1-, 5-year, and since inception (4/30/2012) periods. Morningstar ranked Baron Global Advantage Fund in the 16th,2nd,and1st percentiles, respectively. The Morningstar Health Category consisted of 163 and 138 share classes for the 1-year and since inception (4/30/2018) periods. Morningstar ranked Baron Health Care Fund in the 10th and 5th percentiles, respectively. The Morningstar Allocation – 85%+ Equity Category consisted of 159 and 149 share classes for the 1-year and since inception (12/29/2017) periods. Morningstar ranked Baron WealthBuilder Fund Retail Shares in the 4th and 2nd percentiles, respectively. Morningstar ranked Baron WealthBuilder Fund Institutional Shares in the 3rd and 1st percentiles, respectively. © 2021 Morningstar. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may notbe 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 discussions of the companies herein are not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed in this report reflect those of the respective portfolio managers only through the end of the period stated in this report. The portfolio manager’s views are not intended as recommendations or investment advice to any person reading this report and are subject to change at any time based on market and other conditions and Baron has no obligation to update them. Fidelity Investments is not affiliated with Baron Capital, Inc. For information pertaining to Fidelity, please refer to that firm’s website. There is no guarantee that the objectives discussed in this material will be met. The MSCI ACWI Index measures the equity market performance of large and midcap securities across developed and emerging markets, including the United States. The S&P 500 Index measures the performance of 500 widely held large-cap U.S. companies. MSCI is the source and owner of the trademarks, service marks and copyrights related to the MSCI Indexes. The indexes are unmanaged. Index performance is not fund performance. Investors cannot invest directly into an index. BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a limited purpose broker- dealer registered with the SEC and member of the Financial Industry Regulatory Authority, Inc. (FINRA).

6 June 30, 2021 Letter from Linda

The second quarter of 2021 was the fifth consecutive quarter of solid positive performance for U.S. equities. The S&P 500 Index increased 8.55%, including dividends, and is up over 15% since the start of the year, making the first half of 2021 one of the best first halves for the stock market on record. The wider availability of vaccines and the growing vaccination rates in the U.S. and abroad have accelerated the economic recovery and have pushed investor optimism higher. As a result, net flows in equities have been growing at a robust pace, a notable reversal from the negative trend of the past few years. According to data from the ICI, despite negative net flows in January, nearly $150 billion poured into U.S. and global equity mutual funds and ETFs year-to-date as of the end of June. At the same time, bond funds received even bigger net inflows–around $386 billion since the start of the year, as shown on the chart below.

Money Is Flowing Back to Equities Cumulative Annual Net Flows LINDA MARTINSON in Long-Term Mutual Funds and ETFs (billions) CHAIRMAN, PRESIDENT AND COO 2019 2020 2021 $500 $459 $446 (YTD - June) $386 be, but there is so much discussion about it that we felt it appropriate to $300 address it this quarter.

$148 At the end of June, one-year inflation in the U.S. reached 5.4%1, the highest $100 level since 2008. Much of this increase happened in 2021, at an accelerating pace. Since high and rising inflation is often interpreted as a sign of economic uncertainty, the inflation level and momentum have become -$100 worrisome. Comparisons with the 1970s, when inflation spun out of control, interest rates and unemployment spiked, and the U.S. economy went into a Equities -$200 recession, have further added to investor anxiety. It seems everyone wants -$300 Bonds to know how much higher inflation is going to rise, how long is it going to stay, and what monetary policy actions will follow. -$395 -$500 For fixed income investors, higher inflation can be detrimental. Inflation erodes the real value of a bond’s face value and diminishes real returns. 1/1/21 1/1/19 1/1/20 Inflation can be particularly damaging when it exceeds bond yields, as it 6/30/21 6/30/19 6/30/20 12/31/19 12/31/20 currently does, since the real yield for bonds investors becomes negative. Source: The Investment Company Institute, Combined Estimated Long-Term Fund Flows and ETF Yet, investors may still choose to buy or keep bonds for other reasons, Net Issuance report as of 6/14/2021. Note: Weekly fund flows are estimates based on reporting covering more than 98% of mutual fund including short-term cash flow management or because they believe and ETF assets, while actual monthly mutual fund net new cash flow and ETF net issuance data are inflation is transitory. collected and reported separately. Mutual fund data represent net new cash flow, which is new sales minus redemptions combined with net exchanges, while ETF data represent net issuance, For traditional equity investors, the analysis is less straightforward, and which is gross issuance less gross redemptions. The primary difference is that net new cash flow there is no definitive rule of thumb. While there is no doubt that inflation excludes reinvested dividends and new issuance includes reinvested dividends. Data for mutual affects stock prices, the impact very much depends on what else is going on funds that invest primarily in other mutual funds and ETFs that invest primarily in other ETFs were in the economy and the market. Inflation is only one of many factors excluded from the series. that drive the stock market, and its effects on stock prices are hard to isolate Despite the strong bond and equity flows and the economic improvement this or predict. The level and rate of change of inflation affect companies year, investors remain anxious and cautious. Some fear a new wave of COVID differently, depending on their idiosyncrasies, industry, competitive infections and a subsequent economic slowdown. Others are concerned that landscape, and capital structure, among other things. The overall economic the economy may improve too fast and overheat, resulting in a new recession. environment may also counter or amplify the effects of rising/high The one thing that seems to be on all investors’ minds is inflation. inflation. Inflation could increase during times of improving economic As long-term investors, we do not focus on inflation or other conditions or when conditions are worsening. Just because inflation is rising macroeconomic factors, but inflation is a timely topic, and investors have or surpassing a certain level does not mean equity investors should been asking for our views. We are not economists, and we do not pretend to reflexively buy or sell.

1 As measured by the Consumer Price Index for All Urban Consumers (CPI-U), published by the Bureau of Labor Statistics.

7 Letter from Linda

The chart below shows that over the past century inflation, as measured by Inflation Is a Complex Subject the two most popular indicators, has increased or declined during periods of both economic expansions and recessions. Inflation measures the general increase in prices. While the concept sounds simple, defining inflation is a complicated matter, and there are multiple ways to measure it. The two most popular measures of inflation in the U.S Inflation Has Increased During are the Consumer Price Index (CPI) and the Personal Consumption Economic Expansions and Recessions Expenditures Index (PCE). Broadly speaking, the CPI is a reflection of the price 1-Year CPI and PCE Inflation, 1/31/1913 – 6/30/2021 changes of what people are buying, while the PCE looks at what businesses 25% are selling. Each index also has a “core” version that excludes food and energy prices, which tend to be more volatile. The Federal Open Markets 20% Committee (FOMC), which sets the Federal Reserve’s (the Fed’s) monetary policy, primarily references the PCE index when discussing inflation. 15% CPI CPI inflation is calculated using a fixed-weight basket of goods and services 10% Inflation (June) consumed by households. PCE inflation captures a broader picture of spending, including services paid for on behalf of consumers (e.g., Medicare), 5% 5.4% and can change as people substitute away from some goods and services 0% PCE toward others. Neither index is a perfect representation of the price changes Inflation experienced by the population. In fact, since everyone’s consumption pattern -5% (May) 3.9% is different, a single inflation index will always be imperfect because everyone faces his/her own inflation rate. Yet, investors and economists often rely on a -10% Economic Expansions single index for decision making. Having a solid understanding of the Economic Recessions underlying index methodology and its strengths and weaknesses is important. -15% When evaluating price index changes, it is also important to consider what 1913 1918 1923 1928 1933 1938 1942 1947 1952 1957 1962 1967 1971 1976 1981 1986 1991 1996 2000 2005 2010 2015 2020 subcomponents are driving the movements. The prices of certain items, such Sources: CPI inflation data from the U.S. Bureau of Labor Statistics, PCE inflation data from the U.S. as food, vehicles, and motor fuel, tend to be more volatile (flexible) because Bureau of Economic Analysis, U.S. Business Cycle Expansions and Contractions data from The supply and demand for them is more sensitive to the current economic National Bureau of Economic Research. All data retrieved from the Federal Reserve Bank of St. Louis. environment. Others, such as rent, medical services, and education, typically The last time in recent history when inflation rose to a more significant level change more slowly over time (sticky) because they are based on perceived and lasted was 2002-2005, a period of stable economic expansion and longer-term changes in the economy. When overall inflation is driven by an employment growth after the recession in the early 2000s. As the housing increase in the volatile price items, the increase may be short-lived. On the market entered a correction in 2006, inflation retracted for about a year other hand, when inflation rises due to an increase in the sticky price goods/ before jumping back up when the financial crisis began unfolding. services, it is likely to be lasting. According to the June 2021 data release from the Federal Reserve Bank of Atlanta2, over the past year the sticky- The table below shows the periods of rising one-year inflation since the ‘80s price index increased 2.7%, whereas the flexible-price index increased and how some key economic variables and the stock market changed during 12.4%. While it may still be early to draw conclusions from this data, there these periods. In our view, there is no obvious pattern behind this data, and are indications that some of the overall inflation increase may be any period of rising inflation should be interpreted in context. permanent, and some may be transitory. How inflation is interpreted can significantly affect the behavior of Inflation Has Increased in a Variety of Circumstances investors, businesses, and policymakers and their future inflation Changes in Select Economic Variables and the Stock Market during Rising PCE expectations. Inflation expectations matter because actual inflation is often Inflation Periods driven by actions taken on expectations. Workers may demand higher wages, businesses may hike prices, and the Fed may increase interest rates, S&P 500 1-Yr 10-Yr 1-Yr 1-Yr S&P 500 Index - depending on what expectations are pointing to. 1-Yr PCE PCE Treasury Unempl. Industrial Consumer Index 1-Yr Trough Peak Inflation Inflation Yield Rate Production Spending Return Return Date Date Trough Peak Change Change Change Change (cumulative) After Peak Dec-86 Oct-90 1.57% 5.18% 1.6% –0.7% 11.3% 29.1% 43.0% 33.5% Sep-98 Mar-00 0.63% 2.88% 1.5% –0.6% 7.1% 12.1% 50.2% –21.7% Jan-02 Sep-05 0.67% 3.77% –0.8% –0.7% 7.7% 23.9% 15.9% 10.8% Oct-06 Jul-08 1.58% 4.14% –0.7% 1.4% 0.3% 7.8% –4.8% –20.0% Jul-09 Sep-11 –1.24% 3.06% –1.6% –0.5% 10.9% 9.1% 19.8% 30.2% Sep-15 Jul-18 0.09% 2.45% 0.7% –1.2% 3.0% 13.3% 55.5% 8.0% Apr-20 May-21 0.48% 3.91% 1.0% –9.0% 18.6% 29.3% 47.0% ?

Sources: PCE Inflation and Consumer Spending data from the U.S. Bureau of Economic Analysis, 10-Yr Treasury Yield and Industrial Production data from the Board of Governors of the Federal Reserve System (US), Unemployment Rate data from the U.S. Bureau of Labor Statistics, all retrieved from the Federal Reserve Bank of St. Louis. S&P 500 Index data via FactSet. Note: The S&P 500 Index performance includes dividends. Total returns were not available in FactSet for the period 12/31/1986 – 1/31/1988; the total returns for the Ibbotson SBBI US Large Stock Index (via Morningstar Direct) were used during this period. The performance data quoted represents past performance. Past performance is no guarantee of future results. Current performance may be lower or higher than the performance data quoted.

2 https://www.atlantafed.org/research/inflationproject/stickyprice/

8 June 30, 2021 Letter from Linda

There are several survey-based measures of expected inflation that are Another popular market-based measure of inflation expectation is the closely followed, some of the popular ones plotted on the chart below. 5-year, 5-year forward inflation expectation rate, which is an estimate of Comparing the forecasts with the actual inflation level shows that it is very inflation expectations for the five-year period that begins five years from the difficult to predict inflation consistently. Reminds us that even a broken present. It is calculated by comparing the yields of treasury inflation- clock tells the time correctly twice a day. protected securities (TIPS) and nominal treasury yields. While this measure looks at expected levels of inflation far in the future, it is important for Inflation Expectations Are Not Always a Reliable Indicator policymakers as it reflects the market’s confidence today that the central bank will be able to keep the inflation rate within its set target. As of the 1-Yr Inflation Expectations vs. Actual 1-Yr CPI Inflation Actual 1-Yr CPI writing of this letter, the 5-year, 5-year forward inflation expectation rate 5.5% Inflation was 2.14%, down from a recent high of 2.38% and slightly above the Fed’s 5.0% NY Fed long-term target inflation rate of 2%. Survey 4.5% University 4.0% of Michigan The Market Expects That Long-Run Inflation Will Be Close to Survey 3.5% the Fed’s 2% Target 3.0% Atlanta Fed Survey 5-Year, 5-Year Forward Inflation Expectation Rate 2.5% 3.5% Cleveland Fed 2.0% (survey + 1.5% market data) 3.0% 1.0% 0.5% 2.5% 0.0% 2.0% -0.5%

1.5% Jun-17 Jun-12 Jun-21 Jun-15 Jun-19 Jun-13 Jun-16 Jun-14 Jun-18 Jun-22 Jun-20 Dec-17 Dec-12 Dec-21 Dec-15 Dec-13 Dec-19 Dec-16 Dec-14 Dec-18 Dec-20

Sources: CPI Inflation data from the U.S. Bureau of Labor Statistics via the Federal Reserve Bank of 1.0% St. Louis. University of Michigan Survey via the University of Michigan; NY Fed Survey via the Survey of Consumer Expectations by the Federal Reserve Bank of New York; Atlanta Fed Survey via the 0.5% Business Inflation Expectations Survey by the Federal Reserve Bank of Atlanta; Cleveland Fed data via the Federal Reserve Bank of Cleveland 1-year expected inflation estimates. 0.0% Investors also consider market-based measures of inflation expectations derived ul-14 ul-16 Jul-07 Jul-10 Jul-15 Jul-03 Jul-04 Jul-05 Jul-06 Jul-08 Jul-09 Jul-11 Jul-12 Jul-13 Jul-18 Jul-20 Jul-21 from treasury yields. One common metric is the breakeven inflation rate, which J J Jul-17 Jul-19 is calculated as the difference between the yields of regular and inflation- Source: Federal Reserve Bank of St. Louis. indexed treasury bonds with the same maturity. As of 7/16/2021, the five-year Inflation expectations are important, but they are simply a prediction of breakeven inflation rate was at 2.52%, meaning that over the next five years what may happen and should be considered with caution. Drawing market participants expect inflation to average out to 2.52% per year. The chart comparisons with historical inflationary periods also has many pitfalls, as below shows that the five-year breakeven inflation rate increased steadily since every period has its own idiosyncrasies. At any particular moment, inflation the start of the pandemic, peaked in mid-May ’21 at 2.72% and has declined is driven by many factors with uneven and changing importance, making it since, possibly signaling that inflation concerns are easing. extremely hard for anyone to predict how inflation will shift next. Recently, some economists have been worried that the U.S. may be headed toward a The Market Expects Inflation of Around 2.5% ’70s-like period of inflation. While there are some similarities between the ‘70s and today, we believe that the factors that led to the double-digit Over the Next Five Years* inflation back then are unlikely to repeat today. 5-Year Breakeven Inflation Rate 3.5% The excessive expansionary fiscal policy and tax cuts under President Johnson, followed by President Nixon’s price control policy in the early ‘70s 3.0% and the abandonment of the gold standard (a.k.a. the Nixon Shock), two oil 2.5% crises, and poor monetary policy decisions by the Fed are among the main 2.0% factors that came together and drove inflation in the ‘70s. The Fed’s 1.5% mandate at the time was also quite different than today, and the Fed’s 1.0% institutional knowledge and experience in managing inflation was inferior to 0.5% that of today’s policy makers. 0.0% In addition, there are significant structural differences between today’s -0.5% economy and that of the ‘70s. Economic activity has shifted away from -1.0% manufacturing and more toward services; unionization and the power of -1.5% labor unions have declined significantly, limiting potential wage pressures; and businesses have become global and less capital intensive. Given the -2.0% current demographics and how much more mature the U.S. economy is -2.5% today, it is hard to imagine that it is subject to the same risks as in the ‘70s, although the possibility cannot be completely ruled out. Jul-03Jul-04Jul-05Jul-06Jul-07Jul-08Jul-09Jul-10 Jul-11 Jul-12 Jul-13 Jul-14 Jul-15 Jul-16 Jul-17 Jul-18 Jul-19 Jul-20 Jul-21

Source: Federal Reserve Bank of St. Louis. Finally, one of the key challenges when comparing economic data and *annualized average over five years statistics versus historical periods is the lack of consistent data quality and availability over time, which may lead to misleading comparisons.

9 Letter from Linda

Inflation or Normalization? As for the negative price effects from supply-chain and production bottlenecks – we believe that these will likely be temporary, as it takes some The drivers of today’s inflation are a direct consequence of the pandemic. time to restart the production and supply processes. The economic shutdown and subsequent reopening do not have a relevant historical analog, which makes any comparisons with prior inflation periods Furthermore, we are not seeing sharp price increases across the board. Rents less applicable. are up 1.9% over the past year and food is 2.4% higher, which are not unreasonable increases. Some categories, such as drugs and medical care The combination of strong consumer demand for products and services after equipment and supplies, which were in high demand last year, are even vaccines became widely available, depleted inventories, crippled supply registering declines in prices. chains, and worker shortages resulted in sharp price increases in some categories. Used cars and trucks, for example, are 45% more expensive than Overall, higher consumer demand and spending, production normalization, a year ago since production and deliveries for new vehicles have been and accelerating economic momentum make us feel optimistic. Judging by delayed and the cost of some raw materials has risen. Shipping costs are labor market improvements, increasing industrial activity, higher consumer also significantly higher than a year ago, driven by high demand, limited spending, improving corporate earnings, among other factors, we believe shipping capacity, and higher fuel costs. that the health of the U.S. economy has been improving and that rising inflation is a reflection of this rather than a signal of a growing problem. It is important, however, to keep in mind that some of these price increases follow on the heels of the significant price declines that we experienced last year. While the current percentage increases may be large, they are a result Inflation is Not Necessarily a Bad Thing of an anomaly, since the prices of many goods and services reached very Since inflation decreases the value of money, having some inflation low levels due to the sudden lack of demand. This is known as the “base incentivizes people to do something with their money so it does not lose effect” – the base level of prices, against which current prices are compared, value. If inflation were zero, there would be less incentive to spend and is so low that the change appears very significant when expressed in invest, and the economy would likely grow at a slower pace or not at all. percentage terms. We believe it is critical to consider whether prices Very high or runaway inflation, which occurs when the prices of most increased because of a normalization or because the economy is services and goods increase for a prolonged period at an accelerating pace, is deteriorating. damaging for the economy since it erodes purchasing power rapidly, causing For example, at the beginning of 2020 a barrel of oil was trading at around instability for consumers and producers. Moderate, controlled inflation $70. Once the pandemic lockdowns hit and people stopped travelling, the should help boost demand and consumption at a reasonable pace, driving price fell below $20. As of 6/30/2021, oil prices had gone up to around $75, sustainable economic growth and employment stability. This is why the slightly above pre-pandemic levels. The chart below shows a strong long-term inflation target of the Fed is 2% – a moderate pace. This target relationship between oil price movements and gasoline demand. rate was formally adopted in January 2012 as part of the Fed’s mandate to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates. Oil Prices Have Recovered as Gasoline Demand Recovered A moderate level of inflation is expected by consumers and market Weekly Gasoline Demand vs. Brent Crude Oil Prices participants and is reflected by asset prices. When inflation levels are in 10,000 $80 the 0% – 4% range, equities typically perform well and provide inflation protection, since company debt obligations are inflated away and businesses can pass on most of the input price (e.g., raw materials, labor) 9,000 $68 increases to the consumer. This cost transfer and inflation protection ability decreases for higher levels of inflation, when the economic climate 8,000 $56 deteriorates. Regardless of inflation levels, historically equities have delivered strong 7,000 $44 performance and positive returns most of the time. The charts on the next page examine the forward performance of major asset classes following Weekly U.S. Motor U.S. Weekly

Brent Crude Brent Price per Barrel periods of high (>4%), moderate (2% – 4%), and low (<2%) inflation over 6,000 Gasoline Supplied ('000 b/day)GasolineSupplied ('000 $32 the past 50+ years. Each asset class’s performance was calculated as the Gasoline Demand (left axis) median of the 12-month returns following periods when 1-year PCE Oil Price (right axis) inflation was in the respective bucket. For example, in the first chart (left), 5,000 $20 following periods when inflation was 4% or more the median 12-month performance of U.S. Small Cap Equities was 23.5%. In addition, when Jul-20 Jan-21 Jun-21 Jan-20 Feb-21 Apr-21 Jun-20 Feb-20 Apr-20 Dec-19 Mar-21 Sep-20 Oct-20 Dec-20 Aug-20 Mar-20 May-21 Nov-20 May-20 inflation was 4% or higher, small caps generated positive returns a year later Sources: Weekly U.S. Product Supplied of Finished Motor Gasoline via the U.S. Energy Information 82% of the time (chart on the right). Administration, Brent Crude Oil prices via FactSet. While we acknowledge that this is a simplistic analysis, there is one While the increase from $20 to $75 is significant and would be highly outcome that stands out: equities have generated strong positive future concerning under normal circumstances, we believe that it makes more returns in the majority of time, regardless of inflation levels. sense to view this change as price normalization after a remarkable period of demand disruption.

10 June 30, 2021 Letter from Linda

On Average, Equities Have Delivered Strong Results Regardless of Inflation Regimes Inflation Regimes vs. 1-Yr. Forward Returns Based on monthly observations for the period 12/31/1970 – 6/30/2021 Median 12-Month Forward Returns After Periods % of Periods with When 1-Yr PCE Inflation >4% (175 periods) Positive Returns

U.S. Small Cap Equities 23.5% 82%

U.S. Large Cap Equities 14.7% 79%

Commodities 13.4% 73% Long-Term Corp. Bonds 9.1% 78% (AAA/AA) International Equities 8.9% 73%

U.S. Long-Term Gov't Bonds 8.8% 77%

U.S. 30-Day T-Bills 8.0% 100%

Gold 7.9% 59%

0% 5% 10% 15% 20% 25% 50% 75% 100%

Median 12-Month Forward Returns After Periods % of Periods with When 1-Yr PCE Inflation 2% - 4% (239 periods) Positive Returns

U.S. Large Cap Equities 11.6% 76%

U.S. Small Cap Equities 11.4% 71%

International Equities 11.4% 68%

Long-Term Corp. Bonds 90% (AAA/AA) 10.0% U.S. Long-Term Gov't Bonds 9.6% 91%

Gold 5.7% 64%

Commodities 5.3% 61%

U.S. 30-Day T-Bills 4.5% 100%

0% 5% 10% 15% 50% 75% 100%

Median 12-Month Forward Returns After Periods % of Periods with When 1-Yr PCE Inflation <2% (192 periods) Positive Returns

U.S. Large Cap Equities 16.1% 90%

U.S. Small Cap Equities 13.9% 74%

International Equities 9.0% 69% Long-Term Corp. Bonds 5.9% 75% (AAA/AA) Commodities 5.5% 58%

U.S. Long-Term Gov't Bonds 5.2% 66%

Gold 4.2% 60%

U.S. 30-Day T-Bills 1.0% 100%

0% 5% 10% 15% 20% 50% 75% 100%

Sources: FactSet, Morningstar Direct, Federal Reserve Bank of St. Louis, Baron Capital. Notes: U.S. Small Cap Equities are represented by the Ibbotson® U.S. Small Stock Index; U.S. Large Cap Equities are represented by the Ibbotson® U.S. Large Stock Index; Long-Term Corporate Bonds are represented by the Ibbotson® Long-Term Corporate Bond Index; U.S. Long-Term Gov’t Bonds are represented by the Ibbotson® U.S. Long-Term Government Bond Index (approximate bond maturity 21.5 years); U.S. 30-Day T-Bills are represented by the Ibbotson® U.S. 30-Day T-Bill Index; Commodities are represented by the S&P GSCI Index; International Equities are represented by the MSCI EAFE Index (net); and Gold is represented by the London Bullion Market Gold Fixing Price per Troy Ounce in USD. The performance data quoted represents past performance. Past performance is no guarantee of future results. Current performancemaybelowerorhigherthantheperformancedataquoted.

11 Letter from Linda

Inflation and the Fed what the appropriate policy measures are for each specific situation. Currently, there is no unanimous view on inflation among Fed members, Over the past decade, 1-year PCE inflation has been low and below the which we interpret as a positive sign. While the view of the FOMC is that Fed’s target rate most of the time, as shown in the below chart. recent inflation is largely reflecting transitory factors, it is keeping an eye out for any signs of deterioration and has indicated it is ready to act as Inflation Has Been Low During the Past Decade needed. 1-Year PCE Inflation Rate, 12/31/2010 – 5/31/2021 5.0% Inflation and Equities 4.5% 1-Yr PCE Inflation Rate: While inflation and the stock market are unpredictable over short periods, 4.0% 3.9% there is a consistent historical outcome over the long term: equities have 3.5% provided solid returns, well in excess of inflation. As the chart below shows, over the past 50 years a hypothetical investment of $10,000 could have 3.0% become worth several million dollars if invested in equities or it could have 2.5% Fed Long-Term lost 85% of its value if it were held in cash. Target Rate: 2.0% 2.0% (since Jan 2012) 1.5% 10-Yr Ann. Equities Have Provided Solid Returns and Inflation Protection Inflation Rate: Over the Long Term 1.0% 1.56% Value of $10,000 Over the Past 50 Years 0.5% 6/30/1971 – 6/30/2021 0.0% $10,000,000 U.S. Small Cap Equities $4,339,539(12.9% ann. return) Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16 Dec-17 Dec-18Dec-19 Dec-20 U.S. Large Cap Equities Source: U.S. Bureau of Economic Analysis via the Federal Reserve Bank of St. Louis. $1,840,584(11.0%) $1,000,000 Long-Term Corp. Bonds Since inflation should average out to about 2% over the long term, we (AAA/AA) $583,928(8.5%) expect that it might run at a pace a little over 2% for some time. The Fed’s U.S. Long-Term latest expectation3 is that PCE inflation will be 3.4% for the entire 2021 and Gov't Bonds $480,507(8.1%) much closer to 2% in 2022 and 2023. While the Fed is formally in charge of $100,000 U.S. 30-Day T-Bills controlling inflation, it does not over-fixate on the target rate, as it is $89,120 (4.5%) virtually impossible to control inflation so precisely. Responsible monetary policy requires that all moving pieces are considered carefully and achieve balanced, sustainable results. If inflation runs below or above 2%, the Fed $10,000 will likely take actions to make up for the miss, but its goal is to do so with low volatility over time. Cash If the Fed determines that inflation is becoming harmful to the economy, it (devalued by inflation) may reduce or fully eliminate its bond purchasing program and it may $1,000 $1,546.13 (-3.7%) decide to increase interest rates so borrowing becomes less attractive and 1971 1976 1981 1986 1991 1996 2001 2011 2016 2021 spending slows down. Higher rates are perceived as a negative signal by 2006 some equity investors, but the relationship between rates and stock market Source: Morningstar Direct. ® performance is also very complicated and is a function of many other Notes: U.S. Small Cap Equities are represented by the Ibbotson U.S. Small Stock Index; U.S. Large Cap Equities are represented by the Ibbotson® U.S. Large Stock Index; Long-Term Corporate Bonds variables and economic circumstances. Traditional equities can rise in times are represented by the Ibbotson® Long-Term Corporate Bond Index; U.S. Long-Term Gov’t Bonds of increasing rates and in times of decreasing rates. At the risk of repeating are represented by the Ibbotson® U.S. Long-Term Government Bond Index (approximate bond ourselves, it is extremely difficult to predict the direction of the stock maturity 21.5 years); U.S. 30-Day T-Bills are represented by the Ibbotson® U.S. 30-Day T-Bill market based on the gyrations of one single factor. Index; and the value of Cash (devalued by inflation) was calculated using the Ibbotson® U.S. Inflation Index. As inflation concerns have bubbled up in recent months, the Fed has The performance data quoted represents past performance. Past performance is no guarantee of recognized investors’ anxiety around the possibility of higher rates and has future results. Current performance may be lower or higher than the performance data quoted. reassured that any interest rate increases are unlikely before 2023. In his We believe that over the long term, equities will continue to provide the testimony to the House Financial Services panel on 7/14/21, the Fed attractive returns and solid inflation protection they have delivered in the Chairman Jerome Powell also assured investors that there will be ample past. Of course, equities may underperform on occasion, but we do not notice before any slowdown of the quantitative easing program. think it is possible to time the market and avoid such periods consistently. Inflation, or the overall economy for that matter, cannot be managed by a While we believe that the recent increase in inflation will prove mostly template. The best that policymakers can do is be closely aware of a broad transitory, our stock selection and portfolio management processes are not range of factors, developments, and expectations, and actively consider

3 Per the Economic projections of Federal Reserve Board members and Federal Reserve Bank presidents from June 16, 2021.

12 June 30, 2021 Letter from Linda

driven by our views on inflation. We monitor inflation and do deep-dives to strongly believe that our investment strategy and our active portfolio understand the drivers behind it, but we do not have a hard view of where it management style will continue to deliver above-average returns and is headed, nor do we feel a need to have one. substantial inflation protection in the future. We are stock pickers and investors, not economists, and we cannot control inflation and other macroeconomic factors. Our focus remains on the things Sincerely, we can control: investing in companies with attractive long-term growth prospects and valuations, strong management teams, and sustainable competitive advantages. The table below shows Baron’s scorecard over various periods. Our Funds have generated significant positive returns and, with very few exceptions, have outperformed their primary benchmarks over long periods. In addition, Linda S. Martinson during all periods shown in the table, the Baron Funds have provided Chairman, President, and COO substantial returns above the CPI inflation rate, which tends to be higher June 30, 2021 than the PCE inflation rate. Although we cannot provide any guarantees, we

The Baron Funds Have Provided Strong Returns and Inflation Protection Baron Mutual Funds – Absolute and Relative Performance as of 6/30/2021 (Institutional Shares) Fund Total Return Fund Excess Return (annualized) (annualized, vs. Primary Benchmark) 1 3 5 10 20 Since 1 3 5 10 20 Since Asset Class Fund Name Year Years Years Years Years Inception Year Years Years Years Years Inception Baron Growth Fund 46.19% 21.39% 20.92% 14.92% 11.50% 14.24% –5.17% 5.45% 2.16% 1.40% 2.51% 5.02% Small Cap Baron Small Cap Fund 47.60% 20.66% 21.50% 14.20% 11.27% 11.65% –3.76% 4.72% 2.74% 0.68% 2.28% 3.99% Baron Discovery Fund 70.06% 27.97% 30.53% 21.55% 18.70% 12.03% 11.77% 8.32% Small-Mid Cap Baron Focused Growth Fund 95.00% 39.58% 31.55% 18.44% 14.69% 14.48% 45.37% 19.43% 10.87% 3.61% 4.61% 4.89% Mid Cap Baron Asset Fund 36.04% 21.91% 21.70% 15.73% 10.97% 12.56% –7.73% –0.48% 1.18% 0.60% 0.75% 1.37% Baron Fifth Avenue Growth Fund 35.34% 25.94% 27.32% 18.67% 12.25% –7.16% 0.80% 3.66% 0.80% –0.17% Large Cap Baron Durable Advantage Fund 36.55% 21.14% 18.93% –4.24% 2.47% 2.26% Baron Partners Fund 119.55% 47.64% 38.45% 23.88% 16.09% 16.39% 75.78% 25.25% 17.93% 8.75% 5.87% 5.36% All Cap Baron Opportunity Fund 61.18% 38.62% 35.19% 19.39% 14.12% 11.01% 18.19% 14.15% 11.88% 1.85% 4.40% 4.00% Baron Emerging Markets Fund 42.40% 12.76% 12.66% 7.70% 7.24% 1.50% 1.49% –0.37% 3.42% 3.08% International Baron International Growth Fund 44.18% 15.73% 16.50% 9.79% 13.11% 8.46% 6.35% 5.42% 4.34% 4.61% Baron Global Advantage Fund 45.78% 34.78% 33.68% 21.07% 6.52% 20.21% 19.07% 9.97% Baron Real Estate Fund 61.07% 25.42% 20.49% 16.63% 17.44% 16.80% 11.86% 9.01% 4.52% 4.44% Baron Real Estate Income Fund 44.69% 20.18% 17.01% 8.12% 11.35% 9.32% Sector Baron Health Care Fund 46.51% 26.81% 27.14% 17.02% 9.06% 9.16% Baron FinTech Fund 46.93% 42.27% 6.14% 19.24% Fund of Funds Baron WealthBuilder Fund 61.32% 28.45% 26.49% 20.53% 9.78% 9.82%

Other Comparative Benchmarks S&P 500 Index 40.79% 18.67% 17.65% 14.84% 8.61% Equity MSCI EAFE Index 32.35% 8.27% 10.28% 5.89% 5.78% U.S. Long-Term Gov’t Bonds –9.28% 7.65% 2.71% 6.11% 6.56% Fixed Income Long-Term Corp. Bonds (AAA/AA) 0.52% 10.55% 6.07% 7.73% 7.48% U.S. 30-Day T-Bills 0.07% 1.21% 1.06% 0.55% 1.25% S&P GSCI Index 57.37% –2.72% 1.73% –6.48% –1.53% Commodities Gold –0.73% 12.02% 5.94% 1.54% 9.82% Inflation CPI Inflation 5.39% 2.54% 2.43% 1.87% 2.14%

Sources: Morningstar Direct, FactSet, U.S. Bureau of Labor Statistics via the Federal Reserve Bank of St. Louis, Baron Capital. Notes: Excess Returns are calculated versus each Fund’s primary benchmark. Fund Primary Benchmarks: for Baron Growth Fund, Baron Small Cap Fund, and Baron Discovery Fund – Russell 2000 Growth Index; Baron Focused Growth Fund – Russell 2500 Growth Index; Baron Partners Fund and Baron Asset Fund – Russell Midcap Growth Index; Baron Opportunity Fund – Russell 3000 Growth Index; Baron Fifth

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13 Letter from Linda

Avenue Growth Fund – Russell 1000 Growth Index; Baron Durable Advantage Fund, Baron WealthBuilder Fund, and Baron FinTech Fund – S&P 500 Index; Baron Emerging Markets Fund – MSCI EM Index; Baron International Growth Fund – MSCI ACWI ex USA Index; Baron Global Advantage Fund – MSCI ACWI Index; Baron Real Estate Fund – MSCI USA IMI Extended Real Estate Index; Baron Real Estate Income Fund – MSCI US REIT Index; Baron Health Care Fund – Russell 3000 Health Care Index. Fund Inception Dates: Baron Growth Fund – 12/31/1994; Baron Small Cap Fund – 9/30/1997; Baron Discovery Fund – 9/30/2013; Baron Asset Fund – 6/12/1987; Baron Focused Growth Fund – 5/31/1996; Baron Partners Fund – 1/31/1992; Baron Opportunity Fund – 2/29/2000; Baron Fifth Avenue Growth Fund – 4/30/2004; Baron Durable Advantage Fund – 12/29/2017; Baron Emerging Markets Fund – 12/31/2010; Baron International Growth Fund – 12/31/2008; Baron Global Advantage Fund – 4/30/2012; Baron Real Estate Fund – 12/31/2009; Baron Real Estate Income Fund – 12/29/2017; Baron Health Care Fund – 4/30/2018; Baron FinTech Fund – 12/31/2019, Baron WealthBuilder Fund – 12/29/2017. U.S. Long-Term Gov’t Bonds are represented by the Ibbotson® U.S. Long-Term Government Bond Index (approximate bond maturity 21.5 years); Long-Term Corporate Bonds are represented by the Ibbotson® Long-Term Corporate Bond Index; U.S. 30-Day T-Bills are represented by the Ibbotson® U.S. 30-Day T-Bill Index; and Gold is represented by the London Bullion Market Gold Fixing Price per Troy Ounce in USD. Annual expense Ratios for Inst. shares as of 9/30/2020: Baron Asset Fund, 1.05%, Baron Growth Fund, 1.04%, Baron Small Cap Fund, 1.05%, Baron Opportunity Fund, 1.08%, Baron Fifth Avenue Growth Fund, 0.78%, but the net annual expense ratio was 0.75% (net of the Adviser’s fee waivers), Baron Discovery Fund, 1.08%, Baron Durable Advantage Fund, 2.40% but the net annual expense ratio was 0.70% (net of the Adviser’s fee waivers). Annual expense Ratios for Inst. shares as of 12/31/2020: Baron Partners Fund, 1.30% (comprised of operating expense of 1.05% and interest expense of 0.25%), Baron Focused Growth Fund, 1.07%, Baron International Growth Fund, 1.01%, but the net annual expense ratio was 0.95% (net of the Adviser’s fee waivers), Baron Real Estate Fund, 1.08%, Baron Emerging Markets Fund, 1.09%, Baron Global Advantage Fund, 0.92%, but the net annual expense ratio was 0.90% (net of the Adviser’s fee waivers), Baron Real Estate Income Fund, 3.45%, but the net annual expense ratio was 0.80% (net of the Adviser’s fee waivers), Baron Health Care Fund, 1.45%, but the net annual expense ratio was 0.85% (net of the Adviser’s fee waivers), Baron FinTech Fund, 2.43%, but the net annual expense ratio was 0.95% (net of the Adviser’s fee waivers), and Baron WealthBuilder Fund, 1.22%, but the net annual expense ratio was 1.11% (includes acquired fund fees and expenses of 1.06%, net of the Adviser’s fee waivers). The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original cost. The Adviser reimburses certain Baron Fund expenses pursuant to a contract expiring on August 29, 2031, unless renewed for another 11-year term and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted. For performance information current to the most recent month end, visit www.BaronFunds.com or call 1-800-99BARON. Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectuses contain this and other information about the Funds. You may obtain them from the Funds’ distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing. Performance for the Institutional Shares prior to 5/29/2009 is based on the performance of the Retail Shares, which have a distribution fee. The Institutional Shares do not have a distribution fee. If the annual returns for the Institutional Shares prior to 5/29/2009 did not reflect this fee, the returns would be higher. Discovery Fund’s 2Q 2021, YTD, 1-, 3- and 5-year, Global Advantage Fund’s YTD, 1-, 3- and 5-year, Opportunity Fund’s 3-, 5- and 10-year, and Real Estate Fund’s 2Q 2021 historical performance were impacted by gains from IPOs and there is no guarantee that these results can be repeated or that the Funds’ level of participation in IPOs will be the same in the future. Risks: All investments are subject to risk and may lose value. There is no guarantee that the objectives discussed will be met. The discussion of market trends is not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed in this document reflect those of the respective writer. Some of our comments are based on management expectations and are considered “forward-looking statements.” Actual future results, however, may prove to be different from our expectations. Our views are a reflection of our best judgment at the time and are subject to change at any time based on market and other conditions and Baron has no obligation to update them. The S&P 500 Index measures the performance of 500 widely held large-cap U.S. companies. The Russell 1000® Growth Index measures the performance of large-sized U.S. companies that are classified as growth. The Russell 2500® Growth Index measures the performance of small to medium-sized U.S. companies that are classified as growth. The Russell 2000® Growth Index measures the performance of small-sized U.S. companies that are classified as growth. The Russell Midcap® Growth Index measures the performance of medium-sized U.S. companies that are classified as growth. The Russell 3000® Index measures the performance of the broad segment of the U.S. equity universe comprised of the largest 3000 U.S. companies representing approximately 98% of the investable U.S. equity market. The Russell 3000® Growth Index measures the performance of the broad growth segment of the U.S. equity universe comprised of the largest 3000 U.S. companies representing approximately 98% of the investable U.S. equity market. The Russell 3000® Health Care Index is an unmanaged index representative of companies involved in medical services or health care in the Russell 3000 Index, which is comprised of the 3,000 largest U.S. companies as determined by total market capitalization. The MSCI ACWI Index measures the equity market performance of large and midcap securities across developed and emerging markets, including the United States. The MSCI ACWI ex USA Index captures large and mid cap representation across 22 of 23 Developed Markets countries (excluding the US) and 26 Emerging Markets countries. The MSCI Emerging Markets Index is an unmanaged float-adjusted market capitalization index designed to measure equity market performance of large and mid cap securities in the emerging markets. The MSCI USA IMI Extended Real Estate Index is a custom index calculated by MSCI for, and as requested by, BAMCO, Inc. The index includes real estate and real estate related GICS classification securities. MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indexes or any securities or financial products. This report is not approved, reviewed or produced by MSCI. The MSCI US REIT Index is a free float- adjusted market capitalization index that measures the performance of all equity REITs in the US equity market, except for specialty equity REITs that do not generate a majority of their revenue and income from real estate rental and leasing operations. Russell Investment Group is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. Russell is a trademark of Russell Investment Group. MSCI is the source and owner of the trademarks, service marks and copyrights related to the MSCI Indexes. MSCI is a trademark of Russell Investment Group. The indexes and the Funds include reinvestment of dividends, net of withholding taxes, which positively impact the performance results. The indexes are unmanaged. Index performance is not Fund performance; one cannot invest directly into an index. BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a limited purpose broker-dealer registered with the SEC and member of the Financial Industry Regulatory Authority, Inc. (FINRA).

14 Baron Funds Performance Baron Asset Fund Comparison of the change in value of $10,000 investment in Baron Asset Fund (Institutional Shares)† in relation to the Russell Midcap Growth Index and the S&P 500 Index

$600,000 $561,374 $500,000

$400,000 $367,996 $300,000 $301,598

$200,000

$100,000

$0 6/12/87 12/88 12/91 12/94 12/97 12/00 12/03 12/06 12/09 12/12 12/15 12/18 6/21 Baron Asset Fund1,4 Russell Midcap Growth Index1 S&P 500 Index1 Baron Asset Fund’s annualized returns as of June 30, 2021: 3-month, 10.03%; 1-year, 36.04%; 3-year, 21.91%; 5-year, 21.70%; 10-year, 15.73%; and Since Inception, 12.56%.

Baron Growth Fund Comparison of the change in value of $10,000 investment in Baron Growth Fund (Institutional Shares)† in relation to the Russell 2000 Growth Index and the S&P 500 Index

$350,000 $340,433 $300,000

$250,000

$200,000

$150,000 $155,336

$100,000 $103,513

$50,000

$0 12/31/94 12/97 12/00 12/03 12/06 12/09 12/12 12/15 12/18 6/21 Baron Growth Fund2,4 Russell 2000 Growth Index2 S&P 500 Index2 Baron Growth Fund’s annualized returns as of June 30, 2021: 3-month, 7.80%; 1-year, 46.19%; 3-year, 21.39%; 5-year, 20.92%; 10-year, 14.92%; and Since Inception, 14.24%.

Baron Small Cap Fund Comparison of the change in value of $10,000 investment in Baron Small Cap Fund (Institutional Shares)† in relation to the Russell 2000 Growth Index and the S&P 500 Index

$140,000 $136,877 $120,000

$100,000

$80,000 $70,830 $60,000 $57,707

$40,000

$20,000

$0 9/30/97 12/98 12/01 12/04 12/07 12/10 12/13 12/16 12/19 6/21

Baron Small Cap Fund3,4 Russell 2000 Growth Index3 S&P 500 Index3 Baron Small Cap Fund’s annualized returns as of June 30, 2021: 3-month, 6.37%; 1-year, 47.60%; 3-year, 20.66%; 5-year, 21.50%; 10-year, 14.20%; and Since Inception, 11.65%.

1 The Russell Midcap® Growth Index measures the performance of medium-sized U.S. companies that are classified as growth and the S&P 500 Index of 500 widely held large cap U.S. companies. The indexes and Baron Asset Fund are with dividends, which positively impact the performance results. The indexes are unmanaged. 2 The Russell 2000® Growth Index measures the performance of small-sized U.S. companies that are classified as growth and the S&P 500 Index of 500 widely held large cap U.S. companies. The indexes and Baron Growth Fund are with dividends, which positively impact the performance results. The indexes are unmanaged. 3 The Russell 2000® Growth Index measures the performance of small-sized U.S. companies that are classified as growth and the S&P 500 Index of 500 widely held large cap U.S. companies. The indexes and Baron Small Cap Fund are with dividends, which positively impact the performance results. The indexes are unmanaged. 4 Past performance is not predictive of future performance. The performance data does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemptions of Fund shares. † Performance for the Institutional Shares prior to May 29, 2009 is based on the performance of the Retail Shares, which have a distribution fee. The Institutional Shares do not have a distribution fee. If the annual returns for the Institutional Shares prior to May 29, 2009 did not reflect this fee, the returns would be higher.

15 Baron Funds Performance Baron Opportunity Fund Comparison of the change in value of $10,000 investment in Baron Opportunity Fund (Institutional Shares)† in relation to the Russell 3000 Growth Index and the S&P 500 Index $100,000 $92,838

$80,000

$60,000

$47,480 $40,000 $42,395

$20,000

$0 2/29/00 12/0012/02 12/04 12/06 12/08 12/10 12/12 12/14 12/16 12/1812/20 6/21 Baron Opportunity Fund1,4 Russell 3000 Growth Index1 S&P 500 Index1 Baron Opportunity Fund’s annualized returns as of June 30, 2021: 3-month, 10.14%; 1-year, 61.18%; 3-year, 38.62%; 5-year, 35.19%; 10-year, 19.39%; and Since Inception, 11.01%. Baron Partners Fund Comparison of the change in value of $10,000 investment in Baron Partners Fund (Institutional Shares)† in relation to the Russell Midcap Growth Index and the S&P 500 Index $900,000 $869,465 $800,000 $700,000 $600,000 $500,000 $400,000 $300,000 $216,908 $200,000 $189,991 $100,000 $0 1/31/92 12/94 12/97 12/00 12/03 12/06 12/09 12/12 12/15 12/18 6/21 Baron Partners Fund2,4,5 Russell Midcap Growth Index2 S&P 500 Index2 Baron Partners Fund’s annualized returns as of June 30, 2021: 3-month, 4.83%; 1-year, 119.55%; 3-year, 47.64%; 5-year, 38.45%; 10-year, 23.88%; and Since Inception, 16.39%. Baron Fifth Avenue Growth Fund Comparison of the change in value of $10,000 investment in Baron Fifth Avenue Growth Fund (Institutional Shares)† in relation to the Russell 1000 Growth Index and the S&P 500 Index $80,000 $74,665 $70,000 $72,750 $60,000 $55,049 $50,000 $40,000 $30,000 $20,000 $10,000 $0 4/30/04 12/04 12/06 12/08 12/10 12/12 12/14 12/16 12/18 12/20 6/21 Baron Fifth Avenue Growth Fund3,4 Russell 1000 Growth Index3 S&P 500 Index3 Baron Fifth Avenue Growth Fund’s annualized returns as of June 30, 2021: 3-month, 13.82%; 1-year, 35.34%; 3-year, 25.94%; 5-year, 27.32%; 10-year, 18.67%; and Since Inception, 12.25%.

1 The Russell 3000® Growth Index measures the performance of those companies classified as growth among the largest 3,000 U.S. companies and the S&P 500 Index of 500 widely held large cap U.S. companies. The indexes and Baron Opportunity Fund are with dividends, which positively impact the performance results. The indexes are unmanaged. The Fund’s 3-, 5-, and 10-year historical performance was impacted by gains from IPOs and there is no guarantee that these results can be repeated or that the Fund’s level of participation in IPOs will be the same in the future. 2 The Russell Midcap® Growth Index measures the performance of medium-sized U.S. companies that are classified as growth and the S&P 500 Index of 500 widely held large cap U.S. companies. The indexes and Baron Partners Fund are with dividends, which positively impact the performance results. The indexes are unmanaged. 3 The Russell 1000® Growth Index measures the performance of large-sized U.S. companies that are classified as growth and the S&P 500 Index of 500 widely held large cap U.S. companies. The indexes and Baron Fifth Avenue Growth Fund are with dividends, which positively impact the performance results. The indexes are unmanaged. 4 Past performance is not predictive of future performance. The performance data does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. 5 Reflects the actual fees and expenses that were charged when the Fund was a partnership. The predecessor partnership charged a 20% performance fee after reaching a certain performance benchmark. If the annual returns for the Fund did not reflect the performance fees for the years the predecessor partnership charged a performance fee, returns would be higher. The Fund’s shareholders will not be charged a performance fee. The predecessor partnership’s performance is only for periods before the Fund’s registration statement was effective, which was April 30, 2003. During those periods, the predecessor partnership was not registered under the Investment Company Act of 1940 and was not subject to its requirements or the requirements of the Internal Revenue Code relating to registered investment companies, which, if it were, might have adversely affected its performance. † Performance for the Institutional Shares prior to May 29, 2009 is based on the performance of the Retail Shares, which have a distribution fee. The Institutional Shares do not have a distribution fee. If the annual returns for the Institutional Shares prior to May 29, 2009 did not reflect this fee, the returns would be higher.

16 Baron Funds Performance Baron Focused Growth Fund Comparison of the change in value of $10,000 investment in Baron Focused Growth Fund (Institutional Shares)† in relation to the Russell 2500 Growth Index and the S&P 500 Index

$300,000 $297,048

$250,000

$200,000

$150,000

$102,945 $100,000 $99,429

$50,000

$0 5/31/96 12/97 12/00 12/03 12/06 12/09 12/12 12/15 12/18 6/21 Baron Focused Growth Fund1,4,5 Russell 2500 Growth Index1 S&P 500 Index1 Baron Focused Growth Fund’s annualized returns as of June 30, 2021: 3-month, 2.42%; 1-year, 95.00%; 3-year, 39.58%; 5-year, 31.55%; 10-year, 18.44%; and Since Inception, 14.48%. Baron International Growth Fund Comparison of the change in value of $10,000 investment in Baron International Growth Fund (Institutional Shares)† in relation to the MSCI ACWI ex USA Index and the MSCI ACWI ex USA IMI Growth Index

$50,000 $46,661 $45,000 $40,000 $35,000 $34,198 $30,000 $27,740 $25,000 $20,000 $15,000 $10,000 $5,000 $0 12/31/0812/10 12/12 12/14 12/16 12/18 12/20 6/21 Baron International Growth Fund2,5 MSCI ACWI ex USA Index2 MSCI ACWI ex USA IMI Growth Index2 Baron International Growth Fund’s annualized returns as of June 30, 2021: 3-month, 8.51%; 1-year, 44.18%; 3-year, 15.73%; 5-year, 16.50%; 10-year, 9.79%; and Since Inception, 13.11%. Baron Real Estate Fund Comparison of the change in value of $10,000 investment in Baron Real Estate Fund (Institutional Shares) in relation to the MSCI USA IMI Extended Real Estate Index and MSCI US REIT Index

$70,000 $63,545 $60,000

$50,000

$40,000 $40,780

$30,000 $30,249

$20,000

$10,000

$0 12/31/09 12/11 12/13 12/15 12/17 12/19 6/21 Baron Real Estate Fund3,5 MSCI USA IMI Extended Real Estate Index3 MSCI US REIT Index3 Baron Real Estate Fund’s annualized returns as of June 30, 2021: 3-month, 4.65%; 1-year, 61.07%; 3-year, 25.42%; 5-year, 20.49%; 10-year, 16.63%; and Since Inception, 17.44%.

1 The Russell 2500™ Growth Index measures the performance of small- to medium-sized U.S. companies that are classified as growth and the S&P 500 Index of 500 widely held large-cap U.S. companies. The indexes and Baron Focused Growth Fund are with dividends, which positively impact the performance results. The indexes are unmanaged. 2 The MSCI ACWI ex USA Index Net USD is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of large- and mid-cap securities across developed and emerging markets, excluding the United States. The MSCI ACWI ex USA IMI Growth Index Net USD is a free float-adjusted market capitalization weighted index that is designed to measure the performance of large-, mid-, and small-cap growth securities across developed and emerging markets, excluding the United States. MSCI is the source and owner of the trademarks, service marks and copyrights related to the MSCI Indexes. The indexes and Baron International Growth Fund include reinvestment of dividends, net of foreign withholding taxes, which positively impact the performance results. The indexes are unmanaged. 3 The MSCI USA IMI Extended Real Estate Index is a custom index calculated by MSCI for, and as requested by, BAMCO, Inc. The index includes real estate and real estate-related GICS classification securities. MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indexes or any securities or financial products. This report is not approved, reviewed or produced by MSCI. The MSCI US REIT Index is a free float- adjusted market capitalization index that measures the performance of all equity REITs in the US equity market, except for specialty equity REITs that do not generate a majority of their revenue and income from real estate rental and leasing operations. MSCI is the source and owner of the trademarks, service marks and copyrights related to the MSCI Indexes. The indexes and Baron Real Estate Fund are with dividends, which positively impact performance results. The indexes are unmanaged. The Fund’s 3-month historical performance was impacted by gains from IPOs, and there is no guarantee that these results can be repeated or that the Fund’s level of participation in IPOs will be the same in the future. 4 Reflects the actual fees and expenses that were charged when the Fund was a partnership. The predecessor partnership charged a 15% performance fee through 2003 after reaching a certain performance benchmark. If the annual returns for the Fund did not reflect the performance fees for the years the predecessor partnership charged a performance fee, the returns would be higher. The Fund’s shareholders will not be charged a performance fee. The predecessor partnership’s performance is only for the periods before the Fund’s registration statement was effective, which was June 30, 2008. During those periods, the predecessor partnership was not registered under the Investment Company Act of 1940 and was not subject to its requirements or the requirements of the Internal Revenue Code relating to registered investment companies, which, if it were, might have adversely affected its performance. 5 Past performance is not predictive of future performance. The performance data does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. † Performance for the Institutional Shares prior to May 29, 2009 is based on the performance of the Retail Shares, which have a distribution fee. The Institutional Shares do not have a distribution fee. If the annual returns for the Institutional Shares prior to May 29, 2009 did not reflect this fee, the returns would be higher.

17 Baron Funds Performance Baron Emerging Markets Fund Comparison of the change in value of $10,000 investment in Baron Emerging Markets Fund (Institutional Shares) in relation to the MSCI EM Index and the MSCI EM IMI Growth Index

$25,000

$20,842 $20,000 $18,567

$15,000 $15,345

$10,000

$5,000

$0 12/31/10 12/1112/12 12/13 12/14 12/15 12/16 12/17 12/18 12/19 12/20 6/21 Baron Emerging Markets Fund1,3 MSCI EM Index1 MSCI EM IMI Growth Index1 Baron Emerging Markets Fund’s annualized returns as of June 30, 2021: 3-month, 4.83%; 1-year, 42.40%; 3-year, 12.76%; 5-year, 12.66%; 10-year, 7.70%; and Since Inception, 7.24%.

Baron Global Advantage Fund Comparison of the change in value of $10,000 investment in Baron Global Advantage Fund (Institutional Shares) in relation to the MSCI ACWI Index and the MSCI ACWI Growth Index

$60,000 $57,678

$50,000

$40,000 $32,927 $30,000 $26,254 $20,000

$10,000

$0 4/30/12 12/12 12/13 12/14 12/15 12/16 12/17 12/18 12/19 12/20 6/21

Baron Global Advantage Fund2,3 MSCI ACWI Index2 MSCI ACWI Growth Index2 Baron Global Advantage Fund’s annualized returns as of June 30, 2021: 3-month, 11.91%; 1-year, 45.78%; 3-year, 34.78%; 5-year, 33.68%; and Since Inception, 21.07%.

1 The MSCI EM (Emerging Markets) Index and the MSCI EM (Emerging Markets) IMI Growth Index are free float-adjusted market capitalization weighted indexes. The MSCI EM (Emerging Markets) Index Net USD and the MSCI EM (Emerging Markets) IMI Growth Index Net USD are designed to measure the equity market performance of large-, mid-, and small-cap securities in the emerging markets. The MSCI EM (Emerging Markets) IMI Growth Index Net USD screens for growth-style securities. MSCI is the source and owner of the trademarks, service marks and copyrights related to the MSCI Indexes. The indexes and Baron Emerging Markets Fund include reinvestment of dividends, net of withholding taxes, which positively impact the performance results. The indexes are unmanaged. 2 The MSCI ACWI Index and the MSCI ACWI Growth Index are free float-adjusted market capitalization weighted indexes. The MSCI ACWI Index Net USD and the MSCI ACWI Growth Index Net USD are designed to measure the equity market performance of large- and mid-cap securities across developed and emerging markets, including the United States. The MSCI ACWI Growth Index Net USD screens for growth-style securities. MSCI is the source and owner of the trademarks, service marks and copyrights related to the MSCI Indexes. The indexes and Baron Global Advantage Fund include reinvestment of dividends, net of foreign withholding taxes, which positively impact the performance results. The indexes are unmanaged. The Fund’s 1-, 3- and 5-year historical performance was impacted by gains from IPOs and there is no guarantee that these results can be repeated or that the Fund’s level of participation in IPOs will be the same in the future. 3 Past performance is not predictive of future performance. The performance data does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares.

18 Baron Funds Performance Baron Discovery Fund Comparison of the change in value of $10,000 investment in Baron Discovery Fund (Institutional Shares) in relation to the Russell 2000 Growth Index and the S&P 500 Index

$50,000 $45,373

$40,000

$30,000 $29,807 $26,194

$20,000

$10,000

$0 9/30/13 12/13 12/14 12/15 12/16 12/17 12/18 12/19 12/20 6/21 Baron Discovery Fund1,4 Russell 2000 Growth Index1 S&P 500 Index1 Baron Discovery Fund’s annualized returns as of June 30, 2021: 3-month, 6.07%; 1-year, 70.06%; 3-year, 27.97%; 5-year, 30.53%; and Since Inception, 21.55%.

Baron Durable Advantage Fund Comparison of the change in value of $10,000 investment in Baron Durable Advantage Fund (Institutional Shares) in relation to the S&P 500 Index

$20,000 $18,347 $17,156 $15,000

$10,000

$5,000

$0 12/29/17 3/18 6/18 9/18 12/18 3/19 6/19 9/19 12/19 3/20 6/20 9/20 12/20 3/21 6/21 Baron Durable Advantage Fund2,4 S&P 500 Index2 Baron Durable Advantage Fund’s annualized returns as of June 30, 2021: 3-month, 13.14%; 1-year, 36.55%; 3-year, 21.14%; and Since Inception, 18.93%.

Baron Real Estate Income Fund Comparison of the change in value of $10,000 investment in Baron Real Estate Income Fund (Institutional Shares) in relation to the MSCI US REIT Index

$20,000

$17,330

$15,000 $12,960

$10,000

$5,000

$0 12/29/17 3/18 6/18 9/1812/18 3/19 6/19 9/19 12/19 3/20 6/20 9/20 12/20 3/21 6/21 Baron Real Estate Income Fund3,4 MSCI US REIT Index3 Baron Real Estate Income Fund’s annualized returns as of June 30, 2021: 3-month, 8.42%; 1-year, 44.69%; 3-year, 20.18%; and Since Inception, 17.01%.

1 The Russell 2000® Growth Index measures the performance of small-sized U.S. companies that are classified as growth and the S&P 500 Index of 500 widely held large cap U.S. companies. The indexes and Baron Discovery Fund are with dividends, which positively impact the performance results. The indexes are unmanaged. The Fund’s 3-month, 1-, 3-, and 5-year historical performance was impacted by gains from IPOs and there is no guarantee that these results can be repeated or that the Fund’s level of participation in IPOs will be the same in the future. 2 The S&P 500 Index measures the performance of 500 widely held large cap U.S. companies. The index and Baron Durable Advantage Fund are with dividends, which positively impact the performance results. The index is unmanaged. 3 The MSCI US REIT Index is a free float-adjusted market capitalization index that measures the performance of all equity REITs in the US equity market, except for specialty equity REITs that do not generate a majority of their revenue and income from real estate rental and leasing operations. MSCI is the source and owner of the trademarks, service marks and copyrights related to the MSCI Indexes. The index and Baron Real Estate Income Fund include reinvestment of interest, capital gains and dividends, which positively impact the performance results. The index performance is not Fund performance; one cannot invest directly into an index. The index is unmanaged. 4 Past performance is not predictive of future performance. The performance data does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares.

19 Baron Funds Performance Baron WealthBuilder Fund Comparison of the change in value of $10,000 investment in Baron WealthBuilder Fund (Institutional Shares) in relation to the S&P 500 Index and the MSCI ACWI Index

$25,000 $22,764 $20,000

$17,156 $15,000 $14,972

$10,000

$5,000

$0 12/29/17 3/18 6/189/18 12/18 3/19 6/19 9/19 12/19 3/20 6/20 9/20 12/20 3/21 6/21 Baron WealthBuilder Fund1,3 S&P 500 Index1 MSCI ACWI Index1 Baron WealthBuilder Fund’s annualized returns as of June 30, 2021: 3-month, 8.02%; 1-year, 61.32%; 3-year, 28.45%; and Since Inception, 26.49%.

Baron Health Care Fund Comparison of the change in value of $10,000 investment in Baron Health Care Fund (Institutional Shares) in relation to the Russell 3000 Health Care Index and the S&P 500 Index

$25,000

$21,390 $20,000 $17,221 $16,880 $15,000

$10,000

$5,000

$0 4/30/18 6/18 9/18 12/18 3/196/19 9/19 12/19 3/20 6/20 9/20 12/20 3/21 6/21 Baron Health Care Fund 2,3 Russell 3000 Health Care Index 2 S&P 500 Index2 Baron Health Care Fund’s annualized returns as of June 30, 2021: 3-month, 11.43%; 1-year, 46.51%; 3-year 26.81%; and Since Inception, 27.14%.

1 The S&P 500 Index measures the performance of 500 widely held large cap U.S. companies. The MSCI ACWI Index is an unmanaged, free float-adjusted market capitalization weighted index reflected in US dollars that measures the equity market performance of large- and mid-cap securities across developed and emerging markets, including the United States. MSCI is the source and owner of the trademarks, service marks and copyrights related to the MSCI Indexes. The indexes and Baron WealthBuilder Fund are with dividends, which positively impact the performance results. The MSCI ACWI Index is net of foreign withholding taxes. The indexes are unmanaged. 2 The Russell 3000® Health Care Index is a free float-adjusted market capitalization index that measures the performance of all equity in the US equity market. The S&P 500 Index measures the performance of 500 widely held large-cap U.S. companies. The indexes and Baron Health Care Fund are with dividends, which positively impact the performance results. The indexes are unmanaged. 3 Past performance is not predictive of future performance. The performance data does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares.

20 Baron Funds Performance Baron FinTech Fund Comparison of the change in value of $10,000 investment in Baron FinTech Fund (Institutional Shares) in relation to the S&P 500 Index and the FactSet Global FinTech Index

$20,000

$16,970

$15,000 $14,600 $13,646

$10,000

$5,000

$0 12/31/19 3/20 6/20 9/20 12/20 3/21 6/21 Baron FinTech Fund1,2 S&P 500 Index1 FactSet Global FinTech Index1 Baron FinTech Fund’s returns as of June 30, 2021: 3-month, 16.79%; 1-year, 46.93%; and Since Inception, 42.27%.

1 The S&P 500 Index measures the performance of 500 widely held large-cap U.S. companies. The FactSet Global Fintech Index is an unmanaged and equal-weighted index that measures the equity market performance of companies engaged in Financial Technologies, primarily in the areas of software and consulting, data and analytics, digital payment processing, money transfer, and payment transaction-related hardware, across 30 developed and emerging markets. The indexes and Baron FinTech Fund are with dividends, which positively impact the performance results. The indexes are unmanaged. 2 Past performance is not predictive of future performance. The performance data does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares.

Russell Investment Group is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. Russell is a trademark of Russell Investment Group. 3-month returns for all funds are not annualized. Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectuses contain this and other information about the Funds. You may obtain them from the Funds’ distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing. The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original cost. The Adviser reimburses certain Fund expenses pursuant to a contract expiring on August 29, 2031, unless renewed for another 11-year term, and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted. For performance information current to the most recent month end, visit www.BaronFunds.com or call 1-800-99BARON Risks: The Funds invest primarily in equity securities, which are subject to price fluctuations in the stock market. Non-U.S. investments may involve additional risks to those inherent in U.S. investments, including exchange-rate fluctuations, political or economic instability, the imposition of exchange controls, expropriation, limited disclosure and illiquid markets. This may result in greater share price volatility. Investments in developing countries may have increased risks due to a greater possibility of: settlement delays; currency and capital controls; interest rate sensitivity; corruption and crime; exchange rate volatility; and inflation or deflation. Investments in health care companies are subject to a number of risks, including the adverse impact of legislative actions and government regulations. Securities issued by small and medium sized companies may be thinly traded and may be more difficult to sell during market downturns. Companies propelled by innovation, including technology advances and new business models, may present the risk of rapid change and product obsolescence, and their success may be difficult to predict for the long term. In addition to general market conditions, the value of the real estate and real estate related investments will be affected by the strength of the real estate markets as well as by interest rate fluctuations, credit risk, environmental issues and economic conditions. Even though the Funds are diversified, they may establish significant positions where the Adviser has the greatest conviction. This could increase volatility of the Funds’ returns. The index performance is not Fund performance; one cannot invest directly into an index. BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a limited purpose broker-dealer registered with the SEC and member of the Financial Industry Regulatory Authority, Inc. (FINRA).

21 Baron Asset Fund

DEAR BARON ASSET FUND SHAREHOLDER: PERFORMANCE

U.S. equities moved higher during the quarter in response to various factors, including robust macroeconomic data, ongoing fiscal stimulus, strong corporate earnings, and continued reductions in COVID infection rates. The outlook for inflation remained uncertain, and was an important factor influencing investors’ shifting preferences for growth versus value stocks during the quarter. Real Estate, Information Technology (“IT”), Energy, and Communication Services led the market higher in the period, while the Utilities, Consumer Staples, Industrials, Materials, and Consumer Discretionary sectors underperformed. Against this backdrop, Baron Asset Fund (the “Fund”) increased 10.03% (Institutional Shares), while the Russell Midcap Growth Index (the “Index”) increased 11.07%, and the S&P 500 Index gained 8.55%.

Table I. Performance Annualized for periods ended June 30, 2021 ANDREW PECK Retail Shares: BARAX Baron Baron Institutional Shares: BARIX Asset Asset Russell PORTFOLIO MANAGER R6 Shares: BARUX Fund Fund Midcap S&P Retail Institutional Growth 500 Shares1,2 Shares1,2,3 Index1 Index1 Three Months5 9.95% 10.03% 11.07% 8.55% raising full-year guidance. Within Materials, lower exposure to this lagging Six Months5 8.76% 8.90% 10.44% 15.25% sector and outperformance of cleaning and hygiene solutions provider One Year 35.68% 36.04% 43.77% 40.79% Diversey Holdings, Ltd. lifted relative results. Diversey reported solid Three Years 21.59% 21.91% 22.39% 18.67% quarterly results in its first earnings release since becoming a publicly traded Five Years 21.37% 21.70% 20.52% 17.65% company, with upside coming from market share gains in the Institutional Ten Years 15.42% 15.73% 15.13% 14.84% segment and strong pricing and cost management. Fifteen Years 11.45% 11.69% 12.10% 10.73% Since Inception Underperformance of investments in Communication Services, Industrials, (June 12, 1987) 12.45% 12.56% 11.19%4 10.52% and Financials detracted the most from relative results. Weakness in Communication Services came from online travel company Tripadvisor, Health Care and Materials investments and lack of exposure to the Inc. and real estate and rental marketplace Zillow Group, Inc., which were underperforming Consumer Staples sector added the most value. Favorable among the top detractors on an absolute basis. Tripadvisor’s shares were stock selection in Health Care was driven by IDEXX Laboratories, Inc., the pressured by news that competitor Expedia will expand its current rewards global leader in veterinary diagnostics, software, and water microbiology program to compete more aggressively with the company’s new Tripadvisor testing. IDEXX was the largest contributor as veterinary visits continued Plus subscription offering. Zillow’s stock price declined after second quarter their recovery from pandemic lows, leading to double-digit growth in revenue guidance came in slightly below Street expectations. Investor veterinary practice revenues. Weighing instruments provider Mettler- concerns about the potential impact of rising interest rates on the housing Toledo International, Inc., pharmaceutical packaging manufacturer West market also weighed on the company’s shares. Negative stock selection in Pharmaceutical Services, Inc., and DNA sequencing platform Illumina, Inc. Industrials was driven by data and analytics vendor Verisk Analytics, Inc., also performed well after reporting strong quarterly financial results and whose shares fell after the company’s quarterly financial results came in

Performance listed in the above table is net of annual operating expenses. Annual expense ratio for the Retail Shares and Institutional Shares as of September 30, 2020 was 1.31% and 1.05%, respectively. The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original cost. The Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted. For performance information current to the most recent month end, visit www.BaronFunds.com or call 1-800-99BARON. 1 The Russell Midcap® Growth Index measures the performance of medium-sized U.S. companies that are classified as growth and the S&P 500 Index of 500 widely held large cap U.S. companies. Russell Investment Group is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. Russell is a trademark of Russell Investment Group. The index and the Fund include reinvestment of dividends, net of withholding taxes, which positively impact the performance results. The indexes are unmanaged. The index performance is not Fund performance; one cannot invest directly into an index. 2 The performance data in the table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. 3 Performance for the Institutional Shares prior to May 29, 2009 is based on the performance of the Retail Shares, which have a distribution fee. The Institutional Shares do not have a distribution fee. If the annual returns for the Institutional Shares prior to May 29, 2009 did not reflect this fee, the returns would be higher. 4 BARON For the period June 30, 1987 to June 30, 2021. FUNDS 5 Not annualized.

22 June 30, 2021 Baron Asset Fund

slightly below Street expectations. The company’s core Insurance segment West Pharmaceutical Services, Inc. is a leading provider of components remained strong, but pandemic-related weakness impacted its Energy and and systems for the packaging and delivery of injectable drugs. Shares rose Financial Services segments. Real estate information and marketing services on outstanding first quarter results, highlighted by 31% organic revenue company CoStar Group, Inc. and private rocket and spacecraft growth, driven in part by COVID-19-related sales (mostly stoppers and seals manufacturer Space Exploration Technologies Corp. also hampered for vials of vaccines), but also by strong organic growth in its core packaging performance in the sector. Within Financials, underperformance of business. We continue to believe West can generate durable high single- electronic trading platform MarketAxess Holdings Inc. and specialty digit organic revenue growth, while also expanding its margins by at least insurer Arch Capital Group Ltd. detracted the most from relative results. 100 basis points annually. TransUnion is a consumer credit bureau that businesses rely on to make Table II. credit and marketing decisions. Its shares increased after the company Top contributors to performance for the quarter ended June 30, 2021 reported strong quarterly results and raised full-year guidance. After Year Percent Acquired Impact providing disappointing initial 2021 guidance during the prior quarter, these solid results and improved outlook increased investors’ confidence that the IDEXX Laboratories, Inc. 2006 1.81% company should rebound alongside an improving economy. We continue to Gartner, Inc. 2007 1.60 own the stock because we expect TransUnion to continue gaining market Mettler-Toledo International, Inc. 2008 0.78 share in its core market, while utilizing its expertise in data aggregation and West Pharmaceutical Services, Inc. 2014 0.61 analysis to further diversify into attractive information services vertical TransUnion 2017 0.51 markets. Shares of veterinary diagnostics leader IDEXX Laboratories, Inc. gained after reporting outstanding quarterly results. Total corporate revenues grew Table III. 21%, recurring revenues in its core companion animal segment grew 23%, Top detractors from performance for the quarter ended June 30, 2021 its margins increased more than 800 basis points, and its normalized EPS Year Percent Acquired Impact grew a whopping 80%. The company’s business continued to benefit from an ongoing recovery in veterinary office visits, which drives growth in Tripadvisor, Inc. 2021 –0.36% veterinarians’ expenditures on diagnostic instruments and testing performed Guardant Health, Inc. 2020 –0.18 both in clinics and laboratories. We remain optimistic about IDEXX’s ability Zillow Group, Inc. 2015 –0.17 to continue growing its revenues and profits at elevated rates. MarketAxess Holdings Inc. 2016 –0.14 Bumble Inc. 2021 –0.11 Shares of Gartner, Inc., a leading provider of syndicated research primarily on the IT sector, contributed to performance after reporting financial results Tripadvisor, Inc. is an online travel company, with nearly half a billion significantly better than investor estimates. Growth in the company’s unique monthly visitors, whose core business is hotel metasearch, driven by research business reaccelerated, led by its Global Business Sales segment. its extensive library of hotel reviews. Its shares fell on worries that new We believe this segment will continue to benefit from a multi-year COVID-19 variants would delay the recovery of travel demand. In addition, investment cycle. In addition, Gartner’s Conference segment should investors appeared concerned that the company’s new Tripadvisor Plus eventually benefit from increased corporate travel, now that COVID subscription offering, which launched in June, would face competitive vaccinations are widespread. We expect improved revenue growth and pressures. We do not believe traditional travel loyalty programs will be renewed focus on cost control to drive overall margin expansion and materially competitive with the upfront savings offered by Tripadvisor Plus. enhanced free cash flow generation. The company’s balance sheet is in We also believe that Tripadvisor is well positioned to benefit from inevitable excellent shape, and we expect an acceleration in share repurchases. pent-up consumer demand for travel. Mettler-Toledo International, Inc. is the world’s largest provider of Guardant Health, Inc. offers liquid biopsy tests for advanced stage cancer weighing instruments for use in laboratory, industrial, and food retailing and recurrence monitoring, and it is also developing a test for early cancer applications. Its shares rose on outstanding financial results, highlighted by detection. Shares fell during the quarter as many high-growth companies 18% local currency sales growth, 49% operating profit growth, and 64% EPS sold off. We maintain conviction in our long-term investment thesis, as we growth, as well as an increase in its full-year earnings guidance. We believe believe Guardant is a unique testing company that has the potential to Mettler is an excellent business with meaningful competitive advantages run transform the massive market for cancer care. by skilled operators. We remain optimistic that the company can compound Zillow Group, Inc. operates leading U.S. real estate sites, a mortgage earnings at attractive double-digit rates for years to come. marketplace, and the Zillow Offers home-buying business. Its shares were pressured by rising mortgage rates and concerns over their potential impact on the housing market. In addition, Zillow issued second quarter revenue guidance that was slightly below Street expectations. Despite any macroeconomic uncertainty, we continue to believe that Zillow has substantial upside in all its business segments.

23 Baron Asset Fund

MarketAxess Holdings Inc. operates the leading electronic platform for Recent Activity corporate bond trading. Shares fell because of a slowdown in bond trading activity, particularly against last year’s pandemic-driven spike. Market During the past quarter, the Fund added to 3 positions. The Fund eliminated conditions were unfavorable as a result of lower volatility and narrower 3 positions and reduced its holdings in 17 others. credit spreads. MarketAxess continued to increase its market share, but its Table V. share gains are typically more modest during periods of low market volatility. We continue to believe that MarketAxess will be the prime Top net purchases for the quarter ended June 30, 2021 beneficiary of an ongoing secular shift to electronic trading in the corporate Quarter End Amount Market Cap Purchased bond market. (billions) (millions) Bumble Inc. is an online dating platform geared toward females with more Avalara, Inc. $13.9 $33.5 than 40 million users. Shares declined on its 2021 revenue outlook. Although RingCentral, Inc. 26.4 13.0 this exceeded Street estimates, it was likely not as high as investors may Stitch Fix, Inc. 6.5 11.8 have expected. Some uncertainty around the timing of the recovery in This quarter we meaningfully added to our position in Avalara, Inc.,a in-person dating also pressured shares. We exited our position during the leading cloud-based provider of transactional tax automation software. period. Avalara operates in a large (roughly $15 billion) and relatively untapped market. We believe that the company is well positioned to benefit from Portfolio Structure several underlying secular trends. Following a recent U.S. Supreme Court ruling (Wayfair vs. South Dakota), we expect heightened regulatory scrutiny At June 30, 2021, Baron Asset Fund held 64 positions. The Fund’s 10 largest on whether companies are collecting the appropriate sales taxes in all holdings represented 37.3% of assets, and the 20 largest represented 59.7% jurisdictions in which they operate. The rise of e-commerce, which entails of assets. The Fund’s largest weighting was in the IT sector at 30.6% of sales across state lines, adds further complexity to this challenge. These assets. This sector includes software companies, IT consulting firms, internet trends should encourage the use of software solutions, which are inherently services companies, and data processing firms. The Fund held 26.4% of its more efficient than people-based alternatives, to manage transactional tax assets in the Health Care sector, which includes investments in life sciences calculations, record keeping, and tax filings. companies, and health care equipment, supplies, and technology companies. Avalara is the clear leader for this software among mid-market customers. The Fund held 13.8% of its assets in the Industrials sector, which includes Relative to its competition, we believe the company is distinguished by its investments in research and consulting companies, industrial conglomerates, deep partner integrations, strong brand reputation, deep content database, and machinery companies. The Fund also had significant weightings in native cloud-based technology, and effective sales force. The company is Financials at 10.1% of assets and Consumer Discretionary at 7.0% of assets. operating at near break-even profitability today due to ongoing growth investments. However, we expect to see Avalara meaningfully increase its Table IV. margins and generate substantial free cash flow over the long term. Top 10 holdings as of June 30, 2021 We believe that Avalara is well positioned to grow its revenues by at least Market Quarter 25% to 30% for the next several years. We expect this to be driven by Cap End Quarter End When Market Investment Percent several factors, including the addition of more mid-market customers, Year Acquired Cap Value of Net moving its offerings up-market into enterprise-size customers, international Acquired (billions) (billions) (millions) Assets expansion, deepening its content database, becoming a broader compliance IDEXX Laboratories, Inc. 2006 $2.5 $53.9 $447.5 7.2% platform, and selective acquisitions. We believe that this strong level of Gartner, Inc. 2007 2.9 20.8 362.7 5.8 compounding growth will drive solid returns for the stock over a multi-year Mettler-Toledo period. International, Inc. 2008 2.4 32.2 268.9 4.3 ANSYS, Inc. 2009 2.3 30.2 200.2 3.2 Table VI. Vail Resorts, Inc. 1997 0.2 12.7 191.0 3.1 Top net sales for the quarter ended June 30, 2021 Bio-Techne Corporation 2015 4.0 17.5 180.1 2.9 Amount Sold CoStar Group, Inc. 2016 5.0 32.7 178.5 2.9 (millions) Verisk Analytics, Inc. 2009 4.9 28.3 167.9 2.7 West Pharmaceutical The Toro Company $25.2 IDEXX Laboratories, Inc. 24.4 Services, Inc. 2014 2.9 26.5 161.4 2.6 First Republic Bank 19.2 TransUnion 2017 7.1 21.0 161.3 2.6 Gartner, Inc. 18.7 Willis Towers Watson Public Limited Company 17.4

We reduced our stakes in successful longtime holdings IDEXX Laboratories, Inc. and Gartner, Inc. to raise capital to allocate elsewhere in the Fund. After making a reasonable profit, we sold our stake in The Toro Company over concerns that its recent positive business trends might prove unsustainable. We took some profits in First Republic Bank as its shares benefited from the recent rise in interest rates. We reduced our stake in Willis Towers Watson Public Limited Company given the uncertainty surrounding its pending acquisition by Aon plc.

24 June 30, 2021 Baron Asset Fund

Outlook

We continue to be a long-term investor in businesses that we believe will benefit from long-lived secular growth trends, with sustainable competitive advantages, led by best-in-class management. We remain sensitive to valuation levels, particularly given the ongoing strength in the equity markets and the high near-term valuations accorded to many fast-growing, but speculative, companies. We invest in stocks that we believe, based on our deep fundamental research, will double in value over a five-year period, and all new and existing holdings must meet that objective. Please note that there is no guarantee that this objective will be met. We believe that we have created value for our investors throughout the Fund’s 34-year history by understanding and analyzing businesses better than many others. We do not invest based on our insights into macroeconomic, political, or public health issues. Consistent with that approach, our view about the likely near-term level of inflation does not determine our investment decisions. Similarly, we do not have a Firm view about whether ”growth” or ”value” stocks are likely to lead the market going forward. We continue to adhere to our investment methodology, while trying hard to identify beneficiaries of accelerating changes in technology and consumer preferences, many of which appear to have been permanently impacted by the pandemic. We remain optimistic that this approach will generate strong performance for our portfolio, regardless of the economic climate.

Sincerely,

Andrew Peck Portfolio Manager June 30, 2021

Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectus contain this and other information about the Funds. You may obtain them from its distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing. Risks: The Adviser believes that there is more potential for capital appreciation in mid-sized companies, but there also may be more risk. Specific risks associated with investing in mid-sized companies include that the securities may be thinly traded and they may be more difficult to sell during market downturns. Even though the Fund is diversified, it may establish significant positions where the Adviser has the greatest conviction. This could increase volatility of the Fund’s returns. The Fund may not achieve its objectives. Portfolio holdings are subject to change. Current and future portfolio holdings are subject to risk. The portfolio manager defines “Best-in-class” as well-managed, competitively advantaged, faster growing companies with higher margins and returns on invested capital and lower leverage that are leaders in their respective markets. Note that this statement represents the manager’s opinion and is not based on a third-party ranking. The discussions of the companies herein are not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed in this report reflect those of the respective portfolio managers only through the end of the period stated in this report. The portfolio manager’s views are not intended as recommendations or investment advice to any person reading this report and are subject to change at any time based on market and other conditions and Baron has no obligation to update them. This report does not constitute an offer to sell or a solicitation of any offer to buy securities of Baron Asset Fund by anyone in any jurisdiction where it would be unlawful under the laws of that jurisdiction to make such offer or solicitation. BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a limited purpose broker- dealer registered with the SEC and member of the Financial Industry Regulatory Authority, Inc. (FINRA).

25 Baron Growth Fund

DEAR BARON GROWTH FUND SHAREHOLDER: Performance

Baron Growth Fund (the “Fund”) gained 7.80% (Institutional Shares) during the quarter ended June 30, 2021. This exceeded the Fund’s primary benchmark, the Russell 2000 Growth Index (the “Benchmark”), which gained 3.92%. The S&P 500 Index, which measures the performance of publicly traded large-cap U.S. companies, gained 8.55%. The Fund’s quarterly outperformance was driven by favorable stock selection. This is the goal of our fundamentally driven investment strategy, and where we devote the preponderance of our time and attention. Our investment philosophy has always been underpinned by the view that prices rise inexorably. A belief in the persistency of inflation has heavily influenced the businesses in which we choose to deploy capital. We believe our investments serve large and growing addressable markets, benefit from positive secular trends, boast sustainable barriers to entry, offer high customer value relative to the cost of their products or services, consistently reinvest back into their businesses to drive continuous product improvement, and are run by exceptional entrepreneurial leaders. We NEAL ROSENBERG RONALD BARON Retail Shares: BGRFX believe these attributes endow these businesses with meaningful pricing CO-PORTFOLIO CEO AND LEAD Institutional Shares: BGRIX MANAGER PORTFOLIO MANAGER R6 Shares: BGRUX power, which positions them to prosper as inflation moves higher.

Table I. Domestic investors spent the quarter debating whether the ongoing Performance economic rebound will lead to elevated inflation. As usual, macroeconomic Annualized for periods ended June 30, 2021 results have been opaque, volatile, and inconclusive, enabling central bankers Baron Baron and investors to pick and choose the data that supports their favored Growth Growth Russell conclusion. Visibility has been further clouded by a dispute over the impact Fund Fund 2000 S&P Retail Institutional Growth 500 of generous Federal unemployment benefits on tight labor markets. Interest Shares1,2 Shares1,2,3 Index1 Index1 rates, as measured by the yield on the 10-year U.S. Treasury Bond, fluctuated Three Months4 7.73% 7.80% 3.92% 8.55% as investors struggled to divine the future trajectory of prices and how the Six Months4 8.67% 8.81% 8.98% 15.25% Federal Reserve will set monetary policy in response. One Year 45.81% 46.19% 51.36% 40.79% We do not seek to reposition the portfolio or change our process or strategy Three Years 21.08% 21.39% 15.94% 18.67% based on the market’s mercurial expectations. Instead, we continue to focus Five Years 20.61% 20.92% 18.76% 17.65% on identifying and researching unique businesses with significant barriers to Ten Years 14.63% 14.92% 13.52% 14.84% entry and compelling growth prospects, investing in them at attractive Fifteen Years 11.36% 11.59% 10.89% 10.73% prices, and holding them for the long term. However, we do believe that Since Inception inflation is a persistent and enduring feature of everyday life, regardless of (December 31, 1994) 14.10% 14.24% 9.22% 10.91% when or how it is quantified by macroeconomic metrics such as CPI or PPI.

Performance listed in the above table is net of annual operating expenses. Annual expense ratio for the Retail shares and Institutional shares as of September 30, 2020 was 1.30% and 1.04%, respectively. The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original cost. The Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted. For performance information current to the most recent month end, visit www.BaronFunds.com or call 1-800-99BARON. 1 The Russell 2000® Growth Index measures the performance of small-sized U.S. companies that are classified as growth and the S&P 500 Index of 500 widely held large cap U.S. companies. Russell Investment Group is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. Russell is a trademark of Russell Investment Group. The indexes and the Fund include reinvestment of dividends, net of withholding taxes, which positively impact the performance results. The indexes are unmanaged. Index performance is not Fund performance; one cannot invest directly into an index. 2 The performance data in the table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. 3 Performance for the Institutional Shares prior to May 29, 2009 is based on the performance of the Retail Shares, which have a distribution fee. The Institutional Shares do not have a distribution fee. If the annual returns for the Institutional Shares prior to May 29, 2009 did not reflect this fee, the returns would be higher. BARON FUNDS 4 Not annualized.

26 June 30, 2021 Baron Growth Fund

We believe that all our businesses boast sustainable competitive advantages, %of Total Contribution which helps to insulate them from competitors and enables them to Net Assets Return to Return (as of 6/30/2021) (%) (%) consistently raise prices. Many of our investments have embedded price escalators directly into their contracts with customers. For example, annual FactSet Research Systems, contracts with Gartner, Inc. for syndicated research, CoStar Group, Inc. for Inc. 4.5 9.03 0.37 commercial real estate data, or MSCI, Inc. for benchmarking or analytics Moelis & Company 0.5 8.63 0.04 empowers these companies to pass along annual price increases. Companies Primerica, Inc. 2.8 3.91 0.11 like Bright Horizons Family Solutions, Inc. and Mettler-Toledo SS&C Technologies Holdings, International, Inc. offer such compelling products and services that they Inc. 1.8 3.40 0.08 consistently raise prices without the need for a contract. The increases are Arch Capital Group Ltd. 4.0 1.49 0.07 nominal relative to the value of the services, and capital is reinvested in Kinsale Capital Group, Inc. 1.8 0.05 0.00 R&D, which yields a corresponding improvement to the product. Finally, our Essent Group Ltd. 0.3 –5.01 –0.01 investments in REITs such as Douglas Emmett, Inc., Alexandria Real Disruptive Growth 14.3 4.39 0.66 Estate Equities, Inc., and American Assets Trust, Inc. boast unique, Zymergen Inc. 0.3 75.93 0.03 competitively advantaged businesses that are benefiting from annual rent Northvolt AB 0.2 38.09 0.06 escalators. We think our investments are positioned to perform well Denali Therapeutics Inc. 0.6 37.37 0.17 regardless of the inflationary backdrop, and we believe that owning a well- Pegasystems, Inc. 1.5 21.76 0.29 diversified portfolio of secular growth businesses with pricing power will Guidewire Software, Inc. 1.3 10.91 0.13 prove to be particularly compelling if, by whatever measure, inflation does Altair Engineering Inc. 0.6 10.23 0.05 rise. Farmers Business Network, Table II groups our portfolio based on our assessment of the attributes that Inc. 0.2 8.48 0.01 best characterize each investment. While this does not perfectly correlate to Wix.com Ltd. 0.2 3.54 –0.01 the Global Industry Classification Standard (“GICS”), the industry standard ANSYS, Inc. 4.7 2.21 0.14 nomenclature, we believe it provides added transparency into our thought Adaptive Biotechnologies process. Corporation 0.2 1.50 0.00 Schrodinger, Inc. 0.8 –0.89 –0.00 Table II. Iridium Communications Inc. 3.5 –3.10 –0.13 Total returns by category for the three months ended June 30, 2021 American Well Corporation – –3.26 –0.00 %of Total Contribution Desktop Metal, Inc. 0.1 –22.82 –0.04 Net Assets Return to Return ACV Auctions Inc. 0.1 –25.95 –0.05 (as of 6/30/2021) (%) (%) Russell 2000 Growth Index 3.92 Core Growth 28.2 14.22 3.85 Real-Irreplaceable Assets 25.8 –1.68 –0.37 Gartner, Inc. 4.2 32.68 1.09 IDEXX Laboratories, Inc. 5.2 29.08 1.27 Red Rock Resorts, Inc. 0.8 30.41 0.20 Dechra Pharmaceuticals PLC 0.4 27.84 0.09 American Assets Trust, Inc. 0.1 15.87 0.01 West Pharmaceutical Services, Alexandria Real Estate Inc. 2.1 27.51 0.47 Equities, Inc. 1.5 11.41 0.17 Mettler-Toledo International, Choice Hotels International, Inc. 1.3 19.88 0.23 Inc. 4.0 11.00 0.42 Bio-Techne Corporation 4.2 17.99 0.68 Gaming and Leisure Trex Company, Inc. 2.3 11.58 0.25 Properties, Inc. 2.8 10.72 0.29 Neogen Corp. 0.6 3.59 0.02 Vail Resorts, Inc. 7.0 8.52 0.59 Marel hf. 0.3 1.44 0.01 Douglas Emmett, Inc. 1.4 7.96 0.12 Yucaipa Acquisition Boyd Gaming Corporation 0.3 4.29 0.01 Corporation – 1.07 0.00 Manchester United plc 0.7 –3.50 –0.03 CoStar Group, Inc. 5.0 0.78 0.13 Marriott Vacations Littelfuse, Inc. 0.2 –3.30 –0.00 Worldwide Corp. 2.2 –8.54 –0.21 BrightView Holdings, Inc. 0.2 –4.45 –0.01 Penn National Gaming, Inc. 5.0 –27.17 –1.95 Bright Horizons Family OneSpa World Holdings Solutions, Inc. 2.2 –14.19 –0.37 Limited 0.0 –43.43 –0.00 Financials 31.6 13.57 3.90 Cash 0.1 –35.94 0.01 MSCI, Inc. 10.0 27.35 2.21 Fees – –0.28 –0.29 The Carlyle Group Inc. 1.0 27.15 0.22 Total 100.0 7.76* 7.76* Cohen & Steers, Inc. 1.7 26.44 0.38 Houlihan Lokey, Inc. 0.4 23.68 0.08 Sources: FactSet PA, BAMCO, and Russell, Inc. Morningstar, Inc. 2.8 14.43 0.35 * Represents the blended return of all share classes of the Fund.

27 Baron Growth Fund

We initially presented Table II last quarter to offer incremental insight into cross-border benchmarks. Given the powerful network effects and influence the way that we think about grouping the businesses represented in the of asset owners and their advisors, it is extremely difficult for managers to portfolio. As demonstrated above, our investments in Core Growth, select an alternative provider. MSCI has demonstrated its ability to Financials, and Real or Irreplaceable Assets are in roughly equal balance, consistently grow this business at double-digit rates through consistent representing between 25% and 32% of the portfolio individually and product innovation, volume expansion, and disciplined pricing trends. It has approximately 86% of our portfolio in aggregate. The remaining 14% of the supercharged its growth by licensing the same data to ETF providers to portfolio is invested in businesses that we consider to be Disruptive Growth, construct passive indexes. Given the significant upfront cost and low which we believe offer greater growth potential, albeit with modestly more incremental costs, its margins in this business exceed 70%. We see an risk relative to other investments. We believe this balance appropriately analogous opportunity emerging with MSCI’s ESG franchise, which is the reflects our goal to generate superior returns over time with less risk. same business with attractive secular growth and compelling market share but 20 years earlier. MSCI is successful in generating compelling conversion This quarter, the stocks that we consider to be Core Growth, Financials, and of earnings into free cash flow, which it has adeptly deployed back into its Disruptive Growth performed well on an absolute and relative basis. Our business, for mergers and acquisitions, and to return to shareholders. Core Growth investments, which represent approximately 28% of our portfolio, returned 14.2% during the quarter, while our Financials The remaining 40% of our Financials exposure includes sustainably investments, which represent approximately 32% of the portfolio, returned differentiated P&C carriers or unique advisory businesses. We believe that all 13.6%. Our Disruptive Growth investments returned 4.4% during the have carved out unique and sustainable competitive advantages, such as quarter, which was also better than the performance of our Benchmark. Primerica, Inc.’s extensive distribution network or Arch Capital Group Ltd.’s best-in-class underwriting discipline. We also believe that all are benefiting Last quarter, we highlighted the compelling secular drivers that we believe from compelling secular trends, such as Kinsale Capital Group, Inc.’s underpin our investments in select Consumer Discretionary stocks, which we exposure to dramatic growth in the Excess & Surplus insurance market. believe are being amplified by the ongoing recovery from COVID. This quarter we elaborate on our investments in Financials. At first blush, these While we consider these investments Financials, their success is not investments might seem anathema to a portfolio exclusively focused on dependent on GDP growth, interest rates, and they do not assume any investing in competitively advantaged businesses that can generate credit risk. All share the attractive characteristics that we value in our sustainable growth. investments, which include large addressable markets, positive secular trends, sustainable competitive advantages, attractive business models As of June 30, the Fund had 31.6% of its assets in stocks that are considered underpinned by recurring revenue, annual price increases, robust free cash Financials. This meaningfully exceeds that of the Benchmark, which has flow generation, and best-in-class management teams. We believe these are about 5% exposure to Financials. A common misinterpretation is that we representative of how much is going on under the surface in the portfolio, must own a lot of regional banks or specialty finance companies and have and how fundamental research enables us to make investments that are strong views about the short-term trajectory for interest rates. Of course, high conviction and build a portfolio that is highly differentiated. that is the diametrical opposite of our investment philosophy. As demonstrated in Table II, we do not own a single bank and have not made a This quarter, we participated in the IPO of Zymergen Inc., which came single investment that is contingent on interest rates. public in April. We made a modest initial investment in Zymergen approximately one year ago while it was still private. We used the Instead, approximately 60% of our Financials investments are technology- intervening period to enhance our understanding of the company and its enabled market data vendors such as FactSet Research Systems, Inc., opportunity. The section entitled “Recent Purchases” elaborates on our MSCI, Inc., Morningstar, Inc., and SS&C Technologies Holdings, Inc. Zymergen investment thesis. These are businesses that serve vast and growing end markets, which we estimate offer at least $30 billion of annual recurring revenue. They start We exited modest positions in American Well Corporation and Yucaipa with a proprietary set of data assets that have been collected over decades. Acquisition Corporation during the quarter. We think that these sales This carries significant fixed costs and time to collect, and in many ways exemplify the merits of maintaining small initial position sizes. We were would be impossible to replicate now. Once those assets have been initially excited by the long-term opportunities represented by both collected, the vendors build mission critical products and services that businesses and the valuations at which we were able to deploy capital. become deeply embedded in customer workflows. This creates recurring However, our ongoing and iterative due diligence efforts surfaced concerns revenue, high retention rates, and annual pricing power. And since the regarding the sustainability of competitive advantages over our investment products are delivered electronically and all the data has already been horizon. Additionally, we observed changes to incentive structures that collected, the incremental margins are extremely high. potentially foreshadowed a future misalignment with shareholders. We were easily able to exit these modest positions and reallocate that capital to MSCI is the largest of our Financials investments. It is the dominant market investments in which we have greater conviction that we believe offer more leader for cross-border indexes, with approximately 90% market share in attractive risk-adjusted returns.

Table III. Performance Based Characteristics as of June 30, 2021 Millennium Internet Bubble Millennium Internet Bubble Inception to Financial Panic Financial Panic to Present to Present 12/31/1994 to 12/31/1999 to 12/31/2008 12/31/2008 to 6/30/2021 12/31/1999 to 6/30/2021 6/30/2021 Alpha (%) 5.05 3.66 5.56 7.14 Beta 0.58 0.81 0.69 0.71

28 June 30, 2021 Baron Growth Fund

Table IV. Performance Millennium to COVID-19 Pandemic. The Impact of Not Losing Money. Millennium Internet Bubble Financial Panic Millennium Internet Bubble Inception to Financial Panic to Present to Present 12/31/1994 to 12/31/1999 to 12/31/2008 12/31/2008 to 6/30/2021 12/31/1999 to 6/30/2021 6/30/2021 Value Value Value Value $10,000 Annualized $10,000 Annualized $10,000 Annualized $10,000 Annualized Baron Growth Fund (Institutional Shares) $12,448 2.46% $73,930 17.36% $92,032 10.88% $340,433 14.24% Russell 2000 Growth Index $ 6,476 –4.71% $67,013 16.44% $43,395 7.07% $103,513 9.22% S&P 500 Index $ 7,188 –3.60% $61,548 15.65% $44,240 7.16% $155,336 10.91%

The indexes are unmanaged. Index performance is not Fund performance; one cannot invest directly into an index. The Fund has meaningfully outperformed its Benchmark over the long term. Table V. This is principally the result of not losing money during the nine years ended Top contributors to performance for the quarter ended June 30, 2021 December 2008, when most others did…as well as outstanding performance Market Quarter of our growth stock investments. The Fund has compounded at 14.24% Cap End When Market annually since its inception on December 31, 1994, which exceeds the Year Acquired Cap Total Percent Benchmark by 5.02% annually. While the Fund did not make much money Acquired (billions) (billions) Return Impact from December 31, 1999 through December 31, 2008, a period which MSCI, Inc. 2007 $1.8 $43.9 27.35% 2.21% includes the highs of the Internet Bubble and the lows of the Financial Panic, IDEXX Laboratories, it did generate a positive annualized return of 2.46%. Conversely, a Inc. 2005 1.9 53.9 29.08 1.27 hypothetical investment in a fund designed to track the Fund’s Benchmark Gartner, Inc. 2007 2.3 20.8 32.68 1.09 would have declined in value by 4.71% on an annualized basis over the Bio-Techne same time, while a hypothetical investment in a fund designed to track the Corporation 2009 2.1 17.5 17.99 0.68 large-cap S&P 500 Index would have declined 3.60% annualized. (Please see Vail Resorts, Inc. 1997 0.2 12.7 8.52 0.59 Table IV–Millennium Internet Bubble to Financial Panic). From the Financial Panic to the present, the Fund generated annualized returns of 17.36%, Shares of MSCI, Inc., a leading provider of investment decision support tools, which exceeded that of its Benchmark by 0.92% annually. This represents contributed to performance. The company reported strong first quarter robust absolute and relative returns across a variety of market earnings and management provided an upbeat assessment of the economic environments, driven primarily by favorable stock selection. and market backdrop going forward. We retain long-term conviction as the company owns strong, “all weather” franchises and remains well positioned The power of compounding is best demonstrated by viewing this return in to benefit from numerous secular tailwinds in the investment community. dollar terms. A hypothetical investment of $10,000 in the Fund at its inception on December 31,1994 would be worth $340,433 at June 30, 2021. Shares of veterinary diagnostics leader IDEXX Laboratories, Inc. This is approximately 3.3 times greater than the $103,513 the same contributed to performance in the quarter. Long-term secular trends driving hypothetical investment made in a fund designed to track the Benchmark the humanization of pets have been enhanced by a surge in pandemic-era would be worth. Hypothetically, our returns were achieved with pet adoption, driving practice level revenue to double-digit growth. IDEXX’s approximately 30% less volatility than the Benchmark, as represented by its competitive trends are outstanding, and we expect new proprietary beta. (Please see Tables III and IV.) We are pleased that our long-term innovations and field sales force expansion to be meaningful contributors to investments in what we believe are competitively advantaged growth growth. Margins are moving significantly higher, and we believe that companies with exceptional management teams have generated attractive margins can exceed 30% over time. returns in good markets and have helped to protect capital during more challenging ones. Shares of Gartner, Inc., a provider of syndicated research, contributed to performance after reporting financial results significantly better than investor estimates. Growth in the company’s research business has reaccelerated, led by its Global Business Sales segment, which is benefiting from a multi-year investment cycle. We expect improved revenue growth and renewed focus on cost control to drive margin expansion and enhanced free cash flow generation. The company’s balance sheet is in excellent shape, and we expect an acceleration in repurchases.

29 Baron Growth Fund

Table VI. We believe that Zymergen has developed a unique platform that combines Top detractors from performance for the quarter ended June 30, 2021 biology, machine learning, and automation to reliably design microbes and Market Quarter manufacture them at scale. The company has assembled a vast library of Cap End proprietary genetic data, which it searches to identify molecules that offer When Market Year Acquired Cap Total Percent material characteristics that are superior to traditional petrochemical-based Acquired (billions) (billions) Return Impact materials. Zymergen’s development and manufacturing platform is guided Penn National by artificial intelligence and machine learning, which helps the company Gaming, Inc. 2008 $2.5 $12.0 –27.17% –1.95% ferment microbes at scale faster and more cheaply than traditional Bright Horizons Family techniques. Early estimates imply that Zymergen’s “bio-facturing” platform Solutions, Inc. 2013 1.8 9.0 –14.19 –0.37 can bring products to market in approximately one-half of the time and at Marriott Vacations one-tenth of the cost of traditional techniques. Worldwide Corp. 2013 1.5 6.8 –8.54 –0.21 We expect Zymergen to initially focus on launching products into the Iridium electronics, consumer products, and agricultural spaces. These three verticals Communications have rapid product launch and adoption cycles, enjoy relatively benign Inc. 2014 0.6 5.3 –3.10 –0.13 regulatory environments, and offer compelling margin structures for ACV Auctions Inc. 2021 4.8 4.0 –25.95 –0.05 vendors. In total, we believe that these three end markets represent approximately $150 billion of addressable market opportunity. Penn National Gaming, Inc., a regional U.S. casino operator, detracted on news that the company had lost sports betting and i-gaming market share in Zymergen’s initial product is branded Hyaline and came to market in both Michigan and Pennsylvania. While the lost market share is a December 2020. Hyaline is a high-quality optical film used by electronics disappointment, Penn has been able to maintain a double-digit share with companies for display touch sensors and flexible printed circuits. Hyaline no marketing. We believe the market is attributing little value to Penn’s offers significant enhancements over incumbent products, including better Barstool equity stake as well as its online gaming and sports betting flexibility, transparency, folding endurance, and durability. Zymergen is opportunities including its access fees from other operators. We view the working on additional molecules for the electronics space, which will offer valuation as attractive. other feature enhancements such as greater temperature tolerance. We expect to see additional launches over the next few years. Shares of Bright Horizons Family Solutions, Inc., a leading provider of high-quality corporate-sponsored childcare and other family support Within the consumer care space, we believe Zymergen’s most mature product programs, experienced a pullback on uncertainties related to the post- is an innovative insect repellant, which will offer comparable efficacy with pandemic pace of center re-enrollment and concerns of a potential decline significantly lower toxicity than current DEET-based repellants. We expect to in demand should more flexible work-from-home arrangements result in see a product launched within the next two years and can envision multiple increased utilization of community-based providers. We believe Bright product-line extensions from sprays to creams, gels, sticks, and other delivery Horizons will successfully adapt to any market changes and that the future mechanisms. We believe that the company is also working on UV-repellent remains bright for this well-managed company. with analogous characteristics to those with traditional chemical-based active ingredients, in addition to several undisclosed products. Marriott Vacations Worldwide Corp., a developer and seller of timeshares, detracted in the quarter on investor concerns about how the Delta variant of Zymergen’s most mature agricultural molecule is designed to enhance the COVID-19 would impact leisure travel. Shares were also pressured by the nutrient uptake of crops like corn and wheat, thereby reducing producers’ possibility of higher mortgage rates. While both developments are short- reliance on synthetic nitrogen-based fertilizers. Other products in the term concerns, Marriott Vacations has seen no impact from either as its pipeline are targeting herbicide and pest protection opportunities. Such business is recovering quickly and the securitization market is at its best products could replace synthetic chemical treatments that have negative levels ever. Marriott Vacations remains a strong free cash flow business. environmental or health impacts with more naturally derived products that offer superior or comparable efficacy at a similar or lower cost. Recent Purchases While we have highlighted Zymergen’s most mature products, we think that This quarter, we added to our position in Zymergen Inc. through Zymergen’s process, platform, and intellectual property leave unlimited participation in its IPO in April. We made an initial investment in the flexibility. We recognize that not all Zymergen’s innovations will be business in 2020, when it was still a privately held, and we used the commercially successful. However, we believe that the company has built a intervening time to conduct additional due diligence and interact with scalable, repeatable product design platform, and therefore is not management. constrained by the success or failure of one discrete product. We expect the company to consistently delve more deeply into the aforementioned verticals, while also creating microbes that offer enhanced materials characteristics for use in industrial, health care, consumer non-durables, and manufacturing. We think that ultimately the company’s addressable opportunity can increase by eight-fold from current levels.

30 June 30, 2021 Baron Growth Fund

Portfolio Structure and Investment Strategy Table VIII. Top performing stocks owned less than five years The Fund seeks to invest in businesses that we believe have attractive Cumulative fundamental characteristics and are underpinned by sustainable competitive Total Return advantages. We search for businesses that serve large addressable markets Year of Since First Date First Purchase of Purchase and are benefiting from favorable secular tailwinds. We favor business models that have high levels of recurring revenue, generate attractive Schrodinger, Inc. 2020 612.9% incremental margins, are cash generative, and are not dependent on third- Wix.com Ltd. 2016 518.9 party financing. We exclusively invest with management teams that we Kinsale Capital Group, Inc. 2016 518.0 consider exceptional and are investing in their businesses to generate long- The cohort of investments that have been held for less than five years has term profitable growth. returned 71.3% annually based on weighted average assets since their initial The Fund holds investments for the long term. As of June 30, 2021, the purchase and exceeded the Benchmark by 50.9% annualized. Excluding the weighted average holding period of the Fund was 13.3 years. This is impact of Schrodinger, which was initially a private investment and has dramatically longer than most other small-cap growth funds, which, accrued extraordinary returns, this cohort has exceeded the Benchmark by according to Morningstar, turn over about 78% of their portfolios annually. 21.4% annualized. Eight of these investments have achieved annualized The portfolio’s 10 largest positions have a weighted average holding period returns that exceeded the Benchmark by more than 15% per year, including of 15.8 years, ranging from a 12.4 year investment in Bio-Techne seven that have achieved annualized returns that exceeded the Benchmark Corporation to a 24.4 year investment in Vail Resorts, Inc. Twenty-one of by more than 25% per year. the Fund’s investments, representing 73.4% of the portfolio’s net assets, have been held for more than 10 years. Twelve investments, representing Portfolio Holdings 19.5% of the portfolio’s net assets, have been held between 5 and 10 years. A further 18 investments, representing 7.0% of the portfolio’s net assets, As of June 30, 2021, Baron Growth Fund held 51 investments. The top 10 have been owned for less than 5 years. holdings represented 53.8% of the Fund’s net assets. All were small-cap businesses at the time of purchase and have become top 10 positions We believe that Table VII and Table VIII demonstrate the merits of our long- mostly through stock appreciation. Our holdings in these stocks have term holding philosophy, as our longest tenured investments have continued increased by an average of 18.2 times since our initial investment and have to generate robust absolute and relative returns. exceeded the Benchmark by an average of 6.6% annually. We believe all our positions offer significant further appreciation potential individually, and Table VII. that the Fund’s diversification offers potentially better-than-market returns Top performing stocks owned more than five years with less risk than the market. Note that diversification cannot guarantee a Cumulative profit or protect against loss. Total Return Year of Since First Date Baron Growth Fund only purchases small-cap companies. Since the Fund First Purchase of Purchase holds its investments for the long term, the Fund has a significant IDEXX Laboratories, Inc. 2005 4,288.0% percentage of assets invested in securities that have appreciated beyond Choice Hotels International, Inc. 1996 2,383.4 their market capitalizations at the time of the Fund’s investment. Baron MSCI, Inc. 2007 2,206.5 Growth Fund’s median market cap is $6.8 billion and its weighted average CoStar Group, Inc. 2004 1,968.4 market cap is $19.3 billion. This compares to Morningstar’s U.S. market cap Vail Resorts, Inc. 1997 1,828.5 breakpoints for small- and mid-cap funds of $6.9 billion and $36.4 billion, Mettler-Toledo International, Inc. 2008 1,820.3 respectively, as of June 30, 2021.

The cohort of investments that have been held for more than five years earned an annualized rate of return of 20.5% based on weighted average assets since they were first purchased, which exceeded the performance of the Fund’s Benchmark by 8.0% per year annualized. Five of these investments have achieved annualized returns that exceeded the Benchmark by more than 10% per year, including four that have achieved annualized returns that exceeded the Benchmark by more than 15% per year.

31 Baron Growth Fund

Table IX. Thank you for joining us as fellow shareholders in Baron Growth Fund. We Top 10 holdings as of June 30, 2021 are appreciative of the confidence you have shown in us, and we will Market Quarter Quarter continue to work hard to justify that confidence. Cap End End When Market Investment Percent Year Acquired Cap Value of Net Respectfully, Acquired (billions) (billions) (millions) Assets MSCI, Inc. 2007 $1.8 $43.9 $898.2 10.0% Vail Resorts, Inc. 1997 0.2 12.7 633.0 7.0 IDEXX Laboratories, Inc. 2005 1.9 53.9 467.3 5.2 Ronald Baron Neal Rosenberg Penn National CEO and Lead Portfolio Manager Co-Portfolio Manager Gaming, Inc. 2008 2.5 12.0 451.3 5.0 June 30, 2021 June 30, 2021 CoStar Group, Inc. 2004 0.7 32.7 450.5 5.0 ANSYS, Inc. 2009 2.3 30.2 419.9 4.7 FactSet Research Systems, Inc. 2006 2.5 12.7 402.7 4.5 Bio-Techne Corporation 2009 2.1 17.5 382.7 4.2 Gartner, Inc. 2007 2.3 20.8 381.5 4.2 Arch Capital Group Ltd. 2002 0.4 15.7 356.9 4.0

Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectus contain this and other information about the Funds. You may obtain them from its distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing. Risks: The Adviser believes that there is more potential for capital appreciation in smaller companies, but there also may be more risk. Specific risks associated with investing in smaller companies include that the securities may be thinly traded, and they may be more difficult to sell during market downturns. The Fund may not achieve its objectives. Portfolio holdings are subject to change. Current and future portfolio holdings are subject to risk. The discussions of the companies herein are not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed in this report reflect those of the respective portfolio managers only through the end of the period stated in this report. The portfolio manager’s views are not intended as recommendations or investment advice to any person reading this report and are subject to change at any time based on market and other conditions and Baron has no obligation to update them. This report does not constitute an offer to sell or a solicitation of any offer to buy securities of Baron Growth Fund by anyone in any jurisdiction where it would be unlawful under the laws of that jurisdiction to make such offer or solicitation. There is no guarantee that that the goals discussed will be met. The portfolio manager defines “Best-in-class” as well-managed, competitively advantaged, faster growing companies with higher margins and returns on invested capital and lower leverage that are leaders in their respective markets. Note that this statement represents the manager’s opinion and is not based on a third-party ranking. Alpha: measures the difference between a fund’s actual returns and its expected performance, given its level of risk as measured by beta. Beta: measures a fund’s sensitivity to market movements. The beta of the market (Russell 2000 Growth Index) is 1.00 by definition. BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a limited purpose broker- dealer registered with the SEC and member of the Financial Industry Regulatory Authority, Inc. (FINRA).

32 JUNE 30, 2021 Baron Small Cap Fund

DEAR BARON SMALL CAP FUND SHAREHOLDER: PERFORMANCE

Baron Small Cap Fund (the “Fund”) gained 6.37% (Institutional Shares) in the second quarter of 2021. For the first six months of the year, the Fund is up 9.21%. In the second quarter, the Fund outperformed the Russell 2000 Growth Index (the “Index”), which was up 3.92%. Year-to-date, the Fund is also a bit ahead of the Index, which is up 8.98%. The S&P 500 is up 8.55% in the quarter and 15.25% year-to-date, as large-cap stocks have outperformed small-cap stocks and value has outperformed growth. The Fund has outperformed the Index for most all periods and since inception (almost 24 years...OMG!). It is up 11.65% annualized, which is almost 400 basis points ahead of the Index, which is up 7.66%.

Table I. Performance Annualized for periods ended June 30, 2021 Baron Baron Small Cap Small Cap Russell CLIFF GREENBERG Retail Shares: BSCFX Fund Fund 2000 S&P Institutional Shares: BSFIX Retail Institutional Growth 500 PORTFOLIO MANAGER R6 Shares: BSCUX Shares1,2 Shares1,2,3 Index1 Index1 Three Months4 6.30% 6.37% 3.92% 8.55% Six Months4 9.07% 9.21% 8.98% 15.25% One Year 47.24% 47.60% 51.36% 40.79% consternation about whether policy is too stimulative, whether the Fed Three Years 20.34% 20.66% 15.94% 18.67% needs to change course, and whether interest rates will continue to rise, all Five Years 21.19% 21.50% 18.76% 17.65% of which muted the market’s appreciation. Ten Years 13.90% 14.20% 13.52% 14.84% After ceding leadership to cyclical “recovery” stocks, secular growth stocks Fifteen Years 11.28% 11.51% 10.89% 10.73% were back in vogue in the back half of the quarter, especially among large Since Inception caps. It is our view that while value stocks are indeed having a great rebound (September 30, 1997) 11.50% 11.65% 7.66% 8.59% in their earnings from depressed levels, their stock prices have risen and now they appropriately reflect the positive outlook described above. U.S. equity markets continued to act well in the second quarter in conjunction with strong macroeconomic data, supportive fiscal and The Fund outperformed in the quarter primarily due to favorable stock monetary policy, and excellent earnings results. The economy is growing selection. Our Information Technology (“IT”) holdings had a strong quarter. very rapidly now, as the ill effects of the pandemic have been waning, and Gartner, Inc., our largest position, posted very strong results and the stock U.S growth appears likely to stay strong. We continue to expect high single- appreciated by about a third in the quarter. Endava plc and Nuvei digit GDP growth for the year. However, inflation is accelerating Technologies Corp. were also up significantly after delivering robust significantly, both in goods and wages. During the quarter, this caused earnings and rosy outlooks. The Trade Desk and Guidewire Software, Inc.

Performance listed in the above table is net of annual operating expenses. Annual expense ratio for the Retail Shares and Institutional Shares as of September 30, 2020 was 1.31% and 1.05%, respectively. The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original cost. The Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted. For performance information current to the most recent month end, visit www.BaronFunds.com or call 1-800-99BARON. 1 The Russell 2000® Growth Index measures the performance of small-sized U.S. companies that are classified as growth and the S&P 500 Index of 500 widely held large cap U.S. companies. The index and the Fund include reinvestment of dividends, net of withholding taxes, which positively impact the performance results. . Russell Investment Group is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. Russell is a trademark of Russell Investment Group. The indexes are unmanaged. Index performance is not Fund performance; one cannot invest directly into an index. 2 The performance data in the table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. 3 Performance for the Institutional Shares prior to May 29, 2009 is based on the performance of the Retail Shares, which have a distribution fee. The Institutional Shares do not have a distribution fee. If the annual returns for the Institutional Shares prior to May 29, 2009 did not reflect this fee, the returns would be higher. BARON FUNDS 4 Not annualized.

33 Baron Small Cap Fund

were up on positive business developments and renewed interest in secular base of new clients. Endava has done well to meet elevated demand by growth stocks. Our Industrials holdings, our second largest sector expanding its delivery footprint through recent M&A. The company’s deep concentration, did well too and were up nicely when the sector was down. domain expertise in high-growth end markets such as payments, tech, and Vertiv Holdings, LLC, our third largest position, also rose over a third, as the media/telecom is providing strong tailwinds, and we believe the company company beat expectations and the trading multiple expanded. Other can continue to grow organically over 20% per year while integrating positive contributors included two relatively new holdings, First Advantage strategic acquisitions to expand its base of operations. Corporation and Driven Brands Holdings Inc. Our Health Care stocks also Installed Building Products, Inc. installs insulation and complementary outperformed. Long-term holdings IDEXX Laboratories, Inc. (which we building products for the homebuilding industry and commercial have owned for 12 years), DexCom, Inc. (owned for 8 years) and Mettler- construction markets. The stock was up for the quarter, but after reporting Toledo International, Inc. (owned for 12 years), were all strong and among earnings its price fell because results came in below Street estimates. The our biggest contributors. Our Consumer Discretionary stocks business was disrupted by difficulties getting raw materials and lost underperformed as shares of Penn National Gaming, Inc. and DraftKings, production time from winter storms. However, management detailed that Inc., two plays on online sports betting, fell from stretched peak levels. The demand is very strong and that they expect the housing recovery to last for Cheesecake Factory, Inc., Ollie’s Bargain Outlet Holdings, Inc., and years. They are confident they can pass on announced price increases for Planet Fitness, Inc. were down with the market rotation away from insulation, which would enhance margins. They also indicated that their “reopening” stories. The Fund’s active sector and factor exposures didn’t acquisition pipeline was extremely robust. IBP has been a great acquirer, and materially impact relative performance in the quarter. acquisitions are materially accretive. We are hopeful that future quarters are less noisy and think the company will be able to grow EBITDA at 20% plus Table II. per year go forward. Top contributors to performance for the quarter ended June 30, 2021 Percent Red Rock Resorts, Inc. operates casinos in Las Vegas that cater to locals. As Impact its casinos reopen, the company is reporting strong results, revenues, and Gartner, Inc. 1.14% especially profits. Red Rock learned a lot during the pandemic and is Vertiv Holdings, LLC 1.01 evolving its operations accordingly, leading to much higher margins. Money- Endava plc 0.45 losing amenities have been terminated, marketing budgets have been Installed Building Products, Inc. 0.37 slashed, employee levels reduced, and underperforming casinos have been Red Rock Resorts, Inc. 0.34 shuttered. For the quarter just ended, on a same store basis (compared to 2019 results), revenues grew 5% and profits grew 38%. Red Rock also Shares of Gartner, Inc., the provider of syndicated research, reported results announced it sold the troubled Palms casino for a big price and is soon to that significantly exceeded investor expectations. We believe that this was embark on the building of a new casino in Durango. We believe that there the inflection quarter we have been waiting for. Revenues reaccelerated, led will be great returns from this development and that it is just the first of by double-digit growth in its Global Business Sales. Renewed focus on cost many, which will help the company’s growth profile go forward. controls led to superior margin expansion and free cash flow conversion. Other stocks that gained over 20% in the quarter but contributed less to our With the balance sheet now in excellent shape, the company aggressively overall performance were: IDEXX Laboratories, Inc., Nuvei Technologies repurchased stock, which has been a favored use of capital deployment in its Corp., Dechra Pharmaceuticals PLC, Figs Inc., Houlihan Lokey, Inc., Driven heyday. The company raised its estimates for EBITDA and free cash flow Brands Holdings Inc., First Advantage Corporation,andCryoPort, Inc. growth by over 30% for the year, and the shares grew in lockstep. We foresee free cash flow per share compounding at over 20% go forward and Table III. believe the stock can double over the next three or four years. The stock has Top detractors from performance for the quarter ended June 30, 2021 already increased 10-fold since our initial purchase. Percent Impact Vertiv Holdings, LLC is a leading manufacturer of critical digital infrastructure technology for data centers, communication networks, and Array Technologies, Inc. –0.66% commercial and industrial environments. Vertiv reported organic sales Penn National Gaming, Inc. –0.57 growth of 19.5% in the last quarter, well above expectations. Orders were Bright Horizons Family Solutions, Inc. –0.28 up 21% and backlog 31%, which are good indicators of long-term demand UTZ Brands, Inc. –0.19 for its products. Margins also were much higher than projected leading to a DraftKings, Inc. –0.16 large earnings beat, and we think there is opportunity for continued margin expansion. The company’s balance sheet is much improved, and it has an Array Technologies, Inc. is a leading manufacturer of utility-scale solar active acquisitions funnel. We believe that the company will continue to trackers. Shares fell significantly when the company withdrew guidance for grow nicely and believe its stock still offers great promise, as it is the year due to dramatically increased steel prices and shipping costs, which inexpensive on an absolute basis and low relative to its peers. they will not be able to pass on to their customers. The increased costs are causing a delay in some projects, and lower margins on present business. Endava plc is a pure-play digitally native IT services company, offering The near-term issues surprised investors and came shortly after the products and strategies to help its clients with digital transformation company had done a secondary offering, so management has a credibility initiatives. Endava’s business is snapping back very fast from the pandemic, problem. We continue to believe that the end market will be much bigger, with organic sales growing 15% in the last quarter and projections of over however we are now less certain about Array’s long-term market share and 30% for the upcoming period. Endava is growing its business with both its margin profile. We sold some of our position and are closely monitoring the existing clients with whom they have deep relationships and expanding its critical variables.

34 JUNE 30, 2021 Baron Small Cap Fund

Shares of Penn National Gaming, Inc., a regional casino operator with a big The Fund is heavily invested in four sectors: IT (26.0% of net assets), presence in online sports betting through its Barstool Sports brand, and Industrials (24.8%), Health Care (16.3%), and Consumer Discretionary DraftKings, Inc., a pure play online sports betting firm, both fell in the (14.6%). Compared to the Russell 2000 Growth Index we are overweight in quarter. Sports betting and internet casinos are going to be an enormous IT, we are well overweight in Industrials, we are way underweight in Health business. As new states have legalized this activity, play has exceeded Care, and we are market weight in Consumer Discretionary. expectations, which lends credence to the enormity of the opportunity. This IT has been our largest sector concentration for some time. We have many quarter, both Penn and DraftKings showed some modest decline in market investments in application software companies that are leaders in their share. As both stocks were at all-time highs with high embedded niches and provide critical backbone services sold on a subscription basis. expectations of future earnings, they were vulnerable to retracements. We We also have significant investments in IT consulting and data processing continue to believe the long-term game plan and estimates remain on track. (often referred to as Fintech companies). We have increased our Shares of Bright Horizons Family Solutions, Inc., the leading provider of investments in these latter two sub-industries over the last few years. As high-quality corporate sponsored childcare and other family support always, our Industrials are primarily secular growth companies not cyclicals programs, experienced a pullback this quarter on uncertainties related to the or also-rans. We own stocks of leaders in human resources, aerospace, pace of re-enrollment post-pandemic. Also, there is concern of a potential building products, and electrical components. Our Consumer Discretionary decline in demand should more flexible work-from-home arrangements result holdings are not typical retailers or products companies, but rather niche in less utilization of corporate-based capacity. The Federal government also casino operators, specialty retailers, leisure, and education providers. We are floated the idea of providing new early childcare benefits. We are not underweight in Health Care mainly because we do not own biotechnology stressed about those issues and believe that Bright Horizons will successfully stocks at all and own very few pharmaceuticals stocks, as neither meet our adapt to any market changes. We believe Bright Horizons’ position as market desire to invest in established leaders. leader and trusted service provider is better now than ever, after playing a critical and successful role during the pandemic, and that new opportunities We are long-term investors. The average turnover of our assets is about will result from its entrenched position. The stock is expensive on near-term 15%, as measured by a three-year average. That means our average holding numbers, but we believe it will grow into its valuation. period is about 7 years. We have held about 17% of the Fund’s assets for over 10 years, and another 25% between 5 to 10 years. The reason we own UTZ Brands, Inc. is a salty-snack company founded in 1921, with well- stocks for such a long time is that we have had great success doing so. For known brands such as Utz, Zapps, and Golden Flake, which went public via a the stocks we own for over 10 years, the annualized returns are 25% a year. SPAC in August 2020. The company had great results in 2020, somewhat For those between 5 and 10 years, our returns are 26% annualized. Pretty helped by so many staying at home, and the stock performed well. In the cool. Hopefully, we will have such success with many of our newer first quarter of 2021, UTZ reported slower growth and some cost pressures. investments. We remain positive on UTZ’s ability to accelerate revenue growth through innovation and enhanced marketing, and its opportunity to grow by Because we hold stocks for many years, our winners have appreciated acquisition and include other brands in its route system, and its introduction multiple fold (we hold 9 stocks in which we have made more than 10 times of new products. We sold some of our position in the period as the stock our initial investment and another 7 in which we have made more than traded at an elevated valuation on near-term earnings but continue to see 5 times), the market cap of our Fund is higher than many of the peer funds. good upside in the future. Our approach is to trim big winners as their market caps rise and buy small-cap stocks with the proceeds. Our shareholders have benefited greatly There were no other stocks that declined over 20% in the quarter. from this approach. Of our 10 largest market cap holdings, we own on Portfolio Structure & Recent Activity average 26.3% of our original position. All our new purchases are squarely in the small-cap category, with the weighted average market cap of new As of June 30, 2021, the Fund had $5.4 billion under management. The top positions year-to-date being $1.9 billion. 10 holdings made up 28.3% of the Fund’s net assets, in line with prior levels. Switching subjects, we are often asked questions about the state of the We held 79 stocks and warrants in 2 others at quarter end. special purpose acquisition companies (“SPACs”) market and what the Fund is doing in this sphere. As we mentioned in our last quarterly, we continue to Table IV. see SPACs as a viable and enduring conduit for companies to come public. Top 10 holdings as of June 30, 2021 However, right now, there are too many SPACs chasing private businesses Quarter End Investment Percent and too little capital to fund the private investments in public entities Year Value of Net (“PIPEs”) that are needed to close the deals. This is leading to some of the Acquired (millions) Assets private companies going public this way to trade poorly after their mergers Gartner, Inc. 2007 $242.2 4.5% are closed. There aren’t enough institutional investors familiar with the new Installed Building Products, Inc. 2017 192.7 3.6 equities to buy the shares from the original SPAC IPO investors. We are Vertiv Holdings, LLC 2020 191.1 3.5 adjusting our approach to these new realities and making fewer and/or ASGN Incorporated 2012 150.2 2.8 smaller commitments to PIPEs and looking to make larger investments in Guidewire Software, Inc. 2012 138.1 2.6 the equities post-merger. We continue to be excited about the new SiteOne Landscape Supply, Inc. 2016 135.4 2.5 investments we are making in this channel and believe we are buying into Floor & Decor Holdings, Inc. 2017 134.8 2.5 great businesses and management teams at great valuations, which we ICON Plc 2013 124.0 2.3 would hope will lead to strong long-term returns. Clarivate Plc 2019 110.1 2.0 Aspen Technology, Inc. 2015 110.0 2.0

35 Baron Small Cap Fund

Table V. The market for background screening is both large ($13 billion opportunity Top net purchases for the quarter ended June 30, 2021 with $6 billion current market spending and $7 billion of potential white Quarter End Amount space) and growing (the market is estimated to grow at a 6% CAGR). Year Market Cap Purchased Even as one of the industry leaders, First Advantage’s market share remains Acquired (billions) (millions) relatively low at approximately 9%. The industry is increasingly favoring Janus International Group, Inc. 2021 $1.9 $30.0 scale, which should enable First Advantage to gain incremental market First Advantage Corporation 2021 3.0 26.4 share moving forward. Relative to its smaller regional players (75% of the Landcadia Holdings III, Inc. 2021 0.8 21.3 market), First Advantage has global reach, a vertically integrated sales force Hydrofarm Holdings Group, Inc. 2020 2.4 20.3 with sub-industry expertise targeting the fastest growing end markets, Empower Ltd. 2021 0.6 15.1 strong customer relationships (the top 100 customers have a 12-year average tenure), 65-plus HCM integrations, and deep technology and new During the quarter, we made seven new investments and increased our product investment. First Advantage is well positioned to achieve consistent holdings in nine existing positions. high single- to low double-digit organic revenue growth driven by a All these new investments were in companies coming public, five of which combination of underlying base growth, up and cross-selling, and new are merging into SPACs and two through traditional IPOs. These companies customer additions. The company has an attractive margin profile (high are in many sectors, but share the common characteristics of leading niche 20% increasing to low 30%’s adjusted EBITDA margins over time) and companies, with what we believe are strong management teams, that have strong free cash flow generation. Acquisitions are expected to be the great growth opportunities, and are reasonably valued. primary use of free cash flow and should be accretive, supplementing We initiated a new position in Janus International Group, Inc. when the organic growth. We believe that First Advantage will be a steady earnings company came public by merging with SPAC Juniper Industrial compounder, which should drive solid returns for the stock over a multi-year Holdings. Janus is the leading global manufacturer and supplier of turn-key period. self-storage solutions, including steel roll-up doors, hallway systems, relocatable storage units, and door automation technologies. Janus has over Table VI. 50% market share, a full suite of value-add products, and a nationwide Top net sales for the quarter ended June 30, 2021 manufacturing and installation network to serve the industry’s need for new Market Quarter End Cap Market Cap or capacity and massive renovation (over 60% of installed base is over When Market Cap Amount 20 years old). Janus’s dominant market position and entrenched customer Year Acquired When Sold Sold base lead to high barriers to entry, lucrative opportunities to cross-sell Acquired (billions) (billions) (millions) ancillary products and services, and an attractive financial model with IDEXX Laboratories, Inc. 2008 $2.0 $53.9 $39.7 around 23% average revenue growth since 2010, over 25% EBITDA margins, UTZ Brands, Inc. 2020 1.0 3.0 22.6 and strong free cash flow stemming from its asset-light model. Management SBA Communications aspires to double revenues over the next several years, driven by capturing Corp. 2004 0.2 34.8 20.8 its share of new self-storage construction, increasing penetration of ancillary Penn National Gaming, self-storage offerings (renovation, external storage), accelerating growth in Inc. 2020 2.4 12.0 17.5 several international markets, and share gains in a nascent commercial Waste Connections, Inc. 2009 0.4 31.3 17.5 business. Janus is the first to market with a self-storage smart lock solution called Noke Smart Entry. We believe this is the future for the self-storage Our sales this quarter were primarily to reduce our position size in some of industry, and Janus has a unique ability to drive penetration. This is our larger market caps holdings or trim positions because near-term estimated to be a $1 billion potential revenue opportunity in time. valuations seemed extended. We believe organic growth will be supplemented by acquisitions, as the The stocks with larger market caps that we trimmed were all big winners. company has a long history of finding attractive assets, and recently added Sales this quarter were in: IDEXX Laboratories, Inc. (owned for over Board members with extensive M&A experience at Honeywell. The company 12 years), SBA Communications Corp. (17 years), Waste Connections, has a near-term pipeline of $500 million incremental revenue (40 targets) Inc. (12 years), and Mettler-Toledo International, Inc. (12 years). All the compared to $550 million revenue last fiscal year. We think the stock could sales were made as the stocks were trading around their highs. We believe reach the low $20s over the next several years, driven by 10% organic each still can perform well from here, so merit holding go forward, but it is growth, continued M&A supported by a strong balance sheet and free cash our approach to reduce these holdings into strength and recycle that capital flow, upside penetration of proprietary Noke technology, and sustaining its into new small-cap investments. current valuation multiple, which we think has upside. We reduced our position in UTZ Brands, Inc., Penn National Gaming, Inc., We participated in the First Advantage Corporation IPO during the Wix.com Ltd., and Floor & Decor Holdings, Inc. as those stocks rose and quarter. First Advantage is a leading global provider of comprehensive were near-term expensive. We sometimes tactically trade around our background screening solutions that give employers and housing providers positions: sell some when they spike and look to buy them when they are access to actionable information that results in faster, more accurate people lower, most often when the market falls. decisions. The company offers a wide array of services including criminal We sold our entire position in Fox Factory Holding Corp., a neat growth background checks, drug screening, extended workforce screening, education stock that was a terrific investment. It traded up to a price that we thought verification, work verification, resident screening, driver compliance, and discounted many years of expected growth. continuous monitoring.

36 JUNE 30, 2021 Baron Small Cap Fund

OUTLOOK We believe our stocks trade at reasonable multiples, all considering. We are not concerned that a rise in rates will result in materially lower multiples for As we are writing this, the market is back at all-time highs. The economy is growth stocks. We foresee continued strong growth for our holdings, based very strong as exemplified by the June employment report. Though inflation on how each is positioned and the growth initiatives they have in place, and has picked up, it seems “transitory” for the most part. we expect their stocks to perform in line with the growth in their businesses. Monetary policy remains supportive and though some government stimulus Thanks to assistant portfolio manager David Goldsmith for yeoman’s work programs are winding down, we expect other fiscal stimulus to follow. All of in helping manage the portfolio. Thanks to the fabulous analyst team at this is a great backdrop for the stock market. Baron, who have done a wonderful job finding and following the special Recently, interest rates have declined, primarily reflecting concerns that the businesses in which we invest. And thanks to our shareholders in the Fund economy will cool off faster than anticipated, because of the increase in for your confidence in us at Baron and for your support of Baron Small Cap COVID cases from the new virulent Delta variant or just that it has run its Fund. course. Our view, which does not come from a crystal ball, and which we offer just to give you a sense of where our heads are at, is that the economy will be super strong this year but revert to prior growth rates next year, that inflation willpickup,thatmonetarypolicywillbelessaccommodative,andinterest rates will rise in conjunction with these factors. We expect earnings overall to be very strong this year for most all companies, and then for secular growers Cliff Greenberg to outperform more cyclical companies in the future. We’ll see. Portfolio Manager June 30, 2021

Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectus contain this and other information about the Funds. You may obtain them from its distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing. Risks: The Adviser believes that there is more potential for capital appreciation in smaller companies, but there also may be more risk. Specific risks associated with investing in smaller companies include that the securities may be thinly traded and they may be more difficult to sell during market downturns. The Fund may not achieve its objectives. Portfolio holdings are subject to change. Current and future portfolio holdings are subject to risk. The discussions of the companies herein are not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed in this report reflect those of the respective portfolio manager only through the end of the period stated in this report. The portfolio manager’s views are not intended as recommendations or investment advice to any person reading this report and are subject to change at any time based on market and other conditions and Baron has no obligation to update them. This report does not constitute an offer to sell or a solicitation of any offer to buy securities of Baron Small Cap Fund by anyone in any jurisdiction where it would be unlawful under the laws of that jurisdiction to make such offer or solicitation. BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a limited purpose broker-dealer registered with the SEC and member of the Financial Industry Regulatory Authority, Inc. (FINRA).

37 Baron Opportunity Fund

DEAR BARON OPPORTUNITY FUND SHAREHOLDER: Performance

Baron Opportunity Fund (the “Fund”) had a solid quarter, advancing 10.14% (Institutional Shares), but trailed the Russell 3000 Growth Index, which rose 11.38%, mostly due to market trading during the last few days of the quarter. The Fund outperformed the S&P 500 Index, which increased 8.55%.

Table I. Performance Annualized for periods ended June 30, 2021 Baron Baron Opportunity Opportunity Russell Fund Fund 3000 S&P Retail Institutional Growth 500 Shares1,2 Shares1,2,3 Index1 Index1 Three Months4 10.06% 10.14% 11.38% 8.55% Six Months4 10.97% 11.11% 12.71% 15.25% One Year 60.80% 61.18% 42.99% 40.79% Three Years 38.26% 38.62% 24.47% 18.67% MICHAEL A. LIPPERT Retail Shares: BIOPX Institutional Shares: BIOIX Five Years 34.84% 35.19% 23.31% 17.65% PORTFOLIO MANAGER R6 Shares: BIOUX Ten Years 19.07% 19.39% 17.54% 14.84% Fifteen Years 15.89% 16.14% 13.33% 10.73% Since Inception We continued to run our play – our consistent philosophy, strategy, and (February 29, 2000) 10.84% 11.01% 7.01% 7.57% process, which have empowered the Fund to outperform the broader market indexes by over 40% over the trailing 12 months. While we stay aware of the REVIEW &OUTLOOK political, geopolitical, economic, regulatory, and legal developments that often yield market volatility over the short term, we focus our attention, research, The Fund had a solid quarter, advancing just over double digits for the analysis, and portfolio management on identifying the powerful and durable period. The Fund was buoyed by a strong U.S. equity market overall, as the secular growth trends that will drive economic growth regardless of short-term market continued to move higher in response to robust economic data, economic cycles or stock market gyrations, and the individual companies that continued fiscal and monetary support, and an outstanding corporate are leading or capitalizing on those trends. As I’ve repeated over the last few earnings season. Despite concerns about intensifying inflationary pressures letters, it “is what we do” and the bedrock of our long-term performance. On and the prospect of policy tapering and future rate increases, the Russell one side it may be boring for letter readers more interested in real-time market 3000 Index posted three consecutive monthly gains. analysis, but on the other side, the one we occupy, it speaks to the consistency, repeatability, and durability of the Baron investment approach.

Performance listed in the above table is net of annual operating expenses. Annual expense ratio for the Retail Shares and Institutional Shares as of September 30, 2020 was 1.34% and 1.08%, respectively. The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original The Adviser reimburses certain Baron Fund expenses pursuant to a contract expiring on August 29, 2031, unless renewed for another 11-year term and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted. For performance information current to the most recent month-end, visit www.BaronFunds.com or call 1-800-99BARON. The Fund’s 3-, 5- and 10-year historical performance was impacted by gains from IPOs and there is no guarantee that these results can be repeated or that the Fund’s level of participation in IPOs will be the same in the future. 1 The Russell 3000® Index measures the performance of the broad segment of the U.S. equity universe comprised of the largest 3000 U.S. companies representing approximately 98% of the investable U.S. equity market. The Russell 3000® Growth Index measures the performance of those companies classified as growth among the largest 3,000 U.S. companies and the S&P 500 Index of 500 widely held large cap U.S. companies. Russell Investment Group is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. Russell is a trademark of Russell Investment Group. The indexes and the Fund include reinvestment of dividends, net of withholding taxes, which positively impact the performance results. The indexes are unmanaged. Index performance is not Fund performance; one cannot invest directly into an index. 2 The performance data in the table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. 3 Performance for the Institutional Shares prior to May 29, 2009 is based on the performance of the Retail Shares, which have a distribution fee. The Institutional Shares do not have a distribution fee. If the annual returns for the Institutional Shares prior to May 29, 2009 did not reflect this fee, the returns would be higher. BARON FUNDS 4 Not annualized.

38 June 30, 2021 Baron Opportunity Fund

While the Fund had a solid quarter, it underperformed its primary index compare the revenue growth rates of our Fund and three indexes for the (Russell 3000 Growth Index) slightly during the period, largely due to market trailing four quarters for which we have reliable data: trading activity over the last few days of the quarter. The Fund’s slight underperformance was primarily due to weakness in the Communication Comparison of Revenue Growth (based on quarter-end holdings) Services sector, driven by a sharp pullback in Tripadvisor’s shares on concerns about pressure on global travel from the rise in COVID cases Actual Actual Actual Actual resulting from new variants, particularly Delta, and competition for its Q1 2021 Q4 2020 Q3 2020 Q2 2020 new Plus offering, described more fully below; the Fund’s underweight in Baron Opportunity Fund 38.5% 30.6% 24.7% 18.5% Facebook, which rose sharply the last week of the period as the S&P 500 Index 12.6% 2.8% –1.2% –9.3% antitrust lawsuit against the company was dismissed; and weakness in Russell 3000 Index 12.3% 2.6% –1.6% –10.5% digital real estate stocks, including Zillow, which pulled back on market concerns about the potential impact of rising interest rates on the Russell 3000 Growth Index 16.5% 9.1% 4.0% –6.3% housing market (see Opendoor discussion below, which addresses the same Source: BAMCO and FactSet. issues). On the other hand, the Fund experienced strong performance across the Health Care space (see discussions of Arrowhead and Table II. ShockWave under contributors below), as well as the Information Top contributors to performance for the quarter ended June 30, 2021 Technology (“IT”) sector, where digital transformation trends continued to Percent be robust. Impact We did make some tactical moves during the period. In the biotechnology Microsoft Corporation 1.32% space, we consolidated the portfolio around our three favorite investments Alphabet Inc. 1.20 of Arrowhead, Acceleron, and argenx. Across the software group, we NVIDIA Corporation 0.93 trimmed Microsoft, which remains our largest position, to fund investments Arrowhead Pharmaceuticals, Inc. 0.62 in stocks that faced pandemic-related headwinds and should see accelerated ShockWave Medical, Inc. 0.60 revenue growth moving forward or traded down to highly attractive long- term valuations on the software pullback earlier this year. These include Shares of Microsoft Corporation, a cloud-software leader and provider of cloud unified communications leader RingCentral (discussed more fully software productivity tools and infrastructure, rose during the quarter below); team workflow and collaboration cloud pioneer, Atlassian (also following a strong earnings report highlighting solid demand for its broad below); digital tax calculation and compliance leader, Avalara; enterprise product stack and continued momentum migrating its business to the cloud. workflow automation platform titan, ServiceNow (discussed in depth in our Microsoft was a top contributor in the period because it trades at reasonable last letter); cloud payroll and workforce management software provider, free cash flow and earnings valuations, has cloud and digital transformation Ceridian; business-to-business marketing data, analytics, workflow, and tailwinds at its back, reported a solid March quarter, and beat Street engagement innovator, ZoomInfo; and the leading cloud software provider expectations by a wide margin. Microsoft’s results continued to be strong to the property and casualty insurance industry, Guidewire. across the board, with Azure cloud computing revenues up 46% in constant- currency (“cc”) terms and commercial cloud bookings growth of 38% cc, the Below is a partial list of the secular megatrends we focus on. These themes best in years. Microsoft also reported robust profitability growth, with will be the key drivers of revenue, earnings, and cash flow growth – and operating income expanding 31% and GAAP earnings up 45%. We believe stock performance – for the companies in which we are invested: the company is well positioned for continued solid growth and profitability • Cloud computing through market share gains as more companies look to transform and • Software-as-a-service (“SaaS”) digitize their businesses as they move operations to the cloud. (Brian • Artificial Intelligence (“AI”) and big data Neigut) • Mobile Alphabet Inc. is the parent company of Google, the world’s largest search • Digital communications and online advertising company and a top cloud computing player. Shares of • Digital media/entertainment Alphabet were up in the quarter given continued recovery in ad spending, • Targeted, people-based digital advertising strong cloud revenue growth, and improved cost controls. Alphabet’s total • e-commerce revenue grew 32%, beating the Street’s estimate of 25%, with search • Genomics revenues up 30%, YouTube revenue up 49%, and total cloud revenue up • Genetic medicine 46% (with Google Cloud Platform growing much faster). Moreover, Google’s • Minimally invasive surgical procedures operating margins expanded over 1,000 basis points from 19% to just under • Cybersecurity 30%. We retain high conviction in Alphabet’s merits as it continues to • Electric-drive vehicles/autonomous driving benefit from growth in mobile and online video advertising, which accrues • Electronic payments to its core assets of search, YouTube, and the Google ad network. We are By investing in businesses capitalizing on these potent trends, we have been further encouraged by Alphabet’s investments in cloud computing, artificial able to build portfolios that have revenue growth rates that are multiples of intelligence (AI), autonomous driving (Waymo), and life sciences (Verily, the general economy, as reflected in broad market indexes. Below we Calico). (Ashim Mehra)

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NVIDIA Corporation is a fabless semiconductor company and a leader in BridgeBio Pharma, Inc. is a biotechnology company developing drugs that gaming cards and accelerated computing chips. Shares of NVIDIA rose in the address a host of genetic disorders. Shares fell in the quarter given concerns second quarter on financial results and guidance significantly above Street around increasing competition. While we expect positive results from expectations, as it benefited from the upgrade cycle in its gaming franchise BridgeBio’s Phase 3 trial for its lead program for TTR amyloidosis, a disease along with continued AI-related strength driving its data center segment. in which toxic proteins build up in the heart and nerves, encouraging NVIDIA’s total revenues of $5.66 billion beat Street expectations by $266 updates from Alnylam’s competing drug, Vitrusiran, and more recently, million, growing 84% (including the benefit of acquisitions, 65% organic), Intellia’s gene editing platform, pressured the stock. We exited our position. with its gaming business growing over 100% and its data center business (Josh Riegelhaupt) expanding nearly 80%. We remain confident in NVIDIA’s leading position in gaming, data centers, and autonomous machines. (Guy Tartakovsky) Shares of ACV Auctions Inc., the leading digital marketplace for wholesale automotive transactions, declined after a successful IPO in late March Arrowhead Pharmaceuticals, Inc. develops RNA interference (RNAi) therapies. despite reporting robust results. Given its strong post-IPO performance, ACV Shares increased on positive clinical updates for its lead programs in Alpha-1 permitted a partial early release of the lock-up for existing investors, which Antitrypsin disease. Investors have also started to focus on data catalysts for put pressure on the stock. We exited our small position. (David Sobel) the RNAi platform. We retain conviction in Arrowhead as a core holding in the RNAi field as we believe RNAi is the best positioned new therapeutic modality Guardant Health, Inc. offers liquid biopsy tests for advanced stage cancer to capture treatment of patients at volume given quarterly, biennial, or annual and recurrence monitoring and is developing a test for early cancer dosing and clean safety profiles. (Josh Riegelhaupt) detection. Shares fell during the quarter as high-growth companies with high valuations sold off. We maintain conviction for the long term as we ShockWave Medical, Inc. provides intravascular lithotripsy for the believe Guardant is a unique growth company that has the potential to minimally invasive treatment of arterial plaque. Shares performed well for transform cancer care. (Caleb Huang) the quarter after the company announced FDA approval of its product for use in coronary artery disease, which we see as a significant growth driver as PORTFOLIO STRUCTURE it launches in the U.S. ShockWave’s financial results and guidance were also outstanding, with first quarter revenue growth of 110% and full-year The Fund invests in secular growth and innovative businesses across all revenue guidance over 200% at the high end. We think ShockWave has a market capitalizations, with the bulk of the portfolio landing in the large-cap differentiated technology serving a significant unmet need in arterial disease zone. The Fund is categorized as Large Growth by Morningstar. As of the end and meaningful long-term growth potential. (Caleb Huang) of the second quarter, the largest market cap holding in the Fund was $2.0 trillion and the smallest was $1.4 billion. The median market cap of the Fund Table III. was $24.0 billion. Top detractors from performance for the quarter ended June 30, 2021 Percent The Fund had $1.62 billion of assets under management. The Fund had Impact investments in 68 securities. The Fund’s top 10 positions accounted for Tripadvisor, Inc. –0.90% 36.8% of net assets. Opendoor Technologies Inc. –0.29 Fund inflows, which accelerated during 2020, remained solidly positive for BridgeBio Pharma, Inc. –0.21 the first half of the year. ACV Auctions Inc. –0.21 Guardant Health, Inc. –0.21 Table IV. Tripadvisor, Inc. is an online travel company where users can browse reviews Top 10 holdings as of June 30, 2021 and plan trips. Shares fell on concerns that new COVID-19 variants would delay Quarter End Quarter End Investment Percent the recovery of the travel industry. In addition, investors appeared concerned Market Cap Value of Net that Tripadvisor’s new Tripadvisor Plus subscription offering, which launched in (billions) (millions) Assets June, would face competitive pressures. We do not believe traditional loyalty Microsoft Corporation $2,040.3 $133.8 8.2% programs will be materially competitive with the upfront savings offered by Alphabet Inc. 1,658.8 99.1 6.1 Tripadvisor Plus. We also think Tripadvisor is well positioned to benefit from Amazon.com, Inc. 1,735.0 83.5 5.1 pent-up consumer demand for travel. (Ashim Mehra) Tesla, Inc. 654.8 46.2 2.8 Opendoor Technologies Inc. operates a digital platform for home RingCentral, Inc. 26.4 42.2 2.6 purchases and sales on which buyers can tour homes, make offers, and NVIDIA Corporation 498.5 41.3 2.5 secure financing, and sellers can receive next-day cash offers with flexible ZoomInfo Technologies Inc. 20.4 40.6 2.5 close dates. Shares were down in the quarter given rising mortgage rates and Arrowhead Pharmaceuticals, Inc. 8.6 40.4 2.5 the potential knock-on effects to the housing environment. Despite investor Tripadvisor, Inc. 5.5 38.3 2.4 concerns, the housing market remains robust. As the iBuying industry leader Visa, Inc. 515.7 34.9 2.1 disrupting an enormous and highly inefficient industry, we believe Opendoor will grow regardless of the housing market environment. (Ashim Mehra)

40 June 30, 2021 Baron Opportunity Fund

RECENT ACTIVITY experienced management team has previously built a semiconductor company from the ground up, achieving a successful exit, giving us high Table V. confidence in their ability to execute their strategic plan at Indie as well. Top net purchases for the quarter ended June 30, 2021 Quarter End Amount RingCentral, Inc. has been a three-year portfolio holding and remains a Market Cap Purchased leader in the cloud unified communications-as-a-service (UCaaS) space, (billions) (millions) which includes voice, video, messaging, and call center services. But after Endeavor Group Holdings, Inc. $12.4 $15.6 posting its third quarter in a row of accelerating revenue growth in the first Indie Semiconductor, Inc. 1.4 14.0 quarter, RingCentral’s shares began to sell off on fears around heightened RingCentral, Inc. 26.4 13.1 competition with both Microsoft Teams, of which RingCentral is a partner, Atlassian Corporation Plc 64.5 11.9 and with Zoom Communications, a former partner who has launched its SoFi Technologies, Inc. 15.2 9.9 own voice communications offering. Shares sold off further during the period with the rotation out of secular growth names into cyclicals. We used We participated in the IPO of Endeavor Group Holdings, Inc., a media and the pullback in the shares to add significantly to our position given entertainment conglomerate built and led by CEO Ari Emmanuel, with RingCentral’s best-in-class UCaaS technology, including five 9’s contractual assets spanning talent representation (Endeavor, William Morris), events service commitments (fully operational 99.999% of the time) for voice, production and distribution (IMG, Fashion Week, the Miami Open), which is orders of magnitude above its competitors; presence in roughly 40 marketing and licensing, and owned sports/media properties, most notably countries; data governance and security requirements; number portability the UFC. In our analysis, some 50% of Endeavor’s operating cash flow with all the relevant domestic and international carriers; and positioning as (EBITDA) and 60% to 70% of value comes from the UFC, which is the the Gartner Magic Quadrant UCaaS Leader. The UCaaS market is still quite dominant platform in what we believe is a sport increasingly entering the early in its adoption curve, with only about 3% penetration of the roughly mainstream, both in the U.S. and abroad. We believe the opportunities to 400 million existing business landline seats in operation today. We believe grow UFC revenue over the medium term through sponsorship, event RingCentral is in a solid position to capture meaningful share of this market, revenue, and especially broadcast rights contracts, are substantial both in with its exclusive partnerships with legacy landline players like Avaya, Atos, new territories and at renewal of existing agreements given the sport’s and Alcatel, which effectively gives it a “hunting license” for about half of growth trajectory. We also like the asset’s structure relative to other sports, those 400 million legacy seats, leveraging joint go-to-market efforts with with greater control and superior economics to the league itself each partner. We remain confident that RingCentral is well positioned to versus underlying teams. Beyond the UFC, Ari and team have built the achieve at least 30% top-line growth for years to come, along with steadily combined William Morris Endeavor & IMG into a platform rather than improving operating margins and free cash flow generation. simply an agency, with broader capabilities to help both talent and Atlassian Corporation Plc is a software leader that makes tools that are corporate brands monetize across ever proliferating forms of media used by thousands of teams worldwide, thus its ticker TEAM. Atlassian’s consumption, which we think makes the business stickier and likely to gain tools “help teams collaborate, build, and create together” (quote from share. Finally, we expect future opportunistic acquisitions to be accretive, Atlassian’s website), with an emphasis on designing, developing, and particularly in owned sports and properties, where Endeavor can bring its maintaining software, including JIRA for team planning and project capabilities and platform to bear to accelerate the targets’ growth and management, Confluence for team content creation and sharing, HipChat extract cost synergies. for team messaging and communications, Bitbucket for team software code Indie Semiconductor, Inc. is a fabless designer, developer, and marketer of sharing and management, and JIRA Service Desk for team services and automotive semiconductors for advanced driver assistance systems, including support use cases. Atlassian is the recognized market leader for information LiDAR and connected car, user experience, and electrification applications. technology team planning and project management software, and has We participated in its recent SPAC transaction and have purchased additional extended its product offering into tangential areas, such as those listed shares in the aftermarket. We believe the automotive semiconductor space is above. The company is in the midst of transitioning its business model to an attractive industry vertical as new vehicle designs are long-lived and the cloud, which will help it drive faster product innovation, more seamlessly design wins provide strong revenue visibility. Additionally, semiconductor integrate its product families, and raise the effective price realization for its content in cars is expected to grow substantially in the coming decade, driven suite of products. Atlassian is run by its two visionary founders, has strong by enhanced safety and user experience features, as well as electrification. competitive advantages, and we think it should be able to grow revenue over 25% for many years with best-in-class free cash flow margins. While a relatively small company today, Indie already has multiple contracts with various automobile manufacturers and Tier 1 automotive suppliers that We participated in SPAC offering of SoFi Technologies, Inc., a branchless ramp in the coming years, with a total $2 billion strategic backlog of digital bank that provides a range of financial services products for the “high contracted business and a $2.5 billion pipeline of opportunities for which the earners not well served” demographic. SoFi was initially focused on student R&D has largely been funded. With the cash received from the SPAC loan refinancing, but it has vastly expanded its product portfolio, adding transaction, we are confident that Indie will accelerate its R&D efforts and other types of loans and a range of banking products, such as a bank continue to win new designs across an increasing number of applications, account, debit and credit cards, and brokerage (including crypto). We believe leading to strong growth over the coming decade. Indie’s key advantage is its that SoFi now has the broadest product suite of any “neobank” in the U.S., cross-domain expertise spanning analog, processing, and power and we view the lending segment, SoFi’s historical strength, as a semiconductor applications, enabling it to offer higher levels of integration differentiated product line that few neobank competitors currently offer. and design simplicity at a lower cost to customers. These advantages are With most neobanks focusing on the larger group of unbanked or reflected in 90% of their design wins being sole sourced. Moreover, Indie’s underbanked Americans, SoFi’s focus on a higher-income demographic,

41 Baron Opportunity Fund

coupled with its wide range of products, positions it to be one of the leading Endeavor, discussed above, and the PIPE offering of Nextdoor, led by the digital banks of the future. The breadth of its product portfolio means that, former CFO of Square, Sarah Friar, who we have known since her days on unlike its neobank competitors, SoFi can offer potential customers a product the sell-side at Goldman Sachs. We believe names like Snapchat, Pinterest, at many points in their lifecycle such as student loan refinancing for new Endeavor, and Nextdoor offer superior growth potential, and do not have graduates, or brokerage when those graduates accumulate savings. This the same global legal, regulatory, and political risks as Facebook. enables SoFi to sign up and retain customers for a long period of time. Aside As discussed above, we trimmed our weighting in Microsoft Corporation from member growth, SoFi plans to grow through cross-selling products into on strength to help fund investments in other software names that we its customer base, which drives both customer engagement and stickiness. In believed offered meaningful returns, such as RingCentral, Atlassian, Avalara, addition to the consumer finance offerings, SoFi owns a technology platform ServiceNow, Ceridian, ZoomInfo, and Guidewire. Microsoft remains the called Galileo that is used to power the banking experiences of many other largest position in our portfolio. neobanks. We believe the Galileo asset gives SoFi attractive exposure to the fast-growing broader consumer FinTech space. Over time, we expect SoFi to We sold Installed Building Products, Inc. and Rexford Industrial Realty, continue signing up members and then cross-selling those members multiple Inc. to fund higher growth investments, such as those discussed above. products, which should drive improving unit economics and profit growth. We sold Purple Innovation, Inc. on concerns regarding certain operating challenges facing the company. We anticipate revisiting an investment in Table VI. Purple going forward. Top net sales for the quarter ended June 30, 2021 Quarter End To conclude, I remain confident in and committed to the strategy of the Market Cap or Fund: durable growth based on powerful, long-term, innovation-driven Market Cap Amount When Sold Sold secular growth trends. As we approach the “new normal” after the COVID (billions) (millions) crisis, we continue to believe that non-cyclical, sustainable, and resilient Facebook, Inc. $ 920.5 $38.3 growth should be part of investors’ portfolios. Microsoft Corporation 2,040.3 21.7 Installed Building Products, Inc. 3.9 15.6 Sincerely, Purple Innovation, Inc. 1.8 13.9 Rexford Industrial Realty, Inc. 7.4 12.5

We made the difficult decision to sell our Facebook, Inc. position to fund other investments across the digital media, entertainment, and advertising Michael A. Lippert group, which has a significant total weight in our portfolio. These included Portfolio Manager June 30, 2021

Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectus contain this and other information about the Funds. You may obtain them from its distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing. Risks: The Adviser believes that there is more potential for capital appreciation in securities of high growth businesses benefiting from innovation through development of pioneering, transformative or technologically advanced products or services, but there also is more risk. Companies propelled by innovation, including technological advances and new business models, may present the risk of rapid change and product obsolescence and their successes may be difficult to predict for the long term. Securities issued by small and medium sized companies may be thinly traded and may be more difficult to sell during market downturns. Even though the Fund is diversified, it may establish significant positions where the Adviser has the greatest conviction. This could increase volatility of the Fund’s returns. The Fund may not achieve its objectives. Portfolio holdings are subject to change. Current and future portfolio holdings are subject to risk. The discussions of the companies herein are not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed in this report reflect those of the respective portfolio managers only through the end of the period stated in this report. The portfolio manager’s views are not intended as recommendations or investment advice to any person reading this report and are subject to change at any time based on market and other conditions and Baron has no obligation to update them. This report does not constitute an offer to sell or a solicitation of any offer to buy securities of Baron Opportunity Fund by anyone in any jurisdiction where it would be unlawful under the laws of that jurisdiction to make such offer or solicitation. BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a limited purpose broker- dealer registered with the SEC and member of the Financial Industry Regulatory Authority, Inc. (FINRA).

42 June 30, 2021 Baron Partners Fund

Dear Baron Partners Fund Shareholder: Performance

Baron Partners Fund (the “Fund”) increased 4.83% (Institutional Shares) in the second quarter of 2021. However, it trailed its primary benchmark, the Russell Midcap Growth Index (the “Index”), which increased 11.07%. The S&P 500 Index and the Morningstar Large Growth Category (the “Peer Group”) Average rose 8.55% and 10.28%, respectively. The Fund’s trailing 12-month performance remains outstanding. During that period, the Fund advanced 119.55%. This result compares very favorably to its benchmarks and Peer Group. The Index gained 43.77%, while the S&P 500 Index and Peer Group increased 40.79% and 41.70%, respectively, over the prior year. Table I. Performance Annualized for periods ended June 30, 2021 Baron Baron Partners Partners Russell Fund Fund Midcap S&P Retail Institutional Growth 500 MICHAEL BARON RON BARON Retail Shares: BPTRX Shares1,2,3 Shares1,2,3,4 Index2 Index2 CO-PORTFOLIO CEO AND LEAD Institutional Shares: BPTIX Three Months5 4.76% 4.83% 11.07% 8.55% MANAGER PORTFOLIO MANAGER R6 Shares: BPTUX Six Months5 4.29% 4.43% 10.44% 15.25% One Year 118.98% 119.55% 43.77% 40.79% Three Years 47.25% 47.64% 22.39% 18.67% But it is not only the prior year when the Fund had strong performance. For Five Years 38.09% 38.45% 20.52% 17.65% over 18 years since Baron Partners Fund converted from a private Ten Years 23.55% 23.88% 15.13% 14.84% partnership into a mutual fund, it has an annualized return of 19.20%. Since Fifteen Years 16.36% 16.61% 12.10% 10.73% its conversion, it is ranked 3rd among all U.S. equity funds (2,205 share Since Conversion (April 30, 2003) 18.99% 19.20% 13.42% 11.10% classes) through June 30, 2021.* Since Inception (January 31, 1992) 16.27% 16.39% 11.03% 10.53%

Performance listed in the above table is net of annual operating expenses. Annual expense ratio for the Retail Shares as of December 31, 2020 was 1.56% (comprised of operating expenses of 1.31% and interest expense of 0.25%) and Institutional Shares was 1.30% (comprised of operating expenses of 1.05% and interest expense of 0.25%). The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original cost. The Adviser reimburses certain Baron Fund expenses pursuant to a contract expiring on August 29, 2031, unless renewed for another 11-year term and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted. For performance information current to the most recent month end, visit www.BaronFunds.com or call 1-800-99BARON. 1 Reflects the actual fees and expenses that were charged when the Fund was a partnership. The predecessor partnership charged a 20% performance fee after reaching a certain performance benchmark. If the annual returns for the Fund did not reflect the performance fees the returns would be higher. The Fund’s shareholders will not be charged a performance fee. The predecessor partnership’s performance is only for periods before the Fund’s registration statement was effective, which was April 30, 2003. During those periods, the predecessor partnership was not registered under the Investment Company Act of 1940 and was not subject to its requirements or the requirements of the Internal Revenue Code relating to registered investment companies, which, if it were, might have adversely affected its performance. 2 The Russell Midcap® Growth Index measures the performance of medium-sized U.S. companies that are classified as growth and the S&P 500 Index of 500 widely held large cap U.S. companies. Russell Investment Group is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. Russell is a trademark of Russell Investment Group. The indexes and the Fund include reinvestment of dividends, net of withholding taxes, which positively impact the performance results. The indexes are unmanaged. Index performance is not Fund performance; one cannot invest directly into an index. 3 The performance data in the table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. 4 Performance for the Institutional Shares prior to May 29, 2009 is based on the performance of the Retail Shares, which have a distribution fee. The Institutional Shares do not have a distribution fee. If the annual returns for the Institutional Shares prior to May 29, 2009 did not reflect this fee, the returns would be higher. 5 Not annualized. * This is a hypothetical ranking created by Baron Capital using Morningstar data and is as of 6/30/2021. Note, the peer group used for this analysis includes all U.S. equity share classes in Morningstar Direct domiciled in the U.S., including obsolete funds, index funds, and ETFs. The individual Morningstar Categories used for this analysis are the Morningstar Large Blend, Large Growth, Large Value, Mid-Cap Blend, Mid-Cap Growth, Mid-Cap Value, Small Blend, Small Growth, and Small Value Categories. There are 2,205 share classes in these nine Morningstar Categories for the period from 4/30/2003 to 6/30/2021. The Morningstar Large Growth Category consisted of 1,239, 1,024, and 761 share classes for the 1-, 5-, and 10-year periods. Morningstar ranked Baron Partners Fund – Retail Share Class in the 1st, 2nd, 1st, and 1st percentiles for the 1-, 5-, 10-year, and since conversion periods, respectively. The Fund converted into a mutual Fund 4/30/2003, and the category consisted of 422 share classes. © 2021 Morningstar. All Rights Reserved. The Morningstar information contained herein: (1) is proprietary to Morningstar and/or its content providers; BARON (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 FUNDS responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.

43 Baron Partners Fund

Baron Partners Fund is a non-diversified portfolio, yet it is still diversified Communications Inc., Spotify Technology S.A., and Tesla, Inc. struggled among different types of businesses. In our analysis, we segment the Fund’s as interest in cyclical reopening stocks increased. Investors also had portfolio into four business categories (Core Growth, Disruptive Growth, concerns if customers would return to prior habits. We do not think this is Financials, and Real/Irreplaceable Assets). likely. In our opinion, the far superior offerings of these businesses compared to the competition should sustain and grow their usage. We anticipate high The Fund’s Core Growth and Financials investments achieved returns retention rates for the new clients who were exposed to these offerings similar to the broader market. The vast majority of companies in these during the pandemic. segments appreciated over the quarter, although for different reasons. COVID-19 vaccination rates steadily improved throughout the quarter. Core Growth companies were largely able to continue to execute their Industries are returning to pre-pandemic operations, but it has not been a business plans despite the interruptions caused by the economic restart. seamless process. Investors continue to assess global economic and health Supply chain issues and employment concerns largely did not impact these data points and extrapolate their implications. This combination has created operations. Gartner, Inc. and IDEXX Laboratories, Inc. are good examples. a volatile environment for the markets and the Fund. While the Fund’s Both companies’ stocks appreciated approximately 30% in the quarter. absolute return for the three-month period was good, it was not steady. Gartner’s high-margin research business had accelerating growth. Its April’s return was up 5.52%. In May, the Fund declined 5.22%. And then in retention of clients also improved. And its necessary pivot to digital June, it rose 4.82%. Yet the fundamentals and prospects of the Fund’s conferences spurred by the pandemic has resulted in improved profitability. investments changed little from month to month. We do not try to predict The company provided a favorable outlook and reinforced that optimism macroeconomic occurrences or their near-term impact on market through the repurchase of its stock. Likewise, IDEXX is benefiting from a valuations. Rather, we continually assess the health and prospects of our return of veterinary visits. This favorable backdrop allows its enhanced sales investments. We believe volatility has created investment opportunities for team to sell its new proprietary innovations. Some aspects of the business the Fund. are already at pre-pandemic levels. Improved volume and growth in consumables led to improved margins. And again, the company used its The volatility in the market enabled us to make new investments at what we cash flow to repurchase its own shares. believe are attractive prices. The two largest new purchases were RingCentral, Inc. and Cohen & Steers, Inc. RingCentral is the cloud-based The Fund’s Financials investments also approximated the market’s return. communication systems leader, with 3 million users and capabilities in over Improved asset values and increasing rates were a positive backdrop for 40 countries. But the company’s stock is down approximately 23% over the many of these businesses. More importantly, the long-term outlook for prior six months because of fears of competition from Microsoft and Zoom these businesses remains favorable. MSCI, Inc. is one example. The company Communications. The market rotation to cyclical companies also lowered should be able to increase its data and analytics sales in growing financial RingCentral’s valuation. Regardless, we believe the fundamentals of categories. Its product should enable the continued increased use of factor, RingCentral remain intact. A dispersed workforce has made corporations passive, and environmental, social and governance (“ESG”) investing. MSCI understand that global cloud communications and collaboration solutions has a significant leadership position in ESG data and the category’s are essential. But yet, RingCentral only services a small portion of the increased importance to investors should enable substantial growth in the 400 million users of on-premise telephone systems. We expect this to coming years. change. Over the past 18 months, RingCentral has signed distribution Our investments in Real/Irreplaceable Assets and Disruptive Growth agreements with legacy providers including Avaya, Atos, and Alcatel. We companies had more dispersed returns. Investors continued to evaluate the believe a high portion of these users will seamlessly migrate to the speed at which customers will return to properties or if the pandemic’s RingCentral offering without the need to invest in new hardware. These conclusion will cause a tough comparison for these innovative businesses. connections allow for transferring customer data, configurations, and carrier plans. Its expansive geographic reach will be vital for many clients’ global Hyatt Hotels Corp., Marriot Vacations Worldwide Corp., and footprints and ambitions. The highly scalable service should also enable Manchester United plc declined in the period as new COVID variants RingCentral to lower prices while growing margins. The competition’s delayed the reopening of some global properties and caused some hesitation reliability is not sufficient, and their systems were designed for intra- in travel. Businesses that were more insulated from these concerns, like the company communications (not external communication). Additionally, outdoor-oriented Vail Resorts, Inc. and casino-related businesses like Red RingCentral’s exclusive carrier relationships make it difficult for competitors Rock Resorts, Inc. and Gaming and Leisure Properties, Inc., performed to replace them. better. The diversity of holdings across business types enabled the Fund to have Similarly, certain disruptive businesses like Moderna, Inc., BioNTech SE, and good absolute returns in the quarter. We believe this variety of investments Shopify Inc., with unusually favorable growth prospects as the pandemic should enable it to continue to perform well despite the market’s near-term concludes, continued to outperform. Moderna and BioNTech should rotations. And the market volatility and Fund’s flexibility have enabled us to continue to discover novel therapies using mRNA technology, and Shopify make interesting new investments at what we believe are attractive prices should continue to enable more brands direct e-commerce efforts. Stocks of to our assessment of their future value. We believe this combination other disruptive growth companies like Zillow Group, Inc., Iridium positions the Fund well for long-term results.

44 June 30, 2021 Baron Partners Fund

Table II. Table III. Total returns by category for the three months ended June 30, 2021 Top contributors to performance for the quarter ended June 30, 2021 %of Market Quarter Net Assets Total Contribution Cap End (as of Return to Return When Market 6/30/2021) (%) (%) Year Acquired Cap Total Percent Acquired (billions) (billions) Return Impact Core Growth 23.5 12.17 2.81 IDEXX Laboratories, Inc. 2013 $ 4.7 $ 53.9 29.07% 1.75% Gartner, Inc. 2.5 32.68 0.62 Gartner, Inc. 2013 5.7 20.8 32.68 0.62 IDEXX Laboratories, Inc. 7.3 29.07 1.75 Tesla, Inc. 2014 22.0 654.8 1.76 0.58 HEICO Corporation 0.5 10.21 0.04 The Charles Schwab Adyen N.V. 2.1 9.90 0.20 Activision Blizzard, Inc. 1.1 3.12 0.04 Corp. 1992 1.0 137.3 12.00 0.46 CoStar Group, Inc. 8.8 0.77 0.17 Shopify Inc. 2020 83.7 182.1 32.04 0.40 GDS Holdings Limited 1.1 –3.27 –0.04 Shares of veterinary diagnostics leader IDEXX Laboratories, Inc. Applovin Corporation 0.1 –9.45 0.02 contributed to performance in the quarter. Veterinary visits continue to Russell Midcap Growth Index 11.07 recover from pandemic lows, with practice revenue growing at double-digit Financials 13.5 9.77 1.19 rates. IDEXX’s competitive trends are outstanding, and we expect new proprietary innovations and field sales force expansion to be meaningful MSCI, Inc. 1.2 27.36 0.25 Cohen & Steers, Inc. 0.4 18.38 0.06 contributors to growth. Margins are moving significantly higher, and we Brookfield Asset Management Inc. 0.7 15.62 0.11 believe they could exceed 30% over time. The Charles Schwab Corp. 4.1 12.00 0.46 Shares of Gartner, Inc., a provider of syndicated research, rose in the FactSet Research Systems, Inc. 3.4 9.03 0.26 quarter after the company reported financial results that were significantly Arch Capital Group Ltd. 3.7 1.49 0.04 better than investors’ estimates. Growth in the company’s research business Brookfield Asset Management has reaccelerated. The Global Business Sales segment, which is benefiting Reinsurance Partners Ltd. 0.0 –1.86 –0.00 from a multi-year investment cycle, led the growth. We expect improved Real/Irreplaceable Assets 12.9 1.51 0.19 revenue growth and renewed focus on cost controls to drive margin Red Rock Resorts, Inc. 0.4 30.41 0.09 expansion and enhanced free cash flow generation. The company’s balance Gaming and Leisure Properties, Inc. 1.2 10.72 0.12 sheet is also in excellent condition, and we expect share repurchases to Vail Resorts, Inc. 4.6 8.52 0.36 accelerate. Douglas Emmett, Inc. 0.5 7.96 0.05 Tesla, Inc. designs, manufactures, and sells fully electric vehicles, solar Manchester United plc 1.3 –3.50 –0.07 products, energy storage solutions, and battery cells. Shares increased Hyatt Hotels Corp. 3.3 –6.12 –0.20 following strong execution in a complex supply chain environment. And Marriott Vacations Worldwide Corp. 1.6 –8.54 –0.16 despite recent negative headlines in Chinese media, execution in that Disruptive Growth 58.1 1.35 0.92 country has improved. Demand has remained robust, the refreshed Model S Moderna, Inc. 0.2 78.35 0.07 received positive reviews, and new production facilities are expected to Shopify Inc. 1.4 32.04 0.40 support more profitable growth. We expect supply chain headwinds to be Zymergen Inc. 0.4 28.26 0.08 resolved, and we remain optimistic about existing and new product RingCentral, Inc. 1.3 11.00 0.14 programs. Guidewire Software, Inc. 1.5 10.91 0.17 BioNTech SE 0.2 8.34 0.01 The Charles Schwab Corp., an online brokerage firm, contributed for the Spotify Technology S.A. 1.3 2.08 0.10 quarter. Schwab has continued to attract new customers to its platform and Tesla, Inc. 41.2 1.76 0.58 offer them a wider array of services. This engagement should result in a Iridium Communications Inc. 0.9 –3.05 –0.02 stickier and more valuable client over time. Additionally, the company American Well Corporation – –3.14 –0.00 continues to successfully integrate its acquisition of TD Ameritrade, which Space Exploration Technologies Corp. 4.7 –5.17 –0.25 should yield cost savings. Finally, the business now has over $400 billion of Zillow Group, Inc. 4.9 –6.74 –0.34 interest-earning assets. Anticipated rising rates should lead to improved Northvolt AB 0.1 –6.86 –0.01 earnings in the coming years. Airbnb, Inc. 0.0 –18.52 –0.01 Shopify Inc. is a cloud-based software provider offering an operating system Virgin Galactic Holdings, Inc. – –19.57 –0.01 for multi-channel commerce. The company has over 1.7 million merchants Cash –8.1 0.11 –0.00 that processed nearly $120 billion of gross merchandise value in 2020, Fees – –0.31 –0.32 making Shopify the second largest e-commerce player in the U.S. Shares Total1 100.0 4.79* 4.79* increased on the strength of the company’s continued strong execution as it deepens its platform for merchants while expanding its competitive moats. Sources: FactSet PA, BAMCO, and Russell, Inc. We believe Shopify has a long runway for growth as it continues to reduce * Represents the blended return of all share classes of the Fund. hurdles for its merchants. 1 – Includes the weight and performance of SPAC Atlas Crest Investment Corp., which is not shown in the table.

45 Baron Partners Fund

Table IV. Investment Strategy And Portfolio Structure Top detractors from performance for the quarter ended June 30, 2021 Market Quarter Baron Partners Fund seeks to invest in businesses that we believe could Cap End double in value within five or six years. The Fund seeks to invest for the long When Market term in a focused portfolio of appropriately capitalized, well-managed Year Acquired Cap Total Percent Acquired (billions) (billions) Return Impact growth businesses at attractive prices across market capitalizations. We attempt to create a portfolio of approximately 30 securities diversified by Zillow Group, Inc. 2014 $0.4 $30.3 –6.74% –0.34% GICS sectors, but with the top 10 positions representing a significant portion Space Exploration of net assets. The Fund uses modest leverage to enhance returns, although Technologies Corp. 2017 – – –5.17 –0.25 this does increase its volatility. These businesses are identified by our Hyatt Hotels Corp. 2009 4.2 7.9 –6.12 –0.20 analysts and portfolio managers using our Firm’s proprietary research. We Marriott Vacations think these well-managed businesses have sustainable competitive Worldwide Corp. 2018 3.2 6.8 –8.54 –0.16 advantages and strong, long-term growth opportunities. Manchester United plc 2014 2.8 2.5 –3.50 –0.07 As of June 30, 2021, Baron Partners Fund held 36 investments. The median Zillow Group, Inc. operates leading U.S. real estate sites, a mortgage market capitalization of these growth companies was $23.6 billion. The top marketplace, and the Zillow Offers home buying business. Shares were down 10 positions represented 86.0% of net assets. Leverage was 8.1%. due to rising mortgage rates and the potential knock-on effects to the housing environment. Zillow also issued second quarter revenue guidance Portfolio leverage has increased slightly but is still significantly below that was slightly below Street expectations. Despite this intra-quarter historical levels. We have traditionally managed the portfolio with 20% to volatility, we continue to believe that Zillow has substantial upside in 30% leverage (the average leverage over the prior five years was 23.0%). A mortgages and Offers, which could grow its addressable market not only in year ago, leverage was 22.2%. However, due to a combination of a rapidly houses bought/sold but also in leads provided to Zillow Premier Agents. rising market, higher market volatility and increased concentration in top holdings, we managed risk by reducing the amount of leverage used by the Space Exploration Technologies Corp. (“SpaceX”) designs, manufactures, Fund. Leverage is currently only 8.1%. This increased 480 bps since the and launches rockets, satellites, and spacecrafts. Its mission, ultimately, is to previous quarter end. Market volatility enabled us to make a few new enable people to live on other planets. SpaceX is commercializing its investments in companies, which we have long followed, at what we believe broadband offering by rapidly deploying user terminals and its satellite are attractive prices. While the legacy positions will continue to be the main constellation. It continues to reliably provide reusable launch capabilities, contributors of performance in the near term, these new investments should including crewed flights, and advancing the development of its newest and be a factor in the future. larger rocket, Starship. We value SpaceX using prices of recent transactions and a proprietary valuation model. The long-term absolute and relative performance of the Fund has been very good. The Fund has returned 16.39% annualized since inception as a private Shares of Hyatt Hotels Corp., a global hotelier, declined in the quarter due partnership on January 31, 1992, beating its benchmark Index by 5.36% per to investor concerns around a new, more contagious variant of COVID-19 year. Additionally, the Fund’s performance has exceeded its Index over the and a reopening of Asia and Europe that was slower than market forecasts. prior 1-, 3-, 5-, 10-, 15-, and 20-year periods. In addition to viewing the While the slowed reopening is a disappointment, Hyatt’s domestic business Fund’s returns over various trailing periods, we believe it is helpful to and group bookings are starting to return, and we think conditions will understand how the Fund has performed over an economic cycle. (Please normalize by 2022, at least domestically. The company remains on track see Table V.) with its asset sale program as the hotel transaction market returns to pre-pandemic valuations, which should make Hyatt a more valuable, The Fund has appreciated considerably in good times… fee-based business. The Fund performed very well during the current economic expansion that Marriott Vacations Worldwide Corp., a developer and seller of timeshares, followed the Financial Panic. For over 12 years, there has been sizable detracted in the quarter on investor concerns about the impact on travel of growth in the economy and stock market appreciation. While the market a new, more contagious variant of COVID-19. Shares were also pressured by had strong returns, the Fund’s returns were significantly better. Baron the possibility of higher mortgage rates. While both developments are Partners Fund’s annualized return during this period was 24.35%. Had you concerns, Marriott Vacations has seen no impact from either as its business hypothetically invested $10,000 in the Fund on 12/31/2008, it would have is recovering quickly, and the securitization market is at its best levels ever. been worth $152,453 on 6/30/2021. Had you only tried to mimic the Marriott Vacations remains a strong free cash flow business. Index’s returns by investing in a Fund designed to track the Index, that $10,000 hypothetical investment would be worth $82,931. Manchester United plc is the best-known team in the English Premier League, generating revenue primarily from broadcasting, sponsorship, and The Fund has retained value in difficult times… licensing. Shares fell on continued pandemic-related impact to commercial We believe it is equally important to examine the Fund’s performance and matchday revenues. Investors were also disappointed by the failed during more challenging economic times. The nine-year period from the attempt to form a new Super League that would have replaced the Internet Bubble collapse through the Financial Panic (12/31/1999– Champions League and allowed Manchester United to participate each year 12/31/2008) saw lower returns for the Fund. It had annualized returns of as a founding member. Despite these setbacks, we view Manchester United 1.54%. However, the Index declined substantially. $10,000 hypothetically as a unique media company with 1.1 billion fans globally and broad appeal invested in the Fund at the start of this period would have been worth that should compound value. $11,479 after those nine years. A $10,000 hypothetical investment in funds

46 June 30, 2021 Baron Partners Fund

designed to track the Index would be worth only $6,488. The Fund preserved fund designed to track the Russell Midcap Growth Index. That investment (and slightly grew) capital during this difficult economic time because its would be worth only $53,802. investments in high-quality growth businesses were able to weather the environment and enhance their competitive positioning. During periods of strong economic expansion, investors often disregard more challenging periods. Losing capital during those periods, we believe, The strong relative returns during difficult times are what we believe sets makes it nearly impossible to have exceptionally strong returns over the the Fund apart and makes its returns over an entire cycle exceptional. A long term. Baron Partners Fund has shown a prior ability to modestly grow $10,000 hypothetical investment at the start of the cycle on 12/31/1999 capital during those tough times. We believe the high-quality growth would have been worth $174,995 at 6/30/2021. That same $10,000 portfolio should be able to perform well again in future difficult economic hypothetical investment would be worth 69% less had it been invested in a stretches, although there is no guarantee that will be the case.

Table V. Performance Millennium to COVID-19 Pandemic. The Impact of Not Losing Money. Millennium Internet Bubble Financial Panic to Millennium Internet Inception to Financial Panic Present Bubble to Present 1/31/1992 to 12/31/1999 to 12/31/2008 12/31/2008 to 6/30/2021 12/31/1999 to 6/30/2021 6/30/2021 Value Value Value Value $10,000 Annualized $10,000 Annualized $10,000 Annualized $10,000 Annualized Baron Partners Fund (Institutional Shares) $11,479 1.54% $152,453 24.35% $174,995 14.24% $869,465 16.39% Russell Midcap Growth Index $ 6,488 (4.69)% $ 82,931 18.44% $ 53,802 8.14% $216,908 11.03% S&P 500 Index $ 7,188 (3.60)% $ 61,548 15.65% $ 44,240 7.16% $189,991 10.53%

The indexes are unmanaged. Index performance is not Fund performance; one cannot invest directly into an index.

Portfolio Holdings Thank you for joining us as fellow shareholders in Baron Partners Fund. We continue to work hard to justify your confidence and trust in our Table VI. stewardship of your hard-earned savings. We remain dedicated to provide Top 10 holdings as of June 30, 2021 you with the information we would like to have if our roles were reversed. Market Quarter Quarter We hope this letter enables you to make an informed decision about Cap End End Percent When Market Investment of whether this Fund remains an appropriate investment. Year Acquired Cap Value Total Acquired (billions) (billions) (millions) Investments Respectfully, Tesla, Inc. 2014 $22.0 $654.8 $2,837.7 38.1% CoStar Group, Inc. 2005 0.7 32.7 608.7 8.2 IDEXX Laboratories, Inc. 2013 4.7 53.9 505.2 6.8 Zillow Group, Inc. 2014 0.4 30.3 337.0 4.5 Space Exploration Ronald Baron Michael Baron Technologies Corp. 2017 – – 320.9 4.3 CEO and Lead Portfolio Manager Co-Portfolio Manager Vail Resorts, Inc. 2008 1.6 12.7 316.5 4.2 June 30, 2021 June 30, 2021 The Charles Schwab Corp. 1992 1.0 137.3 284.0 3.8 Arch Capital Group Ltd. 2002 0.6 15.7 255.1 3.4 FactSet Research Systems, Inc. 2007 2.7 12.7 234.9 3.2 Hyatt Hotels Corp. 2009 4.2 7.9 225.2 3.0

47 Baron Partners Fund

Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectus contain this and other information about the Funds. You may obtain them from its distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing. Risks: The Fund is non-diversified which means, in addition to increased volatility of the Fund’s returns, it will likely have a greater percentage of its assets in a single issuer or a small number of issuers, including in a particular industry than a diversified fund. Single issuer risk is the possibility that factors specific to an issuer to which the Fund is exposed will affect the market prices of the issuer’s securities and therefore the net asset value of the Fund. As of the date of the latest prospectus supplement, about 40% of the Fund’s assets are invested in Tesla stock. Therefore, the Fund is exposed to the risk that were Tesla stock to lose significant value, which could happen rapidly, the Fund’s performance would be adversely affected. Specific risks associated with leverage include increased volatility of the Fund’s returns and exposure of the Fund to greater risk of loss in any given period. The Fund may not achieve its objectives. Portfolio holdings are subject to change. Current and future portfolio holdings are subject to risk. The discussions of the companies herein are not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed in this report reflect those of the respective portfolio managers only through the end of the period stated in this report. The portfolio manager’s views are not intended as recommendations or investment advice to any person reading this report and are subject to change at any time based on market and other conditions and Baron has no obligation to update them. This report does not constitute an offer to sell or a solicitation of any offer to buy securities of Baron Partners Fund by anyone in any jurisdiction where it would be unlawful under the laws of that jurisdiction to make such offer or solicitation. BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a limited purpose broker- dealer registered with the SEC and member of the Financial Industry Regulatory Authority, Inc. (FINRA).

48 June 30, 2021 Baron Fifth Avenue Growth Fund

DEAR BARON FIFTH AVENUE GROWTH FUND SHAREHOLDER: PERFORMANCE

Baron Fifth Avenue Growth Fund (the “Fund”) gained 13.8% (Institutional Shares) during the second quarter, which compared favorably to gains of 11.9% for the Russell 1000 Growth Index (“R1KG”) and 8.6% for the S&P 500 Index (“SPX”), the Fund’s benchmarks. The Fund gained back most of its relative underperformance from the prior quarter and is now trailing its benchmarks by 96bps and 322bps year-to-date, respectively.

Table I. Performance Annualized for periods ended June 30, 2021 Baron Baron Fifth Fifth Avenue Avenue Growth Growth Russell Fund Fund 1000 S&P Retail Institutional Growth 500 Shares1,2 Shares1,2,3 Index1 Index1 Three Months4 13.73% 13.82% 11.93% 8.55% ALEX UMANSKY Retail Shares: BFTHX Six Months4 11.87% 12.03% 12.99% 15.25% Institutional Shares: BFTIX One Year 34.99% 35.34% 42.50% 40.79% PORTFOLIO MANAGER R6 Shares: BFTUX Three Years 25.63% 25.94% 25.14% 18.67% Five Years 27.00% 27.32% 23.66% 17.65% Ten Years 18.37% 18.67% 17.87% 14.84% As is usually the case, most of the Fund’s outperformance in the quarter was Fifteen Years 12.62% 12.85% 13.53% 10.73% due to stock selection, which contributed 136bps of the Fund’s 188bps of Since Inception outperformance relative to the R1KG. After the first quarter’s pullback, our (April 30, 2004) 12.06% 12.25% 12.42% 10.45% holdings in Information Technology (“IT”) bounced back nicely and were responsible for 76bps of our outperformance after being our largest From a broad perspective, stocks continued moving higher during the detractor in the prior three months. Within IT, we benefited from the second quarter, extending the market rally over the last 15 months, with the recovery in systems software as our investments in this sub-industry R1KG now up a remarkable 109.0% cumulatively from the trough reached appreciated 21.1% as a group during the quarter, after being down 6.4% in on March 23, 2020. From the same trough, the Fund is up more at 111.4%, the first quarter. This together with continued strength in IT consulting & and the SPX is up less at 96.1%. Looking deeper however, the second quarter other services (think EPAM), contributed 117bps to our relative was quite different from the first. Growth stocks rebounded sharply, as long- outperformance. The Fund also benefited from a recovery in Health Care term interest rates stabilized below 1.5% after hitting a high of nearly 1.8% and Consumer Discretionary, our second and third largest sectors (after IT), during the prior three months. The powerful rotation into stocks perceived which together contributed another 56bps to relative returns. to be the beneficiaries of the “reopening of the economy” had slowed down enabling our portfolio to post solid gains and recover some of the lost ground from the first quarter.

Performance listed in the table above is net of annual operating expenses. Annual expense ratio for the Retail and Institutional Shares as of September 30, 2020 was 1.05% and 0.78%, but the net annual expense ratio was 1.00% and 0.75% (net of the Adviser’s fee waivers, restated to reflect current fee waivers). The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original cost. The Adviser reimburses certain Baron Fund expenses pursuant to a contract expiring on August 29, 2031, unless renewed for another 11-year term and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted. For performance information current to the most recent month end, visit www.BaronFunds.com or call 1-800-99BARON.

1 The Russell 1000® Growth Index measures the performance of large-sized U.S. companies that are classified as growth and the S&P 500 Index of 500 widely held large cap U.S. companies. Russell Investment Group is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. Russell is a trademark of Russell Investment Group. The indexes and the Fund include reinvestment of dividends, net of withholding taxes, which positively impact the performance results. The indexes are unmanaged. Index performance is not Fund performance; one cannot invest directly into an index. 2 The performance data in the table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. 3 Performance for the Institutional Shares prior to May 29, 2009 is based on the performance of the Retail Shares, which have a distribution fee. The Institutional Shares do not have a distribution fee. If the annual returns for the Institutional Shares prior to May 29, 2009 did not reflect this fee, the BARON returns would be higher. FUNDS 4 Not annualized.

49 Baron Fifth Avenue Growth Fund

At the company-specific level, we had an unusually high “hit rate” with 37 optimize a portfolio to perform over any specific period of time (a quarter or contributors/advancers against just 6 decliners. Out of those 37 a year). The investing we do is neither a sprint nor a marathon because there investments, 21 we up double digits, 11 of which appreciated 20% or more, is no finish line. That brings us to the remaining phase of a Chess game that including our newest purchases NVIDIA (initiated last quarter) and UiPath we think can be instructive to investors–the Middlegame! (acquired during this one) which were up 50% and 21%, respectively. According to Wikipedia “The middlegame in chess is the portion of the game in Putting our inflows to work over the last six to nine months into companies between the opening and the endgame. Themiddlegamebeginswhenboth such as Alphabet, Shopify, and Dynatrace, also helped our results. players have completed the development of all or most of their pieces…. Alphabet and EPAM contributed over 100bps each to absolute returns, while Theory on the middlegame is less developed than the opening or endgames. Amazon, CrowdStrike, Facebook, Adobe, NVIDIA, Intuitive Surgical, Since middlegame positions are unique from game to game, memorization of Veeva, Illumina, Shopify, PayPal, and Twilio contributed over 50bps each. theoretical variations is not possible as it is in the opening. Likewise, there are According to Morningstar, for the period ended June 30, 2021, the Fund usually too many pieces on the board for theoretical positions to be completely ranked in the top 16% for its 3-year return, top 9% for its 5-year return, top analyzed as can be done in the simpler endgames.” The Middlegame is often 10% for its 10-year return, and top 9% since the Fund’s restructuring at the considered the most exciting phase of the chess game. It is in this stage of the end of 2011. Since that time, it has returned 505.1% cumulatively, game, after the Opening has finished but while there are still plenty of pieces on outperforming the R1KG by 66.5%, the SPX by 190.9%, and the Morningstar the board, that the outcome of the game is most frequently decided. One of Large Growth Category Average by 150.6%.* the great challenges of the Middlegame is how to make progress when there are no obvious moves. We think of investing as the perpetual Middlegame. We We have written in the past how we thought Poker and Fantasy Football go to great lengths to research, understand, and develop conviction in the could provide useful training ground for aspiring investors. Both are games companies in which we invest. More often than not, we are happy with our of incomplete information that require patient and opportunistic capital “Opening” and are comfortable with our “board.” This is what Garry Kasparov, allocation in the face of a wide range of outcomes, with the ability to the greatest Chess player of all time, refers to as the “nothing to do” phase of manage the inherent uncertainty the future brings emerging as a critical skill the game. Interestingly enough, it is this stage of the game when action (as set. From that perspective, Chess has little to offer us. Chess is a classic opposed to reaction) is required most! It is this ability to improve one’s game of certainty. There is a “correct” move and a countermove at every positioning through subtle, seemingly unimportant or insignificant moves that step, where good decisions are rewarded, and bad ones punished. There are separates contenders from pretenders. Just like in Chess, we find there are no “ugly” river cards that radically change the texture of the board or frequent periods of time when there are no obvious buys or sells. Just like catastrophic knee injuries that wreak havoc on your team’s receiving corps, Mr. Kasparov, we believe that being proactive and not reactive is one of the and the better player wins almost every game. Yet, there is a critical part of keys to long-term success. We are always in the Middlegame and there are a Chess game that we think investors can learn from. many “nothing to do” moments. So we proactively build a pipeline of ideas– A game of Chess is divided into three distinct phases, known as the great businesses that benefit from disruptive change with platform economics Opening, the Middlegame, and the Endgame, each with its own distinct and network effects, run by talented entrepreneurs. Then we work on building strategies. The Opening typically covers the first 10 to 15 moves of the the conviction, stress-testing our assumptions, analyzing the competitive game in which both players are moving their pieces from their starting landscape, comparing them to our existing investments–always asking positions to take up active posts ready to do battle in the Middlegame. ourselves where we could be wrong and then taking action when we feel the Advanced players usually have this stage of the game figured out where a time is right. These shareholder letters are often focused on new ideas and we decision to open with the Queen’s Gambit or a Sicilian Defense is made write about a few things that impacted the recent results the most. Often, the subtle, “seemingly unimportant” moves do not attract a lot of attention before the game ever starts. This is akin to an investment team knowing/ because they do not become apparent or impactful until sometime in the deciding how they will allocate funds on day one of a new fund. In both future. cases, it is not uncommon to stay up all night just before, agonizing over the final decisions of what you want to accomplish and what you need it to look For example, Alphabet and Facebook were two of our largest additions in like once the Opening is complete. The Endgame in Chess has been the fourth quarter of last year and then again in the first quarter of 2021 thoroughly analyzed and is rarely played out at a higher level since piece and both performed very well, up 41% and 27% year-to-date, respectively. positioning makes it obvious who the winner will be. It has even less Interestingly, this solid performance coincided with an accelerating news relevance to us since the investing we do has no Endgame. We do not flow around Big Tech regulation. There are five new antitrust bills in the

* Mr. Umansky became the portfolio manager of the Fund on November 1, 2011. Since that date, the Fund has returned 486.65% cumulatively, which compares to 436.83% for the Russell 1000 Growth Index and 317.53% for the S&P 500 Index, outperforming the Morningstar Fund Large Growth Category average by 142.09% over the nine plus-year period. As of 6/30/2021, the annualized returns of the Morningstar Large Growth Category average were 41.70%, 22.56%, 21.98%, and 15.99% for the 1-, 3-, 5-, and 10-year periods, respectively. Morningstar calculates the Morningstar Large Growth Category average performance and rankings using the Morningstar Fractional Weighting methodology. Total returns do account for management, administrative, and 12b-1 fees and other costs automatically deducted from fund assets. Morningstar rankings are based on total returns and do not include sales charges. As of 6/30/2021, the Category consisted of 1,239, 1,138, 1,024, 761, and 788 share classes for the 1-, 3-, 5-, 10-year, and since restructuring (12/31/2011) periods. Morningstar ranked Baron Fifth Avenue Growth Fund Institutional Share Class in the 87th, 16th, 9th, 10th, and 9th percentiles, respectively. © 2021 Morningstar. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (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.

50 June 30, 2021 Baron Fifth Avenue Growth Fund

house targeting Big Tech, a G-7 proposal to change the tax rate (potentially encouraged by Alphabet’s investments in AI, autonomous driving (Waymo), taxing subsidiaries separately and limiting deductions), and a continued flow and life sciences (Verily, Calico). of litigation from the FTC, state attorney generals as well as international EPAM Systems, Inc. provides outsourced software development services to regulators. At the same time, Apple changed its privacy settings (App business customers. Shares gained 29% during the quarter driven by strong Tracking Transparency or ATT) such that users would need to proactively financial results that exceeded Street expectations. EPAM operates at the agree to share their data with the apps (and obviously, many decide not to; forefront of digitization by helping customers optimize ways to interact with recent data points to only 10% to 20% of users agreeing to share their their clients, enabling them to become more engaging, responsive, and data). This in turn is reducing the quality of the signal that is used by efficient. With rebounding demand following last year’s COVID-driven advertisers and could create disruption in the advertising ecosystem. slowdown as investments in digital transformation have risen in priority, So, have investors suddenly stopped caring about regulation? Is it priced in? EPAM has seen a strong recovery in revenue growth. We remain excited about EPAM’s long runway for growth underpinned by the need for digital We think that over time investors will realize that what really drives the transformations and the company’s strong execution in addressing this intrinsic values of both Alphabet and Facebook are the choices made by growing demand. Despite years of strong double-digit growth, it still consumers on the one side, and advertisers on the other side. As long as accounts for less than 2% of the $150 billion annual spend on digital people continue to use Google to research their next vacation or the type of engineering services. TV they want to buy, or even just for general knowledge gaining purposes, advertisers will continue to choose Google as the place they must spend Amazon.com, Inc. is the world’s largest retailer and cloud services provider. money on, to reach those consumers. Similarly, as long as users keep Shares were up 11% during the quarter after Amazon reported results that spending over an hour every day on Facebook (or on Instagram or WhatsApp beat expectations with revenues growing 44% year-over-year to nearly or Messenger), advertisers will have little to no choice but to be there. The $110 billion and operating margins reaching 8.2% driven by a continued famous Facebook advertiser boycott lasted for less than a month... They improvement in the international segment. Amazon remains our largest simply cannot afford to not be there. Even the recent privacy changes position as we believe it is one of the most competitively advantaged brought by Apple, while potentially disruptive in the near term, could end up companies in the world with a leading position in multiple trillion-dollar being a tailwind longer term to the walled gardens (Facebook, Alphabet and markets, that Amazon is in the early stages of disrupting. Domestic Amazon) due to the magnitude of first-party data these platforms have and e-commerce is still only 20% of retail (as of 2020), Amazon has around 1% the fact that they can increasingly close the proverbial loops on their own market share of international e-commerce (about $150 billion out of $16 platform (shopping), which increases their relative value to the advertisers. trillion), its advertising share is roughly 2%, and its share in cloud computing is still only 7.5% out of $3.6 trillion of global spend on information We wrote about Big Tech in our third quarter of 2020 letter and our view technology (according to Gartner). Areas such as logistics and health care remains largely unchanged: present additional optionality. “Big Tech’s power comes from consumer adoption and consumer preferences CrowdStrike, Inc. provides cloud-delivered, next generation security and there is little to nothing that regulations can do about that. It’s simply too solutions via its Falcon platform consisting of end-point protection, late. Instead of trying to figure out how to break them up (we wrote in the past advanced persistent threat, security information, event management, and that we believe in every relevant case 1+1 will likely yield a value greater than cloud workload protection. Shares rose 38% in the second quarter, more 2), the regulators need to realize that these four Tech giants fighting each than recovering the 14% correction in the first quarter, with revenue growth other is probably the best remedy (and a system of checks and balances) of 70% year-over-year and robust guidance ahead of consensus. With more available to them today.” workloads migrating to or starting in the cloud, CrowdStrike is well The Baron Fifth Avenue Growth Fund has generated an attractive upside positioned to compound at high growth rates for years given its unique capture of 101.5% and a downside capture of 80.8% over the last five years. product platform and disruptive go-to-market business model. We believe it is our ability to excel in the Middlegame and take advantage Shares of Facebook, Inc., the world’s largest social network, were up 18% of these “nothing to do” moments that has been the key to that success. this quarter on results that came ahead of market forecasts with 44% revenue growth (in constant currency), which compared to Street Table II. expectations of 31%, driven by the recovery in ad spending. In our view, Top contributors to performance for the quarter ended June 30, 2021 Facebook continues to utilize its leadership in mobile to provide global Quarter End advertisers targeted marketing capabilities at scale, with substantial future Market Cap Percent monetization opportunities across its various assets including WhatsApp, (billions) Impact Instagram, video tools including Watch and IG TV, and community-based Alphabet Inc. $1,658.8 1.27% marketplace, shopping, jobs, and dating features. EPAM Systems, Inc. 28.8 1.04 Amazon.com, Inc. 1,735.0 0.93 Table III. CrowdStrike, Inc. 56.7 0.90 Top detractors from performance for the quarter ended June 30, 2021 Facebook, Inc. 985.9 0.84 Quarter End Market Cap or Alphabet Inc. is the parent company of Google, the world’s largest search Market Cap and online advertising company. Shares of Alphabet were up 20% in the When Sold Percent (billions) Impact quarter driven by a continued recovery in ad spend, strong cloud revenue growth (up 46% in the first quarter year-over-year), and improved cost Acceleron Pharma Inc. $ 7.6 –0.13% controls (with operating margins reaching 30% in the first quarter). We GDS Holdings Limited 13.3 –0.13 remain excited about Alphabet’s merits as it continues to benefit from RingCentral, Inc. 26.4 –0.08 growth in mobile and online video advertising, which accrues to its core Alibaba Group Holding Limited 614.8 –0.06 assets of search, YouTube, and the Google ad network. We are further Space Exploration Technologies Corp. – –0.01

51 Baron Fifth Avenue Growth Fund

Acceleron Pharma Inc. is a biotechnology company focused on Table IV. therapeutics for rare blood and lung disorders. Shares declined 7% in the Top 10 holdings as of June 30, 2021 second quarter on limited impactful news flow during the quarter. Quarter End Importantly, Acceleron issued positive updates on clinical trial data packages Quarter End Investment Market Cap Value Percent of that highlighted the strength of its drug Luspatercept in the treatment of (billions) (millions) Net Assets Beta Thalessemia (the BEYOND trial). More recently, the company Amazon.com, Inc. $1,735.0 $66.3 7.9% highlighted its development strategies during a deep dive R&D day. Alphabet Inc. 1,658.8 53.8 6.4 Acceleron remains our largest biotechnology position and we have not Facebook, Inc. 985.9 40.5 4.8 changed our conviction. ServiceNow, Inc. 108.5 33.0 3.9 GDS Holdings Limited is a leading Chinese data center operator namely EPAM Systems, Inc. 28.8 32.5 3.9 focused on Tier 1 cities. Shares detracted from performance in the quarter, Twilio Inc. 68.1 32.2 3.8 declining 3% for the period held due to the overall sell-off in Chinese Adobe Inc. 279.9 32.1 3.8 technology-related companies due to tightening government regulations, Veeva Systems Inc. 47.6 31.2 3.7 market concerns regarding supply/competition, and the escalation of Intuitive Surgical, Inc. 108.9 28.8 3.4 geopolitical tensions. We have chosen to exit this investment and to Mastercard Incorporated 361.8 28.4 3.4 reallocate capital to higher conviction ideas. Shares of RingCentral, Inc., the global market leader in UCaaS (Unified Recent Activity Communications as a Service) voice, video, and collaboration software, During the second quarter, we initiated a new small position in the leading declined slightly during the quarter despite a strong earnings report Robotics Process Automation (“RPA”) software provider, UiPath while also highlighted by the third quarter in a row of year-over-year top-line reinitiating a small investment in Zoom Video Communications, which at acceleration and guidance ahead of consensus. We continue to believe this point in the pandemic needs no introduction...The more seasoned RingCentral’s strong market position, fast pace of product innovation, and investors in the Fund will recall that we held Zoom previously, after buying ramping exclusive partnerships will enable the business to compound at shares following the company’s IPO in 2019, only to end up selling it several higher rates than market forecasts for many years. We continue to add to months later as the stock quickly tripled. We also added to 15 existing this investment. positions as we continued putting the Fund’s inflows to work. We sold out Alibaba Group Holding Limited is the largest retailer and e-commerce of 3 investments–Vertex Pharmaceuticals, GDS, and Slack Technologies, company in China. Alibaba operates shopping platforms Taobao and Tmall exiting the quarter with 40 holdings. This number includes a stub position in and owns 33% of Ant Group, which operates Alipay, China’s largest third- Airbnb, in which we invested during its IPO, but we were unable to acquire a party online payment provider. Despite news that Chinese regulators had “real” position before its stock price moved away from us. It also includes launched an investigation into the company for suspected monopolistic our three small private investments which together represent less than 1% behavior and concerns of increased competition from peers, we believe the of the Fund’s net assets. stock was flat because much of these risks were already priced in. Its core business is highly profitable, while true earnings are masked by a host of Table V. earlier stage (and rapidly growing) businesses such as Ali cloud (Alibaba’s Top net purchases for the quarter ended June 30, 2021 “AWS”), logistics, and New Retail. Despite that, as of the end of the second Quarter End Amount quarter, Alibaba was trading at less than 20 times earnings (which were Market Cap Purchased negatively impacted by all those early-stage businesses). We believe the (billions) (millions) risk-reward remains favorable for long-term investors, such as ourselves. Square, Inc. $111.0 $9.8 Zoom Video Communications, Inc. 114.0 7.0 Portfolio Structure Shopify Inc. 182.1 5.6 NVIDIA Corporation 498.5 4.2 The Fund’s portfolio is constructed on a bottom-up basis with the quality of ServiceNow, Inc. 108.5 3.7 ideas and conviction level determining the size of each investment. Sector weights tend to be an outcome of the portfolio construction process and are Apart from acquiring UiPath and Zoom, we continued scaling into the not meant to indicate a positive or a negative “view.” fintech leader Square, Inc., and the artificial intelligence leader NVIDIA Corporation, with both now approaching our average position size. We also As of June 30, the top 10 positions represented 45.0% of the Fund and the continued adding to Shopify Inc., the leading cloud-based commerce top 20 were 72.7%. IT, Health Care, Consumer Discretionary, software provider, as well as to ServiceNow, Inc., the leading cloud-based Communication Services, and Financials made up 96.8% of net assets. The workflow automation software, which has now become the fourth largest remaining 3.2% was made up of Equinix, a REIT classified in Real Estate, GM position in the Fund. Cruise and SpaceX, our two private investments classified in Industrials, and cash.

52 June 30, 2021 Baron Fifth Avenue Growth Fund

During the quarter, we initiated a small position in UiPath. The company Outlook helps organizations efficiently automate business processes. It helps customers discover automation opportunities and then build, manage, run, In the last quarterly letter, we wrote about not being too concerned with the engage, measure, and govern automations. The platform leverages the much anticipated “reopening” trade, even though the concurrent rotation power of computer vision to enable software robots to perform a vast array from growth to value stocks was clearly unfavorable to the kinds of of actions like a human would in order to automate manual processes and businesses in which we tend to invest, and it had a negative impact on our free human employees to focus on higher-value activities. Daniel Dines, the quarterly returns. We did suggest that paying attention to the yield of the company’s Co-founder and CEO explained it best in his shareholder letter: 10-year U.S. Treasury bond, which peaked at almost 1.8% during that time was important, as higher interest rates (specifically, significantly higher “As the economy largely moved from manufacturing to services, the need for interest rates) would likely present a material headwind for many of our automation shifted from industrial to business process automation. But, investments. We also reiterated that we do not attempt to predict inflation despite enormous gains in computing power… we witness a paradox. While or interest rates. today’s work is largely digital, the repetitive, manual work has not disappeared – the form of it has simply shifted… today’s knowledge worker Well…the annualized inflation rate for May (the CPI Index) came in at 5%. spends a vast amount of his/her time at work extracting, entering and This is the first-time inflation reached 5% since 2008. Jerome Powell, the processing data and enduring the drudgery of continuously copying and chairman of the Federal Reserve then reiterated that in his opinion this high pasting between a growing number of applications. inflation number is “transitory” and that the Fed will not start raising rates until 2023. Though the message was consistent with his prior statements, “Much like how self-driving cars emulate human drivers but still reuse the this time the market had a different reaction and the yield on the 10-year existing car and road infrastructure, we have created a form of automation bond came down to almost 1.3%. Last time we checked; we are all that emulates people performing a business activity on a computer. The “transitory.” software infrastructure, existing applications, and workflows are reused, thus reducing complexity and cost of implementation.” The Fed believes that the inflation rate will likely come back down to 2% to 2.5% annual rate in the next few months, which would be considered benign The market opportunity is both large and growing with IDC estimating a for the U.S economy. The more interesting phenomenon from our $17 billion addressable market that is expected to grow at a double-digit perspective is that whether inflation is running at 5% or at 2.5% one is rate. UiPath is the market leader in RPA, and relative to the competition, we absolutely guaranteed to lose money (in real terms) by investing in a believe the company stands out due to its strong brand, fast time to value, 10-year government bond yielding less than 1.5%! high customer satisfaction (NPS>70), end-to-end platform with rapid product innovation, and large partner ecosystem. In our view, UiPath is well Every day we live and invest in an uncertain world. Well-known conditions positioned to benefit from a durable growth runway driven by existing and widely anticipated events, such as Federal Reserve rate changes, customers expanding on the platform, adding new clients, cross-selling new ongoing trade disputes, government shutdowns, and the unpredictable products, enhancing the partner network, and selective acquisitions. behavior of important politicians the world over, are shrugged off by the financial markets one day and seem to drive them up or down the next. We Table VI. often find it difficult to know why market participants do what they do over Top net sales for the quarter ended June 30, 2021 the short term. The constant challenges we face are real and serious, with clearly uncertain outcomes. History would suggest that most will prove Quarter End Market Cap or passing or manageable. The business of capital allocation (or investing) is Market Cap Amount the business of taking risk, managing the uncertainty, and taking advantage When Sold Sold (billions) (millions) of the long-term opportunities that those risks and uncertainties create. We are confident that our process is the right one, and we believe that it will GDS Holdings Limited $13.9 $12.5 enable us to make good investment decisions over time. Vertex Pharmaceuticals Incorporated 56.1 11.2 Slack Technologies Inc. 24.0 5.4 We are optimistic about the long-term prospects of the companies in which Splunk, Inc. 23.7 1.5 we are invested and continue to search for new ideas and investment opportunities while remaining patient and investing only when we believe We exited our position in GDS Holdings Limited, the leading Chinese data- the target companies are trading significantly below their intrinsic values. center operator, as we increased our required hurdle rate for Chinese investments following the latest round of regulatory tightening, which has Sincerely, been more extreme than we have previously seen. While we like the secular tailwinds underpinning GDS’s growth, such as the adoption of cloud in China as well as its strong competitive positioning, and we continue holding it in our Baron Global Advantage Fund, it no longer satisfies our required hurdle rate for this Fund. We sold our position in Vertex Pharmaceuticals Incorporated, the leading Alex Umansky cystic fibrosis biotechnology company, because of concerns that the Portfolio Manager company’s long-term growth may be more dependent upon acquisitions June 30, 2021 than originally thought. We also sold our position in Slack Technologies Inc. as it was being acquired by Salesforce, and we reduced our position in Splunk, Inc., reallocating proceeds to higher conviction ideas.

53 Baron Fifth Avenue Growth Fund

Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectus contain this and other information about the Funds. You may obtain them from its distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing. Risks: The Fund invests primarily in large cap equity securities which are subject to price fluctuations in the stock market. The Fund may not achieve its objectives. Portfolio holdings are subject to change. Current and future portfolio holdings are subject to risk. There is no guarantee that these objectives will be met. The discussions of the companies herein are not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed in this report reflect those of the respective portfolio managers only through the end of the period stated in this report. The portfolio manager’s views are not intended as recommendations or investment advice to any person reading this report and are subject to change at any time based on market and other conditions and Baron has no obligation to update them. This report does not constitute an offer to sell or a solicitation of any offer to buy securities of Baron Fifth Avenue Growth Fund by anyone in any jurisdiction where it would be unlawful under the laws of that jurisdiction to make such offer or solicitation. Upside Capture explains how well a fund performs in time periods where the benchmark’s returns are greater than zero. Downside Capture measures how well a fund performs in time periods where the benchmark’s returns are less than zero. BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a limited purpose broker- dealer registered with the SEC and member of the Financial Industry Regulatory Authority, Inc. (FINRA).

54 June 30, 2021 Baron Focused Growth Fund

Dear Baron Focused Growth Fund Shareholder: Performance

Baron Focused Growth Fund (the “Fund”) increased 2.42% (Institutional Shares) in the second quarter. The Russell 2500 Growth Index (the “Index”), the benchmark against which we compare the performance of the Fund, increased 6.04%, and the S&P 500 Index increased by 8.55%. The S&P 500 Index measures the performance of large-cap companies. Despite the recent underperformance, the Fund continues to outperform its benchmarks for the 1-, 3-, 5-, and 10-year periods. Since its inception on May 31, 1996, the Fund has increased 14.48% annualized. This compares favorably to the Index, which has increased 9.59% annualized, and the S&P 500 Index, which has increased 9.74% annualized.

Table I. Performance Annualized for periods ended June 30, 2021 Baron Baron Focused Focused Growth Growth Russell DAVID BARON RONALD BARON Retail Shares: BFGFX Fund Fund 2500 S&P CO-PORTFOLIO CEO AND LEAD Institutional Shares: BFGIX Retail Institutional Growth 500 MANAGER PORTFOLIO MANAGER R6 Shares: BFGUX Shares1,2,3 Shares1,2,3,4 Index2 Index2 Three Months5 2.37% 2.42% 6.04% 8.55% Six Months5 2.40% 2.54% 8.67% 15.25% inflation; and finally, foundational, long-term, Core Growth holdings that One Year 94.48% 95.00% 49.63% 40.79% continue to steadily grow sales and earnings while using excess free cash to Three Years 39.24% 39.58% 20.15% 18.67% return value to shareholders. (Please see Table II.) Five Years 31.22% 31.55% 20.68% 17.65% Ten Years 18.14% 18.44% 14.83% 14.84% Second quarter performance for the Fund was led by our Disruptive Fifteen Years 14.46% 14.69% 12.04% 10.73% Growth stocks, which increased 6.6% in the quarter and represent over half Since Inception of the Fund’s net assets. These stocks rebounded from first quarter inflation (May 31,1996) 14.34% 14.48% 9.59% 9.74% and rising rate concerns, as many now expect the recent surge in prices to be transitory and the eventual rise in interest rates to be gradual. We classify the holdings of the Fund as one of three types: rapid, early-stage Performance was led by our biotechnology/pharmaceutical companies, as growth businesses that are Disruptive to their industries; companies with well as a newly purchased IPO in Figs Inc. Real/Irreplaceable Assets with pricing power that provide a hedge against

Performance listed in the above table is net of annual operating expenses. Annual expense ratio for the Retail Shares and Institutional Shares as of December 31, 2020 was 1.35% and 1.07%, respectively. The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original cost. The Adviser reimburses certain Baron Fund expenses pursuant to a contract expiring on August 29, 2031, unless renewed for another 11-year term and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted. For performance information current to the most recent month end, visit www.BaronFunds.com or call 1-800-99BARON. 1 Reflects the actual fees and expenses that were charged when the Fund was a partnership. The predecessor partnership charged a 15% performance fee through 2003 after reaching a certain performance benchmark. If the annual returns for the Fund did not reflect the performance fees for the years the predecessor partnership charged a performance fee, the returns would be higher. The Fund’s shareholders will not be charged a performance fee. The performance is only for the periods before the Fund’s registration statement was effective, which was June 30, 2008. During those periods, the predecessor partnership was not registered under the Investment Company Act of 1940 and was not subject to its requirements or the requirements of the Internal Revenue Code relating to registered investment companies, which, if it were, might have adversely affected its performance. 2 The Russell 2500™ Growth Index measures are classified as growth and the S&P 500 Index of 500 widely the performance of small to medium-sized U.S. companies that held large cap U.S. companies. Russell Investment Group is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. Russell is a trademark of Russell Investment Group. The index and the Fund include reinvestment of dividends, net of withholding taxes, which positively impact the performance results. The indexes are unmanaged. Index performance is not Fund performance; one cannot invest directly into an index. 3 The performance data does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. 4 Performance for the Institutional Shares prior to May 29, 2009 is based on the performance of the Retail Shares, which have a distribution fee. The Institutional Shares do not have a distribution fee. If the annual returns for the Institutional Shares prior to May 29, 2009 did not reflect this fee, the BARON returns would be higher. FUNDS 5 Not annualized.

55 Baron Focused Growth Fund

BioNTech SE more than doubled and helped performance by 176bps in the However, Red Rock Resorts, Inc. continued its strong stock performance in quarter due to success with its mRNA drugs and programs in engineered cell the quarter and increased another 30% on reported EBITDA 20% above therapies with a strong pipeline of new targets from oncology to other pre-pandemic levels on a complete recovery in revenue. Management infectious and rare diseases. indicated it believes the margin expansion is sustainable given current revenue and a reimagined cost structure. This robust cash generation Figs, the only direct-to-consumer health care apparel brand, with its own combined with the $650 million sale of its Palms casino, which is slated proprietary fabric technology, increased 66.9% and helped performance by to close by the end of 2021, should help significantly improve the 86bps during the period held in the quarter, as investors found the company’s balance sheet. While Delta variant concerns are a negative, we company’s strong growth trajectory in a large global addressable market believe this to be short lived and will have little impact on casino visitation. appealing. We believe Figs should be able to grow its revenues during the In our opinion, state governments will not return to statewide lockdowns next few years at a 30% CAGR and generate steady state margins of given lower infections, hospitalization rates, and increased vaccine between 25% and 30%. Given the asset light nature of the business, this penetration levels. should translate into strong cash flow with a 90% EBITDA to free cash flow conversion. We believe the company is well positioned and its founders well The operating efficiencies of our travel and leisure businesses, which incentivized, as they still own 15% of the company. represent 22.4% of net assets at the end of the quarter, have resulted in higher margins, better cash flow, and stronger balance sheets, which in We continue to believe the growth prospects of these businesses remain certain instances are better than pre-pandemic levels. Travel businesses are favorable and their continued investments in their businesses should rapidly normalizing, and we believe the companies in which we have accelerate revenue and EBITDA growth in the years to come. invested should exceed pre-pandemic earnings levels by 2023 at the latest. Our Real/Irreplaceable Asset investments experienced weak stock Until then, we believe these companies have sufficient liquidity to survive performance, decreasing 5.7% in the quarter due to declines in Penn the disruption. All have been able to get covenant relief from their banks. National Gaming, Inc. and Hyatt Hotels Corp, which together comprised Balance sheets are no longer concerns and many are now switching their 10.1% of the Fund. We believe the declines have created attractive strategic plans from defense to offense. Further, many of our companies are valuations for both, and we see significant upside potential in the years considering or have completed acquisitions that should lead to significant ahead. earnings and cash flow growth in the years ahead. Others are using their enhanced cash flow to reduce debt or return capital to shareholders by Penn, a regional domestic operator of casinos, declined over 27% in the reinstating or increasing dividends. We continue to see further upside in quarter. This followed reports that the company had lost sports betting and these stocks as the economy continues to recover and COVID restrictions i-gaming market share in both Michigan and Pennsylvania. While the lost ease. market share is a disappointment, Penn has been able to maintain a double- digit share with no marketing spending. This is due in large part to its The Fund’s Core Growth investments increased 3.0% in the quarter, Barstool branded sportsbook app and the strong loyalty of those players. We underperforming the Index which increased 6.04%, mainly due to a 3.4% believe the market is attributing little value to Penn’s Barstool equity stake decline in GDS Holdings Limited, the largest data center provider in China. as well as its online gaming and sports betting opportunities, including its This was amid a broader technical sell-off in U.S.-listed Chinese internet access fees from other operators. We view the valuation as attractive and businesses, as the Chinese government tries to restrict U.S. listings of expect further upside from M&A as it uses its strong balance sheet to invest Chinese companies and adds regulations to have more control over them. in its digital growth opportunity. We added to our position in the quarter as the company continues to grow three to four times as fast as peers and yet trades at a significant discount Hyatt declined over 6% in the quarter due to investor concerns around a to them. We believe this discount should narrow as GDS continues to invest new, more contagious variant of COVID-19 and a forecasted slower-than- in its data center businesses and generates strong returns on investment as expected reopening of Asia and Europe. While the slowed reopening is a it continues to experience robust demand for space. The company has disappointment, Hyatt’s domestic business and group bookings are significant land holdings and power commitments that are difficult to attain. beginning to return. We think conditions will normalize next year, at least domestically. The company remains on track with its asset sale program, as FactSet Research Systems, Inc., a provider of financial intelligence to the the hotel transaction market returns to pre-pandemic valuations. This investment community, represented 3.7% of the average portfolio weight. should ultimately make Hyatt a more valuable, fee-based business. Its stock price increased 9.0% in the quarter as speculation surfaced the company was in discussions to be acquired. The company continues to Declines in Manchester United plc, the English Premier League professional make investments in new products and services, which is reducing its soccer team, also hurt performance as shares fell on continued pandemic current earnings growth. However, we believe FactSet’s two-year worries related to its commercial and matchday revenues. Investors were investment cycle in private equity information is warranted and should also disappointed by the failed attempt to form a new Super League that ultimately accelerate revenue growth. We believe these investments will would have replaced the Champions League and allowed the team to eventually generate 50% returns on capital. FactSet is a prime example of a participate each year as a founding member. Despite these setbacks, we business penalizing its current earnings by investing in new products to view Manchester United as a unique media company with 1.1 billion fans become a significantly larger company. globally and broad appeal that should compound value. Its share price declined 3.5% in the quarter. The stock represented 2.3% of the Fund’s net assets as of the end of the quarter.

56 June 30, 2021 Baron Focused Growth Fund

Table II. Table III. Total returns by category for the quarter ended June 30, 2021 Performance %of Total Contribution Periods Baron Focused Growth Fund underperformed Net Assets Return to Return Baron Growth Stocks (as of 6/30/2021) (%) (%) Internet Underperform Disruptive Growth 52.3 6.62 3.59 Bubble 2014-2016 Annualized Returns BioNTech SE 3.6 102.85 1.76 10/8/1998 to 12/31/2013 to Figs Inc. 2.1 66.85 0.86 3/9/2000 12/31/2016 Denali Therapeutics Inc. 1.5 36.49 0.43 Baron Focused Growth Fund Stitch Fix, Inc. 1.1 19.29 0.19 (Institutional Shares) 41.77% 0.45% Guidewire Software, Inc. 1.7 10.91 0.18 Russell 2500 Growth Index 126.53% 5.45% Spotify Technology S.A. 3.4 2.16 0.26 S&P 500 Index 32.29% 8.87% Tesla, Inc. 31.6 1.76 0.38 Schrodinger, Inc. 1.3 –1.46 0.05 The indexes are unmanaged. Index performance is not Fund performance; one Iridium Communications cannot invest directly into an index. Inc. 2.3 –3.05 –0.05 From 2014 through 2016, the Fund invested in several companies whose Space Exploration stocks underperformed when they were investing in their businesses. CoStar Technologies Corp. 3.7 –5.17 –0.20 Group, Inc. and Tesla, Inc. were among those businesses. Their stocks Tripadvisor, Inc. – –12.07 –0.26 outperformed in 2019 and 2020 as those investments began to generate Russell 2500 Growth Index 6.04 strong returns. These companies continue to invest in themselves, although Core Growth 18.5 3.05 0.57 now that they are financially stronger, they are better able to finance these investments while continuing to grow their core businesses. Adyen N.V. 2.1 9.90 0.19 FactSet Research We believe the Fund’s underperformance from 2014 through 2016 is Systems, Inc. 3.6 9.03 0.29 analogous to instances when, after brief periods of underperformance, the Arch Capital Group Ltd. 3.4 1.49 0.04 Fund subsequently outperformed for an extended period. For example, in the CoStar Group, Inc. 7.4 0.77 0.12 18-month period from October 1998 through March 2000, at the height of GDS Holdings Limited 2.0 –3.37 –0.07 the Internet Bubble, the Fund, which owned no internet stocks, increased Real/Irreplaceable Assets 24.4 –5.73 –1.48 41.77% annualized while the Index increased 126.53% annualized. This was immediately prior to the Internet Bubble bursting and the Index falling Red Rock Resorts, Inc. 1.2 30.41 0.31 materially over the next eight years. The Fund increased in value during that American Homes 4 Rent 1.3 16.82 0.19 same period. (Please see Tables III and IV.) Choice Hotels International, Inc. 2.7 11.00 0.29 Analogous to the Fund’s relatively strong performance in the post-Internet Vail Resorts, Inc. 6.2 8.52 0.50 Bubble period, we expect the Fund to perform well over the next several Americold Realty Trust 0.6 –1.05 –0.01 years. This is despite our expectation that there will be periods when value Manchester United plc 2.3 –3.49 –0.11 stocks outperform the growth stocks in which we have invested. We can Hyatt Hotels Corp. 3.8 –6.12 –0.24 certainly give no assurance this will be the case. Currently, we believe some Penn National Gaming, of our growth companies are trading as if they were value stocks despite Inc. 6.3 –27.21 –2.41 having strong liquidity and balance sheets. They are already recovering quickly as vaccines are administered to combat the virus, and we see further Cash 4.8 0.47 0.02 upside still to come. Fees – –0.28 –0.28 Since its inception on May 31, 1996 through June 30, 2021, the Fund’s Total 100.0 2.42* 2.42* 14.48% annualized performance has exceeded that of its Index by 489 bps Sources: FactSet PA, BAMCO, and Russell, Inc. per year. This means that a hypothetical $10,000 investment in Baron Focused Growth Fund over 25 years ago would now be worth approximately * Represents the blended return of all share classes of the Fund. $297,000! If an investor had instead hypothetically invested $10,000 in a fund designed to track the Index, it would be worth approximately $99,400. (Please see Tables I and IV.) The Fund’s beta has averaged 0.82 since inception. This means the Fund has been 82% as volatile as the Index. As a result of the Fund’s strong absolute and relative returns and lower risk, the Fund has achieved 6.76% annual alpha, a measure of risk-adjusted performance since inception.

57 Baron Focused Growth Fund

Table IV. Performance Millennium to COVID-19 Pandemic. The Impact of Not Losing Money. Millennium Internet Bubble Financial Panic to Millennium Internet Bubble to Financial Panic Present to Present Inception 12/31/1999 to 12/31/2008 12/31/2008 to 6/30/2021 12/31/1999 to 6/30/2021 5/31/1996 to 6/30/2021 Value Value Value Value $10,000 Annualized $10,000 Annualized $10,000 Annualized $10,000 Annualized Baron Focused Growth Fund (Institutional Shares) $12,732 2.72% $96,686 19.90% $123,101 12.39% $297,048 14.48% Russell 2500 Growth Index $ 6,931 –3.99% $80,242 18.13% $ 55,615 8.31% $ 99,429 9.59% S&P 500 Index $ 7,188 –3.60% $61,548 15.65% $ 44,240 7.16% $102,945 9.74%

The indexes are unmanaged. Index performance is not Fund performance; one cannot invest directly into an index.

We did not make much money from December 31, 1999 through margins in 2020, which we believe are sustainable over the long term due to December 31, 2008 (amid the highs of the Internet Bubble and the lows of factors that include low markdown/fashion risk and declining customer the Financial Crisis). But…we did make something…which gave investors a acquisition costs. much better outcome than if they had hypothetically invested in a passive Vail Resorts, Inc., a global owner and operator of ski resorts, contributed index fund mirroring either the Index or the S&P 500 Index. Both indexes during the quarter on reports of season pass sales that were 33% above lost a material amount of money during that period. (Please see Table IV.) 2019 levels despite a 20% price cut. Season pass sales are a key component Due to the power of compounding and of not losing money from the of growth as pass holders are the most frequent visitors to the resorts and Millennium Internet Bubble to the Financial Panic period and keeping up the most likely to return the following season. Given the strong sales figures, with the market during upswings from the Financial Panic to Present, we believe next year’s EBITDA should be significantly above pre-pandemic $10,000 hypothetically invested in Baron Focused Growth Fund at the levels, generating robust cash flow for the reinstallation of Vail’s dividend Fund’s inception on May 31, 1996 was worth $297,048 on June 30, 2021. and additional M&A. That is almost three times the value of a hypothetical investment of the Shares of Denali Therapeutics Inc. increased as the broader space same amount in funds designed to track the S&P 500 and Russell 2500 recovered from a slow start in 2021. We expect more impactful news flow Growth Indexes. (Please see Table IV.) in the second half of the year as we get updates across key pipeline assets that utilize Denali’s blood brain barrier carrier technology to treat a rare Table V. genetic disease called Hunter syndrome. We retain conviction in Denali as a Top contributors to performance for the quarter ended June 30, 2021 leader in the neurodegeneration space. Market Quarter Cap End Tesla, Inc. designs, manufactures, and sells fully electric vehicles, solar When Market Year Acquired Cap Total Percent products, energy storage solutions and battery cells. Shares increased Acquired (billions) (billions) Return Impact following strong execution in a complex supply chain environment and BioNTech SE 2020 $24.1 $ 54.1 102.85% 1.76% generally improving execution in China despite recent negative headlines in Figs Inc. 2021 4.8 8.0 66.85 0.86 the local market. Demand remained robust, the refreshed Model S received Vail Resorts, Inc. 2013 2.3 12.7 8.52 0.50 positive reviews, and new production facilities are expected to support more Denali profitable growth. We expect supply chain headwinds to be resolved and Therapeutics remain optimistic about existing and new product programs. Inc. 2020 8.4 9.5 36.49 0.43 Tesla, Inc. 2014 31.2 654.8 1.76 0.38 Table VI. Top detractors from performance for the quarter ended June 30, 2021 BioNTech SE is a leader in the emerging field of mRNA drugs, with Market Quarter additional programs in engineered cell therapies, antibodies, and Cap End When Market immunomodulators. Shares performed well for the quarter. The COVID-19 Year Acquired Cap Total Percent vaccine rollout continued, and we believe the pandemic has been a strong Acquired (billions) (billions) Return Impact proof point of the speed and efficacy of the mRNA platform. Beyond Penn National vaccines, we think BioNTech has potential to disrupt the biopharmaceutical Gaming, Inc. 2019 $2.5 $12.0 –27.21% –2.41% space with a pipeline spanning oncology, infectious diseases, and rare Tripadvisor, Inc. 2021 6.0 6.5 –12.07 –0.26 diseases. Hyatt Hotels Figs Inc. operates the largest direct-to-consumer platform in health care Corp. 2009 4.2 7.9 –6.12 –0.24 apparel. The stock rose following its May IPO. We remain bullish on Figs’ Space Exploration long-term growth opportunity to disrupt the medical apparel market both Technologies domestically and overseas and see plenty of space to grow its customer Corp. 2017 – – –5.17 –0.20 base. We like the company’s financial operating model and mid-20’s EBITDA Manchester United plc 2012 2.3 2.5 –3.49 –0.11

58 June 30, 2021 Baron Focused Growth Fund

Penn National Gaming, Inc., a regional U.S. casino operator, detracted on attempt to create a portfolio of between 20 and 25 securities diversified by news that the company had lost sports betting and i-gaming market share in GICS sectors that will be approximately 80% as volatile (as measured by both Michigan and Pennsylvania. While the lost market share is a beta) as the market. Since inception, the Fund has generated approximately disappointment, Penn has been able to maintain a double-digit share with 97% of the upside when the market rises but just 79% of the downside no marketing. We believe the market is attributing little value to Penn’s when the market declines. Businesses in which the Fund invests are Barstool equity stake as well as its online gaming and sports betting identified by our analysts and portfolio managers using the Firm’s opportunities including its access fees from other operators. We view the proprietary research and time-tested investment approach. valuation as attractive. As of June 30, 2021, the Fund held 23 investments. The Fund’s average Tripadvisor, Inc. is an online travel company where users can browse portfolio turnover for the past three years was 9.66%. This means the Fund reviews and plan trips. Shares fell on concerns that new COVID-19 variants has an average holding period for its investments of almost 10.4 years. This would delay the recovery of the travel industry. In addition, investors contrasts sharply with the average mid-cap growth mutual fund, which appeared concerned that Tripadvisor’s new Tripadvisor Plus subscription typically turns over its portfolio every 16 months. From a quality standpoint, offering, which launched in June, would face competitive pressures. We do the Fund’s investments have stronger sales and EPS growth than the not believe traditional loyalty programs will be materially competitive with holdings in the Index, higher EBITDA and operating margins, stronger returns the upfront savings offered by Tripadvisor Plus. We also think Tripadvisor is on invested capital, and more robust balance sheets. We believe these well positioned to benefit from pent-up consumer demand for travel. metrics are important to limit risk in this concentrated portfolio. Hyatt Hotels Corp., a global hotelier, detracted over investor concerns While focused, the Fund is diversified by sector. The Fund’s weightings are around a new, more contagious variant of COVID-19 and a forecasted significantly different than those of the Index. For example, the Fund is slower-than-expected reopening of Asia and Europe. While the slowed heavily weighted in Consumer Discretionary businesses with 52.9% of its reopening is a disappointment, Hyatt’s domestic business and group net assets in this sector versus 15.6% for the Index. While the Fund has bookings are starting to return and we think conditions will normalize by historically not invested in pharmaceuticals and biotechnology, it has added 2022, at least domestically. The company remains on track with its asset two biotechnology investments over the past year and now has 5.1% of the sale program as the hotel transaction market returns to pre-pandemic total portfolio in two stocks, Denali Therapeutics Inc. and BioNTech SE. valuations, which should make Hyatt a more valuable, fee-based business. While there is somewhat greater risk investing in these companies, we think the small positions do not significantly alter the portfolio’s risk profile, and Space Exploration Technologies Corp. (“SpaceX”) designs, manufactures, they give us upside potential should any of these companies discover new and launches rockets, satellites, and spacecrafts. Its mission, ultimately, is to medicines and procedures. The Fund is further diversified by investments in enable people to live on other planets. SpaceX is commercializing its businesses at different stages of growth and development as discussed broadband offering by rapidly deploying user terminals and its satellite above and shown below. constellation. It continues to reliably provide reusable launch capabilities, including crewed flights, and advancing the development of its newest and Table VII. larger rocket, Starship. We value SpaceX using prices of recent transactions Disruptive Growth Companies as of June 30, 2021 and a proprietary valuation model. Cumulative Manchester United plc is the best known team in the English Premier Return Percent Since League, generating revenue primarily from broadcasting, sponsorship, and of Net Year Initial licensing. Shares fell on continued pandemic-related impact to commercial Assets Acquired Purchase and matchday revenues. Investors were also disappointed by the failed Tesla, Inc. 31.6% 2014 1,257.17% attempt to form a new Super League that would have replaced the Space Exploration Technologies Corp. 3.7 2017 188.00 Champions League and allowed Manchester United to participate each year BioNTech SE 3.6 2020 123.75 as a founding member. Despite these setbacks, we view Manchester United Spotify Technology S.A. 3.4 2020 15.17 as a unique media company with 1.1 billion fans globally and broad appeal Iridium Communications Inc. 2.3 2019 47.84 that should compound value. Figs Inc. 2.1 2021 66.89 Guidewire Software, Inc. 1.7 2013 143.88 Investment Strategy & Portfolio Structure Denali Therapeutics Inc. 1.5 2020 12.15 Schrodinger, Inc. 1.3 2020 43.50 Despite current market volatility and investor angst, we have continued to Stitch Fix, Inc. 1.1 2021 –36.89 manage the Fund the same way we have historically. In the second quarter, we initiated a small position in the only direct-to-consumer health care Disruptive Growth firms accounted for 52.3% of the Fund’s net assets. On apparel service company Figs Inc. and added to our position in Spotify current metrics, these businesses may appear expensive; however, we think Technology S.A. Both companies have large addressable markets with they will continue to grow significantly and, if we are correct, they have the strong brands that should allow them to take significant market share over potential to generate exceptional returns over time. Examples of these time. They are both appropriately financed and generate significant cash to companies include electric vehicle leader Tesla, Inc., commercial satellite continue investing in their businesses for further growth. While we have company Iridium Communications Inc., and systems software provider to made other modest changes on the margin, the Fund’s strategy remains the the insurance industry Guidewire Software, Inc. All of these companies same. We continue to invest for the long term in a focused portfolio of what have large addressable markets relative to the current size of those we believe are appropriately capitalized, competitively advantaged, well- competitively advantaged businesses. managed, small- and mid-cap growth businesses at attractive prices. We

59 Baron Focused Growth Fund

Table VIII. Portfolio Holdings Investments with Real/Irreplaceable Assets as of June 30, 2021 Cumulative For the quarter ended June 30, 2021, the Fund’s top 10 holdings represented Return 73.0% of net assets. A number of these investments have been successful Percent Since and were purchased when they were much smaller businesses. We believe of Net Year Initial Assets Acquired Purchase they continue to offer significant further appreciation potential although we cannot guarantee that will be the case. Penn National Gaming, Inc. 6.3% 2019 264.41% Vail Resorts, Inc. 6.2 2013 489.39 The top five positions in the portfolio, Tesla, Inc., CoStar Group, Inc., Penn Hyatt Hotels Corp. 3.8 2009 183.01 National Gaming, Inc., Vail Resorts, Inc., and Hyatt Hotels Corp. all have, Choice Hotels International, Inc. 2.7 2010 480.16 in our view, significant competitive advantages due to irreplaceable assets, Manchester United plc 2.3 2012 16.92 strong brand awareness, technologically superior know-how, or exclusive American Homes 4 Rent 1.3 2018 91.26 data that is integral to their operations. We think these businesses cannot be Red Rock Resorts, Inc. 1.2 2017 101.86 easily duplicated, which enhances their potential for superior earnings Americold Realty Trust 0.6 2020 13.67 growth and returns over time.

Companies that own what we believe are Real/Irreplaceable Assets Table X. represented 24.4% of net assets. Vail Resorts, Inc., owner of the premier ski Top 10 holdings as of June 30, 2021 resort portfolio in the world, upscale lodging brand Hyatt Hotels Corp., and Market Quarter Quarter Cap End End storied English Premier League sports franchise Manchester United plc are When Market Investment Percent examples of companies we believe possess meaningful brand equity and Year Acquired Cap Value of Net barriers to entry that equate to pricing power over time. Penn National Acquired (billions) (billions) (millions) Assets Gaming, Inc.’s state-granted licenses for its regional casinos provide Tesla, Inc. 2014 $31.2 $654.8 $218.2 31.6% important protection from competitors. Online sports betting and i-casino CoStar Group, Inc. 2014 6.2 32.7 51.3 7.4 gaming offer large opportunities for future growth for the company. Penn National Gaming, Inc. 2019 2.5 12.0 43.4 6.3 Table IX. Vail Resorts, Inc. 2013 2.3 12.7 42.4 6.2 Core Growth Investments: Growth, Dividends, and Share Repurchases as of Hyatt Hotels Corp. 2009 4.2 7.9 26.4 3.8 June 30, 2021 Space Exploration Cumulative Technologies Return Corp. 2017 – – 25.5 3.7 Percent Since of Net Year Initial FactSet Research Assets Acquired Purchase Systems, Inc. 2008 2.5 12.7 25.2 3.6 CoStar Group, Inc. 7.4% 2014 287.01% BioNTech SE 2020 24.1 54.1 24.6 3.6 FactSet Research Systems, Inc. 3.6 2008 657.12 Spotify Technology Arch Capital Group Ltd. 3.4 2003 969.45 S.A. 2020 45.4 52.6 23.4 3.4 Adyen N.V. 2.1 2020 154.33 Arch Capital Group GDS Holdings Limited 2.0 2020 27.67 Ltd. 2003 0.9 15.7 23.4 3.4

Core Growth investments, steady growers that continually return excess Thank you for investing in Baron Focused Growth Fund. We continue to free cash flow to shareholders, represented 18.5% of net assets. Examples of work hard to justify your confidence and trust in our stewardship of your these companies include CoStar Group, Inc. and FactSet Research family’s hard-earned savings. We also continue to try to provide you with Systems, Inc. CoStar continues to add new services both in the commercial information we would like to have if our roles were reversed. This is so you and residential areas of real estate that has grown its addressable market can make an informed judgment about whether Baron Focused Growth and added new services for its clients further improving retention and cash Fund remains an appropriate investment for your family. flow. As one of the leading financial intelligence systems for the asset management industry, FactSet continues to grow into new areas via fixed Respectfully, income, risk management, and, most recently, private equity. This should enable the company to grow while generating a steady stream of recurring cash flow that it uses for acquisitions, dividends, and buybacks.

Ronald Baron David Baron CEO and Lead Portfolio Manager Co-Portfolio Manager June 30, 2021 June 30, 2021

60 June 30, 2021 Baron Focused Growth Fund

Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectus contain this and other information about the Funds. You may obtain them from its distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing. Risks: The Fund is non-diversified which means, in addition to increased volatility of the Fund’s returns, it will likely have a greater percentage of its assets in a single issuer or a small number of issuers, including in a particular industry than a diversified fund. Single issuer risk is the possibility that factors specific to an issuer to which the Fund is exposed will affect the market prices of the issuer’s securities and therefore the net asset value of the Fund. As of the date of the latest prospectus supplement, about 40% of the Fund’s assets are invested in Tesla stock. Therefore, the Fund is exposed to the risk that were Tesla stock to lose significant value, which could happen rapidly, the Fund’s performance would be adversely affected. Specific risks associated with investing in small and medium-sized companies include that the securities may be thinly traded and more difficult to sell during market downturns. The discussions of the companies herein are not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed in this report reflect those of the respective portfolio managers only through the end of the period stated in this report. The portfolio manager’s views are not intended as recommendations or investment advice to any person reading this report and are subject to change at any time based on market and other conditions and Baron has no obligation to update them. This report does not constitute an offer to sell or a solicitation of any offer to buy securities of Baron Focused Growth Fund by anyone in any jurisdiction where it would be unlawful under the laws of that jurisdiction to make such offer or solicitation. Beta: measures a fund’s sensitivity to market movements. The beta of the market (Russell 2500 Growth Index) is 1.00 by definition. Alpha: measures the difference between a fund’s actual returns and its expected performance, given its level of risk as measured by beta. Upside Capture explains how well a fund performs in time periods where the benchmark’s returns are greater than zero. Downside Capture measures how well a fund performs in time periods where the benchmark’s returns are less than zero. BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a limited purpose broker- dealer registered with the SEC and member of the Financial Industry Regulatory Authority, Inc. (FINRA).

61 Baron International Growth Fund

DEAR BARON INTERNATIONAL GROWTH FUND SHAREHOLDER: PERFORMANCE

Baron International Growth Fund (the “Fund”) appreciated 8.51% (Institutional Shares) during the second quarter of 2021, while its principal benchmark index, the MSCI ACWI ex USA Index, gained 5.48%. The MSCI ACWI ex USA IMI Growth Index gained 6.62% for the quarter. The Fund solidly outperformed its principal benchmark index, as well as the all-cap growth proxy, during a solid quarter for global equities. International and emerging market (“EM”) equities modestly trailed their U.S. counterparts, defined as the S&P 500 Index. It was a relatively uneventful quarter, with the Fed’s confirmation of its modest hawkish tilt late in the quarter contributing to a cooling of the interest rate and inflation fever witnessed earlier in the year. As we suggested in our previous letter, this turn of events supported the performance of quality growth stocks for the quarter. Also, during the quarter, the U.S. showed solid progress on ramping COVID-19 vaccine penetration, while several international jurisdictions lagged, creating the perception of relatively greater U.S. earnings visibility. We believe this distinction will likely prove temporary, and we remain optimistic that MICHAEL KASS Retail Shares: BIGFX corporate earnings are likely to deliver on a global basis, though we believe a Institutional Shares: BINIX mid-cycle pause is increasingly likely given a sustained slowdown in China PORTFOLIO MANAGER R6 Shares: BIGUX credit growth and the marginal Fed tightening referenced above. We welcome the cooling of inflation expectations and believe such tightening is likely necessary given ongoing COVID-19-related labor and supply Table I. bottlenecks in order to prolong the global expansion. As always, we are Performance confident that we have invested in many well-positioned and well-managed Annualized for periods ended June 30, 2021 companies on a bottom-up basis, which are poised to benefit from long- Baron Baron MSCI term and attractive investment themes. International International ACWI Growth Growth MSCI ex USA Fund Fund ACWI IMI Retail Institutional ex USA Growth Shares1,2 Shares1,2,3 Index1 Index1 Three Months4 8.44% 8.51% 5.48% 6.62% Six Months4 10.92% 11.04% 9.16% 7.03% One Year 43.83% 44.18% 35.72% 35.13% Three Years 15.46% 15.73% 9.38% 13.04% Five Years 16.22% 16.50% 11.08% 13.36% Ten Years 9.52% 9.79% 5.45% 7.36% Since Inception (December 31, 2008) 12.84% 13.11% 8.50% 10.34%

Performance listed in the above table is net of annual operating expenses. Annual expense ratio for the Retail Shares and Institutional Shares as of December 31, 2020 was 1.28% and 1.01%, but the net annual expense ratio was 1.20% and 0.95% (net of the Adviser’s fee waivers), respectively. The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original cost. The Adviser reimburses certain Baron Fund expenses pursuant to a contract expiring on August 29, 2031, unless renewed for another 11-year term and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted. For performance information current to the most recent month end, visit www.BaronFunds.com or call 1-800-99BARON.

1 The MSCI ACWI ex USA indexes cited are unmanaged, free float-adjusted market capitalization weighted indexes. The MSCI ACWI ex USA Index Net USD measures the equity market performance of large- and mid-cap securities across developed and emerging markets, excluding the United States. The MSCI ACWI ex USA IMI Growth Index Net USD measures the equity market performance of large-, mid- and small-cap growth securities across developed and emerging markets, excluding the United States. MSCI is the source and owner of the trademarks, service marks and copyrights related to the MSCI Indexes. The indexes and Baron International Growth Fund include reinvestment of dividends, net of foreign withholding taxes, which positively impact the performance results. Index performance is not Fund performance; one cannot invest directly into an index. 2 The performance data does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. 3 Performance for the Institutional Shares prior to 5/29/2009 is based on the performance of the Retail Shares, which have a distribution fee. The Institutional Shares do not have a distribution fee. If the annual returns for the Institutional Shares prior to 5/29/2009 did not reflect this fee, the returns BARON would be higher. FUNDS 4 Not annualized.

62 June 30, 2021 Baron International Growth Fund

For the second quarter of 2021, we outperformed our primary benchmark, TCS Group Holding PLC is a Russian financial and lifestyle services platform the MSCI ACWI ex USA Index, as well as the all-cap international growth ecosystem with over 13 million active users. Through its subsidiaries, TCS is proxy. From a broad market perspective, second quarter trends were mixed. exposed to digital banking as well as fast-growing verticals including online While markets continued to support economically cyclical stocks, there was and offline merchant acquisitions, retail brokerage, and insurance. Shares an increase in investor appetite for quality growth stocks toward the latter rose during the quarter after the company reported results for the first five part of the quarter. From a sector perspective, strong stock selection in months of 2021 that exceeded Street estimates. TCS also started providing Communications Services, driven by our digitization related investments detailed information about its verticals, allowing investors to better value (Future plc and S4 Capital plc) was a key contributor to relative the company. outperformance. The Financials sector, led by our fintech theme (TCS Group Zai Lab Limited is a leader in the development of a biopharmaceutical Holding PLC) and India wealth management/consumer finance investments industry in China. Shares increased given continued execution of deals, most (Max Financial Services Limited and Bajaj Finance Limited) also recently highlighted by in-licensing of Mirati’s KRAS G12C inhibitor. We contributed meaningfully. Another noteworthy contributor of our fintech believe Zai Lab can be a leader among China pharmaceuticals, a market that theme, but classified within the Information Technology sector, was Dlocal is growing as the Chinese government continues to grow health care Ltd., a Uruguay-based financial technology company that facilitates cross- spending as a percentage of total GDP. border and local-to-local e-commerce payments in emerging markets for global enterprise merchants. Offsetting a portion of the above was adverse S4 Capital plc is a global marketing services business founded by Sir Martin stock selection effect in the Materials sector, primarily driven by a decline in Sorrell, the founder and former CEO of WPP, the largest ad agency in the AMG Advanced Metallurgical Group N.V. and Grupo Mexico, S.A.B. de world. S4 encompasses creative production firm MediaMonks and data- C.V., due to a near-term correction in underlying commodity metals prices. driven media consultancy MightyHive. Shares of S4 were up on recovering global ad spending, continued M&A, and increasing investor awareness. We From a country perspective, positive allocation effect together with strong believe S4 has meaningful potential over the long term to grow revenue at stock selection in the U.K., Uruguay, and Russia, led by several of our above- north of 25% annually with high-teens EBITDA margins as it benefits from mentioned investments, powered a good majority of relative performance digital transformation across industries and geographies. during the quarter. Our underweight exposure in Canada and Switzerland, along with weak stock selection effect in those countries as well as in Japan and the Netherlands were the largest detractors to relative performance. In Table III. addition, adverse stock selection in Brazil and Mexico also negatively Top detractors from performance for the quarter ended June 30, 2021 impacted relative results. Percent Impact

Table II. NEXON Co., Ltd. –0.24% Top contributors to performance for the quarter ended June 30, 2021 AMG Advanced Metallurgical Group N.V. –0.24 TeamViewer AG –0.13 Percent Impact Takeda Pharmaceutical Company Limited –0.13 MonotaRO Co., Ltd. –0.13 Future plc 1.18% Dlocal Ltd. 0.91 NEXON Co., Ltd. is a leading gaming developer based in Japan. Shares fell TCS Group Holding PLC 0.77 during the quarter as the core Dungeon Fighter franchise continued to Zai Lab Limited 0.49 experience lack of user momentum in China while the fast-growing Korea S4 Capital plc 0.46 market faced tougher comparables. The release date of its highly anticipated mobile Dungeon Fighter title remains elusive. While we continue to like Future plc is a special-interest publisher of digital content, magazines, and NEXON and its visionary management team, we are trimming the position events with a brand portfolio including TechRadar, PC Gamer, and Gizmodo. given near-term uncertainties. Shares were up on well-received M&A and pandemic-related tailwinds to e-commerce in Future’s largest categories–technology, gaming, music, AMG Advanced Metallurgical Group N.V. is a European specialty metals sports, home, and lifestyle–as well as strength in the broader advertising company producing key materials such as vanadium and titanium alloys. environment. We believe Future can continue to grow both organically and AMG also recycles spent catalysts from the oil refinery process into through M&A, with potential to compete in the $150 billion-plus global B2B ferrovanadium using proprietary technology. Shares fell after an equity raise market with lead generation and business intelligence offerings. to fund strategic growth investments including lithium, an essential metal used in EV batteries and energy storage. We continue to like the shares. Dlocal Ltd. is a Uruguay-based financial technology company that enables AMG plans to build its own lithium chemical capacity in Europe, which we cross-border and local-to-local e-commerce payments in 29 EM countries think should lead to a much better margin profile for its lithium business. for global enterprise merchants. The company is experiencing fast growth, driven by increasing globalization of commerce, higher penetration of digital TeamViewer AG, a leading global software connectivity platform, detracted payments, and increasing purchasing power from middle-class consumers. from performance. The company reported solid first quarter earnings and Dlocal went public at the beginning of June at an attractive valuation and reiterated 2021 guidance, but the stock lagged as the market continued to shares rose as demand exceeded supply. digest two large sponsorship partnerships that will take down margins in the near term and as investors tried to gauge near-term comparables coming out of the pandemic. We retain conviction as we believe the company has a compelling combination of strong growth prospects and attractive margins.

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Takeda Pharmaceutical Company Limited is a leading global Table VI. pharmaceutical company. Shares fell following modest earnings results Percentage of securities in Developed Markets as of June 30, 2021 along with limited visibility into the launch of blockbuster drugs that would Percent of drive an inflection in its growth trajectory. We retain conviction. We think Net Assets Takeda is well positioned to benefit from growing incidences of United Kingdom 16.9% gastrointestinal, oncology, and central nervous system disorders. Current Japan 10.0 management has improved profitability via ongoing cost-cutting initiatives France 8.1 and repositioned the company to be more shareholder friendly. Switzerland 4.3 Netherlands 4.2 MonotaRO Co., Ltd. is an online distributor of machine tools, engine parts, Israel 3.6 and consumables for maintenance, repair, and operations activity in Japan. Germany 3.6 Shares fell in the quarter on a broader market rotation out of stocks that Sweden 2.8 benefited from pandemic-related digitization trends. The company came off Spain 2.6 a record 2020 as digitalization of B2B maintenance purchases reached a United States 2.3 historical high. We believe the current weakness is temporary and Canada 1.9 MonotaRo is well positioned for market share gains in industrial Denmark 1.0 e-commerce via product and customer base expansion. Australia 0.8 Norway 0.8 PORTFOLIO STRUCTURE Hong Kong 0.8

Table IV. Table VII. Percentage of securities in Emerging Markets as of June 30, 2021 Top 10 holdings as of June 30, 2021 – Developed Countries Percent of Percent of Net Assets Net Assets BNP Paribas S.A. 2.8% China 10.9% Future plc 2.7 India 6.8 S4 Capital plc 2.2 Russia 4.8 argenx SE 1.8 Brazil 4.6 Lloyds Banking Group plc 1.8 Korea 1.5 Linde plc 1.6 Mexico 0.8 LVMH Moet Hennessy Louis Vuitton SE 1.6 Poland 0.7 Befesa S.A. 1.6 United Arab Emirates 0.2 Endava plc 1.5 Eurofins Scientific SE 1.5 The tables above do not include the Fund’s exposure to Uruguay (1.5%) because the country falls outside of MSCI’s developed/emerging/frontier framework.

Table V. Exposure by Market Cap: The Fund may invest in companies of any market Top five holdings as of June 30, 2021 – Emerging Countries capitalization, and we strive to maintain broad diversification by market cap. Percent of At the end of the second quarter of 2021, the Fund’s median market cap Net Assets was $16.8 billion. We were invested 65.9% in large- and giant-cap TCS Group Holding PLC 2.2% companies, 22.6% in mid-cap companies, and 7.0% in small- and micro-cap Zai Lab Limited 1.6 companies, as defined by Morningstar, with the remainder in cash. Bajaj Finance Limited 1.6 Korea Shipbuilding & Offshore Engineering Co., Ltd. 1.5 RECENT ACTIVITY Tencent Holdings Limited 1.4 During the second quarter of 2021, we added a few new positions while also increasing position sizes in several existing investments. We were active in adding to our fintech theme, most notably via two new positions in Latin America: Dlocal Ltd. and StoneCo Ltd. We participated in the recent IPO of Dlocal, a Uruguay-based financial technology company that facilitates cross-border and local-to-local e-commerce payments in emerging markets for global enterprise merchants. The company’s proprietary technology platform enables global merchants to connect seamlessly with millions of consumers in emerging markets through one API and one platform. Dlocal addresses several pain points for global merchants looking to expand sales in emerging markets. It facilitates adherence to complex regulatory and tax requirements, enables acceptance of the relevant local payment methods, increases authorization rates versus existing alternatives, and helps reduce

64 June 30, 2021 Baron International Growth Fund

fraud. In our view, these factors have allowed Dlocal to create a strong During the quarter, we also initiated a position in InPost S.A., a Poland- competitive moat, which has led to fast growth in merchant partners and an based but increasingly pan-European operator of logistics networks increase in wallet share for existing clients, as evidenced by a high net including technology-enabled automated parcel lockers. Being an existing revenue retention rate of over 150% in 2020. Dlocal is benefiting from position in the Baron Emerging Markets Fund, we know the business well, secular trends including the globalization of commerce, growing penetration and a sell-off during the quarter allowed us to initiate a position in the of alternative digital payment methods, and increasing purchasing power of Baron International Growth Fund at an attractive entry point. InPost middle-class consumers in the markets it serves. In addition, the company’s operates the largest automated parcel locker network in Poland with a 98% processed volumes are tied to the sales growth of the largest market share, increasingly the preferred method among Poles to receive and global enterprise merchants around the world. With strong tailwinds return goods bought online. InPost’s highly dense, technology-enabled for revenue growth and improving operating leverage, we believe Dlocal logistics network has powered package delivery times and e-commerce has the potential to deliver exciting earnings growth for many years to frequency levels generally not seen in other emerging markets (other than come. China). We believe the company’s density (of lockers, couriers, and pick-up points) and merchant-neutral network creates unit economics that new We also initiated a position in Stone, a leading financial technology services entrants will be unable to replicate. The company is also expanding into new company in Brazil offering payments, software, and e-commerce solutions markets, with a nascent position in the U.K. and its recent acquisition of to merchants in the country. Stone has a differentiated client-centric Mondial Relay, a logistics network in France, from which we believe InPost business model which combines technology, hyper-local distribution, and will extract synergies by overlaying its technology and onboarding superior customer service to deliver a better value proposition to its pan-European customers from its Polish and U.K. businesses. We believe customers. Beyond payments, Stone offers a complete financial platform continued fast growth in Poland as well as international expansion will where clients can access traditional banking solutions and tools to digitize power annual revenue growth in excess of 25% over the next four to five their business while also building omni-channel distribution capabilities. The years. company recently enhanced its software services to clients via the acquisition of Linx, a top tier software development company with an Lastly, we also added to several existing positions, notably AMG Advanced Metallurgical Group N.V., Nestle S.A., Korea Shipbuilding & Offshore emphasis on retail clients in Brazil. In our view, these offerings will open new Engineering Co., Ltd., Koninklijke DSM N.V., Novatek PJSC, Cellnex revenue opportunities for the company and will enable it to deliver higher Telecom, S.A., and S4 Capital plc. Based on our goal to increase portfolio client retention versus peers. Lastly, Stone is also benefiting from the secular concentration and our practice of selling when valuations reach levels trends of increasing digital payments and penetration of e-commerce, which inconsistent with our view of fundamentals, we exited positions in Glodon provide a long runway for growth. Company Limited, PagSeguro Digital Ltd., and Hong Kong Exchanges We also made an investment in Compagnie Financiere Richemont SA,a and Clearing Limited. global luxury conglomerate widely known for its hard luxury brands, most notably Cartier and Van Cleef & Arpels. In our view, the highest quality, OUTLOOK most iconic luxury brands will continue to gain market share, and Richemont owns two of the most prominent ones in luxury jewelry in The second quarter of 2021 was relatively uneventful. The volatility we saw Cartier and Van Cleef (the other two being Bulgari and Tiffany, both owned in the first quarter moderated and global equities traded within a narrower by LVMH, another position held in the Fund). Richemont has range. U.S. equities led global returns as the U.S. dollar firmed and treasury underperformed luxury peers in the last half decade, as strong performance yields retreated on expectations that Fed tapering and rate hikes would be in the jewelry maisons was offset by declines in other businesses, such as pulled forward. luxury watches and Yoox/Net-A-Porter. However, in our view, these We quote from our first quarter letter: “In our view, bond yields have segments are now at or near their nadir, with Cartier and Van Cleef likely already priced in a materially tighter Fed than both what is being constituting well over 100% of consolidated profits. We believe the shares communicated and what is likely. We suspect bond market vigilantes may can compound at the rate of growth of these two jewelry maisons plus have gone too far, too soon, and note that a peak in bond yields would favor potential improvement or value crystallization of the other businesses, to growth stocks after a substantive first quarter correction.” In recent months, which the market currently ascribes negative value given their combined bond yields and inflation fever indeed peaked, as an ongoing slowdown in losses. In effect, we believe we bought Cartier and Van Cleef at healthy Chinese credit growth, the spread of the Delta variant of COVID-19, and discounts to their intrinsic value with optionality on loss mitigation or rising conviction that the Fed would not fall too far behind the curve, improvement in the other businesses. coalesced to cool both global growth expectations and spiraling commodity prices. As we alluded above, these conditions resulted in growth stocks, particularly in the U.S., outperforming during the recent quarter. Meanwhile, international and EM equities lagged modestly in U.S. dollar terms amid mixed signals, though we remain optimistic regarding their relative appeal, particularly on a multi-year basis. In the shorter term, we believe that as the U.S. was an early leader in COVID vaccination penetration (along with the U.K. and Israel), recent strength in the U.S. economy and U.S. equities may be more likely the result of a timing difference than a structural difference relative to other countries, and we suspect many international and EM jurisdictions are due for a catch-up phase in coming quarters.

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There has been much consternation regarding the re-emergence of inflation yields remaining historically low and real interest rates still negative in most at above the long-term optimal rate of 2.0% to 2.5%. At this point, we developed markets, we believe equities can likely continue to be supported believe it is far too early in the global recovery/expansion cycle to raise by capital flows at the expense of sovereign bonds for some time. concern that this will have a material or lasting impact on equities. We remain optimistic regarding the outlook for corporate earnings, though we Thank you for investing in the Baron International Growth Fund. reiterate that equity returns should moderate as we believe earnings expectations are already high in the near term, and multiple compression is Sincerely, more likely than expansion from here given our view that over the longer term we anticipate a modest rise in both real and nominal interest rates. We view recent growth and inflation above targeted levels as having both transitory and structural drivers; COVID-19-related supply and labor bottlenecks will likely prove transitory and contain inflation readings in coming months, while the marked increase in global fiscal spending will have more of a structural impact, leading to marginally higher economic Michael Kass growth, inflation, and interest rates in coming years. With sovereign bond Portfolio Manager June 30, 2021

Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectus contain this and other information about the Funds. You may obtain them from its distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing. Risks: Non-U.S. investments may involve additional risks to those inherent in U.S. investments, including exchange-rate fluctuations, political or economic instability, the imposition of exchange controls, expropriation, limited disclosure and illiquid markets. This may result in greater share price volatility. Securities of small and medium-sized companies may be thinly traded and more difficult to sell. Even though the Fund is diversified, it may establish significant positions where the Adviser has the greatest conviction. This could increase volatility of the Fund’s returns. Portfolio holdings are subject to change. Current and future portfolio holdings are subject to risk. The discussions of the companies herein are not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed in this report reflect those of the respective portfolio manager only through the end of the period stated in this report. The portfolio manager’s views are not intended as recommendations or investment advice to any person reading this report and are subject to change at any time based on market and other conditions and Baron has no obligation to update them. This report does not constitute an offer to sell or a solicitation of any offer to buy securities of Baron International Growth Fund by anyone in any jurisdiction where it would be unlawful under the laws of that jurisdiction to make such offer or solicitation. BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a limited purpose broker- dealer registered with the SEC and member of the Financial Industry Regulatory Authority, Inc. (FINRA).

66 June 30, 2021 Baron Real Estate Fund

Dear Baron Real Estate Fund Shareholder:

We are pleased to report that the Baron Real Estate Fund (the “Fund”) generated strong performance for the six months ended June 30, 2021, gaining 16.24% (Institutional Shares). During this period, however, the Fund underperformed its primary benchmark index, the MSCI USA IMI Extended Real Estate Index (the “MSCI Real Estate Index”), and the MSCI US REIT Index, which increased 20.04% and 21.24%, respectively. In the most recent three-month period ended June 30, 2021, the Fund gained 4.65% (Institutional Shares) compared to gains of 6.99% for the MSCI Real Estate Index and 11.74% for the MSCI US REIT Index. For our more detailed thoughts on the Fund’s recent performance, please refer to our “A review of recent activity and performance” section later in this letter. We are also pleased to report that as of June 30, 2021, the Fund maintained its 5-star Overall Morningstar Rating™. Morningstar Real Estate Category Rankings (as of June 30, 2021) JEFFREY KOLITCH Retail Shares: BREFX • 10-year performance: Ranked as the #1 real estate fund Institutional Shares: BREIX PORTFOLIO MANAGER R6 Shares: BREUX • 5-year performance: Ranked as the #1 real estate fund • 3-year performance: Ranked as the #1 real estate fund We will address the following topics in this letter: • 1-year performance: Ranked as the #1 real estate fund • A review of recent activity and performance • Our investment themes and portfolio construction • Our “all-weather” real estate fund • The prospects for real estate and the Baron Real Estate Fund (preview: we remain bullish)

As of 6/30/2021, the Morningstar Ratings™ were based on 228, 199, 143, and 228 share classes for the 3-year, 5-year, 10-year, and Overall periods, respectively. The Baron Real Estate Fund received 5, 5, 5, and 5 stars, respectively. The Morningstar Ratings are for the Institutional Share Class only; other classes may have different performance characteristics. The Morningstar Ratings are based on the Morningstar Risk-Adjusted Return measures. As of 6/30/2021, the Morningstar Real Estate Category consisted of 246, 228, 199, and 143 share classes for the 1-, 3-, 5-, and 10-year periods. Morningstar ranked Baron Real Estate Fund Institutional Share Class in the 1st, 1st, 1st, and 1st percentiles, respectively. On an absolute basis, Morningstar ranked Baron Real Estate Fund Institutional Share Class as the 2nd, 1st, 2nd, and 1st best performing share class in its Category, for the 1-, 3-, 5-, and 10-year periods, respectively. As of 6/30/2021, the Morningstar Real Estate Category consisted of 246, 228, and 199 share classes for the 1-, 3-, and 5-year periods. Morningstar ranked Baron Real Estate Fund R6 Share Class in the 1st, 1st, and 1st percentiles, respectively. On an absolute basis, Morningstar ranked Baron Real Estate Fund R6 Share Class as the 1st, 2nd, and 1st best performing share class in its Category for the 1-, 3-, and 5-year periods, respectively. Morningstar calculates the Morningstar Real Estate Category Average performance and rankings using its Fractional Weighting methodology. Morningstar rankings are based on total returns and do not include sales charges. Total returns do account for management, administrative, and 12b-1 fees and other costs automatically deducted from fund assets. 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 Morningstar Rating does not include any adjustment for sales loads. 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 inall three rating periods. © 2021 Morningstar. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may notbe copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any BARON damages or losses arising from any use of this information. Past performance is no guarantee of future results. FUNDS

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Table I. Table II. Performance Top net purchases for the quarter ended June 30, 2021 Annualized for periods ended June 30, 2021 Quarter End Amount Baron Baron MSCI Market Cap Purchased Real Real USA IMI (billions) (millions) Estate Estate Extended Vornado Realty Trust $ 8.9 $25.5 Fund Fund Real MSCI Retail Institutional Estate US REIT CoreSite Realty Corporation 6.6 24.6 Shares1,2 Shares1,2 Index1 Index1 Cellnex Telecom, S.A. 43.3 23.5 Three Months3 4.58% 4.65% 6.99% 11.74% Marriott Vacations Worldwide Corp. 6.8 23.5 Six Months3 16.10% 16.24% 20.04% 21.24% The AZEK Company Inc. 6.6 22.1 One Year 60.69% 61.07% 44.27% 36.57% In the most recent quarter, we acquired shares or made additional purchases in: Three Years 25.09% 25.42% 13.56% 8.83% Five Years 20.17% 20.49% 11.48% 5.02% • Vornado Realty Trust: Vornado is a REIT that owns a high-quality Ten Years 16.33% 16.63% 12.11% 8.06% portfolio of office and street retail assets concentrated in New York Since Inception City. As economic activity improves and employees return to work, we (December 31, 2009) expect leasing and occupancy trends to improve. At its recent price of (Annualized) 17.15% 17.44% 13.00% 10.10% $47, we believe the shares are attractively valued at a 40% discount to Since Inception our estimate of net asset value of $78 per share. (December 31, 2009) • CoreSite Realty Corporation: CoreSite is a REIT that operates a high- 3 (Cumulative) 517.27% 535.45% 307.80% 202.49% quality real estate portfolio of 25 well-located real estate data centers in eight markets in the U.S. We believe the company is poised for a A REVIEW OF RECENT ACTIVITY AND PERFORMANCE positive inflection in cash flow growth in the next few years. In our Recent Activity opinion, the shares are attractively valued relative to its public data center peers and recent private market transactions. Like our portfolio management playbook that we employed in 2020, we have maintained our unusually elevated active approach of managing the • Cellnex Telecom, S.A.: Cellnex has assembled the premier and largest Fund in the first six months of 2021 due to the acceleration and emergence wireless tower portfolio in Europe. We believe the company will grow of headwinds and tailwinds in certain segments of real estate, the its cash flow by 100% by the end of 2025, far more than the expected unprecedented economic and social lockdown and reopening, and the growth of other tower companies. Despite expectations for superior resulting stock market volatility. growth, Cellnex’s shares are valued at a comparable cash flow multiple to U.S. tower REITs. • Marriott Vacations Worldwide Corp.: Marriott Vacations is a leading owner, operator, and developer of real estate timeshare resorts. With the company’s 100% focus on leisure travelers, we believe Marriott Vacations is ideally positioned for a robust travel recovery as more and more people are vaccinated. We believe the long-term growth prospects for Marriott Vacations are compelling and the shares remain attractively valued.

Performance listed in the above table is net of annual operating expenses. Annual expense ratio for the Retail Shares and Institutional Shares as of December 31, 2020 was 1.34% and 1.08%, respectively. The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original cost. The Adviser reimburses certain Baron Fund expenses pursuant to a contract expiring on August 29, 2031, unless renewed for another 11-year term and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted. For performance information current to the most recent month end, visit www.BaronFunds.com or call 1-800-99BARON. The Fund’s 2Q 2021 historical performance was impacted by gains from IPOs and there is no guarantee that these results can be repeated or that the Fund’s level of participation in IPOs will be the same in the future. 1 The MSCI USA IMI Extended Real Estate Index is a custom index calculated by MSCI for, and as requested by, BAMCO, Inc. The index includes real estate and real estate- related GICS classification securities. MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indexes or any securities or financial products. This report is not approved, reviewed or produced by MSCI. The MSCI US REIT Index is a free float-adjusted market capitalization index that measures the performance of all equity REITs in the US equity market, except for specialty equity REITs that do not generate a majority of their revenue and income from real estate rental and leasing operations. MSCI is the source and owner of the trademarks, service marks and copyrights related to the MSCI Indexes. The indexes and the Fund include reinvestment of interest, capital gains and dividends, which positively impact the performance results. The indexes are unmanaged. Index performance is not Fund performance; one cannot invest directly into an index. 2 The performance data in the table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. 3 Not annualized.

68 June 30, 2021 Baron Real Estate Fund

• The AZEK Company Inc.: AZEK is a leading manufacturer of outdoor, The generally strong share price performance of several “value” real estate non-wood building products including decking, railing, trim, and other companies versus “growth” companies weighed on the Fund’s relative leading outdoor products. 95% of cash flow is generated from the U.S. performance in the first half of 2021. Although the Fund maintains residential housing market. We believe the company has a compelling investments in “value” real estate companies, we continue to prioritize multi-year strategic growth plan that should result in strong share price best-in-class, competitively advantaged real estate growth companies, appreciation in the next few years. consistent with our long-term investment philosophy. In our opinion, the risk-reward prospects have started to become more favorable for growth Table III. stocks following the sharp divergence in year-to-date performance between Top net sales for the quarter ended June 30, 2021 real estate value and real estate growth stocks. Quarter End Market Cap or Following significant underperformance in 2020, REITs were among the best Market Cap Amount performing market categories in the first six months of 2021. The Baron Real When Sold Sold Estate Fund, with its balanced portfolio composition that tends to limit its (billions) (millions) REIT allocation to approximately 25% to 30% of the Fund, was unable to Wynn Resorts Ltd. $14.1 $23.4 keep pace with REITs in the last few months. Las Vegas Sands Corporation 40.3 18.3 Opendoor Technologies Inc. 10.2 12.9 Additionally, a few of the Fund’s Asia-focused real estate investments (Las Hilton Worldwide Holdings, Inc. 34.0 11.3 Vegas Sands Corporation, Wynn Resorts Ltd., and GDS Holdings Penn National Gaming, Inc. 12.0 9.9 Limited) weighed on the Fund’s performance due to COVID-19 headwinds that limited travel and other Asia-centric macro-economic and business In the most recent quarter, we trimmed the Fund’s holdings in Wynn considerations. We remain optimistic about the long-term return potential Resorts Ltd. and Las Vegas Sands Corporation largely due to ongoing for these companies. COVID-19-related travel restrictions in China, Macau, and Singapore. We In the past, there have been periods when the Fund has temporarily trailed expect business activity to rebound sharply when travel restrictions are its benchmark. The Fund has a track record of bouncing back. Our team lifted and may acquire additional shares in the future. remains driven, hard at work, and we are optimistic that we will, once again, Following exceptional share price performance in 2020 for Opendoor deliver strong long-term relative performance for our shareholders as we Technologies Inc. and Penn National Gaming, Inc. (Opendoor and Penn have done over the years. gained 112% and 232%, respectively), we trimmed the Fund’s holdings in both companies to manage the position size of each investment. We remain Table IV. optimistic about the long-term prospects for each of these companies. Top contributors to performance for the quarter ended June 30, 2021 Quarter End We recently exited the Fund’s investment in Hilton Worldwide Holdings, Market Cap Percent Inc. and reallocated the capital to other real estate companies that we (billions) Impact believe offer superior return potential. Latham Group, Inc. $ 3.8 0.95% Red Rock Resorts, Inc. 5.0 0.88 Recent Performance Equinix, Inc. 71.9 0.48 The Baron Real Estate Fund generated particularly strong absolute and Brookfield Asset Management Inc. 175.0 0.41 relative performance in both 2019 and 2020. American Tower Corp. 122.8 0.39

2019 Performance In the most recent quarter, we participated in the IPO of Latham Group, • Baron Real Estate Fund: 44.44% Inc., the largest manufacturer of fabricated pools globally. We believe this • MSCI Real Estate Index: 30.21% company is well positioned to benefit from several multi-year tailwinds • MSCI US REIT Index: 24.33% including anticipated strength in the U.S. housing market, a cyclical recovery 2020 Performance in new pool construction, and a secular growth opportunity as the • Baron Real Estate Fund: 44.28% company’s fiberglass pools offer several advantages versus most other pool • MSCI Real Estate Index: 4.21% options (concrete and vinyl, for example) including lower costs and • MSCI US REIT Index: -8.70% maintenance, faster build times, and higher manufacturer profitability. Following two straight years of annual returns of over 44%, we are pleased The shares of Red Rock Resorts, Inc., a real estate gaming, development, that the Fund continued to generate strong performance in the first six and management company that generates 100% of its cash flow in the Las months of 2021, gaining 16.24%. Nevertheless, a few factors contributed to Vegas Locals market continued to perform well in the most recent quarter. the Fund’s relative underperformance in the last few months compared to We remain optimistic about the long-term prospects for the company given its primary benchmark and the MSCI US REIT Index. the quality of its 100% owned real estate assets, the attractive and expanding Las Vegas Locals market (strong population growth), and the company’s impressive growth and free cash flow prospects. We believe the shares could appreciate by approximately 50% in the next few years. The shares of Equinix, Inc. gained 18% in the most recent quarter. Equinix is the premier global data center company in the world. We believe

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the company is exceptionally well positioned to continue to benefit from At its recent price of $17 (versus a peak price of $36 in February), we believe powerful secular demand trends including strong growth in information the shares are attractively valued and offer compelling upside in the next technology outsourcing, increased cloud computing adoption, multi-year few years. increases in mobile data traffic, global internet traffic, and the number of OUR INVESTMENT THEMES AND PORTFOLIO CONSTRUCTION connected devices. Investment Themes The shares of long-term holding Brookfield Asset Management Inc. gained 15% in the most recent quarter. The company is a leading alternative asset In the second half of 2020, we structured the Fund to take advantage of manager focused on investing in high-quality real estate and infrastructure- three compelling investing themes and have maintained these themes in the related assets that tend to generate predictable and growing cash flows. We first six months of 2021. remain bullish about the ongoing prospects for Brookfield given the secular As we peer into the second half of 2021, our sense is that it is premature to growth opportunity for alternative assets, the company’s many competitive pivot away from the Fund’s themes. advantages including scale, global capabilities, its well known brand name, operating expertise, and performance track record. We hold management in As a reminder, the Fund’s current investing themes are: high regard and believe the shares remain attractively valued. 1. COVID-19 recovery beneficiaries Table V. This investment theme encompasses what we call the epicenter real estate Top detractors from performance for the quarter ended June 30, 2021 companies of the 2020 pandemic. Quarter End Market Cap Percent Last year, certain REITs and other real estate-related businesses that rely on (billions) Impact the assembly of people were severely impacted by COVID-19 as they were Las Vegas Sands Corporation $40.3 –0.60% forced to shut down all or a large part of operations almost without Tripadvisor, Inc. 5.5 –0.53 exception. The share prices of many of these companies declined last year Penn National Gaming, Inc. 12.0 –0.53 and remain below peak prices. Opendoor Technologies Inc. 10.2 –0.51 In the second half of 2021, we anticipate the release of pent-up consumer Zillow Group, Inc. 30.3 –0.18 and commercial demand and a rebound in cash flows for several of the hardest hit segments of real estate – particularly the travel-related segments The shares of Las Vegas Sands Corporation, a leading developer of luxury - as more people are inoculated with COVID-19 vaccines and economic casino resorts in Macau and Singapore, declined in the most recent quarter activity resumes. in large part due to COVID-19 travel-related restrictions. We believe the shares are attractively valued and will recover sharply when travel Despite a recent rebound in the share prices of many of the “COVID-19 restrictions are lifted. recovery beneficiaries,” we believe several companies have significant upside. Following exceptionally strong performance in the first quarter of 2021 Examples of the Fund’s COVID-19 recovery beneficiaries include: when its shares gained 56%, the shares of Tripadvisor, Inc. declined 27% in • Real estate casino and gaming companies the most recent quarter. The company is an online travel site used for o Las Vegas Sands Corporation, Red Rock Resorts, Inc., planning vacation trips. Tripadvisor has built a strong following with more Boyd Gaming Corporation, Wynn Resorts Ltd., and Penn than 460 million unique monthly visitors, and we believe the company is National Gaming, Inc. ideally positioned for a travel recovery as more and more people are vaccinated. • Vacation timeshare companies o Marriott Vacations Worldwide Corp., Travel + Leisure Following a 232% gain in 2020, the shares of Penn National Gaming, Inc. Co., and Hilton Grand Vacations Inc. declined 29% in the most recent quarter and are down 13% year-to-date. At its recent price of only $73 (down from a peak price of $136 in March), • Amusement park operators we believe Penn’s shares are now attractively valued. We believe the o Six Flags Entertainment Corporation and Seaworld company’s 41 regional casinos are worth approximately $60 per share. Its Entertainment Inc. remaining Barstool media business and online sports betting and i-gaming • Commercial real estate services companies businesses are currently valued at only $13 per share or less than 3.5 times o CBRE Group, Inc. and Jones Lang LaSalle Incorporated our expectation for cash flow for these business in 2025. We hold CEO Jay Snowden in high regard and believe he and his team have several levers to • Real estate operating companies grow cash flow and create strong shareholder value in the next few years. o Brookfield Asset Management Inc. Following exceptionally strong share price performance in 2020 and early in • Land development companies 2021, the shares of Opendoor Technologies Inc. declined sharply in the o The Howard Hughes Corporation last few months. Opendoor provides a digital platform for residential real • Certain REITs (office, apartment, mall, shopping center, hotel, health estate that allows for the purchase and sale of homes on a mobile device. care, and gaming REITs) The company generated $2.5 billion of revenues last year, and management, o Douglas Emmett, Inc., Simon Property Group, Inc., who we have high regard for, believes there is a path to growing revenues to Vornado Realty Trust, American Assets Trust, Inc., Equity $50 billion over time! Residential, MGM Growth Properties LLC, and Gaming and Leisure Properties, Inc.

70 June 30, 2021 Baron Real Estate Fund

On June 30, 2021, COVID-19 recovery beneficiary companies represented Secular tailwinds 45.9% of the Fund’s net assets. COVID-19 has also given rise to secular tailwinds that may aid the U.S. housing market for several years: Table VI. COVID-19 Recovery Beneficiaries as of June 30, 2021 • Suburban may become the new urban: More U.S. families have been Percent of moving out of urban areas to suburban towns. We expect demand for Net Assets single-family homes – to purchase or rent – to remain strong. Casinos & Gaming Operators 13.1% • Work from home or anywhere: Should work-from-home arrangements Certain REITs 11.5 become more permanent, people will have more flexibility to relocate Timeshare Companies 6.4 away from urban centers. This should lead to an increase in new home Commercial Real Estate Services Companies 5.4 sales and demand for single-family rentals. Real Estate Operating Companies 3.4 Amusement Park Companies 2.4 • More time at home may lead to more investment in the home: Land Development Companies 2.1 Homeowners are likely to spend more time at home than ever before OTAs 1.6 as more employees work from home. This trend should contribute to Total 45.9% homeowners spending more on home repair and remodeling activity (home office, outdoor decks and living spaces, pools, kitchens, and 2. Opportunities in residential real estate refreshing paint jobs). The Fund currently has investments in several companies that should benefit from this trend including: Home Depot, We remain bullish on the multi-year prospects for U.S. residential real Inc., Lowe’s Companies, Inc., Fortune Brands Home & Security, Inc., estate. Installed Building Products, Inc., SiteOne Landscape Supply, Inc., The key component of our optimism is that there has been a structural Pool Corporation, Trex Company, Inc., The AZEK Company Inc., and underinvestment in the construction of residential real estate that we believe Latham Group, Inc. is likely to reverse in the years ahead. We are mindful of, and will continue to monitor, the potential risks to the Today, the U.S. is building the same number of homes annually as it did in Fund’s investments in residential real estate-related companies. Many 1959 - approximately 1.4 million homes, which also equals the 60-year residential-related stocks performed well in 2020 and in the first six months average. This annual construction figure is shockingly low when one considers of 2021, certain valuations are not as compelling, year-over-year growth that the U.S. population is more than 150 million people larger than it was in comparisons may be more challenging later in 2021, and a sharp increase in 1959 - 330 million people today versus 178 million people in 1959! mortgage rates coupled with double-digit home price growth would make homes less affordable. Demand prospects are also encouraging especially from the approximately 72 million millennials – ages 23 to 38 – many of whom are now looking to Regarding home price affordability, despite strong recent home price buy or rent a home. appreciation, we believe affordability remains attractive in part due to increases in household income and historically low mortgage rates. We will The large imbalance between pent-up housing demand and low elaborate on this topic in our next shareholder letter. construction levels bodes well for new single-family home purchases, so long as mortgage rates and home prices do not spike to levels that would We would also note that many builders are currently holding back the sales deter would-be homebuyers. of homes so that they can better match the home sales price with the cost to build a home (lumber, labor, etc.) and generate an attractive profit Other cyclical and secular tailwinds that should aid the U.S. housing market margin. The implication is that the recent slowdown in new home sales is in the years ahead include: partly technical (supply-induced, not due to a lack of demand), and, if so, Cyclical tailwinds any home sale slowdown may not persist. In addition to cyclically depressed levels of construction activity and Should headwinds begin to surface for the housing market, we would expect pent-up demand, low inventory levels, low mortgage rates, higher consumer any correction in the share prices of residential real estate-related savings, meaningful stimulus checks, and a rebound in job and economic companies to be relatively shallow given the powerful cyclical and secular growth should continue to benefit the U.S. housing market. The current housing-related tailwinds. situation is nothing like what occurred during the global Financial Crisis Areas of investment focus include homebuilders, single-family rental REITs, when our country’s inventory of homes was significantly oversupplied manufactured housing REITs, residential building products/services relative to demand. companies, apartment REITs, and other residential-related real estate companies.

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The Fund’s ability to invest in non-REIT residential-related real estate Portfolio Construction companies such as homebuilders, land developers, building products/services In addition to prioritizing the three investment themes cited above, we have companies, and home centers is one of the important differentiators that continued to implement a barbell approach to the Fund’s portfolio affords the Fund the ability to distinguish itself versus REIT funds. construction that includes a more balanced mix between best-in-class real On June 30, 2021, residential-related real estate companies represented estate “growth” companies and real estate “value” opportunities. 20.5% of the Fund’s net assets. We believe our current barbell approach is prudent because COVID-19 led Table VII. to a wide disparity in share price performance and valuation for several real Residential-related Real Estate Companies as of June 30, 2021 estate companies. Percent of We have maintained the Fund’s investments in competitively advantaged Net Assets best-in-class real estate companies with long runways for growth. Examples Building Products/Services 10.7% include: Home Centers 4.1 Homebuilders 2.2 • Alexandria Real Estate Equities, Inc., American Tower Corp., CBRE REITs Group, Inc., CoStar Group, Inc., Equinix, Inc., GDS Holdings Limited, Single-Family Rental 2.0 Lowe’s Companies, Inc., Prologis, Inc., and Zillow Group, Inc. Manufactured Housing 1.5 The Fund’s long-term investment philosophy remains the prioritization of Total1 20.5% best-in-class real estate growth companies. 1 Total would be 23.7% if included residential-related technology companies Zillow We have continued to acquire shares in several real estate companies that Group, Inc. and Opendoor Technologies Inc. are attractively valued and are “on sale.” Examples include: 3. The intersection of technology and real estate • Brookfield Asset Management Inc., Douglas Emmett, Inc., Jones Real estate technology-related companies performed well in 2020. We Lang LaSalle Incorporated, Simon Property Group, Inc., Vornado noted in our 2020 fourth quarter letter that valuations were generally less Realty Trust, and The Howard Hughes Corporation. compelling than one year ago and the performance of the stocks may Baron Real Estate Fund currently has investments in REITs, plus eight underperform in the near term relative to laggard real estate categories that additional real estate-related categories (not including Unclassified should benefit if economic growth accelerates in 2021. This has occurred in securities). Our percentage allocations to these categories vary, and they are the first six months of 2021. We also cited that we remain bullish on the based on our research and assessment of opportunities in each category long-term prospects for several real estate technology companies. (See Table IX. below). The impact of technology on real estate is undeniable. The growth in cloud computing, the internet, mobile data and cellphones, and wireless Table IX. infrastructure are powerful secular drivers that should continue unabated for Fund investments in real estate-related categories as of June 30, 2021 years and are impacting real estate, along with many other industries. Percent of Net Assets If anything, the pandemic has accelerated these secular trends as more REITs 30.3% people conduct business, leisure, residential, and commercial activities Building Products/Services 13.7 online. Casinos & Gaming Operators 13.1 Real Estate Service Companies 12.5 Real estate-related companies that embrace and adopt the latest Hotels & Leisure 8.8 technological advances and innovations remain an important focus for us. Homebuilders & Land Developers 5.4 Key beneficiaries of the technology revolution include data center Data Centers1 4.4 companies, wireless tower companies, industrial REITs, and real estate data Unclassified 4.0 analytics companies, among others. Real Estate Operating Companies 3.4 Tower Operators 2.1 On June 30, 2021, technology-related real estate companies represented 19.9% of the Fund’s net assets. Cash and Cash Equivalents 2.3 Total 100.0% Table VIII. Technology-related Real Estate Companies as of June 30, 2021 1 Total would be 8.4% if included data center REITs Equinix, Inc. and CoreSite Percent of Realty Corporation. Net Assets Real Estate Data Analytics Companies 5.5% Data Centers 4.4 Wireless Tower Operators 2.1 REITs Wireless Tower REITs 4.0 Data Center REITs 3.9 Total 19.9%

72 June 30, 2021 Baron Real Estate Fund

OUR “ALL-WEATHER” REAL ESTATE FUND pivot away from REIT and non-REIT real estate categories that may face long-term occupancy, rent, and cash flow pressures. Approximately 12 years ago, we began to prepare for the launch of the Baron Real Estate Fund. At that time, our goal was to structure an Second, our decision to pursue a differentiated real estate investment “all-weather” real estate fund that would have the potential to perform approach enhances our potential to generate strong returns in various real well in: estate and macro-economic environments. (i) various stages of a real estate cycle; For example, we are mindful that interest rates and inflation are a current, top-of-mind topic. (ii) different macro-economic environments such as periods of strong and weak economic growth, declining and rising interest rates, inflationary It appears that the “consensus” expectation is that interest rates are likely to periods, etc.; and, rise, and elevated inflation may persist. Should this occur, we believe the (iii) disparate real estate investment landscapes Baron Real Estate Fund has the capability – more so than most of our real estate peers – to continue to perform well, in part due to our more The key distinguishing characteristic of our “all-weather” real estate fund is expansive approach. that unlike most real estate funds that tend to limit their investments to REITs, our investment philosophy and strategy has been to structure and We would note, however, that although we are mindful of the maintain a more expansive and actively managed real estate fund – one macroeconomic environment, we do not base our investment decisions on that invests in REITs, but also in various non-REIT companies that operate macro forecasts. In our opinion, macro forecasts such as the direction of within or provide services or products to the real estate industry. interest rates, inflation, the U.S. dollar, and economic growth tend to be hit or miss. In our opinion, the Fund’s flexibility fosters two key competitive advantages. First, the Baron Real Estate Fund, unlike passively managed real estate strategies and most REIT funds, has a greater ability to pick our spots and

The performance of Baron Real Estate Fund in rising interest rate environments Since the launch of the Fund at the end of 2009, there have been six periods when the U.S. 10-year Treasury yield increased by at least 80 basis points. During these rising interest rate periods, the Baron Real Estate Fund: • Generated positive absolute performance in five of six periods. The only period the Fund did not generate a positive return was a 13-month period when it declined 1.82% • Outperformed the MSCI US REIT Index 100% of the time (in six out of six periods) The following table summarizes the Fund’s performance during the periods when interest rates have increased at least 80 basis points.

Table X. Performance of Baron Real Estate Fund When Interest Rates Have Risen Change in MSCI Increase in USA IMI Increase in 10-Year Baron Real MSCI US Extended 10-Year Treasury Yield Estate Fund REIT Index Real Estate Date Treasury Yield (bps) Performance Performance Performance 10/8/2010 to 2/10/2011 2.38% to 3.72% + 134 bps 16.61% 9.04% 13.85% 7/24/2012 to 1/1/2014 1.39% to 3.04% + 165 bps 60.33% 3.47% 32.83% 1/30/2015 to 6/10/2015 1.64% to 2.48% + 84 bps 3.76% –10.62% –1.36% 7/8/2016 to 3/13/2017 1.36% to 2.63% + 127 bps 5.92% –8.43% 1.42% 9/7/2017 to 10/5/2018 2.06% to 3.23% + 117 bps –1.82% –1.97% 4.56% 3/9/2020 to 3/31/2021 0.50% to 1.74% + 124 bps 83.59% 12.00% 35.18%

Source: BAMCO and FactSet. The performance of Baron Real Estate Fund in rising inflationary environments Since the launch of the Fund at the end of 2009, there have been six periods when the one-year inflation increased at least 100 basis points. In aggregate, the Fund and real estate more generally have proven to be respectable inflation hedges. During these inflationary periods, the Baron Real Estate Fund: • Generated positive absolute performance in five of six periods. The only period the Fund did not generate a positive return was a 10-month period beginning on November 30, 2010, when it declined 7.51% • Outperformed the MSCI US REIT Index in four of six periods with an average outperformance of 724 basis points • Outperformed the MSCI Real Estate Index in four of six periods with an average outperformance of 339 basis points

73 Baron Real Estate Fund

The following table summarizes the Fund’s performance during the periods when the one-year inflation increased at least 100 basis points.

Table XI. Performance of Baron Real Estate Fund When Inflation Has Risen Cumulative Total Returns Excess Returns vs.: MSCI MSCI USA IMI USA IMI Baron Real Extended Extended Period 1-Yr Estate Fund Real MSCI Real MSCI Length Inflation (Institutional Estate US REIT Estate US REIT Date (months) Change Shares) Index Index Index Index 11/30/2010 to 9/30/2011 10 2.73% –7.51% –9.00% –2.28% 1.49% –5.23% 10/31/2013 to 5/31/2014 7 1.29% 13.29% 8.50% 9.78% 4.79% 3.51% 1/31/2015 to 2/28/2017 25 2.98% 0.31% 14.47% 5.06% –14.16% –4.75% 6/30/2017 to 7/31/2018 13 1.23% 8.39% 8.95% 2.90% –0.56% 5.49% 2/28/2019 to 1/31/2020 11 1.00% 23.56% 15.55% 11.86% 8.01% 11.70% 5/31/2020 to 3/31/2021 10 2.41% 58.42% 37.65% 25.70% 20.77% 32.72%

Source: Morningstar Direct, FactSet, Board of Governors of the Federal Reserve System (US) via the Federal Reserve Bank of St. Louis, U.S. Bureau of Labor Statistics. Concluding thoughts on our “all-weather” real estate fund We do not profess to have clarity regarding what may transpire in the real estate cycle, real estate landscape, and macro-economic environment in the months and years ahead. Rather than attempting to forecast the “macro,” we will continue to prioritize the “micro” – the research and analysis of real estate companies and real estate markets. We will also continue to do our best to structure our “all-weather” real estate fund to perform well over the long term. The table below summarizes the absolute and relative performance of the Fund’s Institutional Share class since inception and over shorter standard periods. The Fund has outperformed its primary benchmark, the MSCI Real Estate Index, and the MSCI US REIT Index over all periods.

Table XII. Overall Fund Performance as of June 30, 2021 Annualized Total Returns Excess Returns vs.: Baron Real Estate Fund MSCI USA IMI MSCI USA IMI (Institutional Extended Real MSCI US REIT Extended Real MSCI US REIT Shares) Estate Index Index Estate Index Index One Year 61.07% 44.27% 36.57% 16.80% 24.50% Three Years 25.42% 13.56% 8.83% 11.86% 16.59% Five Years 20.49% 11.48% 5.02% 9.01% 15.47% Ten Years 16.63% 12.11% 8.06% 4.52% 8.57% Since Inception 17.44% 13.00% 10.10% 4.44% 7.34%

THE PROSPECTS FOR REAL ESTATE AND THE BARON REAL ESTATE Commercial real estate construction activity and inventory levels remain FUND modest due, in part, to elevated construction costs and labor shortages. We continue to believe the near-term and long-term prospects for public In the single-family for-sale home segment of residential real estate, real estate remain attractive. inventory levels remain depressed relative to historical standards and Near-term case for real estate demographics. 1. Demand continues to outstrip supply 2. Business conditions are improving for most of our real estate companies–both residential and commercial real estate–and the A generally favorable relationship between demand and supply bodes well outlook does not portend a recession for real estate. The performance of several real estate companies lagged in 2020 largely due Regarding the demand outlook, commercial occupancy and rents and to the Coronavirus headwind that led to a sharp slowdown in business residential home sales and homes for rent are, in most cases, improving activity for hotels, real estate casinos, urban apartment and office landlords, against a backdrop of modest inventory levels. malls and shopping centers, and other real estate categories. The inability to Regarding the supply outlook, most real estate categories are not witnessing assemble people and businesses disproportionately weighed on a large warning signs of excess inventory and sharp increases in new construction. segment of real estate.

74 June 30, 2021 Baron Real Estate Fund

Last year’s real estate headwinds have begun to recede, and we expect this Long-term case for real estate trend to continue in the months ahead. We anticipate that portions of real We believe the long-term case for public real estate is compelling. estate will continue to be key beneficiaries of an economic reopening. 1. Solid historical long-term returns with ongoing potential 3. The real estate cycle has reset, and we believe the multi-year outlook is attractive For the 20-year period ended June 30, 2021, U.S. equity REITs have delivered the best cumulative return relative to the S&P 500 Index, fixed income Most real estate cycles tend to last five to seven years (like an economic alternatives, international equities, and commodities. cycle). Since inception on 12/31/09 through June 30, 2021, the Baron Real Estate We believe much of real estate is in the relatively early stages of a multi- Fund which owns REITs and non-REIT real estate companies has delivered a year recovery, fueled by improving prospects for demand, subdued cumulative return of 535.45%, far outdistancing the 202.49% return of the construction inventory levels, strong and liquid balance sheets, and well- MSCI U.S. REIT Index. functioning credit markets with historically low interest rates. We remain optimistic about the potential for real estate to continue to 4. Substantial private capital is still in pursuit of real estate ownership generate solid long-term absolute and relative performance. supported by widely available debt capital at low interest rates 2. Diversification and low correlation to equities and bonds We continue to believe that real estate merger and acquisition activity will According to FactSet, over the last 20 years (through 6/30/2021), REITs remain strong. have provided diversification benefits due to their modest correlation versus It is estimated that approximately $344 billion of capital has now been stocks (0.67 versus S&P 500 Index) and low correlation versus bonds (0.21 raised by private equity sources to invest in real estate, which equates to versus Bloomberg Barclays U.S. Aggregate Index). approximately $1.1 trillion of total real estate purchasing capacity, assuming 3. Inflation protection typical 70% debt financing! Historically, certain real estate has had the ability to raise prices to provide We anticipate that large amounts of capital from private equity investors inflation protection: such as Blackstone and Brookfield Asset Management, sovereign wealth funds, endowments, pension funds, and others will continue to step in and • Inflation-linked property value: Higher prices for labor, land and capitalize on the opportunity to buy quality public real estate given the materials may constrain new real estate construction activity compelling arbitrage opportunity in the public real estate market relative to thereby supporting higher occupancies and the ability for the private market. This “embedded put” scenario should limit downside landlords to raise rents. valuation and pricing. • Pricing Power: Property owners in supply-constrained areas are often able to pass along higher operating costs by raising rents in 5. We continue to identify several real estate companies that remain “on periods of rising inflation. sale” and are attractively valued • Short lease duration: Real estate segments with short lease terms The Fund took advantage of the major buying opportunities that were have the ability to raise rents relatively quickly to offset inflation. created in 2020 following the swift and intense stock market correction. Examples include hotels (1 day), self-storage real estate (30 days), Though many stock prices have recovered, valuations for many of our apartments (1 year), single-family rental homes (1 year), and current or prospective real estate-related investments remain quite senior housing facilities (1 year). reasonable and, in some cases, particularly attractive. • Annual rent escalators: Certain real estate leases have contractual annual rent escalators, in some cases tied to an inflation index (i.e., consumer price index or CPI).

We remain optimistic about the prospects for Baron Real Estate Fund. • We believe the benefits of the Fund’s broader approach and flexibility will become even more apparent in the years ahead in part due to the new and evolving real estate landscape. • We continue to believe the Fund is comprised of quality companies. The businesses that we continue to own are well managed, have market-leading positions, possess quality balance sheets, own well- located real estate, and grow cash flow at faster rates than most of their peers. • We believe the Fund is structured to capitalize on compelling investment themes. • A portion of the Fund’s real estate companies–such as certain REITs, real estate service companies, homebuilders, casinos & gaming companies, and other commercial and residential-related real estate companies–remain “on sale” at appealing prices.

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Table XIII. Top 10 holdings as of June 30, 2021 Quarter End Quarter End Investment Market Cap Value Percent of (billions) (millions) Net Assets GDS Holdings Limited $ 14.7 $64.1 3.6% Red Rock Resorts, Inc. 5.0 60.8 3.4 Brookfield Asset Management Inc. 175.0 60.7 3.4 American Tower Corp. 122.8 53.7 3.0 Lowe’s Companies, Inc. 137.1 53.3 3.0 Jones Lang LaSalle Incorporated 10.0 50.5 2.8 Boyd Gaming Corporation 6.9 49.0 2.7 Simon Property Group, Inc. 42.9 46.5 2.6 CBRE Group, Inc. 28.8 46.2 2.6 Zillow Group, Inc. 30.3 46.0 2.6

Thank you for your past and continuing support. Of course, I proudly continue as a major shareholder of the Baron Real Estate Fund, alongside you.

Sincerely,

Jeffrey Kolitch Portfolio Manager June 30, 2021

Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectus contain this and other information about the Funds. You may obtain them from its distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing. Risks: In addition to general market conditions, the value of the Fund will be affected by the strength of the real estate markets. Factors that could affect the value of the Fund’s holdings include the following: overbuilding and increased competition; increases in property taxes and operating expenses; declines in the value of real estate; lack of availability of equity and debt financing to refinance maturing debt; vacancies due to economic conditions and tenant bankruptcies; losses due to costs resulting from environmental contamination and its related cleanup; changes in interest rates; changes in zoning laws, casualty or condemnation losses; variations in rental income; changes in neighborhood values; and functional obsolescence and appeal of properties to tenants. The Fund may not achieve its objectives. Portfolio holdings are subject to change. Current and future portfolio holdings are subject to risk. The portfolio manager defines “Best-in-class” as well-managed, competitively advantaged, faster growing companies with higher margins and returns on invested capital and lower leverage that are leaders in their respective markets. Note that this statement represents the manager’s opinion and is not based on a third-party ranking. Discussions of the companies herein are not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed in this report reflect those of the respective portfolio managers only through the end of the period stated in this report. The portfolio manager’s views are not intended as recommendations or investment advice to any person reading this report and are subject to change at any time based on market and other conditions and Baron has no obligation to update them. This report does not constitute an offer to sell or a solicitation of any offer to buy securities of Baron Real Estate Fund by anyone in any jurisdiction where it would be unlawful under the laws of that jurisdiction to make such an offer or solicitation. BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a limited purpose broker-dealer registered with the SEC and member of the Financial Industry Regulatory Authority, Inc. (FINRA).

76 JUNE 30, 2021 Baron Emerging Markets Fund

DEAR BARON EMERGING MARKETS FUND SHAREHOLDER: PERFORMANCE

Baron Emerging Markets Fund (the “Fund”) appreciated 4.83% (Institutional Shares) during the second quarter of 2021, while its principal benchmark index, the MSCI EM Index, gained 5.05%. The MSCI EM IMI Growth Index gained 5.17% for the quarter. The Fund performed roughly in line with its principal benchmark index, as well as the all-cap growth proxy, during a solid quarter for global equities. Emerging market (“EM”) and international equities modestly trailed their U.S. counterparts, defined as the S&P 500 Index. It was a relatively uneventful quarter, with the Fed’s confirmation of its modest hawkish tilt late in the quarter contributing to a cooling of the interest rate and inflation fever witnessed earlier in the year. As we suggested in our previous letter, this turn of events supported the performance of quality growth stocks for the quarter. Also, during the quarter, the U.S. showed solid progress on ramping COVID-19 vaccine penetration, while several international jurisdictions lagged, creating the perception of relatively greater U.S. earnings visibility. We believe this distinction will likely prove temporary, and we remain optimistic that corporate earnings are likely to deliver on a global basis, though we believe a mid-cycle MICHAEL KASS Retail Shares: BEXFX pause is increasingly likely given a sustained slowdown in China credit growth Institutional Shares: BEXIX and the marginal Fed tightening referenced above. We welcome the cooling of PORTFOLIO MANAGER R6 Shares: BEXUX inflation expectations and believe such tightening is likely necessary given ongoing COVID-19-related labor and supply bottlenecks in order to prolong the global expansion. As always, we are confident that we have invested in many For the second quarter of 2021, we performed roughly in line with our well-positioned and well-managed companies on a bottom-up basis that are primary benchmark, the MSCI EM Index, as well as the all-cap EM growth poised to benefit from long-term and attractive investment themes. proxy. From a broad market perspective, second quarter trends were mixed. While markets continued to support economically cyclical stocks, there was Table I. an increase in investor appetite for quality growth stocks toward the latter Performance part of the quarter. From a sector and theme perspective, strong stock Annualized for periods ended June 30, 2021 selection in the Financials sector, led by our fintech theme (TCS Group Baron Baron Holding PLC) and India wealth management/consumer finance investments Emerging Emerging (Max Financial Services Limited and Bajaj Finance Limited) contributed Markets Markets MSCI EM the most to relative performance. In addition, favorable stock selection in Fund Fund IMI Retail Institutional MSCI EM Growth the Health Care sector, led by our China value added/localization theme Shares1,2 Shares1,2 Index1 Index1 (Zai Lab Limited, Hangzhou Tigermed Consulting Co., Ltd., and Shenzhen Three Months3 4.81% 4.83% 5.05% 5.17% Mindray Bio-Medical Electronics Co., Ltd.) also bolstered relative results. Six Months3 4.59% 4.67% 7.45% 6.54% Offsetting the above was adverse stock selection effect in the Industrials One Year 42.12% 42.40% 40.90% 42.45% sector, most notably China Conch Venture Holdings Ltd., a leading hazardous/solid waste management company in China, whose shares came Three Years 12.48% 12.76% 11.27% 14.34% under pressure due to a decline in the value of its non-core stake in Anhui Five Years 12.38% 12.66% 13.03% 15.54% Conch Cement. Weak stock selection in the Information Technology sector, Ten Years 7.43% 7.70% 4.28% 6.34% primarily attributable to some of our China valued-added/SaaS software Since Inception investments (Kingsoft Corporation Ltd. and Venustech Group Inc.), and (December 31, 2010) 6.98% 7.24% 4.16% 6.07% digitization theme (GDS Holdings Limited) also stood out.

Performance listed in the above table is net of annual operating expenses. Annual expense ratio for the Retail Shares and Institutional Shares as of December 31, 2020 was 1.35% and 1.09%, respectively. The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original cost. The Adviser reimburses certain Baron Fund expenses pursuant to a contract expiring on August 29, 2031, unless renewed for another 11-year term and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted. For performance information current to the most recent month end, visit www.BaronFunds.com or call 1-800-99BARON. 1 The MSCI EM (Emerging Markets) Index Net USD is designed to measure equity market performance of large and mid-cap securities across 23 Emerging Markets countries. The MSCI EM (Emerging Markets) IMI Growth Index Net USD is a free float-adjusted market capitalization index designed to measure equity market performance of large, mid and small-cap securities exhibiting overall growth characteristicsacross23EmergingMarketscountries. MSCI is the source and owner of the trademarks, service marks and copyrights related to the MSCI Indexes. The indexes and the Fund include reinvestment of dividends, net of foreign withholding taxes, which positively impact the performance results. The indexes are unmanaged. Index performance is not Fund performance; one cannot invest directly into an index. 2 BARON The performance data does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. FUNDS 3 Not annualized.

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From a country perspective, our overweight positioning and solid stock Table III. selection in India was a key contributor to relative performance this quarter. Top detractors from performance for the quarter ended June 30, 2021 In our view, the worst of COVID-related disruptions in India is likely behind Percent us, which together with the implementation of economic reforms, should Impact support higher relative earnings growth and solid equity performance going Tencent Holdings Limited –0.25% forward. Our overweight positioning in Brazil and Russia, and lack of Ping An Insurance (Group) Company of China, Ltd. –0.20 exposure to South Africa, also contributed to relative results. This was Lufax Holding Ltd. –0.15 broadly offset by our underweight positioning, together with poor stock Galaxy Entertainment Group Limited –0.15 selection, in Korea and Taiwan, and adverse stock selection effect in Mexico Kingsoft Corporation Ltd. –0.13 and China. Tencent Holdings Limited operates the leading social network and Table II. messaging platforms (QQ, WeChat), the largest online entertainment and Top contributors to performance for the quarter ended June 30, 2021 media business, and the largest online gaming business in China. Shares of Percent Tencent were down following increased regulatory scrutiny by the Chinese Impact government of suspected monopolistic behavior across large corporations. Zai Lab Limited 0.64% Despite the current regulatory environment, we believe Tencent can grow Max Financial Services Limited 0.29 each of its large businesses for years to come given its track record of TCS Group Holding PLC 0.29 execution, scale, and unique and diversified online assets, and we retain Bajaj Finance Limited 0.29 conviction. Hangzhou Tigermed Consulting Co., Ltd. 0.27 Ping An Insurance (Group) Company of China, Ltd. is one of China’s largest insurance companies. Shares declined during the quarter after the Zai Lab Limited is a leader in the development of a biopharmaceutical company reported new sales of life insurance that missed Street estimates industry in China. Shares increased given continued execution of deals, most due to weak demand and a shrinking agency salesforce. Ping An’s recently highlighted by in-licensing of Mirati’s KRAS G12C inhibitor. We participation in the restructuring of Founder Group, a bankrupt state-owned believe Zai Lab can be a leader among China pharmaceuticals, a market that conglomerate, also weighed on investor sentiment. We have reduced our is growing as the Chinese government continues to grow health care position. spending as a percentage of total GDP. Lufax Holding Ltd. operates a technology-empowered platform focused on Max Financial Services Limited is India’s leading life insurance player. credit and wealth management for individuals and small and medium Shares increased on solid earnings growth and market share gains following businesses in China. Despite posting solid first results and raising guidance the renewal of its distribution agreement with Axis Bank that recently for the year, shares declined after the Chinese government imposed wide- became a strategic investor in the company. We remain investors based on ranging restrictions on the financial divisions of major technology strong and growing consumer demand for term protection and financial companies and subjected them to more rigorous supervision in April. savings products. We expect mid-teens earnings growth over the next three Despite the regulatory overhang, we believe Lufax will be a beneficiary of to five years. deepening financial penetration in its target segments. TCS Group Holding PLC is a Russian financial and lifestyle services platform Shares of Macao-based casino company Galaxy Entertainment Group ecosystem with over 13 million active users. Through its subsidiaries, TCS is Limited fell in the quarter on new travel restrictions between Macau and exposed to digital banking as well as fast-growing verticals including online and Guangdong due to an uptick in COVID-19 cases in China. Macau gaming’s offline merchant acquisitions, retail brokerage, and insurance. Shares rose during ultimate recovery will come when vaccinations in China and Hong Kong the quarter after the company reported results for the first five months of 2021 achieve critical mass. Until then, we are unconcerned by minor fluctuations that exceeded Street estimates. TCS also started providing detailed information in depressed gaming revenue, as Galaxy’s net cash balance sheet (unlike about its verticals, allowing investors to better value the company. peers) and upcoming room additions make it better positioned both to weather the current storm and to ultimately recover revenue when tourist Bajaj Finance Limited, a leading, data-driven, non-bank financial company flows normalize. in India, contributed to performance in the quarter as the worst of COVID-19-related disruptions in the country appeared to be over. The Kingsoft Corporation Ltd. is a Chinese internet service and software anticipated post-pandemic pick-up in economic activity should benefit company operating in the gaming, office software (WPS), and cloud services Bajaj, as we think it is well positioned to benefit from growing demand for segments. Shares fell during the quarter due to multiple contraction in consumer financial services in the country. We remain investors due to global software stocks. In addition, subsidiary Kingsoft Cloud was pressured Bajaj’s best-in-class management team, robust long-term growth outlook, by rumors that a key client was establishing its own cloud hosting function. and conservative risk management frameworks. We retain conviction as WPS, Kingsoft’s key value driver, continued to demonstrate solid growth momentum due to robust demand for enterprise Hangzhou Tigermed Consulting Co., Ltd. is China’s largest clinical software coupled with China’s software localization policy. research organization. Shares increased in the quarter on solid earnings growth and improving business fundamentals. The company is benefiting from secular growth opportunities owing to China’s booming biotechnology and pharmaceutical industry. We believe Tigermed will continue to gain market share in the high-growth biotechnology services sector and expect 25% to 30% earnings growth over the next three to five years.

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Portfolio Structure Banco Inter S.A. We participated in a late-stage private funding round of Pine Labs, which is a leading merchant commerce solutions provider in India with a network of roughly 600,000 POS devices across 150,000+ merchants. Table IV. The company is led by industry veteran and serial entrepreneur, Amrish Rau, Top 10 holdings as of June 30, 2021 who took over as CEO just over a year ago and is fast transforming the Percent of Net business into a dominant, cloud native, omnichannel merchant commerce Assets platform. Pine Labs partners with leading banks and other financial Tencent Holdings Limited 4.4% institutions to offer their customer base the option to Buy Now Pay Later Taiwan Semiconductor Manufacturing Company Ltd. 3.5 (“BNPL”) while transacting through its merchant network. It has developed Alibaba Group Holding Limited 3.4 best-in-class infrastructure with superior consistency, stability, after-sales Samsung Electronics Co., Ltd. 3.2 service, and downtime versus peers. Bank partners throughout India today Bajaj Finance Limited 2.3 have over 60 million pre-approved debit card users (versus over 850 million Zai Lab Limited 2.2 outstanding) who can access BNPL through the Pine Labs network. The Korea Shipbuilding & Offshore Engineering Co., Ltd. 2.1 company aspires to become a “one app solution” that provides a Reliance Industries Limited 2.1 comprehensive service to its merchant base and has integrated over 400 Novatek PJSC 1.9 billing software/ERP vendors, providing a more seamless experience for its Sberbank of Russia PJSC 1.8 customers. In our view, merchant digitization/BNPL in India is still in its infancy and will be a high-growth sector over the next decade (and beyond) Exposure by Country driven by accelerating digital payments adoption and growing consumption/ disposable income by a tech savvy and aspirational Indian population. Pine Labs is also fast expanding into Southeast Asia, which provides significant Table V. upside potential as they scale operations in countries such as Malaysia. Percentage of securities by country as of June 30, 2021 We also participated in a follow-on offering for Banco Inter, a digital bank Percent of Net turned financial and lifestyle services ecosystem in Brazil. Through its “Super Assets App,” Banco Inter delivers a wide range of financial products to its clients China 34.1% including credit, no-fee deposit accounts, investments, and insurance. The India 22.4 company also manages an e-commerce marketplace where its users are can Brazil 9.2 shop online and take advantage of incentives offered in connection with its Russia 7.1 financial products. With a strong value proposition and solid user Korea 5.3 experience, Banco Inter is enjoying fast growth with modest client Taiwan 4.9 acquisition costs. It has seen its user base surge in the past few years, Hong Kong 2.1 reaching over 10 million clients, up from 1.4 million at the end of 2018. The Mexico 2.1 company is enjoying increasing user engagement as more clients are using United Kingdom 1.7 Banco Inter as their main banking relationship, and the number of products Philippines 1.2 per client is steadily increasing. Banco Inter is disrupting the financial Poland 1.1 services sector in Brazil, which is characterized by high fees and poor Hungary 1.0 customer service. In our view, over the past two years, the company has Japan 0.7 gained a strong following as a preeminent player in digital banking and is Norway 0.6 poised to continue gaining share from incumbent players. Peru 0.4 During the quarter, we also participated in a follow-on offering for Aarti United States 0.3 Industries Ltd. as part of our China supply chain diversification theme. Aarti United Arab Emirates 0.3 is a leading specialty chemical manufacturer in India with a key focus on benzene-based derivatives. The company is vertically integrated and is a top Exposure by Market Cap: The Fund may invest in companies of any market four global producer for approximately 75% of its product portfolio. Aarti capitalization, and we have generally been broadly diversified across large-, has little to no dependence on Chinese vendors for its raw material supply, mid-, and small-cap companies as we believe developing world companies which is a key competitive advantage in our view. Due to the ongoing of all sizes can exhibit attractive growth potential. At the end of the second geopolitical tensions between the U.S. and China, global corporations are quarter of 2021, the Fund’s median market cap was $16.4 billion, and we actively looking to diversify supply chains outside of China. This creates were invested 44.3% in giant-cap companies, 38.7% in large-cap companies, significant opportunity for Aarti to win new customers and gain market 10.2% in mid-cap companies, and 1.3% in small- and micro-cap companies share from its Chinese counterparts. In addition, Aarti also stands to as defined by Morningstar, with the remainder in cash. potentially benefit from recently implemented economic reforms in India that provide tax incentives to support local manufacturing/capex as part of RECENT ACTIVITY the country’s “Make in India” initiative. In our view, the company is well positioned to sustain high-teens earnings growth for at least the next five During the second quarter of 2021, we initiated new ideas to our existing years driven by an expanding customer base and higher revenue themes while also increasing exposure to several positions that we contribution from value-added products and contract manufacturing established in prior quarters. We added to our fintech theme during the services. quarter, most notably by initiating positions in Pine Labs Pte. Ltd. and

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We added to several of our existing positions during the quarter, most U.K. and Israel), recent strength in the U.S. economy and U.S. equities may notably Tencent Holdings Limited, StoneCo Ltd., Korea Shipbuilding & be more likely the result of a timing difference than a structural difference Offshore Engineering Co., Ltd., Ozon Holdings PLC, Novatek PJSC, Sino relative to other countries, and we suspect many EM and international Biopharmaceutical Ltd., Itau Unibanco Banco Holding SA, InPost S.A., jurisdictions will catch up in coming quarters. Godrej Properties Limited, and TCS Group Holding PLC. There has been much consternation regarding the re-emergence of inflation During the quarter, we also exited a few positions due to concerns regarding at above the long-term optimal rate of 2.0% to 2.5%. At this point, we fundamental developments or valuation, or due to our endeavor to increase believe it is far too early in the global recovery/expansion cycle to raise concentration where we have the highest conviction in quality and return concern that this will have a material or lasting impact on equities. We potential. Stocks sold during the period include ZTO Express (Cayman) Inc., remain optimistic regarding the outlook for corporate earnings, though we New Oriental Education & Technology Group Inc., Hong Kong reiterate that equity returns should moderate as we believe earnings Exchanges and Clearing Limited, and Kuaishou Technology Co., Ltd. expectations are already high in the near term, and multiple compression is more likely than expansion from here given our view that over the longer OUTLOOK term we anticipate a modest rise in both real and nominal interest rates. We view recent growth and inflation above targeted levels as having both The second quarter of 2021 was relatively uneventful. The volatility we saw transitory and structural drivers. COVID-19-related supply and labor in the first quarter moderated and global equities traded within a narrower bottlenecks will likely prove transitory and contain inflation readings in range. U.S. equities led global returns as the U.S. dollar firmed and treasury coming months, while the marked increase in global fiscal spending will yields retreated on expectations that Fed tapering and rate hikes would be have more of a structural impact, leading to marginally higher economic pulled forward. growth, inflation, and interest rates in coming years. With sovereign bond We quote from our first quarter letter: “In our view, bond yields have yields remaining historically low and real interest rates still negative in most already priced in a materially tighter Fed than both what is being developed markets, we believe equities can likely continue to be supported communicated and what is likely. We suspect bond market vigilantes may by capital flows at the expense of sovereign bonds for some time. have gone too far, too soon, and note that a peak in bond yields would favor Thank you for investing in the Baron Emerging Markets Fund. growth stocks after a substantive first quarter correction.” In recent months, bond yields and inflation fever indeed peaked, as an ongoing slowdown in Sincerely, Chinese credit growth, the spread of the Delta variant of COVID-19, and rising conviction that the Fed would not fall too far behind the curve, coalesced to cool both global growth expectations and spiraling commodity prices. As we alluded to above, these conditions resulted in growth stocks, particularly in the U.S., outperforming during the recent quarter. Meanwhile, EM and international equities lagged modestly in U.S. dollar terms amid mixed signals, though we remain optimistic regarding their relative appeal, Michael Kass particularly on a multi-year basis. In the shorter term, we believe that as the Portfolio Manager U.S. was an early leader in COVID vaccination penetration (along with the June 30, 2021

Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectus contain this and other information about the Funds. You may obtain them from its distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing. Risks: In addition to the general stock market risk that securities may fluctuate in value, investments in developing countries may have increased risks due to a greater possibility of: settlement delays; currency and capital controls; interest rate sensitivity; corruption and crime; exchange rate volatility; and inflation or deflation. The Fund invests in companies of all sizes, including small and medium sized companies whose securities may be thinly traded and more difficult to sell during market downturns. The Fund may not achieve its objectives. Portfolio holdings are subject to change. Current and future portfolio holdings are subject to risk. The discussions of the companies herein are not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed in this report reflect those of the respective portfolio manager only through the end of the period stated in this report. The portfolio manager’s views are not intended as recommendations or investment advice to any person reading this report and are subject to change at any time based on market and other conditions and Baron has no obligation to update them. This report does not constitute an offer to sell or a solicitation of any offer to buy securities of Baron Emerging Markets Fund by anyone in any jurisdiction where it would be unlawful under the laws of that jurisdiction to make such offer or solicitation. BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a limited purpose broker- dealer registered with the SEC and member of the Financial Industry Regulatory Authority, Inc. (FINRA).

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Dear Baron Global Advantage Fund Shareholder: Performances

Baron Global Advantage Fund (the “Fund”) gained 11.9% (Institutional Shares) during the second quarter, which compared favorably to gains of 7.4% for the MSCI ACWI Index and 10.0% for the MSCI ACWI Growth Index, the Fund’s benchmarks. The Fund gained back most of its relative underperformance from the prior quarter and is now trailing its benchmarks by 245bps and 44bps, respectively, for the year-to-date period.

Table I. Performance† Annualized for periods ended June 30, 2021 Baron Baron Global Global Advantage Advantage MSCI Fund Fund MSCI ACWI Retail Institutional ACWI Growth Shares1,2 Shares1,2 Index1 Index1 Three Months3 11.83% 11.91% 7.39% 9.98% ALEX UMANSKY Retail Shares: BGAFX 3 Six Months 9.72% 9.85% 12.30% 10.29% Institutional Shares: BGAIX One Year 45.41% 45.78% 39.26% 39.69% PORTFOLIO MANAGER R6 Shares: BGLUX Three Years 34.42% 34.78% 14.57% 20.40% Five Years 33.37% 33.68% 14.61% 19.15% Since Inception outperformance during the quarter was due to stock selection, which (April 30, 2012) 20.80% 21.07% 11.10% 13.88% contributed 395bps of the Fund’s 450bps of outperformance relative to the From a broad perspective, the market continued its march higher during the MSCI ACWI Index. After a correction during the first quarter, our holdings in second quarter, extending its rally over the last 15 months, with the MSCI Information Technology (“IT”) recovered almost as sharply and were ACWI now up a remarkable 91.5% cumulatively from the trough reached on responsible for 322bps of our outperformance. Within IT, we benefited from March 23, 2020. From the same trough, the MSCI ACWI Growth Index is being overweight internet services & infrastructure, systems software, and also up significantly at 100.2%, and the Fund up 134.8%. application software, which were the top three sub-industries and were all up double digits in the quarter (after being some of the worst performing Looking deeper however, the second quarter was quite different from the sub-industries within IT in the first quarter). first. Growth stocks rebounded sharply, as the yield on the 10-year U.S. Government bond stabilized below 1.5%, after hitting a high of nearly 1.8% Offsetting some of that strength was poor stock selection in Consumer during the prior three months. The powerful rotation into stocks perceived Discretionary, Real Estate, and Health Care. In Consumer Discretionary, to be the beneficiaries of the “reopening of the economy” had slowed down there was particular trouble in education services, the worst performing enabling our portfolio to both post solid gains and recover some of the lost sub-industry in the benchmark, which was down 43.7%. Though we fared ground from the first quarter. As is customary, most of the Fund’s significantly better, by being down only 6.5%, it still hurt our returns.

Performance listed in the table above is net of annual operating expenses. Annual expense ratio for the Retail Shares and Institutional Shares as of December 31, 2020 was 1.17% and 0.92%, respectively, but the net annual expense ratio is 1.15% and 0.90% (net of the Adviser’s fee waivers), respectively. The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original cost. The Adviser reimburses certain Baron Fund expenses pursuant to a contract expiring on August 29, 2031, unless renewed for another 11-year term and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted. For performance information current to the most recent month end, visit www.BaronFunds.com or call 1-800-99BARON. † The Fund’s YTD, 1-, 3- and 5 year historical performance was impacted by gains from IPOs. There is no guarantee that these results can be repeated or that the Fund’s level of participation in IPOs will be the same in the future. 1 The MSCI ACWI indexes cited are unmanaged, free float-adjusted market capitalization weighted indexes reflected in US dollars. The MSCI ACWI Growth Index Net USD measures the equity market performance of large- and mid-cap growth securities across developed and emerging markets. The MSCI ACWI Index Net USD measures the equity market performance of large- and mid-cap securities across developed and emerging markets. MSCI is the source and owner of the trademarks, service marks and copyrights related to the MSCI Indexes. The indexes and the Baron Global Advantage Fund include reinvestment of dividends, net of foreign withholding taxes, which positively impact the performance results. The indexes are unmanaged. Index performance is not fund performance; one cannot invest directly into an index. 2 The performance data in the table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. BARON FUNDS 3 Not annualized.

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Geographically, we were able to add value in the U.S. (57% of the average same period of time, the Fund has outperformed the Morningstar World weight of the Fund), Uruguay, Canada, the U.K., and the Netherlands. Not Large-Stock Growth Category average, by 256.5%, cumulatively. On an being in Japan was a good thing as well. Our overweight and stock selection annualized since inception basis, the Fund generated excess returns of in China combined detracted 111bps from relative returns. 10.0% and 7.2% over its benchmarks, the MSCI ACWI Index and the MSCI ACWI Growth Index, respectively. On an annualized since inception basis, At the company-specific level, we had a large number of sizable winners the Fund generated excess returns of 7.5% over its peer group average.* with 22 investments up over 20% each. Newcomers Dlocal and Monday.com joined our existing holdings in Endava, CrowdStrike, Zai Lab, We have written in the past how we thought Poker and Fantasy Football Shopify, Cloudflare, Nuvei, Afya, and Zymergen in a list of companies could provide useful training ground for aspiring investors. Both are games that appreciated over 30% each. All in all, it was a solid, satisfying, albeit of incomplete information that require patient and opportunistic capital unspectacular quarter, set up to a large degree by a pullback in many of our allocation in the face of a wide range of outcomes, with the ability to core names in the prior three-month period. manage the inherent uncertainty the future brings emerging as a critical skill set. From that perspective, Chess has little to offer us. Chess is a classic As we mentioned briefly in the last quarterly letter, Baron Global Advantage game of certainty. There is a “correct” move and a countermove at every Fund was named the winner by Lipper Analytics as the best fund in its step, where good decisions are rewarded and bad ones punished. There are category for consistent, risk-adjusted returns over the last five years. The no “ugly” river cards that radically change the texture of the board or Fund was also recognized as the best fund in its category (for consistent, catastrophic knee injuries that wreak havoc on your team’s receiving corps, risk-adjusted returns) over the last three years for the third consecutive and the better player wins almost every game. Yet, there is a critical part of time. We’re pretty proud of that. a chess game that we think investors can learn from. According to Morningstar, as of June 30, 2021, Baron Global Advantage A game of chess is divided into three distinct phases, known as the Opening, Fund ranked in the top 14% for its 1-year return, the top 3% for its 3-year the Middlegame,andtheEndgame,eachwithitsowndistinctstrategies. return, and the top 1% for its 5-year return. The Fund is also ranked in the The Opening typically covers the first 10 to 15 moves of the game in which top 1% since its inception on 4/30/2012. The Fund has received a 5-star both players are moving their pieces from their starting positions to take up ™ Morningstar Rating for its 3-year, 5-year, and Overall risk-adjusted active posts ready to do battle in the Middlegame. Advanced players usually performance. Since its inception, Baron Global Advantage Fund has returned have this stage of the game figured out where a decision to open with the 476.8% (Institutional Shares), cumulatively, compared to 162.5% for the Queen’s Gambit or a Sicilian Defense is made before the game ever starts. MSCI ACWI Index, and 229.3% for the MSCI ACWI Growth Index. Over that This is akin to an investment team knowing/deciding how they will allocate

* As of 6/30/2021, the annualized returns of the Morningstar World Large Stock Category average were 40.81%, 19.17%, 18.49%, and 13.54% for the 1-, 3-, 5-year, and since inception (4/30/2012) periods, respectively. The Refinitiv Lipper Fund Awards, granted annually, highlight funds and fund companies that have excelled in delivering consistently strong risk-adjusted performance relative to their peers. The Refinitiv Lipper Fund Awards are based on the Lipper Leader for Consistent Return rating, which is a risk-adjusted performance measure calculated over 36, 60 and 120 months. The fund with the highest Lipper Leader for Consistent Return (Effective Return) value in each eligible classification wins the Refinitiv Lipper Fund Award. For more information, see lipperfundawards.com. Although Refinitiv Lipper makes reasonable efforts to ensure the accuracy and reliability of the data contained herein, the accuracy is not guaranteed by Refinitiv Lipper. As of 6/30/2021, the Morningstar Ratings™ were based on 307, 263, and 307 share classes for the 3-year, 5-year and Overall periods, respectively. Baron Global Advantage Fund Institutional Share Class received 5 stars for its 3-year, 5-year, and overall performance, respectively. The Morningstar Ratings™ are for the Institutional share class only; other classes may have different performance characteristics. The Morningstar Ratings are based on the Morningstar Risk-Adjusted Return measures. As of 6/30/2021, the Morningstar World Large-Stock Growth Category consisted of 352, 307, 263, and 175 share classes for the 1-, 3-, 5-year and since inception (4/30/2012) periods. Morningstar ranked Baron Global Advantage Fund in the 14th, 3rd, 1st, and 1st percentiles, respectively. Morningstar calculates the Morningstar World Large-Stock Growth Category average performance and rankings using its Fractional Weighting methodology. Morningstar rankings are based on total returns and do not include sales charges. Total returns do account for management, administrative, and 12b-1 fees and other costs automatically deducted from fund assets. 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 Morningstar Rating does not include any adjustment for sales loads. 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. © 2021 Morningstar. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (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.

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funds on day one of a new fund. In both cases, it is not uncommon to stay Table II. up all night just before, agonizing over the final decisions of what you want Top contributors to performance for the quarter ended June 30, 2021 to accomplish and what you need it to look like once the Opening is Quarter End complete. The Endgame in Chess has been thoroughly analyzed and is rarely Market Cap Percent (billions) Impact played out at a higher level since piece positioning makes it obvious who the winner will be. It has even less relevance to us since the investing we do has Alphabet Inc. $1,658.8 1.21% no Endgame. We do not optimize a portfolio to perform over any specific Dlocal Ltd. 15.4 0.93 period of time (a quarter or a year). The investing we do is neither a sprint Endava plc 6.2 0.88 nor a marathon because there is no finish line. That brings us to the EPAM Systems, Inc. 28.8 0.83 remaining phase of a Chess game that we think can be instructive to Facebook, Inc. 985.9 0.69 investors–the Middlegame! Alphabet Inc. is the parent company of Google, the world’s largest search According to Wikipedia “The middlegame in chess is the portion of the game and online advertising company. Shares of Alphabet were up 21% in the in between the opening and the endgame. The middlegame begins when quarter driven by a continued recovery in ad spending, strong cloud revenue both players have completed the development of all or most of their growth (up 46% in the first quarter year-over-year), and improved cost pieces… Theory on the middlegame is less developed than the opening or controls (with operating margins reaching 30% in the first quarter). We endgames. Since middlegame positions are unique from game to game, remain excited about Alphabet’s merits as it continues to benefit from memorization of theoretical variations is not possible as it is in the opening. growth in mobile and online video advertising, which accrues to its core Likewise, there are usually too many pieces on the board for theoretical assets of search, YouTube, and the Google ad network. We are further positions to be completely analyzed as can be done in the simpler encouraged by Alphabet’s investments in AI, autonomous driving (Waymo), endgames.” The Middlegame is often considered the most exciting phase of and life sciences (Verily, Calico). the Chess game. It is in this stage of the game, after the Opening has finished, but while there are still plenty of pieces on the board, that the Dlocal Ltd. is a Uruguay-based financial technology company that outcome of the game is most frequently decided. One of the great facilitates cross-border and local-to-local e-commerce payments in challenges of the Middlegame is how to make progress when there are no emerging markets for global enterprise merchants. Dlocal shares were up obvious moves. We think of investing as the perpetual Middlegame. We go 138% during the period held in the quarter, as investors responded with to great lengths to research, understand, and develop conviction in the excitement to the company’s successful IPO. Dlocal is benefiting from companies in which we invest. More often than not, we are happy with our secular trends including the globalization of commerce, growing penetration “Opening” and are comfortable with our “board.” This is what Garry of digital payments, and increasing purchasing power of middle-class Kasparov, the greatest Chess player of all time, refers to as the “nothing to consumers. In addition, the volumes processed by the company are tied to do” phase of the game. Interestingly enough, it is this stage of the game the sales growth of the largest global enterprise merchants around the when action (as opposed to reaction) is required most! It is this ability to world. With strong tailwinds for revenue growth and improving operating improve one’s positioning through subtle, seemingly unimportant or leverage, we believe Dlocal has the potential to deliver sustainable earnings insignificant moves that separates contenders from pretenders. Just like in growth for years to come. Chess, we find there are frequent periods of time when there are no obvious buys or sells. Just like Mr. Kasparov, we believe that being proactive and not Endava plc provides outsourced software development services to business reactive is one of the keys to long-term success. We are always in the customers. The company operates at the forefront of the digital revolution Middlegame and there are many “nothing to do” moments. So, we by helping clients find new ways to interact with their customers, enabling proactively build a pipeline of ideas–great businesses that benefit from them to become more engaging, responsive, and efficient. Endava’s stock disruptive change with platform economics and network effects, run by was up 34% during the second quarter after reporting strong quarterly talented entrepreneurs. And then we work on building the conviction, stress- results with accelerating organic revenue growth, while raising full-year testing our assumptions, analyzing the competitive landscape, comparing guidance. As companies continue to digitally transform to avoid being them to our existing investments–always asking ourselves where we could disrupted (especially in a post-COVID world), they turn to companies like be wrong and then taking action when we feel the time is right. Endava for help. We believe that this dynamic will drive Endava’s market share in the large global market for IT services for years to come. These shareholder letters are often focused on new ideas and we write about a few things that impacted the recent results the most. Often, the EPAM Systems, Inc. provides outsourced software development services to subtle, “seemingly unimportant” moves do not attract a lot of attention business customers. Shares gained 29% during the quarter driven by strong because they do not become apparent or impactful until some time in the financial results that exceeded Street expectations. EPAM is benefiting from future. For example, Alphabet (up 42% year-to-date) and Facebook (up 27% similar trends to Endava with a rebounding demand following last year’s year-to-date) were two of our largest additions in the fourth quarter of last COVID-driven slowdown as investments in digital transformation have risen year and then again in the first quarter of 2021. At the same time, we in the priority list for customers. We remain excited about EPAM’s long starved most of our Chinese investments of fresh capital (while taking in runway for growth underpinned by the need for digital transformations and meaningful new inflows at the Fund level), which caused us to have lower the company’s strong execution in addressing this growing demand. Despite absolute and relative exposure to China then we have had historically. years of strong double-digit growth, it still accounts for less than 2% of the $150 billion annual spend on digital engineering services. The Baron Global Advantage Fund compiled an upside capture of 125.8% and a downside capture of 78.6% since its inception on 4/30/2012. We Shares of Facebook, Inc., the world’s largest social network, were up 18% believe it is our ability to excel in the Middlegame and take advantage of this quarter on results that came ahead of market forecasts with 44% these “nothing to do” moments that have been the key to that success. revenue growth (in constant currency), which compared to Street

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expectations of 31%, driven by the recovery in ad spend. In our view, 13% for the period held in the quarter, following a meaningful earlier Facebook continues to utilize its leadership in mobile to provide global deceleration in contract activity. We exited our position and reallocated advertisers targeted marketing capabilities at scale, with substantial future capital to higher conviction opportunities. monetization opportunities across its various assets including WhatsApp, Coupang, LLC is a leading e-commerce platform in South Korea. Coupang Instagram, video tools including Watch and IG TV, and community-based shares corrected 15% during the quarter as investors took profits after the marketplace, shopping, jobs, and dating features. company’s successful IPO after which its share price increased 41% in the first quarter. While benefiting from the continued growth in underlying Table III. e-commerce penetration in South Korea, we believe Coupang, leveraging its Top detractors from performance for the quarter ended June 30, 2021 unrivaled logistics capability and differentiated customer experience (99% Quarter End Market Cap or of orders delivered within one day) will keep gaining market share over time. Market Cap When Sold Percent Portfolio Structure (billions) Impact TAL Education Group $16.3 –0.84% The portfolio is constructed on a bottom-up basis with the quality of ideas Opendoor Technologies Inc. 10.2 –0.54 and conviction level having the most significant roles in determining the size Guardant Health, Inc. 12.6 –0.44 of each individual investment. Sector and country weights are an outcome Splunk, Inc. 19.0 –0.28 of the stock selection process and are not meant to indicate a positive or a Coupang, LLC 72.5 –0.21 negative “view.” As of June 30, 2021, the top 10 positions represented 34.3% of the Fund, and the top 20 represented 57.0%. Our investments in TAL Education Group is a leading K-12 after-school tutoring company in the IT, Consumer Discretionary, Health Care, Communication Services, and China with over 1,000 learning centers in 110 cities. Shares declined 53% Financials sectors, as classified by GICS, represented 91.9% of the Fund’s net during the second quarter following continued rumors regarding the severity assets. Our investments in companies domiciled outside the U.S. of the upcoming regulatory changes that investors fear will adversely impact represented 41.5% of net assets and our investments in emerging markets the after-school tutoring industry in China. While we have reduced the and unclassified countries totaled 23.5%. weight of our position over the last year, we continue to hold the stock as we believe the probability of a severe impact on the demand for high- There has been a steady rise in the number of holdings in the Fund over the quality tutoring is relatively low, given the competitive nature of the last four quarters and we exited June with a reported total of 65 positions. educational system in China. We are awaiting official regulatory Most of it is attributable to the significant influx of fresh capital, which announcements and will assess our position accordingly. coincided with an exceedingly strong period of performance that made valuations less attractive and prevented us from allocating new capital to Opendoor Technologies Inc. operates a digital platform for home some of our existing investments. We think this to be transitory and expect purchases and sales on which buyers can tour homes, make offers, and the number of holdings to return to its historical range of 40 to 50 over the secure financing, and sellers can receive next-day cash offers with flexible next few quarters. Still, the top 50 investments represented 92.5% of the close dates. Shares were down 17% in the quarter driven by rising mortgage Fund’s net assets, and the top 55 were 94.8%, with the balance being stub rates and growing investor concerns regarding the potential negative impact holdings and cash. Guarding against overdiversification remains an higher rates could have on the housing market. However, as the iBuying important part of our process. industry leader, disrupting the $1.3 trillion U.S. residential real estate market and being in the early stage of market disruption, we believe that Opendoor Table IV. will be able to sustain growth even in a less favorable housing market Top 10 holdings as of June 30, 2021 environment. Quarter End Quarter End Investment Percent Guardant Health, Inc. offers liquid biopsy tests for advanced stage cancer Market Cap Value of Net and recurrence monitoring and is developing a test for early cancer (billions) (millions) Assets detection. Shares declined 19% during the quarter as investors took profits Alphabet Inc. $1,658.8 $157.8 5.4% after the stock was up 68% in 2020, followed by an increase of another Amazon.com, Inc. 1,735.0 132.2 4.6 18% in the first quarter, and after the company reported first quarter Facebook, Inc. 985.9 111.7 3.9 revenues only modestly ahead of expectations left its annual guidance Alibaba Group Holding Limited 614.8 111.7 3.9 unchanged. We maintain conviction for the long term as we believe EPAM Systems, Inc. 28.8 87.6 3.0 Guardant is a unique growth company that has the potential to transform Endava plc 6.2 82.4 2.8 cancer care. Acceleron Pharma Inc. 7.6 80.3 2.8 Splunk, Inc. is a data analytics company selling software solutions that help Fiverr International Ltd. 8.7 79.3 2.7 enterprises run their IT organizations, including security, internet-of-things, SoFi Technologies, Inc. 15.2 75.9 2.6 application and business analytics, and infrastructure. The stock declined RingCentral, Inc. 26.4 75.2 2.6

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Exposure By Country U.S. targeting the higher income demographic, while most of its competitors target unbanked or underbanked Americans. The breadth of products offered Table V. and SoFi’s ability to acquire customers at a younger age (such as students) Percentage of securities by country as of June 30, 2021 provide multiple touch points in its customer’s lifecycle, growing its new Percent customer acquisition funnel, as well as the lifetime value of existing of Net Assets customers, who are more engaged and churn less. In addition to the consumer finance offerings, SoFi owns Galileo, a technology platform that is United States 55.3% used to power the banking experiences of other neobanks. We believe that China 11.3 Galileo gives SoFi attractive exposure to the broader, fast-growing consumer Israel 6.5 fintech space. Over time, we expect SoFi to continue to grow its member Netherlands 4.8 base and cross-sell them with multiple banking products, which should drive Canada 3.9 improving unit economics and durable revenue and EBITDA growth. We Brazil 3.1 invested in SoFi via the PIPE (“Private Investment in Public Equity”) Argentina 3.1 transaction in Chamath Palihapitiya’s Social Capital Hedosophia Holdings V United Kingdom 2.8 SPAC (“Special Purpose Acquisition Company”). This is another good India 2.5 example of why SPACs present an attractive structure for us, enabling Uruguay 1.5 sizeable investments at attractive prices that are rarely possible with Korea 0.9 traditional IPOs. Poland 0.5 Mexico 0.3 During the quarter, we also invested in Dlocal Ltd., a Uruguay-based Indonesia 0.3 financial technology company that facilitates cross-border and local-to-local e-commerce payments in emerging markets for global enterprise merchants Recent Activity (Netflix, Microsoft, Amazon, and Wix are customers). The company’s proprietary technology platform enables global merchants to connect During the second quarter, we initiated four new investments and added to seamlessly with millions of consumers in emerging markets through a single nine existing holdings, which included the synthetic biology leader, Application Programing Interface. Dlocal addresses several pain points for Zymergen, a company in which we made a private investment (discussed in global merchants looking to expand sales in emerging markets–it facilitates our third quarter 2020 letter) and that went public during the second adherence to complex regulatory and tax requirements; enables acceptance quarter. This is our first private company that went public, and it is a good of the relevant local payment methods; increases authorization rates versus example for the key reason behind investing in private rounds–a seat at the existing alternatives; and helps reduce fraud. We believe these factors have table, which enables us to learn, build conviction in the business over time, allowed Dlocal to create a strong competitive moat, which has led to fast and eventually get the opportunity to make it a more meaningful position growth in merchant partners and increasing share of wallet with existing once the company goes public. We now hold six private investments that clients, as evidenced by a high net revenue retention rate of 159% in 2020. together represent approximately 3% of the Fund’s net assets: Farmers Dlocal is benefiting from secular trends including the globalization of Business Network, Rivian Automotive, Resident Home, SpaceX, GM commerce, growing penetration of alternative digital payment methods, and Cruise, and Think & Learn. We also exited five positions during the quarter, increasing purchasing power of middle-class consumers in the markets it reallocating capital to higher conviction ideas. serves. In addition, the company’s processed volumes are tied to the sales growth of the largest global enterprise merchants around the world. With Table VI. strong tailwinds for revenue growth and improving operating leverage, we Top net purchases for the quarter ended June 30, 2021 believe Dlocal has the potential to deliver exciting earnings growth for many Quarter End Amount years to come. Market Cap Purchased (billions) (millions) We invested in the PIPE of the Israeli SPAC, ION Acquisition Corp 1 Ltd.,as SoFi Technologies, Inc. $15.2 $39.6 part of its merger with the leading internet recommendations platform, Zymergen Inc. 4.0 21.3 Taboola.com Ltd. Taboola’s recommendation engine helps publishers Dlocal Ltd. 15.4 17.8 present the right content to users to drive better engagement–across both ION Acquisition Corp 1 Ltd. 0.7 13.4 organic content as well as ads. Taboola’s technology is integrated directly RingCentral, Inc. 26.4 7.6 into the publishers’ websites, providing a steady stream of proprietary data on user behavior that is used to train its artificial intelligence models, driving Our largest new purchase in the quarter was SoFi Technologies, Inc.,a continuous improvement in its recommendation engine. This dynamic branchless digital bank (“neobank”) that provides a range of financial creates a sustainable competitive moat as Taboola’s recommendation services including non-lending products such as money and investment engine gets better with the growing scale of its network of publishers and management through its financial services platform. SoFi was founded on advertisers. Taboola powers over 2 billion clicks per month across the premise of offering a better student-loan refinancing solution (the thesis 500 million daily active users, while serving 13,000 advertisers. It generated being that while students at top universities have little current income, their $1.2 billion of revenues in 2020 with adjusted EBITDA margins of 28%. As future earnings potential is large and so their default risk is relatively small), the company’s recommendation engine continues improving over time and and has since expanded to other types of loans, along with additional it adds additional ad formats and attracts more advertisers, we believe that banking products (account, debit and credit cards, and brokerage). We Taboola will see a steady increase in advertising yield, driving durable believe that SoFi offers the broadest product suite of any neobank in the revenue growth for years to come. We also believe Taboola can expand over

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time outside of its core market into e-commerce, games, and video Outlook recommendations. The recent capital injection as part of the SPAC merger enables Taboola to accelerate organic investments while increasing the In the last quarterly letter, we wrote about not being too concerned with the flexibility to add tuck-in acquisitions to further strengthen its positioning. much anticipated “reopening” trade, even though the concurrent rotation from growth to value stocks was clearly unfavorable to the kinds of As mentioned earlier, we got to know Zymergen Inc. well after making a businesses in which we tend to invest, and it had a negative impact on our small private investment in the company in the third quarter of 2020. We quarterly returns. We did suggest that paying attention to the yield of the followed up with a more meaningful investment when the company went 10-year U.S. Treasury bond, which peaked at almost 1.8% during that time public during this quarter. We also added to several of our other high- was important, as higher interest rates (specifically, significantly higher conviction ideas, including the leading Unified Communications as a Service interest rates) would likely present a material headwind for many of our provider, RingCentral, Inc., after its stock sold off during the first quarter investments. We also reiterated that we do not attempt to predict inflation amid the rotation out of growth names. or interest rates.

Table VII. Well…the annualized inflation rate for May (the CPI Index) came in at 5%. Top net sales for the quarter ended June 30, 2021 This is the first-time inflation reached 5% since 2008. Jerome Powell, the Quarter End chairman of the Federal Reserve then reiterated that in his opinion this high Market Cap or inflation number is “transitory” and that the Fed will not start raising rates Market Cap Amount until 2023. Though the message was consistent with his prior statements, When Sold Sold (billions) (millions) this time the market had a different reaction and the yield on the 10-year bond came down to almost 1.3%. Last time we checked; we are all Splunk, Inc. $ 19.0 $38.5 “transitory.” PTC Therapeutics 3.0 26.5 PagSeguro Digital Ltd. 14.2 21.6 The Fed believes that the inflation rate will likely come back down to 2% to Alphabet Inc. 1,658.8 18.5 2.5% annual rate in the next few months, which would be considered benign Opendoor Technologies Inc. 10.2 16.9 for the U.S. economy. The more interesting phenomenon from our perspective is that whether inflation is running at 5% or at 2.5% one is We exited our investment in PTC Therapeutics, a broad-based drug absolutely guaranteed to lose money (in real terms) by investing in a development company with RNA splicing capabilities, which we discussed in 10-year government bond yielding less than 1.5%! our previous letter. We also sold out of PagSeguro Digital Ltd., the Brazilian payments provider to micro-merchants and Splunk, Inc., the data analytics Every day we live and invest in an uncertain world. Well-known conditions software provider, as we reallocated capital to higher conviction and widely anticipated events, such as Federal Reserve rate changes (up and investments. down), ongoing trade disputes, government shutdowns, and the unpredictable behavior of important politicians the world over, are shrugged We slightly reduced our position in Alphabet Inc., after several quarters of off by the financial markets one day and seem to drive them up or down the buying, as the stock appreciated significantly (now up over 40% next. We often find it difficult to know why market participants do what they year-to-date), and we saw good opportunities to redeploy capital while still do over the short term. The constant challenges we face are real and serious, maintaining Alphabet as a top position. As part of portfolio risk with clearly uncertain outcomes. History would suggest that most will prove management, we slightly reduced our Opendoor Technologies Inc. position passing or manageable. The business of capital allocation (or investing) is the to account for rising rate scenarios though we remain excited about its long- business of taking risk, managing the uncertainty, and taking advantage of term upside potential. the long-term opportunities that those risks and uncertainties create. We are Lastly, we sold our stub positions in BigCommerce Holdings, Inc. and confident that our process is the right one, and we believe that it will enable Kuaishou Technology Co., Ltd. as we were unable to develop enough us to make good investment decisions over time. conviction to make them more meaningful positions at current valuations. We are optimistic about the long-term prospects of the companies in which we are invested and continue to search for new ideas and investment opportunities while remaining patient and investing only when we believe the target companies are trading significantly below their intrinsic values.

Sincerely,

Alex Umansky Portfolio Manager June 30, 2021

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Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectus contain this and other information about the Funds. You may obtain them from its distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing. Risks: Growth stocks can react differently to issuer, political, market and economic developments than the market as a whole. Non-U.S. investments may involve additional risks to those inherent in U.S. investments, including exchange-rate fluctuations, political or economic instability, the imposition of exchange controls, expropriation, limited disclosure and illiquid markets, resulting in greater share price volatility. Securities of small and medium-sized companies may be thinly traded and more difficult to sell. The Fund may not achieve its objectives. Portfolio holdings are subject to change. Current and future portfolio holdings are subject to risk. The discussions of the companies herein are not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed in this report reflect those of the respective portfolio managers only through the end of the period stated in this report. The portfolio manager’s views are not intended as recommendations or investment advice to any person reading this report and are subject to change at any time based on market and other conditions and Baron has no obligation to update them. This report does not constitute an offer to sell or a solicitation of any offer to buy securities of Baron Global Advantage Fund by anyone in any jurisdiction where it would be unlawful under the laws of that jurisdiction to make such offer or solicitation. BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a limited purpose broker-dealer registered with the SEC and member of the Financial Industry Regulatory Authority, Inc. (FINRA).

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Dear Baron Discovery Fund Shareholder: Performance

This quarter marked a turning point. It represented the bridge from the COVID pandemic to normalcy, if not in finality, then certainly in understanding and sentiment. In the U.S. it is estimated that by the end of this summer about 60% of the population will have been vaccinated, and another 10% to 15% of the non-vaccinated population will have immunity due to having a prior COVID infection. That means that in excess of 70% of the population will have strong immunity to the virus. While this may not mean no one will get sick again, the studies do show that the risk of hospitalization or death has been substantially eliminated as a risk. And while evidence is still coming in, it appears that the vaccines are effective against COVID variants as well. We may need booster shots to lengthen the effectiveness of the vaccines, but we have no doubt that a proper dosage balance can be struck. We have always believed in the fantastic ingenuity of the people in the U.S., and our scientists and pharmaceutical companies have truly saved us from what could have been a far worse health care and economic disaster. We are proud to invest beside these exceptional women RANDY GWIRTZMAN AND LAIRD BIEGER Retail Shares: BDFFX and men. Even in the depths of the pandemic in early 2020 we always Institutional Shares: BDFIX believed that solutions would be found in the short term (which we define PORTFOLIO MANAGERS R6 Shares: BDFUX as less than two years) to bring COVID to heel.

Table I. Bearing that in mind, we continued to invest through the pandemic in Performance† companies that have fantastic products and services, exceptional Annualized for periods ended June 30, 2021 management teams, barriers to entry, and big growth potential into lightly Baron Baron Discovery Discovery Russell penetrated market opportunities. Now that the economy is normalizing, we Fund Fund 2000 S&P are seeing businesses in which we were already invested accelerate their Retail Institutional Growth 500 Shares1,2 Shares1,2 Index1 Index1 growth, and we are being presented with a myriad of new companies and ideas from which to enhance the portfolio. We estimate that between us, Three Months3 5.99% 6.07% 3.92% 8.55% we have seen about 5 to 10 new companies per week in the past quarter, Six Months3 13.84% 14.00% 8.98% 15.25% One Year 69.57% 70.06% 51.36% 40.79% which at the low end means we met with about 60 management teams Three Years 27.64% 27.97% 15.94% 18.67% over 12 weeks. Whether or not we invest in these ideas, we are always wiser Five Years 30.18% 30.53% 18.76% 17.65% for having had probing conversations from which we learn about new Since Inception industries and further inform our opinions on the ones we know well. In the (September 30, 2013) process, we are privileged to meet with some of today’s brightest (Annualized) 21.24% 21.55% 13.23% 15.13% entrepreneurs. In the quarter we invested in eight new companies in health Since Inception care tools, synthetic biological production of materials, advertising (September 30, 2013) technology, and real estate. We strive to keep our finger on the pulse of the (Cumulative)3 345.01% 353.73% 161.94% 198.07% most important new growth themes in the economy.

Performance listed in the above table is net of annual operating expenses. Annual expense ratio for the Retail Shares and Institutional Shares as of September 30, 2020 was 1.35% and 1.08%, respectively. The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original cost. The Adviser reimburses certain Baron Fund expenses pursuant to a contract expiring on August 29, 2031, unless renewed for another 11-year term and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted. For performance information current to the most recent month end, visit www.BaronFunds.com or call 1-800-99BARON. † The Fund’s 2Q 2021, YTD, 1-, 3-, and 5-year historical performance was impacted by gains from IPOs. There is no guarantee that these results can be repeated or that the Fund’s level of participation in IPOs will be the same. 1 The Russell 2000® Growth Index measures the performance of small-sized U.S. companies that are classified as growth and the S&P 500 Index of 500 widely held large cap U.S. companies. Russell Investment Group is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. Russell is a trademark of Russell Investment Group. The indexes and the Fund include reinvestment of dividends, net of withholding taxes, which positively impact the performance results. The indexes are unmanaged. Index performance is not Fund performance; one cannot invest directly into an index. 2 BARON The performance data in the table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. FUNDS 3 Not annualized.

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The net result this quarter was performance with which we were pleased. organic revenue growth to exceed 20% with additional growth from Baron Discovery Fund (the “Fund”) was up just about 6% (Institutional accretive acquisitions. We continue to be bullish on the company because Shares), which was over 2% better than the Russell 2000 Growth Index. we believe Endava will continue gaining share in a large global market for IT More importantly, since we are focused on the long term, the Fund has services. produced annualized returns exceeding 21% since inception, which is over CareDx, Inc. is the market leader in transplant diagnostics, with a presence 8% better per year, after fees, than the Russell 2000 Growth Index. That in nearly all U.S. and EU centers. One of the most amazing things about makes us proud and happy since we are investors in the Fund as well! CareDx’s strategy is that while it is primarily focused on delivering terrific tests for the industry, it also provides best-in-class service for the transplant Table II. centers as well as for patients. For example, the company has mobile apps Top contributors to performance for the quarter ended June 30, 2021 for patients to remind them of testing and medication schedules, and it has Percent Impact other software to help centers with transplant waiting list management and patient treatment tracking. In the quarter, the company continued to Future plc 0.98% execute successfully on its growth strategy; it beat estimates and the shares The Beauty Health Company 0.90 responded. The company’s flagship product is cell-free DNA-oriented testing Endava plc 0.76 (cf-DNA) to determine whether a transplanted kidney is being subjected to CareDx, Inc. 0.72 biological rejection. This is a $2 billion market, and we estimate that for Progyny, Inc. 0.65 2020 CareDx did about $130 million in total kidney testing revenue, up about 72% year-over-year from $74 million in 2019. For 2021, we estimate Future plc is a special-interest publisher of digital content, magazines, and that this will grow nearly 60% to over $200 million, which would still be just events with a brand portfolio including TechRadar, PC Gamer, and Gizmodo. 10% of the market. In addition, CareDx also has market opportunities in Future was a top contributor in the quarter as a result of COVID-related pre-transplant human leukocyte antigen, heart transplant testing, as well as tailwinds to e-commerce in Future’s largest categories–tech, gaming, music, liver and lung transplant testing. Further out on the horizon is a new test sports, home, and lifestyle–as well as continued strength in the broader called AlloCell, which is a surveillance test for patients who have received advertising environment. The company recently reported half-year results engineered-cell transplants made from other peoples’ cells. AlloCell will during which management raised full-year expectations to be “materially monitor the effectiveness and persistence of the transplanted cells. CareDx ahead” of market expectations given robust organic growth alongside the believes that cell therapy applications for AlloCell address an incremental strong performance of recent acquisitions such as TI Media and GoCo $5 billion market so it would be exciting if it develops as management Group. Future also kept busy with the acquisition of the rights to operate expects. We see many years of market-leading growth for CareDx ahead. the Marie Claire franchise in the U.S. and Canada. The acquisition follows Future’s acquisition of Marie Claire U.K. in 2020 and builds on the ongoing We purchased Progyny, Inc. at the company’s successful IPO in October success of the MarieClaire.co.uk brand. It strengthens Future’s position in the 2019. Progyny is a leading benefits management company specializing in women’s lifestyle vertical in North America in line with its strategy to fertility and family benefits. It provides comprehensive fertility solutions via achieve brand vertical leadership across English-speaking markets. Within a network of participating physicians who are among the best in the the insurance vertical, Future benefited from the U.K.’s Financial Conduct country. Its share price increased in the quarter after growing revenues by Authority’s policy statement which encouraged consumers to shop around 51% and beating Street estimates on profitability. It also guided second on general insurance price comparison websites (which benefits GoCo’s quarter results ahead of consensus with 100% revenue growth and cash GoCompare website). We believe Future can continue to grow both flow better than expected. Progyny now has 2.7 million members (nearly organically and through M&A, which we believe will result in continued double 1.4 million members it had at the end of the third quarter of 2020), stock appreciation from these levels. and it has only scratched the surface of its total opportunity of a 90 million member target market. The Beauty Health Company, formerly known as HydraFacial, is an innovative skin care and beauty health company providing consumers the benefits of a professional medical treatment with the experience of a Table III. consumer brand. The Beauty Health company came public via a special Top detractors from performance for the quarter ended June 30, 2021 purpose acquisition corporation (“SPAC”). Shares outperformed during the Percent Impact quarter as investors became increasingly aware of the company’s growth opportunities following the closing of the SPAC acquisition and strong Array Technologies, Inc. –0.85% earnings results where the company significantly increased annual revenue Viant Technology Inc. –0.78 guidance. We continue to be attracted to Beauty Health’s asset light, Tripadvisor, Inc. –0.66 recurring revenue business model and see a long runway for growth as the Veracyte, Inc. –0.38 company more than doubles its base of delivery systems both domestically ACV Auctions Inc. –0.37 and internationally while better monetizing each system with new serums and different product and category extensions. Endava plc provides outsourced software development to business customers. Shares outperformed after the company reported better-than- expected quarterly results and raised full-year guidance. Following a brief slowdown last year, business has fully rebounded as clients recognize the need for greater investment in digital transformation. Management expects

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Array Technologies, Inc., a leading manufacturer of solar trackers, fell accuracy of its results. Since our initial investment in Veracyte in the middle during the quarter after management rescinded guidance due to uncertainty of 2019, the company has been busy enhancing its product base and around rapidly rising steel costs. Our understanding at the time of the extending its growth markets. It acquired an analyzer platform at the end of company’s IPO in October 2020, was that Array fixed input costs at the 2019 that will let it sell its tests as kits in the EU, which has a more same time as its sales contracts were signed, thereby eliminating fragmented lab landscape than the U.S. New test kits for the analyzer are commodity pricing risk. However, this quarter management noted that a lag expected to launch at the end of 2021. The company also acquired a of just a few days between these events led to significant pricing urological testing franchise for bladder, kidney, and prostate cancers in early mis-matches due to the extreme volatility in steel pricing during that 2021 that adds an additional $2 billion to its market opportunity. Finally, in period. This disrupted not only Array, but the entire contracting complex mid-2021 Veracyte bought a company that brings EU manufacturing around large solar projects. Contracts relating to these projects had to be capability to support the EU test kit strategy, with additional capabilities in renegotiated across the board, leading to multiple quarter delays in revenue the colorectal cancer space (another $2 billion market opportunity). The recognition. Further, our due diligence has indicated that while the company purchase was funded with a $630 million equity raise (done at market high has terrific products, it might be falling behind its competitors from an share prices). In total, Veracyte has positioned itself to address over innovation standpoint, increasing our concerns that the company will not $14 billion in total market opportunity, including $8.4 billion in lung, reach its market penetration goals. For these reasons we sold the investment $800 million in thyroid, $900 million in breast, $2 billion in urology and in the quarter. $2 billion in colorectal cancer. We believe that shares were down in the quarter due to the news that Bonnie Anderson, the highly esteemed founder Viant Technology Inc. is a leading internet advertising demand-side and CEO of Veracyte, announced that she will be stepping down as CEO but platform, enabling advertising agencies to efficiently purchase digital willremainasChairmanofthecompany.WespokewithBonnieandthenew advertising across PC, mobile, and online video channels. Viant CEO, Mark Stapley soon after the announcement. We believe that Mark is a underperformed during the quarter following recent announcements by terrific hire as he has significant industry experience, particularly in the role of Apple and Google to restrict the tracking of third-party cookies on which building out international organizations. His pedigree includes a role as CFO many advertisers rely on to target potential customers. While it has been of Illumina, the leading next-generation DNA sequencing systems developer. known for some time that browsers would eventually restrict cookies, the Bonnie will retain a key strategic role at the company. We believe shares will announcement created uncertainty in investors’ minds on how Viant would recover as Veracyte shows increased penetration into all of its market navigate a new cookie-less environment. What we believe investors do not opportunities, and that other investors are being incredibly short-sighted understand, however, is that Viant’s tracking capabilities are based on given the company’s terrific strategic execution over the past few years. household level data rather than third-party cookies. We have dug deep into the company’s underlying technology with its CTO, CEO, and CFO, and we Shares of ACV Auctions Inc., the leading digital marketplace for wholesale believe Viant can grow through this transition given its proprietary automotive transactions, fell during the quarter despite reporting strong first technology. We believe the intra-quarter stock weakness will dissipate as quarter 2021 earnings results. We believe the decline in the stock was awareness improves around Viant’s household-level tracking abilities. We related to technical pressure from an early lockup release that allowed have not significantly changed our near-term financial forecasts and still pre-IPO investors the ability to sell shares in the open market. Despite this believe longer term that Viant will be a prime beneficiary of the secular recent stock weakness, our long-term thesis on the company is unchanged. growth in digital advertising. Our research leads us to believe ACV is well positioned to capture significant market share as the automotive auction industry transitions from Tripadvisor, Inc. is an online travel company where users can browse physical auctions to digital auctions. reviews and plan trips. Shares took a breather after last quarter’s exciting announcement of the new Tripadvisor Plus subscription program, where Portfolio Structure users pay $99/year for savings and perks on all their hotel bookings made on the site. More recently, concerns of new COVID variants delaying a recovery Table IV. in travel may have also weighed on results. As we wrote in last quarter’s Top 10 holdings as of June 30, 2021 letter, we remain bullish on the opportunity for the Tripadvisor Plus program Quarter End longer term, and we believe Tripadvisor is well positioned to benefit from Investment the pent-up consumer demand for travel coming out of COVID. Year Value Percent of Acquired (millions) Net Assets Veracyte, Inc. is a medical diagnostics company specializing in the Endava plc 2018 $51.0 2.6% characterization of thyroid, lung, breast, and urological cancers. In our Mercury Systems, Inc. 2015 49.9 2.5 opinion, Veracyte has the highest-quality (or in some cases, only) tests for Advanced Energy Industries, Inc. 2019 46.2 2.3 these indications in the market. The company’s tests help to qualify with a Inogen, Inc. 2019 46.1 2.3 high degree of accuracy whether a patient with suspicious initial medical CareDx, Inc. 2018 45.7 2.3 findings (from a needle aspiration for thyroid, or CT scan for lung cancer) Red Rock Resorts, Inc. 2020 42.5 2.1 needs to be followed up with a higher risk, expensive invasive medical The Beauty Health Company 2021 42.0 2.1 procedure such as a full-tissue biopsy. Newer tests will catch cancer activity Future plc 2019 41.2 2.1 at very early stages, allowing for better outcomes. The company is also Progyny, Inc. 2019 40.6 2.0 building an extensive database of complex genetic findings to better aid the Axonics, Inc. 2020 40.5 2.0

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Our top 10 holdings represented 22.3% of the portfolio, which is a bit lower Indie Semiconductor, Inc. is a fabless designer, developer, and marketer of than the 25% level we have held in the past. The lower top 10 semiconductors for automotive applications. Indie’s management team concentration is not a deliberate strategy on our part, but rather the natural previously built a semiconductor company from the ground up, including a result of the addition of new investments across the portfolio, and our successful exit, which gives us high confidence in its ability to execute at judgment about the position sizes of each of these top holdings based upon Indie as well. Indie’s products are used in advanced driver assistance risk and valuation. It is possible that in the future our top 10 positions will systems, light detection and ranging systems (LiDAR, which include ultimately move toward the 25% level we have seen in the past. laser-based components for autonomous vehicle systems), and applications Recent Activity for connected car, user experience, and electrification. Automotive semiconductors is a great industry given that product cycles are long-lived Table V. and design wins provide strong revenue visibility. Additionally, Top net purchases for the quarter ended June 30, 2021 semiconductor content in cars is expected to grow substantially in the coming decade driven by enhanced safety and user experience features as Quarter End Amount Year Market Cap Purchased well as powertrain electrification. We believe Indie is a prime beneficiary Acquired (billions) (millions) of the massive growth in electric vehicle sales volume. Indie’s key advantage JBG SMITH Properties 2021 $4.1 $33.7 is its cross-domain expertise across analog, processing, and power DoubleVerify, Inc. 2021 6.7 28.3 semiconductor applications, allowing it to offer higher levels of Indie Semiconductor, Inc. 2021 1.4 23.7 integration and design simplicity at a lower cost to customers. This Alkami Technology Inc. 2021 3.1 20.4 advantage is reflected in 90% of Indie’s design wins being sole sourced. Ping Identity Corporation 2019 1.9 15.7 While a relatively small company today, Indie already has multiple contracts with various OEMs and Tier 1 suppliers that will ramp in the coming We initiated a new position during the second quarter in JBG SMITH years. With a $2 billion strategic backlog of contracted business and a Properties. JBG is a real estate investment trust that owns a high-quality $2.5 billion pipeline of opportunity for which the R&D has largely been portfolio of office, residential, and land assets concentrated in the funded, Indie has good visibility into rapid revenue growth over the next Washington D.C. metro area. The company was formed in July 2017 via a three to five years. combination of JBG Companies (a D.C. area private equity firm) and Vornado Realty Trust’s D.C. properties. JBG’s regional footprint is poised to This quarter, we invested in Alkami Technology Inc., a cloud-based digital benefit from rebounding job growth over the next several years, driven by a banking platform that enables financial institutions (primarily credit unions) normalization of the D.C. metro economy following negative impacts from to onboard and engage new users, accelerate revenues, and meaningfully the COVID-19 pandemic. In addition, Amazon’s “HQ2” development improve operational efficiency. The market opportunity is large with Alkami currently underway is expected to drive outsized job growth over the next focusing on the top 2,000 of the 10,000 total financial institutions in the decade in National Landing, Virginia, which should benefit the vast majority U.S. (excluding the mega-banks). Many financial institutions use clunky, of JBG’s portfolio. We think JBG has the potential to grow cash flow by outdated legacy systems today that are not well suited to the shift to digital approximately 30% over the next several years and, in time, can double the banking (which has been accelerated by COVID). As a result, we are seeing size of the company by monetizing a sizeable development pipeline and financial institutions significantly increase their IT investments in these owned land bank. We have great respect for the management team, led by products. We believe Alkami will be a prime beneficiary of this shift as it CEO Matt Kelly, whose interests are aligned with shareholders. We believe stands out due to its highly rated user experience, leading brand with credit valuation is attractive, with the stock trading at a significant discount to its unions, and platform flexibility (multi-tenant, single code base platform). private market value and well below pre-COVID levels. Alkami is well positioned to grow revenue 25% or more for the next several DoubleVerify, Inc. is a software platform for digital media measurement and years driven by a combination of expanding existing customer relationships, analytics. Founded in 2008, its mission is to increase the effectiveness and adding new clients (heightened focus on banks in addition to credit unions), transparency of the digital advertising ecosystem through the metrics provided new product development, and selective acquisitions. We also believe that on its platform. DoubleVerify directly analyzes over five billion digital ad the company’s 30% or greater long-term adjusted EBITDA margin target is transactions daily, measuring whether ads are delivered in a fraud-free, brand- achievable. safe environment and are fully viewable in the intended geography. Advertisers are increasingly searching for third-party verification as they attempt to Ping Identity Corporation is a software company that provides secure user maximize their return on investment in the fast-growing digital advertising identification, mainly for large enterprises. We initially invested in Ping on market. As such, DoubleVerify’s revenue has grown at over a 50% compounded its IPO in the third quarter of 2019. Ping’s products address employee annualized rate from 2017 to 2020 and is expected to grow approximately 30% access as well as customer access. Examples of Ping’s products include over the next few years with favorable margins. We expect future growth to be multi-factor identification (which might use mobile text verification or a driven by strong category growth across digital advertising as well as new and biometric identifier like a fingerprint to add to a password protected existing customer growth, product innovation, international expansion, and identity), and single sign-on (SSO, which allows employees of a firm to log potential M&A. DoubleVerify is the market leader in its segment boasting into multiple applications simultaneously). Ping secures over 2 billion integration across major demand-side platforms and partnerships with major identities globally. It is a well-run company with highly visible growth social advertising platforms (Facebook, Twitter, Pinterest, etc.). Combining all of prospects, a strong balance sheet, and real free cash flow. Ping also trades at these factors, we feel confident in underwriting DoubleVerify as a strong “Baron- a reasonable valuation multiple, far below that of its closest competitors. In type” investment: a competitively differentiated business in a secularly growing our opinion, this is because it has been growing slower than its rivals (low to industry with a strong management team. We expect that increased demand for mid-teens revenue growth versus 40% plus at the competitors). But with third-party digital advertising data analytics will fuel continued adoption of new products (recognized by leading consulting firms as industry leading) DoubleVerify’s solutions across key channels, formats, devices, and geographies.

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and a better focus on marketing, we surmise that growth will accelerate market, and we believe this paradigm is in the early innings of disrupting the meaningfully. There is also a significant margin-expansion opportunity. If the entire biopharmaceutical industry. Since Recursion’s program pipeline is still expected growth and margin expansion occur, Ping’s share price should relatively early stage, we have started with a small investment. substantially increase. Table VI. We also initiated smaller positions in some exciting new companies. Top net sales for the quarter ended June 30, 2021 Zymergen Inc. is a synthetic biology company that uses microbes to create Market Quarter End commercial materials used for products including electronics and consumer Cap Market Cap or When Market Cap Amount products. By using its own customized process that leverages biology, Year Acquired When Sold Sold machine learning, and artificial intelligence, Zymergen can create materials Acquired (billions) (billions) (millions) never thought possible with standard chemical processes. Zymergen’s Emergent BioSolutions Inc. 2017 $1.9 $3.5 $15.9 microbe-based processes also avoid the use of petroleum products currently Repay Holdings Corporation 2019 0.4 1.9 11.1 used to create most plastics–so the company is highly ESG-oriented as well. Medallia Inc. 2019 0.6 5.4 8.8 In electronics, Zymergen just launched a specialized film for touch sensor Esperion Therapeutics, Inc. 2017 1.0 0.6 7.0 screens that is clearer and more scratch resistant than current products, and Purple Innovation, Inc. 2020 1.0 1.8 6.8 it also works with folding phone screens. The company will add a new product soon, which is a similar film with higher temperature tolerance. On We sold our remaining position in Emergent BioSolutions Inc., a specialty the consumer side, the company created a novel insect repellant, launching biomanufacturer and service provider for commercial and government in a couple of years, that is expected to be safe and effective and potentially customers. Our original investment thesis was that since Emergent has for combined with sunscreen for easy UV and insect protection. The company is years been a trusted provider of vaccines for the government for biological also working on other products including drought and insect resistant plant agents (including small pox and anthrax), that it should be able to transition nutrients that are environmentally safe, and environmentally friendly naturally to servicing commercial clients in the vaccine space. This played product packaging solutions. We are excited about the company’s out well at the outset, as Emergent’s manufacturing segment won contracts prospects. Since its product portfolio rollout is in the early stages, we have from many customers, including some of the larger COVID vaccine started with a small investment. manufacturers. However, the company stumbled dramatically in the delivery of COVID vaccine products to an extent that surprised us. For now, We made another small investment in Olink Holding AB, which is a health we have decided to wait for evidence of operational improvement. care tools company focused on the identification of proteins (proteomics). It has a proprietary way of identifying proteins that provides high specificity, We also sold our position in Repay Holdings Corporation to allocate that sensitivity, dynamic range, precision, and scalability. Science has advanced capital to other fintech investments. We reduced our position in Medallia Inc. dramatically with regard to understanding the human genome via next when the company was rumored to be up for sale and shares jumped in price. generation sequencing, which shows normal and abnormal portions of a person’s gene sequences. It is now moving toward understanding how those Esperion Therapeutics, Inc. developed and currently manufactures an genes can actively create biologically significant signals (expression of approved oral medication for the treatment of high low density lipids messenger RNA (mRNA) from DNA followed by the translation of mRNA (“LDL”) cholesterol. High LDL has been linked to heart disease, and it is a into proteins). These proteins can potentially be the means by which disease standard of basic medical care to lower LDL for long-term patient is initiated and spread in the body. Olink can help understand this process health. Esperion had two LDL medications approved by the FDA right before for researchers and help its customers to develop next-generation drugs to COVID hit the world, which was truly unfortunate timing. In our opinion the attack these processes. Olink’s platform can also be incorporated into novel company’s medication is terrific for the millions of Americans who cannot diagnostic tests. This is a very exciting new area. We are looking forward to take the most widely used statin medications (like Lipitor) to lower LDL due watching accelerating progress in proteomics. to significant side effects. We stuck with the investment during COVID, with the expectation that when COVID lifted, increased access to cardiologists Recursion Pharmaceuticals, Inc. is a biotechnology company engaged in and primary care physicians would help accelerate prescription volumes of technology-enabled drug discovery. The company uses automated wet-lab Esperion’s drugs. This has happened somewhat, but our research has infrastructure (actual biologic experimentation) with cell perturbations revealed that doctors are finding it nearly impossible to get coverage (multiple experiments done on the duplicate cells), and image capture to approved by many insurance companies, despite the fact that the drugs are generate data at large scale. It also operates its own supercomputer (the on the formularies of all of the leading health care insurers. In the “BioHive”) to drive “in-silico” (virtual, software-enabled) inferences based on meantime, the company is burning a significant amount of cash as it has its data and wet-lab experiments. This combined approach has generated a hired a full sales force to market its products. We hope that the situation strong pipeline of programs spanning early discovery to clinical trials, including turns around as the medication works, is reasonably priced (in our opinion), a collaboration deal with Bayer. The company’s use of artificial intelligence and can help millions around the world to lower their risk of heart and machine learning lowers the cost of drug discovery and speeds up time to disease. However, for now we remain on the sidelines.

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We sold our position in Purple Innovation, Inc. after the company lowered Outlook guidance when an employee lost her life in an industrial accident at the Grantsville, Utah mattress manufacturing plant. The company is completing We are closely watching policy decisions made by the federal government an internal investigation but, in the meantime, has slowed production to and by the Federal Reserve as well as commodity pricing, which might give implement better safety measures. While we think the company eventually us hints about whether the current inflationary pressures we are seeing will be able to work through any required changes in manufacturing (wages, basic materials, transportation) will persist. However, we always processes to increase safety, we felt there was enough uncertainty to exit manage the portfolio on a micro, not a macro basis, and feel that each the position until we had more information on what happened and how of our investments stands alone on its merits. New opportunities future safety incidents could be addressed. abound, and many are extremely interesting for this Fund. Generally, we feel good about our companies’ prospects, about our idea generation, and about the state of the U.S. economy. Thank you for investing in Baron Discovery Fund.

Randy Gwirtzman & Laird Bieger Portfolio Managers June30, 2021

Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectus contain this and other information about the Funds. You may obtain them from its distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing. Risks: The Adviser believes that there is more potential for capital appreciation in smaller companies, but there also may be more risk. Specific risks associated with investing in smaller companies include that the securities may be thinly traded and they may be more difficult to sell during market downturns. The Fund may not achieve its objectives. Portfolio holdings are subject to change. Current and future portfolio holdings are subject to risk. The discussions of the companies herein are not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed in this report reflect those of the respective portfolio manager only through the end of the period stated in this report. The portfolio managers’ views are not intended as recommendations or investment advice to any person reading this report and are subject to change at any time based on market and other conditions and Baron has no obligation to update them. This report does not constitute an offer to sell or a solicitation of any offer to buy securities of Baron Discovery Fund by anyone in any jurisdiction where it would be unlawful under the laws of that jurisdiction to make such offer or solicitation. BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a limited purpose broker- dealer registered with the SEC and member of the Financial Industry Regulatory Authority, Inc. (FINRA).

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Dear Baron Durable Advantage Fund Shareholder: Performance

Baron Durable Advantage Fund (the “Fund”) gained 13.1% (Institutional Shares) during the second quarter, outperforming the 8.6% gain for the S&P 500 Index (“SPX”), the Fund’s benchmark. The Fund is up 16.5% year-to-date, which compares favorably to the 15.3% return for the SPX.

Table I. Performance Annualized for periods ended June 30, 2021 Baron Baron Durable Durable Advantage Advantage Fund Fund Retail Institutional S&P 500 Shares1,2 Shares1,2 Index1 Three Months3 13.11% 13.14% 8.55% Six Months3 16.38% 16.53% 15.25% One Year 36.31% 36.55% 40.79% ALEX UMANSKY Retail Shares: BDAFX Three Years 20.87% 21.14% 18.67% Institutional Shares: BDAIX Since Inception (December 29, 2017) 18.67% 18.93% 16.67% PORTFOLIO MANAGER R6 Shares: BDAUX

Stocks continued moving higher during the second quarter, extending their rally over the last 15 months, with the SPX now up 96.1% cumulatively from the At the company-specific level, all our investments increased in value this trough reached on March 23, 2020, and the Fund is keeping up with a similar quarter, except for Ecolab, which was down 3.5%. The majority (21 out of return of 95.3%. Underneath the headline numbers however, the second 36) were up double digits, including some of our largest purchases from last quarter saw a reversal in some of the first quarter’s trends with the yield on a quarter. Alphabet was up 21%, Facebook up 18%, and Microsoft up 15%. 10-year U.S. Treasury bond declining from the highs of nearly 1.8% down into Other big winners were some of the names that corrected the most in the the 1.3% to 1.4% range. As a result, value stocks underperformed as investors first quarter, including MSCI, which was down 6% during the March quarter were willing to look longer term, which benefited the types of businesses we and up 27% in June, and Adobe, which was down 5% and then up 23%. tend to hold high-quality, long-term compounders. Having no exposure to various underperforming “reopening” areas such as banks, travel (hotels, airlines, We have written in the past how we thought Poker and Fantasy Football cruise lines), or movie theater operators also helped. could provide useful training ground for aspiring investors. Both are games of incomplete information that require patient and opportunistic capital Most of our outperformance in the quarter was due to stock selection, allocation in the face of a wide range of outcomes, with the ability to which was responsible for 378bps of the Fund’s 461bps of outperformance. manage the inherent uncertainty the future brings emerging as a critical skill Most of that came from superior selection in the Communication Services, set. From that perspective, Chess has little to offer us. Chess is a classic Health Care, and Financials sectors, with a more modest contribution in game of certainty. There is a “correct” move and a countermove at every Industrials. Sector allocation contributed the remaining 82bps with step, where good decisions are rewarded and bad ones punished. There are overweights in Information Technology (“IT”) and Communication Services no “ugly” river cards that radically change the texture of the board or and underweights in Utilities and Industrials contributing positively to catastrophic knee injuries that wreak havoc on your team’s receiving corps, relative results. The overall strength this quarter was broad based with and the better player wins almost every game. Yet, there is a critical part of positive relative contributions from all sectors except Materials and Energy, a Chess game that we think investors can learn from. which cost us 9bps combined.

Performance listed in the table above is net of annual operating expenses. Annual expense ratio for the Retail and Institutional Shares as of September 30, 2020 was 2.80% and 2.40%, respectively, but the net annual expense ratio was 0.95% and 0.70% (net of the Adviser’s fee waivers), respectively. The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original cost. The Adviser reimburses certain Baron Fund expenses pursuant to a contract expiring on August 29, 2031, unless renewed for another 11-year term and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted. For performance information current to the most recent month end, visit www.BaronFunds.com or call 1-800-99BARON. 1 The S&P 500 Index measures the performance of 500 widely held large cap U.S. companies. The index and the Fund include reinvestment of dividends, net of withholding taxes, which positively impact the performance results. The index is unmanaged. The index performance is not Fund performance; one cannot invest directly into an index. 2 The performance data in the table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. BARON FUNDS 3 Not annualized.

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A game of Chess is divided into three distinct phases, known as the For example, Alphabet and Facebook were two of our largest additions in Opening, the Middlegame, and the Endgame, each with its own distinct the fourth quarter of last year and then again in the first quarter of 2021 strategies. The Opening typically covers the first 10 to 15 moves of the and both performed very well, up 42% and 27% year-to-date, respectively. game in which both players are moving their pieces from their starting Interestingly, this solid performance coincided with an accelerating news positions to take up active posts ready to do battle in the Middlegame. flow around Big Tech regulation. There are five new antitrust bills in the Advanced players usually have this stage of the game figured out where a house targeting Big Tech, a G-7 proposal to change their tax rates decision to open with the Queen’s Gambit or a Sicilian Defense is made (potentially taxing subsidiaries separately and limiting deductions), and a before the game ever starts. This is akin to an investment team knowing/ continued flow of litigation from the FTC, state attorney generals as well as deciding how they will allocate funds on day one of a new fund. In both international regulators. At the same time, Apple changed its privacy cases, it is not uncommon to stay up all night just before, agonizing over the settings (App Tracking Transparency or ATT) such that users would need to final decisions of what you want to accomplish and what you need it to look proactively agree to share their data with the apps (and naturally, many like once the Opening is complete. The Endgame in Chess has been decide not to; recent data points to only 10% to 20% of users agreeing to thoroughly analyzed and is rarely played out at a higher level since piece share their data). This in turn is reducing the quality of the signal that is positioning makes it obvious who the winner will be. It has even less used by advertisers and could create disruption in the advertising ecosystem. relevance to us since the investing we do has no Endgame. We do not So, have investors suddenly stopped caring about regulation? Is it priced in? optimize a portfolio to perform over any specific period of time (a quarter or a year). The investing we do is neither a sprint nor a marathon because there We think that over time investors realize that what really matters for the is no finish line. That brings us to the remaining phase of a Chess game that intrinsic values of both Alphabet and Facebook are the choices made by we think can be instructive to investors—the Middlegame! consumers on the one side and advertisers on the other side. As long as users continue going to Google to research their next vacation or the type of TV they According to Wikipedia “The middlegame in chess is the portion of the game want to buy, advertisers will choose Google as the place they want to spend in between the opening and the endgame. The middlegame begins when dollars to reach those consumers. Similarly, as long as users keep spending both players have completed the development of all or most of their around 30 minutes every day on each of Facebook and Instagram, advertisers pieces…. Theory on the middlegame is less developed than the opening or will be there. The famous Facebook advertiser boycott lasted for one month... endgames. Since middlegame positions are unique from game to game, They just can’t afford to not be there. Even the recent privacy changes brought memorization of theoretical variations is not possible as it is in the opening. by Apple, while potentially disruptive in the near term, could end up being a Likewise, there are usually too many pieces on the board for theoretical tailwind longer term to the walled gardens (Facebook, Alphabet and Amazon) positions to be completely analyzed as can be done in the simpler due to the magnitude of first-party data these platforms have and the fact that endgames.” The Middlegame is often considered the most exciting phase of they can increasingly close loops on the platform (shopping), which increases the Chess game. It is in this stage of the game, after the Opening has their relative value in the eyes of advertisers. finished but while there are still plenty of pieces on the board, that the outcome of the game is most frequently decided. One of the great We wrote about Big Tech regulation in the past and our view remains challenges of the Middlegame is how to make progress when there are no largely unchanged: obvious moves. We think of investing as the perpetual Middlegame. We go “Big Tech’s power comes from consumer adoption and consumer preferences to great lengths to research, understand, and develop conviction in the and there is little to nothing that regulations can do about that. It’s simply too companies in which we invest. More often than not, we are happy with our late. Instead of trying to figure out how to break them up (we wrote in the past “Opening” and are comfortable with our “board.” This is what Garry that we believe in every relevant case 1+1 will likely yield a value greater than Kasparov, the greatest Chess player of all time, refers to as the “nothing to 2), the regulators need to realize that these four Tech giants fighting each do” phase of the game. Interestingly enough, it is this stage of the game other is probably the best remedy (and a system of checks and balances) when action (as opposed to reaction) is required most! It is this ability to available to them today.” improve one’s positioning through subtle, seemingly unimportant or insignificant moves that separates contenders from pretenders. Just like in Baron Durable Advantage Fund generated an upside capture of 98.3% and a Chess, we find there are frequent periods of time when there are no obvious downside capture of 86.0% since inception. We believe it is our ability to buys or sells. Just like Mr. Kasparov, we believe that being proactive and not excel in the Middlegame and take advantage of these “nothing to do” reactive is one of the keys to long-term success. We are always in the moments that has been the key to that success. Middlegame and there are many “nothing to do” moments. So we proactively build a pipeline of ideas–great businesses that benefit from Table II. disruptive change with platform economics and network effects, run by Top contributors to performance for the quarter ended June 30, 2021 talented entrepreneurs. Then we work on building the conviction, stress- Quarter End testing our assumptions, analyzing the competitive landscape, comparing Market Cap Percent (billions) Impact them to our existing investments–always asking ourselves where we could be wrong and then taking action when we feel the time is right. These Alphabet Inc. $1,658.8 1.78% shareholder letters are often focused on new ideas and we write about a few Microsoft Corporation 2,040.3 1.21 things that impacted the recent results the most. Often, the subtle, Facebook, Inc. 985.9 1.11 “seemingly unimportant” moves do not attract a lot of attention because Adobe Inc. 279.9 0.88 they do not become apparent or impactful until some time in the future. Moody’s Corporation 67.8 0.79

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Alphabet Inc. is the parent company of Google, the world’s largest search and higher M&A activity. Favorable issuance trends continued into the and online advertising company. Shares of Alphabet were up 21% in the second quarter with strong growth in high yield and leveraged loan issuance. quarter driven by a continued recovery in ad spend, strong cloud revenue We remain shareholders based on our belief that the company benefits from growth (up 46% in the first quarter year-over-year), and improved cost numerous secular growth trends, such as bonds taking share in the credit controls (with operating margins reaching 30% in the first quarter). We pie, growth in passive investing, and demand for data and analytics. Moody’s remain excited about Alphabet’s merits as it continues to benefit from also operates in attractive oligopoly markets where it enjoys meaningful growth in mobile and online video advertising, which accrues to its core competitive advantages and pricing power. assets of search, YouTube, and the Google ad network. We are further encouraged by Alphabet’s investments in AI, autonomous driving (Waymo), Table III. and life sciences (Verily, Calico). Top detractors from performance for the quarter ended June 30, 2021 Shares of Microsoft Corporation, a provider of software productivity tools Quarter End Market Cap Percent and cloud infrastructure, rose 15% during the quarter following a strong (billions) Impact earnings report highlighting solid demand for its broad product stack and Ecolab Inc. $ 58.9 –0.03% continued momentum in cloud adoption. March quarter revenues were up Alibaba Group Holding Limited 614.8 –0.01 16% year-over-year (in constant currency terms), operating profits up 27%, EPS was up 34%, and Azure was up 46%. We believe Microsoft will continue Shares of Ecolab Inc., a global leader in water, hygiene, and infection enjoying durable growth characteristics as more companies look to digitally prevention, declined 4% in the quarter as the company continues facing transform. Satya Nadella, Microsoft’s CEO commented on these COVID-related headwinds in its industrial and hospitality businesses along accelerating trends during the last earnings call: with the negative impact of rising commodity prices on margins. Note that “Over a year into the pandemic, digital adoption curves aren’t slowing down. while some near-term headwinds remain, trends are improving as In fact, they’re accelerating, and it’s just the beginning. Digital technology will economies reopen. We continue to believe that Ecolab will benefit from an be the foundation for resilience and growth over the next decade. We are increase in hygiene awareness as customers ranging from hotels to innovating and building the cloud stack to accelerate the digital capability of restaurants, office buildings, and manufacturing facilities implement every organization on the planet.” additional cleaning and sanitation protocols in response to COVID-19. We think that the company has a substantial opportunity to grow organically, We also believe that Microsoft’s competitive advantages are strong and with only a 10% share of its estimated $13 billion addressable market. durable as it benefits from the long reach of its sales channel, its broad product set, its differentiated hybrid cloud offering, and its large installed Our new position, Alibaba Group Holding Limited, the largest retailer and base of enterprise customers. It therefore remains our second largest e-commerce company in China, detracted 1bp from performance in the position in the Fund. quarter (as its stock was flat in a rising market for the period held). Alibaba operates shopping platforms Taobao and Tmall and owns 33% of Ant Shares of Facebook, Inc., the world’s largest social network, were up 18% Group, which operates Alipay, China’s largest third-party online payment this quarter on results that came in ahead of market forecasts with 44% provider. Despite news that Chinese regulators had launched an revenue growth (in constant currency), which compared to Street investigation into the company for suspected monopolistic behavior and expectations of 31%, driven by the recovery in ad spend. In our view, concerns of increased competition from peers, we believe the stock was flat Facebook continues to utilize its leadership in mobile to provide global because much of these risks were already priced in. We believe the risk- advertisers targeted marketing capabilities at scale, with substantial future reward remains favorable for long-term investors, such as ourselves and monetization opportunities across its various assets including WhatsApp, hence decided to initiate a position. Instagram, video tools including Watch and IG TV, and community-based marketplace, shopping, jobs, and dating features. Portfolio Structure Shares of Adobe Inc., the leading provider of content creation, document management, and marketing software, rose 23% following strong first The Fund’s portfolio is constructed on a bottom-up basis with the quality of quarter results and robust guidance ahead of consensus, with revenues up ideas and conviction level (rather than benchmark weights) determining the 23% year-over-year and operating margins hitting nearly 46%. We continue size of each individual investment. Sector weights tend to be an outcome of to believe the company is extremely well positioned over the long term the portfolio construction process and are not meant to indicate a positive given its marquee brand and best-in-class technology, which helps content or a negative “view.” creators and marketing professionals better reach, communicate, and sell As of June 30, 2021, our top 10 positions represented 49.2% of the Fund, their companies’ products in an increasingly digitally connected world. the top 20 were 74.6%, and we exited the quarter with 36 investments. IT, Moody’s Corporation provides credit ratings, financial intelligence, and our largest sector, represented 35.2% of the Fund. Communication Services, analytical tools to assist businesses in making decisions. Shares increased Health Care, and Financials were 16.1% each (48.3% together), while 22% in the quarter as bond issuance activity exceeded consensus Consumer Staples, Industrials, Real Estate, and Consumer Discretionary expectations. Strong first quarter results were highlighted by 30% revenue represented another 12.6% of the Fund. Cash and our Ecolab investment, growth in the ratings segment driven by an improving economic outlook which is classified under Materials, were the remaining 3.9%.

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Table IV. markets require higher power efficiency with smaller form factors directly Top 10 holdings as of June 30, 2021 playing into MPS’s strengths. As a result, over the last decade, MPS’s Quarter End exposure to consumer end markets declined from 65% of sales in 2010 to Quarter End Investment 26% in 2020. Even with solid and durable growth profile, the company has Market Cap Value Percent of (billions) (millions) Net Assets been returning 50% of free cash flow to shareholders in the form of dividends and buybacks. We believe MPS will be able to sustain its growth as Alphabet Inc. $1,658.8 $2.4 8.2% it further penetrates new and growing end markets, while continuing to take Microsoft Corporation 2,040.3 2.2 7.6 share from competitors and returning excess cash to shareholders over time. Facebook, Inc. 985.9 1.9 6.7 Visa, Inc. 515.7 1.3 4.5 We also initiated a small position in Alibaba Group Holding Limited, the Danaher Corporation 191.4 1.3 4.5 largest retailer and e-commerce company in China. Alibaba operates the Adobe Inc. 279.9 1.2 4.3 shopping platforms Taobao and Tmall and owns 33% of Ant Group, which Mastercard Incorporated 361.8 1.1 3.9 operates Alipay, China’s largest third-party online payment provider. Moody’s Corporation 67.8 1.1 3.7 We bought Alibaba shares taking advantage of the nearly 30% decline in its Intuit Inc. 133.9 0.8 2.9 stock since October 2020, driven by the increased regulatory scrutiny of tech Thermo Fisher Scientific Inc. 198.3 0.8 2.9 platforms in China. On the one hand, it is clear that regulatory risks are higher today than they have been in the past, and so we demand higher Recent Activity hurdle rates (or margin of safety) especially for investing outside the U.S., which is not the bread and butter of this strategy. On the other hand, we During the second quarter, we added two new holdings. The first is believe Alibaba’s stock, at this valuation, represents a favorable risk-reward Monolithic Power Systems, a fabless (asset-light) analog semiconductor equation. In our view, Alibaba is one of the most undervalued platform company; the second is Alibaba, the leading Chinese e-commerce platform. businesses in the world. Its core business is highly profitable, while true We took advantage of flows into the Fund to add to 25 existing holdings. earnings are masked by a host of earlier stage (and rapidly growing) We had no sales in the quarter. businesses such as Ali cloud (Alibaba’s “AWS”), Lazada (its marketplace business in Southeast Asia), Cianiao (its logistics business), and New Retail. It Table V. also enjoys strong competitive advantages, with over 1 billion annual active Top net purchases for the quarter ended June 30, 2021 customers, and a 22% market share of total retail sales in China. Amazon, for Quarter End Amount Market Cap Purchased example, has 8%. Despite that, as of the end of the second quarter, Alibaba (billions) (thousands) was trading at less than 20 times fully diluted GAAP earnings, which were Monolithic Power Systems, Inc. $ 17.1 $392.7 negatively impacted by all those early-stage businesses. Alibaba Group Holding Limited 614.8 357.2 Intuit Inc. 133.9 332.6 Table VI. Danaher Corporation 191.4 323.4 Top net sales for the quarter ended June 30, 2021 Visa, Inc. 515.7 255.6 Market Cap Amount When Sold Sold Our largest purchase in the quarter was Monolithic Power Systems, Inc. (billions) (thousands) (“MPS”), a best-in-class high-performance analog-power, fabless, No Sales semiconductor company. Over 95% of MPS’s sales are DC-DC products which are used to convert and control voltages in a broad range of Outlook electronic systems across five key end markets including: Computing/ Storage, Automotive, Industrial, Communications, and Consumer. The In the last quarterly letter, we wrote about not being too concerned with the company’s core differentiation comes from deep system-level and “reopening” trade, even though it has benefited businesses we tend to shy applications knowledge, strong design experience, an agile and away from (such as airlines, hotels and banks), and therefore had a negative entrepreneurial product-driven culture, and innovative proprietary process impact on our quarterly returns. We did suggest that paying attention to the technologies. This differentiation enables MPS to provide highly integrated, yield of the 10-year U.S. Treasury bond, which peaked at almost 1.8% energy efficient, cost effective, and easy to use monolithic (on one die) during that time was important, as higher interest rates (specifically, products. significantly higher interest rates) would likely present headwind for equities even though our holdings tend to be more mature and hence, less Over the last five years, MPS has grown revenues at a 20% CAGR but, with susceptible to interest rate movements. We also reiterated that we do not approximately $1 billion in total annual sales, has less than 2% of the overall attempt to predict inflation or interest rates. analog semiconductor market. Given its relative size in the market, we believe growth drivers will remain weighted towards design wins and Well…the annualized inflation rate for May (the CPI Index) came in at 5%. company-specific factors rather than the overall macroeconomic This is the first-time inflation reached 5% since 2008. Jerome Powell, the environment, making MPS less cyclical than the broader semiconductor chairman of the Federal Reserve then reiterated that in his opinion this high industry. While the company’s legacy is in consumer products, which tend inflation number is “transitory” and that the Fed will not start raising rates to be lower margin, it is rapidly expanding into other higher-margin end until 2023. Though the message was consistent with his prior statements, markets such as 5G infrastructure and devices, automotive ADAS, this time the market had a different reaction and the yield on the 10-year infotainment, electric vehicles, data center power supply and cooling, and bond came down to almost 1.3%. Last time we checked; we are all sensor applications related to internet-of-things and industry 4.0. Those end “transitory.”

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The Fed believes that the inflation rate will likely come back down to 2% to Our goal is to invest in large-cap companies with, in our view, strong and 2.5% annual rate in the next few months, which would be considered benign durable competitive advantages, proven track records of successful capital for the U.S economy. The more interesting phenomenon from our allocation, high returns on invested capital, and high free cash flow perspective is that whether inflation is running at 5% or at 2.5% one is generation, a significant portion of which is regularly returned back to absolutely guaranteed to lose money (in real terms) by investing in a shareholders in the form of dividends or share repurchases. It is our belief 10-year government bond yielding less than 1.5%! that investing in great businesses at attractive valuations will enable us to earn excess risk-adjusted returns for our shareholders over the long term. Every day we live and invest in an uncertain world. Well-known conditions We are optimistic about the prospects of the companies in which we are and widely anticipated events, such as Federal Reserve rate changes, invested and continue to search for new ideas and investment opportunities. ongoing trade disputes, government shutdowns, and the unpredictable behavior of important politicians the world over, are shrugged off by the Sincerely, financial markets one day and seem to drive them up or down the next. We often find it difficult to know why market participants do what they do over the short term. The constant challenges we face are real and serious, with clearly uncertain outcomes. History would suggest that most will prove passing or manageable. The business of capital allocation (or investing) is the business of taking risk, managing the uncertainty, and taking advantage Alex Umansky of the long-term opportunities that those risks and uncertainties create. We Portfolio Manager are confident that our process is the right one, and we believe that it will June 30, 2021 enable us to make good investment decisions over time.

Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectus contain this and other information about the Funds. You may obtain them from its distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing. Risks: The Fund invests primarily in large cap equity securities which are subject to price fluctuations in the stock market. The Fund may not achieve its objectives. Portfolio holdings are subject to change. Current and future portfolio holdings are subject to risk. The discussions of the companies herein are not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed in this report reflect those of the respective portfolio managers only through the end of the period stated in this report. The portfolio manager’s views are not intended as recommendations or investment advice to any person reading this report and are subject to change at any time based on market and other conditions and Baron has no obligation to update them. This report does not constitute an offer to sell or a solicitation of any offer to buy securities of Baron Fifth Avenue Growth Fund by anyone in any jurisdiction where it would be unlawful under the laws of that jurisdiction to make such offer or solicitation. Downside Capture measures how well a fund performs in time periods where the benchmark’s returns are less than zero. Upside Capture explains how well a fund performs in time periods where the benchmark’s returns are greater than zero. BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a limited purpose broker-dealer registered with the SEC and member of the Financial Industry Regulatory Authority, Inc. (FINRA).

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Dear Baron Real Estate Income Fund Shareholder:

We are pleased to report that the Baron Real Estate Income Fund (the “Fund”) generated strong performance for the six months ended June 30, 2021, gaining 16.64% (Institutional Shares). During this period, however, the Fund underperformed its primary benchmark index, the MSCI US REIT Index (the “REIT Index”), which increased 21.24%. In the most recent three-month period ended June 30, 2021, the Fund gained 8.42% compared to a gain of 11.74% for the REIT Index. The Fund’s average annualized return (net of fees) since inception is 17.01% vs. 7.69% for the REIT Index. For our more detailed thoughts on the Fund’s recent performance, please refer to our “A review of recent activity and performance” section later in this letter. We are also pleased to report that as of June 30, 2021, the Fund received a 5-star Overall Morningstar Rating™.

The Fund achieved the following rankings within the Morningstar Real Estate JEFFREY KOLITCH Retail Shares: BRIFX Category: Institutional Shares: BRIIX PORTFOLIO MANAGER R6 Shares: BRIUX 3-year performance: Ranked in the top 3% of all real estate funds for its 3-year performance 1-year performance: Ranked in the top 9% of all real estate funds for its We will address the following topics in this letter: 1-year performance • A review of recent activity and performance • A mid-year REIT update (preview: strong start to 2021, and we remain bullish) • Our investment themes and portfolio construction • The prospects for real estate and the Baron Real Estate Income Fund (preview: we remain bullish)

As of 6/30/2021, the Morningstar Ratings™ were based on 228 share classes for the 3-year and Overall periods. The Baron Real Estate Income Fund received 5 Stars for both periods. The Morningstar Ratings are for the Institutional Share Class only; other classes may have different performance characteristics. The Morningstar Ratings are based on the Morningstar Risk-Adjusted Return measures. As of 6/30/2021, the Morningstar Real Estate Category consisted of 246 and 228 share classes for the 1- and 3-year periods. Morningstar ranked Baron Real Estate Income Fund in the 9th and 3rd percentiles for the 1- and 3-year periods, respectively. Morningstar calculates the Morningstar Real Estate Category Average performance and rankings using its Fractional Weighting methodology. Morningstar rankings are based on total returns and do not include sales charges. Total returns do account for management, administrative, and 12b-1 fees and other costs automatically deducted from fund assets. 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 Morningstar Rating does not include any adjustment for sales loads. 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. © 2021 Morningstar. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may notbe copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any BARON FUNDS damages or losses arising from any use of this information. Past performance is no guarantee of future results.

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Table I. in California, Florida, Georgia, Arizona, Seattle, and the Carolinas. Its primary Performance business strategy focuses on acquiring, renovating, leasing, and operating For periods ended June 30, 2021 single-family homes as rentals. We are bullish about the long-term Baron Baron prospects for the company given multiple growth opportunities which Real Estate Real Estate include: i). significant pent-up demand from the millennial generation to Income Fund Income Fund MSCI US Retail Institutional REIT rent single-family homes versus a backdrop of constrained inventory (which Shares1,2 Shares1,2 Index1 we expect will lead to rental and occupancy growth), ii). continued Three Months3 8.33% 8.42% 11.74% acquisitions of homes in high-growth geographic markets, and iii). the Six Months3 16.44% 16.64% 21.24% expansion of ancillary home services for residents (e.g., enhanced smart One Year 44.23% 44.69% 36.57% home, pest control, landscape, and pet services). Three Years 19.95% 20.18% 8.83% American Tower Corp.: American Tower is the largest wireless tower Since Inception (December 29, company in the world. We are optimistic about the long-term prospects for 2017) 16.79% 17.01% 7.69% the company given exceptionally strong secular growth expectations for Since Inception (December 29, mobile data usage, 5G technology, and “connected homes and cars,” which 2017) (Cumulative) 72.17% 73.30% 29.60% will require increased wireless bandwidth. The company also benefits from long-term leases with annual rent increases of approximately 3%, limited A REVIEW OF RECENT ACTIVITY AND PERFORMANCE competition, higher barriers to entry given limited government zoning Recent Activity approvals, and scale advantages. Like our portfolio management playbook that we employed in 2020, we CoreSite Realty Corporation: CoreSite operates a high-quality real estate have maintained our unusually elevated active approach to managing the portfolio of 25 well-located real estate data centers in 8 markets in the U.S. Fund in the first six months of 2021 due to the acceleration and emergence We believe the company is poised for a positive inflection point in its cash of headwinds and tailwinds in certain segments of real estate, the flow growth in the next few years. In our opinion, the shares are attractively unprecedented economic and social lockdown and reopening, and the valued relative to its public data center peers and recent private market resulting stock market volatility. transactions. : JBG SMITH owns, operates, invests in, and develops Table II. JBG SMITH Properties a well-located real estate portfolio of office, apartment, and land holdings Top net purchases for the quarter ended June 30, 2021 concentrated in the sub-markets of Washington, D.C. As economic activity Quarter End Amount Market Cap Purchased improves and employees return to work, we expect leasing and occupancy (billions) (millions) trends to improve. Further, we believe a key catalyst for growth in the years Invitation Homes, Inc. $ 21.2 $2.6 ahead is the fact that JBG SMITH serves as the exclusive developer for American Tower Corp. 122.8 1.8 Amazon’s new headquarters in the Washington, D.C. area (“National CoreSite Realty Corporation 6.6 1.8 Landing”). At its recent price of only $31 per share, the stock remains 26% JBG SMITH Properties 4.1 1.7 below our $42 estimate of net asset value or liquidation value. Park Hotels & Resorts Inc. 4.9 1.7 Park Hotels & Resorts Inc.: Park Hotels owns a portfolio of 59 premium- branded hotels and resorts (Hilton, Marriott, Hyatt, and IGH), a majority of In the most recent quarter, we acquired shares or made additional purchases which are in prime U.S. markets, including Hawaii, Northern California, and in the following REITs: Florida. We believe the company is well positioned to benefit from a Invitation Homes, Inc.: Invitation Homes is the largest single-family home recovery in travel. At its recent price of only $20 per share, the shares are leasing company in the U.S. with approximately 80,000 homes concentrated valued at a 60% discount to management’s estimate of replacement cost.

Performance listed in the above table is net of annual operating expenses. Annual expense ratio for the Retail Shares and Institutional Shares as of December 31, 2020 was 4.40% and 3.45%, respectively, but the net annual expense ratio was 1.05% and 0.80% (net of the Adviser’s fee waivers), respectively. The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original cost The Adviser reimburses certain Baron Fund expenses pursuant to a contract expiring on August 29, 2031, unless renewed for another 11-year term and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted. For performance information current to the most recent month end, visit www.BaronFunds.com or call 1-800-99BARON. 1 The MSCI US REIT Index is a free float-adjusted market capitalization index that measures the performance of all equity REITs in the US equity market, except for specialty equity REITs that do not generate a majority of their revenue and income from real estate rental and leasing operations. MSCI is the source and owner of the trademarks, service marks and copyrights related to the MSCI Indexes. The index and the Fund include reinvestment of interest, capital gains and dividends, which positively impact the performance results. The index is unmanaged. Index performance is not Fund performance; one cannot invest directly into an index. 2 The performance data in the table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. 3 Not annualized.

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Table III. The generally strong share price performance of several value REITs (for Top net sales for the quarter ended June 30, 2021 example, shopping centers and retail malls) versus growth REITs weighed on Quarter End the Fund’s relative performance in the first half of 2021. Although the Fund Market Cap or maintains investments in value real estate companies, we continue to Market Cap Amount When Sold Sold prioritize best-in-class, competitively advantaged real estate growth (billions) (millions) companies, consistent with our long-term investment philosophy. In our Extended Stay America, Inc. $ 3.6 $1.0 opinion, the risk-reward prospects have started to become more favorable Las Vegas Sands Corporation 40.3 0.7 for real estate growth stocks following the sharp divergence in year-to-date STORE Capital Corporation 9.3 0.5 performance between real estate value and growth stocks. Wynn Resorts Ltd. 14.1 0.4 Additionally, a few of the Fund’s non-REIT Asia-focused real estate Terreno Realty Corporation 4.5 0.2 investments (Las Vegas Sands Corporation, Wynn Resorts Ltd., and GDS Holdings Limited) lagged due to COVID-19 headwinds that limited travel Extended Stay America, Inc.: Following the announcement that Extended and other Asia-centric macroeconomic and business considerations. We Stay would be acquired by Blackstone and Starwood Capital at a significant remain optimistic about the long-term return potential for these companies. premium to the Fund’s cost basis in the company, we exited our investment in Extended Stay and reallocated the capital to other real estate companies. In the past, there have been periods when the Fund has temporarily trailed its benchmark. The Fund has a track record of bouncing back. Our team Las Vegas Sands Corporation and Wynn Resorts Ltd.: In the most recent remains driven, hard at work, and we are optimistic that we will, once again, quarter, we trimmed the Fund’s holdings in these gaming businesses due to deliver strong long-term relative performance for our shareholders as we ongoing COVID-19-related travel restrictions in China, Macau, and have done over the years. Singapore. We expect business activity to rebound sharply when travel restrictions are lifted and may acquire additional shares in the future. Table IV. Top contributors to performance for the quarter ended June 30, 2021 STORE Capital Corporation: We recently reduced the Fund’s investment in Quarter End STORE Capital yet remain optimistic about the company’s long-term Market Cap Percent prospects. STORE Capital is a REIT that owns a diversified $9 billion portfolio (billions) Impact of net leased real estate properties (63% service, 19% retail, and 18% Red Rock Resorts, Inc. $ 5.0 1.11% manufacturing) throughout the U.S. The company has a strong track record Equinix, Inc. 71.9 0.72 of accretive acquisitions, and we expect business activity to improve in the American Tower Corp. 122.8 0.63 second half of 2021 as COVID-19 headwinds continue to fade. Prologis, Inc. 88.4 0.58 Terreno Realty Corporation: The company owns and operates a high- Simon Property Group, Inc. 42.9 0.52 quality real estate portfolio of industrial properties concentrated in six The shares of Red Rock Resorts, Inc., a real estate gaming, development, coastal markets (Seattle, San Francisco Bay Area, Los Angeles, Northern and management company that generates 100% of its cash flow in the New Jersey / New York City, Washington D.C., and Miami) where strong Las Vegas locals market continued to perform well in the most recent demand (high population densities) tends to outstrip supply (physical and quarter. We remain optimistic about the long-term prospects for the regulatory constraints). Management has an excellent track record of company given the quality of its 100% owned real estate assets, the delivering strong growth. We recently trimmed the Fund’s investment in attractive and expanding Las Vegas locals market (strong population Terreno because we believe the shares are fairly valued. growth), and the company’s impressive growth and free cash flow prospects. We believe the shares could appreciate by approximately 50% in the next Recent Performance few years. The Baron Real Estate Income Fund generated particularly strong absolute The shares of Equinix, Inc. gained 18% in the most recent quarter. Equinix is and relative performance in both 2019 and 2020. the largest and leading global data center company in the world. We believe 2019 Performance the company is exceptionally well positioned to continue to benefit from • Baron Real Estate Income Fund: 36.54% powerful secular demand trends including strong growth in information • MSCI US REIT Index: 24.33% technology outsourcing, increased cloud computing adoption, and multi- year increases in mobile data and global internet traffic. 2020 Performance • Baron Real Estate Income Fund: 22.30% The shares of American Tower Corp., the largest independent wireless • MSCI US REIT Index: -8.70% tower operator in the world, gained 14% in the most recent quarter. The company continues to benefit from increasing demand for wireless data Following two straight years of particularly strong annual returns, we are coverage by wireless carriers. We remain optimistic about the company’s pleased that the Fund continued to generate strong performance in the first organic and acquisition growth opportunities. six months of 2021, gaining 16.64%. Nevertheless, a few factors contributed Prologis, Inc. is a REIT that owns a $40 billion global industrial portfolio. to the Fund’s relative underperformance in the last few months compared to The company continues to benefit from robust demand for its warehouse the REIT Index. facilities driven by the growth of e-commerce and the need for infill real estate locations to service “last mile” delivery. In the most recent quarter, the shares gained 13%, and we remain optimistic about the company’s long-term prospects.

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Simon Property Group, Inc. is the largest and premier mall operator in the A MID-YEAR REIT UPDATE U.S. The company owns A-quality malls in A-quality geographic locations. At the end of 2020, we stated that we believed REITs would perform well in We expect the company to benefit from a further reopening of the economy 2021. REITs had underperformed for several years, with notable and believe management is well positioned to acquire real estate assets underperformance in 2020. REIT valuations were compelling. We expected given its strong balance sheet and low cost of capital. Despite the recent REITs would be one of the key beneficiaries of an economic reopening. In strength in its shares, we continue to believe that Simon is attractively the first six months of 2021, the REIT Index increased 21.24%, valued and offers attractive return potential. outperforming the S&P 500 Index, which gained 15.25%. Table V. We continue to believe now is an attractive time to invest in REITs. Top detractors from performance for the quarter ended June 30, 2021 1. Many REITs remain attractively valued. Quarter End Market Cap or We believe many REITs are reasonably valued versus stocks and cheap Market Cap When Sold Percent versus bonds and private real estate alternatives. (billions) Impact REITs relative to other equity alternatives Las Vegas Sands Corporation $40.3 –0.56% Penn National Gaming, Inc. 12.0 –0.45 Early in 2021, the REIT Index was priced at a discounted valuation Park Hotels & Resorts Inc. 4.9 –0.12 multiple relative to the S&P 500 Index for the first time since 2009. CyrusOne Inc. 8.9 –0.12 Since then, the valuation gap has narrowed. Today, the valuation GDS Holdings Limited 14.7 –0.09 multiple of the REIT Index approximates the multiple of the S&P 500 Index. The shares of Las Vegas Sands Corporation, a leading developer of luxury casino resorts in Macau and Singapore, declined in the most recent quarter In the past, there have been periods when REITs have been valued at a in large part due to COVID-19 travel-related restrictions. We believe the premium multiple to the S&P 500 Index due to long-term earnings shares are attractively valued and will recover sharply when travel growth potential coupled with lower annual earnings volatility, in large restrictions are lifted. part due to the documented nature of most REIT cash flows that are under contract or lease. Following a 239% gain in 2020, the shares of Penn National Gaming, Inc. declined 28% in the most recent quarter and are down 12% year-to-date. Today, even though the REIT Index is valued at a similar multiple to the At its recent price of only $73 (down from a peak price of $136 in March S&P 500 Index, we are continuing to identify several REITs that remain 2021), we believe Penn’s shares are now attractively valued. We believe the attractively valued relative to many equity alternatives. company’s 41 regional casinos are worth approximately $60 per share. Its As such, we believe the return potential of several REIT segments remaining Barstool media business and online sports betting and i-gaming remain attractive relative to many equity alternatives. businesses are currently valued at only $13 per share or less than 3.5 times our expectation for cash flow for these businesses in 2025. We hold CEO Jay REITS relative to bonds Snowden in high regard and believe he and his team have several levers to We continue to believe segments of commercial real estate will remain grow cash flow and create strong shareholder value in the next few years. an attractive surrogate for traditional fixed income investments given Following a 24% gain in its share price in the first quarter of 2021, the strong demand for income-producing assets and historically low global shares of Park Hotels & Resorts Inc., a premier hotel REIT, declined fixed income rates. modestly in the second quarter. We believe the company is well positioned REITs have historically been priced to deliver returns that exceed the for a recovery in travel and the shares are attractively valued at a steep yields on BBB-rated corporate bonds by approximately 170 basis discount to estimated replacement cost. points. According to data provided by Citi Research, REITs are currently In the most recent quarter, we exited the Fund’s investment in data center priced at a 260 basis point yield premium to BBB-rated corporate REIT CyrusOne Inc. and reallocated the capital to other REITs that we bonds. believe offer superior growth prospects. And so, REITs, in our opinion, are attractively valued versus bonds. Following exceptional share price performance in the last few years, the Public real estate, including REITS, relative to private market real estate shares of GDS Holdings Limited, the leading developer and operator of data centers in China, have been under pressure in the first six months of We believe there is a compelling arbitrage opportunity in the public 2021 and declined 3% in the most recent quarter. Concerns about increased real estate market relative to the private market. competition and pricing pressure and local macroeconomic and regulatory With last year’s sharp correction in several REITs and other real considerations have weighed on the shares. At its current discounted estate-related stocks, the valuations of recent private market real valuation of only 18 times 2022 estimated cash flow for 30% to 40% cash estate transactions indicate that it remains notably cheaper to buy flow growth, we believe these concerns have been largely reflected in the certain segments of real estate in the public market than in the company’s stock price. private market.

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2. We believe the multi-year business prospects for several REIT • Single-Family Rental REITs: Limited inventory combined with a categories are promising. strong desire by households to rent homes in suburbs rather than rent apartments in cities or purchase homes is leading to robust We have been busy meeting with REIT management teams (mostly rent growth for single-family rental REITs. through Zoom!) and conducting our ongoing research. We are encouraged by what we have learned. • Life Science REITs: An increase in funding for health care drug Business prospects are improving for several REIT categories that development is contributing to demand for life science buildings lagged in 2020 largely due to the Coronavirus headwind that led to a that continues to exceed supply. sharp slowdown in business activity–examples include hotels, • Manufactured Housing REITs: Demand for affordable housing apartments, office landlords, malls and shopping centers, health care, remains strong against a backdrop of limited supply. and gaming REITs. 3. Investor appetite for yield remains strong. Other REITs less impacted by COVID-19 are benefiting from tailwinds that should lead to ongoing strength in business fundamentals– As interest rates and bond yields remain at low levels, we believe the industrial warehouse REITs, data center and wireless tower REITs, search for income-producing securities will continue to stoke strong manufactured housing, single-family home rentals, cold storage investment interest in dividend-focused securities like REITs and yield- companies, and life sciences real estate REITs. oriented funds like REIT funds. Our summary observations for various REIT categories are as follows: The 3.0% dividend yield of the REIT Index far exceeds the 1.5% yield of the U.S. 10-year Treasury, the 1.4% yield of the S&P 500 Index, and • Apartment REITs: Occupancy and rents are improving and public numerous other income alternatives. valuations, in some cases, remain at discounts to recent private Also, we expect REIT dividends to be reinstated and grow and if cash market transactions. flows continue to improve in 2021. • Office REITs: A reopening of cities is leading to an uptick in leasing 4. Additional favorable REIT considerations. volumes. We believe most office REITs are currently valued at significant discounts to replacement cost. Contracted and improving cash flows • Industrial Warehouse REITs: The growth in online sales as We anticipate that the following should lead to improving cash flow businesses and consumers relentlessly seek faster delivery bodes growth in 2021: well for the continuation of excellent tenant demand for industrial • A recovery in operating fundamentals warehouse REITs. • Refinancing of debt at lower interest rates • Retail REITs: Tenant demand is improving, and we believe the • Acquisitions and development growth prospects for the largest mall REIT, Simon Property Stronger balance sheets than a decade ago Group, Inc., remains compelling. Many REITs have suitable levels of debt, high levels of liquidity, and minimal • Self-Storage REITs: Demand for self-storage real estate remains debt maturities in the next few years, which is in stark contrast to the real strong driven by strength in the housing market and increasing estate market heading into the Financial Crisis over 10 years ago. mobility. Elevated construction costs are constraining new construction. Historically low financing costs • Health Care REITs: Senior housing occupancy has bottomed, Interest rates are at historically low levels, which is unequivocally bullish for construction activity is modest, thereby setting the stage for more real estate. Low borrowing costs may lead to advantageous refinancing and favorable cash flow prospects. investment opportunities. • Hotel REITs: Leisure travel is accelerating, business travel is Modest level of new construction activity re-emerging (albeit slowly), and hotel REITs are currently valued New construction activity has not overheated due to increased construction at steep discounts to replacement cost. and labor costs. This serves to buttress real estate values. • Gaming REITs: Casino gaming business is strong in Las Vegas and For our additional thoughts on the outlook for REITs, please see “The most regional markets. We believe gaming REITs are attractively prospects for real estate and the Baron Real Estate Income Fund” later in valued relative to private market transactions. this letter. • Data Center REITs: Demand remains strong. The price paid by Blackstone for its recent $10 billion acquisition of data center OUR INVESTMENT THEMES AND PORTFOLIO CONSTRUCTION REIT, QTS Realty Trust Inc., implies that some data center REITs Investment Themes are attractively valued and could be take-out candidates. In the second half of 2020, we structured the Fund to take advantage of • Tower REITs: The long-term growth prospects for tower REITs three compelling themes and have maintained our positioning around these remain encouraging given strong secular growth expectations for themes in the first six months of 2021. As we peer into the second half of mobile data usage, 5G technology, and “connected homes and 2021, we believe it is premature to pivot away from these themes. Our cars,” which will require increased wireless bandwidth. current investing themes are:

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1. COVID-19 recovery beneficiaries On June 30, 2021, COVID-19 recovery beneficiary companies represented 42.8% of the Fund’s net assets. This investment theme encompasses what we call the “epicenter” REITs and non-REIT real estate companies of the 2020 pandemic. Table VI. Last year, certain REITs and other real estate-related businesses that COVID-19 recovery beneficiaries as of June 30, 2021 rely on the assembly of people were severely impacted by COVID-19 Percent of as they were forced to shut down all or a large part of operations Net Assets almost without exception. The share prices of many of these Office REITs 10.5% companies declined last year and remain well below peak prices. Hotel REITs 8.4 Casinos & Gaming Operators 7.9 Examples of COVID-19 recovery beneficiaries include the following real Real Estate Operating Companies 5.2 estate categories: Mall REITs 3.7 • Hotel REITs Hotel & Timeshare Operators 2.3 • Office REITs Apartment REITs 1.5 • Apartment REITs Health Care REITs 1.4 • Gaming REITs Other REITs 1.9 • Mall REITs Total 42.8% • Health Care REITs • Casinos & Gaming Operators • Real Estate Operating Companies 2. REITs that specialize in technology facilities and services Most of the real estate businesses that we are prioritizing are cyclically Several technology-related REITs performed well in 2020. We noted in depressed, but not secularly challenged. Consequently, we expect the our 2020 fourth quarter letter that valuations were generally less cash flows of many of these real estate businesses to rebound compelling than one year ago and the performance of the stocks may significantly as people become inoculated with COVID-19 vaccines and underperform in the near term relative to laggard REIT categories that normalized social and economic activity resumes. should benefit if economic growth accelerates in 2021. This has occurred in the first six months of 2021. Now, as then, we are bullish on the long-term prospects for several real estate technology companies. Despite a recent rebound in the share prices of many of the “COVID-19 recovery beneficiaries,” we believe several companies The impact of technology on real estate is undeniable. The growth in remain discounted to their two- to three-year prospective values. cloud computing, the internet, mobile data and cellphones, and Examples include: wireless infrastructure are powerful secular drivers that should continue unabated for years and are impacting real estate, along with many Hotel REITs: Pebblebrook Hotel Trust, Host Hotels & Resorts, Inc., other industries. and Park Hotels & Resorts Inc. If anything, the pandemic has accelerated these secular trends as more Office REITs: Douglas Emmett, Inc., Vornado Realty Trust, Boston people conduct business, leisure, residential, and commercial activities Properties, Inc., and Paramount Group, Inc. online. Apartment REITs: Equity Residential Real estate-related companies that embrace and adopt the latest Gaming REITs: MGM Growth Properties LLC and Gaming and Leisure technological advances and innovations remain an important focus for Properties, Inc. us. Key beneficiaries of the technology revolution include data center REITs, wireless tower REITs, and industrial REITs, among others. Mall REITs: Simon Property Group, Inc. Wireless Tower REITs: Our tower REITs (American Tower Corp., SBA Health Care REITs: Welltower Inc. Communications Corp., and Crown Castle International Corp.) are, Other REITs: STORE Capital Corporation and American Assets Trust, in our view, positioned to grow for several years as the demand for Inc. data intensive devices accelerates, and new wireless technologies continue to emerge and improve. Casinos & Gaming Operators: Red Rock Resorts, Inc., Las Vegas Sands Corporation, Wynn Resorts Ltd., and Penn National Gaming, New technological innovations and greater data demand require a Inc. greater number of antennae rental space that will continue to benefit tower companies. Like data centers, we expect wireless towers to Real Estate Operating Companies: Kennedy-Wilson Holdings, Inc. and continue to benefit from increased home-based consumer and Brookfield Infrastructure Partners L.P. commercial activity (online shopping, video streaming, and working from home).

104 June 30, 2021 Baron Real Estate Income Fund

Data Center REITs: Our data center REITs (Equinix, Inc. and CoreSite Triple Net REITs: Our gaming REITs (MGM Growth Properties LLC and Realty Corporation) are benefiting from the meteoric growth in the Gaming and Leisure Properties, Inc.) own quality casino and gaming outsourcing of information technology, increased cloud computing real estate properties. Both have attractive and well-covered dividends, adoption, and the growth in U.S. mobile data and internet traffic. accretive acquisition growth opportunities, and are, in our opinion, attractively valued. The rapid transition to a world of computer screen meetings and conferencing should also benefit data centers due to the need to store Manufactured Housing REITs: We expect our two premier a greater library of data to conduct and support these virtual online manufactured housing companies, Equity Lifestyle Properties, Inc. meetings. and Sun Communities, Inc., to continue to benefit from favorable Industrial REITs: We expect business conditions for the Fund’s industrial demand/supply dynamics. These companies are the prime beneficiaries REIT holdings (Prologis, Inc., Rexford Industrial Realty, Inc., Duke of strong demand from budget-conscious home buyers such as retirees Realty Corporation, and Terreno Realty Corporation) to remain and millennials. Demand for these homes is outstripping supply, in part strong for several years. due to high barriers of entry such as local governmental approvals. Both companies have superior prospects for long-term cash flow Each of these companies is expected to continue to benefit from robust growth, plus lower capital expenditure needs than most other REIT warehousedemandandincreasedrents.Thisisdue,inpart,tobroader categories. In the aftermath of the economic impact from the e-commerce needs resulting from the accelerated growth of online sales Coronavirus, we expect demand for both affordable housing and as businesses and consumers relentlessly seek faster delivery. recreational vehicles to accelerate. On June 30, 2021, REITs and non-REIT technology-related real estate Life Sciences REITs: Alexandria Real Estate Equities, Inc. is the leading companies that we expect to directly benefit from long-term owner, operator, and developer of collaborative life sciences office real technology growth currently represent 24.7% of the Fund’s net assets. estate campuses. We anticipate that additional life sciences office space may be required as more funding is directed towards drug Table VII. development and as pharmaceutical and biotechnology companies Technology-related real estate companies as of June 30, 2021 increase their budgets for research and development. Percent of Net Assets Cold Storage REITs: Americold Realty Trust is a leading owner, Wireless Tower REITs 8.1% operator, and developer of temperature-controlled warehouses with Data Center REITs 7.2 the largest portfolio globally. We believe the company is well Industrial REITs 6.9 positioned to deliver superior growth versus most REITs because of its Non-REIT Technology-Related Real Estate Companies 2.5 ability to improve occupancy and rents in its current portfolio, exploit and develop its own real estate pipeline, and to acquire additional Total 24.7% temperature-controlled warehouses. Americold is also poised to benefit 3. Niche REITs from an acceleration in e-grocery penetration as grocery stores recognize the increased need for additional automated cold storage The Fund continues to see opportunities in some unconventional or facilities to streamline inventory replenishment, largely resulting from niche REITs that we believe have the potential to grow faster than the rapid increase in consumer food delivery. several traditional or mainstream REITs such as malls, shopping centers, offices, apartments, and self-storage REITs. On June 30, 2021, niche REITs represented 24.9% of the Fund’s net assets. We believe some niche REITs may benefit from their outsized exposure to secular demand trends and/or reduced exposure to cyclical Table VIII. weaknesses such as elevated construction activity and excess supply Niche REITs as of June 30, 2021 witnessed in some traditional REITs. Percent of Niche REITs that we favor include: Net Assets Single-Family Rental REITs 8.7% Single-Family Rental REITs: We are bullish on the prospects for our Triple Net REITs 4.7 investments in the single-family rental REIT category (Invitation Manufactured Housing REITs 4.7 Homes, Inc. and American Homes 4 Rent) because we believe the Life Sciences REITs 2.5 demand outlook for single-family home rentals should continue to Cold Storage REITs 1.8 outstrip supply, thereby creating a favorable backdrop for strong rent Other REITs 2.5 and cash flow growth. We expect this niche REIT category to continue to benefit from the current preference for flexibility that comes with Total 24.9% renting, home ownership affordability issues, high student debt burdens, and the possibility that, in the aftermath of the pandemic, more people may opt for single-family rentals rather than multi-family dwellings.

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Baron Real Estate Income Fund currently has investments in several REIT what we anticipate will be a multi-year recovery. In our opinion, categories and non-REIT real estate companies. Our percentage allocations several ingredients are in place that will serve as tailwinds and to these categories are based on our research and assessment of contribute to an improvement in business performance for a large opportunities in each category on a bottom-up basis (see Table IX below). segment of both commercial and residential real estate in the next few years. A sampling of the ingredients includes improving prospects for Table IX. demand, modest levels of commercial construction activity, strong and Fund investments in REIT categories as of June 30, 2021 liquid balance sheets, and well-functioning credit markets with Percent of historically low interest rates. Net Assets Non-REIT Real Estate Companies 17.9% 4. Substantial private capital is still in pursuit of real estate Office REITs 10.5 ownership supported by widely available debt capital at low Single-Family Rental REITs 8.7 interest rates. Hotel REITs 8.4 Other REITs 8.3 It is estimated that approximately $344 billion of capital has now Wireless Tower REITs 8.0 been raised by private equity sources to invest in real estate, which Data Center REITs 7.2 equates to approximately $1.1 trillion of total real estate purchasing Industrial REITs 6.9 capacity, assuming typical 70% debt financing! We anticipate that Triple Net REITs 5.1 large amounts of capital from private equity investors such as Manufactured Housing REITs 4.7 Blackstone and Brookfield Asset Management, sovereign wealth funds, Mall REITs 3.7 endowments, pension funds, and others will continue to step in and Self-Storage REITs 3.2 capitalize on the opportunity to buy quality public real estate given the Unclassified 1.6 compelling valuation arbitrage in the public real estate market relative Multi-Family REITs 1.5 to the private market. This “embedded put” should limit downside Health Care REITs 1.5 valuation and pricing. We continue to believe that real estate merger Cash and Cash Equivalents 2.8 and acquisition activity will remain strong. Total 100.0% 5. We continue to identify several real estate companies that remain “on sale” and are attractively valued. THE PROSPECTS FOR REAL ESTATE AND THE BARON REAL ESTATE INCOME FUND The Fund took advantage of the major buying opportunities that were We continue to believe the near-term and long-term prospects for public created in 2020 following the swift and intense stock market real estate remain attractive. correction. Though many stock prices have recovered, valuations for many of our current or prospective REIT and real estate-related Near-term case for real estate investments remain reasonable and, in some cases, particularly 1. Demand continues to outstrip supply. attractive. A generally favorable relationship between demand and supply bodes Long-term case for real estate well for real estate. For the demand outlook, commercial occupancy and We believe the long-term case for public real estate is compelling. rents and residential homes for rent are, in most cases, improving against a backdrop of modest inventory levels. For the supply outlook, 1. Solid historical long-term returns with ongoing potential commercial real estate construction activity and inventory levels remain modest due, in part, to elevated construction costs and labor shortages. For the 20-year period ended June 30, 2021, U.S. equity REITs have delivered higher cumulative returns than the S&P 500 Index, fixed 2. Business conditions are improving for most of our real estate income alternatives, international equities, and commodities. companies–both commercial and residential real estate. Since inception on December 29, 2017 through June 30, 2021, the The performance of several real estate companies lagged in 2020 largely Baron Real Estate Income Fund, which owns REITs and non-REIT real due to the Coronavirus headwind that led to a sharp slowdown in business estate companies, has delivered a cumulative return of 73.30%, far activity for hotels, real estate casinos, urban apartment and office outdistancing the 29.60% return of the REIT Index. landlords, malls and shopping centers, and other real estate categories. The inability to assemble people and businesses disproportionately As mentioned in several instances in this letter, we remain optimistic weighed on a large segment of the real estate sector. Last year’s real about the potential for real estate to continue to generate solid long- estate headwinds have begun to recede, and we expect this trend to term absolute and relative performance. continue in the months ahead. We anticipate that portions of real estate will continue to be key beneficiaries of an economic reopening. 2. Diversification and low correlation to equities and bonds 3. The real estate cycle has reset, and we believe the multi-year According to FactSet, over the last 20 years (through 6/30/2021), REITs outlook is attractive. have provided diversification benefits due to their modest correlation to stocks (0.67 versus S&P 500 Index) and low correlation to bonds Following the sharp decline in global economic activity in 2020, we (0.21 versus Bloomberg Barclays U.S. Aggregate Index). believe the U.S. real estate cycle has reset and is in the early stages of

106 June 30, 2021 Baron Real Estate Income Fund

3. Inflation protection The valuations for a portion of the Fund’s real estate companies remain “on sale” at appealing prices. Historically, certain real estate businesses have had the ability to raise prices to provide inflation protection: • Classic REIT attributes such as yield will remain in demand. • Inflation-linked property value: Higher prices for labor, land, and We expect investors to continue to search for yield in a low interest materials may constrain new real estate construction activity rate environment, and this should aid REITs, and other dividend- thereby supporting higher occupancies and the ability for yielding real estate companies. landlords to raise rents. Table X. • Pricing power: Property owners in supply-constrained areas are Top 10 holdings as of June 30, 2021 often able to pass along higher operating costs by raising rents in Quarter End periods of rising inflation. Quarter End Investment Market Cap Value Percent of • Short lease duration: Real estate segments with short lease terms (billions) (millions) Net Assets could raise rents relatively quickly to offset inflation. Examples Invitation Homes, Inc. $ 21.2 $4.2 5.7% include hotels (1 day), self-storage real estate (30 days), American Tower Corp. 122.8 3.7 5.1 apartments (1 year), single-family rental homes (1 year), and Simon Property Group, Inc. 42.9 2.7 3.7 senior housing facilities (1 year). Equinix, Inc. 71.9 2.7 3.6 • Annual rent escalators: Certain real estate leases have contractual CoreSite Realty Corporation 6.6 2.7 3.6 annual rent escalators, in some cases tied to an inflation index Brookfield Infrastructure such as the Consumer Price Index. Partners L.P. 23.2 2.6 3.6 Vornado Realty Trust 8.9 2.6 3.5 We remain optimistic about the prospects for Baron Real Estate Income Prologis, Inc. 88.4 2.6 3.5 Fund. Public Storage Incorporated 52.6 2.3 3.2 • The Fund is composed of quality companies. Pebblebrook Hotel Trust 3.1 2.2 3.1 We have meticulously assembled a portfolio of REITs and non-REIT real Thank you for your past and continuing support. estate companies that we believe should provide strong risk-adjusted Of course, I proudly continue as a major shareholder of the Baron Real returns. Estate Income Fund, alongside you. The businesses that we own are well managed, have market-leading positions, possess quality balance sheets, own well-located real estate, Sincerely, and grow cash flow at faster rates than most of their peers. The businesses that we tend to emphasize also have unique competitive advantages, deliver compelling acquisition and development returns, and operate relatively capital efficient business models. • The Fund is structured to capitalize on compelling investment themes (as described earlier in this letter). Jeffrey Kolitch • Valuations for several REITs and non-REIT real estate segments remain Portfolio Manager compelling. June 30, 2021

Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectus contain this and other information about the Funds. You may obtain them from its distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing. Risks: In addition to general market conditions, the value of the Fund will be affected by the strength of the real estate markets as well as by interest rate fluctuations, credit risk, environmental issues and economic conditions. The Fund invests in companies of all sizes, including small and medium sized companies whose securities may be thinly traded and more difficult to sell during market downturns. Prices of equity securities may decline significantly over short or extended period. Debt or fixed income securities such as those held by the Fund, are also subject to derivatives risk, liquidity risk, and income risk. As interest rates rise, bond prices fall. The Fund may not achieve its objectives. Portfolio holdings are subject to change. Current and future portfolio holdings are subject to risk. The portfolio manager defines “Best-in-class” as well-managed, competitively advantaged, faster growing companies with higher margins and returns on invested capital and lower leverage that are leaders in their respective markets. Note that this statement represents the manager’s opinion and is not based on a third-party ranking. Discussions of the companies herein are not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed in this report reflect those of the respective portfolio managers only through the end of the period stated in this report. The portfolio manager’s views are not intended as recommendations or investment advice to any person reading this report and are subject to change at any time based on market and other conditions and Baron has no obligation to update them. This report does not constitute an offer to sell or a solicitation of any offer to buy securities of Baron Real Estate Income Fund by anyone in any jurisdiction where it would be unlawful under the laws of that jurisdiction to make such an offer or solicitation. BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a limited purpose broker-dealer registered with the SEC and member of the Financial Industry Regulatory Authority, Inc. (FINRA).

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Dear Baron WealthBuilder Fund Shareholder: PERFORMANCE

Baron WealthBuilder Fund (the “Fund”) increased 8.02% (Institutional Shares) in the quarter while the S&P 500 Index (the “Index”) rose 8.55%. The MSCI ACWI Index and the Morningstar Allocation 85%+ Equity Category (the “Peer Group”) Average rose 7.39% and 6.75%, respectively.

Table I. Performance Annualized for periods ended June 30, 2021 Baron Baron Wealth Wealth Baron Builder Builder Wealth Fund Fund Builder S&P MSCI Retail Institutional Fund TA 500 ACWI Shares1,2 Shares1,2 Shares1,2 Index1 Index1 Three Months3 7.98% 8.02% 8.07% 8.55% 7.39% Six Months3 9.25% 9.39% 9.39% 15.25% 12.30% One Year 60.90% 61.32% 61.20% 40.79% 39.26% MICHAEL BARON RONALD BARON Retail Shares: BWBFX Three Years 28.12% 28.45% 28.45% 18.67% 14.57% CO- PORTFOLIO CEO AND PORTFOLIO Institutional Shares: BWBIX Since Inception MANAGER MANAGER TA Shares: BWBTX (December 29, 2017) 26.22% 26.49% 26.49% 16.67% 12.22%

The Fund’s trailing 12-month absolute and relative performance has been quite strong. Over that period, the Fund advanced 61.32%. This result Since its inception, Baron WealthBuilder Fund has an annualized return of compares favorably to its benchmarks and Peer Group. The Index and MSCI 26.49%. The Fund ranks as the #1 fund in its Peer Group since its inception. ACWI Index gained 40.79% and 39.26%, respectively. The Peer Group rose 40.77% over this period.

As of 6/30/2021, the Morningstar Allocation – 85%+ Equity Category consisted of 159, 149, and 149 share classes for the 1-year, 3-year, and since inception (12/29/2017) periods. Morningstar ranked Baron WealthBuilder Fund Institutional Share Class in the 3rd,1st, and 1st percentiles, respectively. On an absolute basis, Morningstar ranked Baron WealthBuilder Fund Institutional Share Class as the 5th,2nd, and 1st best performing share class in its category for the 1-year, 3-year, and since inception (12/29/2017) periods, respectively. As of 6/30/2021, the annualized returns of the Morningstar Allocation – 85%+ Equity Category Average were 40.77%, 13.59%, and 11.23% for the 1-year, 3-year, and since inception (12/29/2017) periods, respectively. Morningstar calculates the Morningstar Allocation – 85%+ Equity Category Average performance and rankings using its Fractional Weighting methodology. Morningstar rankings are based on total returns and do not include sales charges. Total returns account for management, administrative, and 12b-1 fees and other costs automatically deducted from fund assets. © 2021 Morningstar. All Rights Reserved. The Morningstar information contained herein: (1) is proprietary to Morningstar and/or its content providers; (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.

Performance listed in the above table is net of annual operating expenses. Annual expense ratio for the Retail Shares, Institutional Shares, and TA Shares as of December 31, 2020 was 1.47%, 1.22%, and 1.22%, respectively, but the net annual expense ratio was 1.36%, 1.11%, and 1.11% (includes acquired fund fees of 1.06%, net of the Adviser’s fee waivers), respectively. The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original cost. BAMCO, Inc. (‘BAMCO” or the “Adviser”) has agreed that, pursuant to a contract expiring on August 29, 2031, unless renewed for another 11-year term, it will reimburse certain expenses of the Fund, limiting net annual operating expenses (portfolio transaction costs, interest, dividend, acquired fund fees and expenses and extraordinary expenses are not subject to the operating expense limitation) to 0.30% of average daily nest assets of Retail Shares, 0.05% of average daily net assets of Institutional Shares and 0.05% of average daily net assets of TA Shares, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted. For performance information current to the most recent month end, visit www.BaronFunds.com or call 1-800-99BARON. 1 The S&P 500 Index measures the performance of 500 widely held large cap U.S. companies. The MSCI ACWI Index is an unmanaged, free float- adjusted market capitalization weighted index reflected in US dollars that measures the equity market performance of large- and mid-cap securities across developed and emerging markets. MSCI is the source and owner of the trademarks, service marks and copyrights related to the MSCI Indexes. The indexes and the Fund include reinvestment of dividends, net of withholding taxes, which positively impact the performance results. The indexes are unmanaged. Index performance is not Fund performance; one cannot invest directly into an index. 2 The performance data in the table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. BARON FUNDS 3 Not annualized.

108 June 30, 2021 Baron WealthBuilder Fund

COVID-19 vaccination rates steadily improved throughout the quarter. cyclical companies. Additionally, investments in economically impacted Industries are returning to pre-pandemic operations, while investors sectors and regions also had more challenged returns. Further, stocks with continue to assess global economic and health data points and extrapolate any short-term disappointment significantly underperformed. As cyclical their implications. This has created a volatile environment for the markets stocks gained interest, the non-diversified and high-growth portfolios of and the Fund. While the Fund’s absolute return for the three-month period Baron Partners and Focused Growth Funds were negatively impacted. And was good, it was not consistent month to month. The Fund’s April return our holdings in real estate and emerging markets were affected by macro was up 6.17%. In May, the Fund declined 2.50%. In June, it rose 4.36%. Yet events and fears of COVID variants. Penn National Gaming, Inc.,aregional the fundamentals and prospects of the Fund’s investments changed little casino operator, is a good example of one of those businesses. The stock from month to month. We do not try to predict macroeconomic declined approximately 27% in the second quarter due to increased occurrences or their near-term impact on market valuations. Rather, we competition for sports betting and i-gaming in key markets. Last year, Penn continually assess the health and prospects of our investments. was up 238%. However, we have been impressed with Penn’s market share despite limited traditional advertising. Its equity stake in Barstool should In this volatile environment, portfolios with companies that exhibited continue to attract loyal customers to its platform and into their properties. sustained growth contributed the most to Baron WealthBuilder’s We believe it can also build a lucrative license business from other operators. performance. It includes our mid- and large-cap funds, Baron Asset, Fifth This branding and license access cannot easily be replicated by competitors. Avenue Growth, Durable Advantage, and Global Advantage Funds, as well as our specialty sector funds, Baron FinTech and Health Care Funds. These The Fund’s large stake in small-cap growth Baron funds also resulted in underlying funds’ investments in Information Technology (“IT”), Health lower relative returns than the S&P 500 Index. However, all three of these Care, and Financials were largely able to execute their business plans despite underlying funds, Baron Discovery, Small Cap, and Growth Funds, had the interruptions caused by the economic restart. Supply chain issues and returns that exceeded their respective benchmark, the Russell 2000 Growth employment concerns largely did not impact these operations. A few Index. These underlying funds own higher-quality businesses than typically examples are Health Care business West Pharmaceutical Services, Inc. and found in their benchmark. The businesses in which Baron Funds invested outsourced software development firms Endava plc and EPAM Systems, achieved sustained growth in a volatile environment while many of their Inc. West is a leading provider of components and systems for the counterparts had not. Gartner, Inc. and IDEXX Laboratories, Inc. are good packaging and delivery of injectable drugs. The company’s impressive 31% examples. Both companies’ stocks appreciated approximately 30% in the organic growth rate was driven by increased sales of products used in quarter. Gartner’s high-margin research business had accelerating growth. COVID-19 vaccine packaging. We believe this usage will be sustained as Its retention of clients also improved. And its necessary pivot to digital greater drug discovery will utilize its high-value packaging products. conferences spurred by the pandemic has resulted in improved profitability. Additionally, Endava and EPAM have both had an increase in usage as clients The company provided a favorable outlook and reinforced that optimism prioritize their digital initiatives. Utilizing software to interact and engage through the repurchase of its stock. Likewise, IDEXX is benefiting from a with customers is essential for today’s businesses, but most organizations do return of veterinary visits. This favorable backdrop allows its enhanced sales not have the internal expertise to accomplish their needs. Market leaders team to sell its new proprietary innovations. Some aspects of the business Endava and EPAM are growing in the high 20% range with top-tier clients are already at pre-pandemic levels. Improved volume and growth in (examples are UBS, Mercedes, and Expedia) while still only attaining a consumables led to improved margins. And again, the company used its single-digit market share of this $150 billion category. We believe they cash flow to repurchase its own shares. should have sustained growth while maintaining strong margins. We encourage you to read the various quarterly letters found in this report On the other hand, portfolios that held disruptive growth businesses, which for a deeper understanding of the funds that make up Baron WealthBuilder had outperformed last year, were impacted by a market rotation towards Fund.

109 Baron WealthBuilder Fund

Table II. Baron Funds Performance as of June 30, 2021 Institutional Share Class Data

Annualized Annualized % of Net Assets Second Quarter 12/29/17 to Second Quarter 12/29/17 to of Fund of 2021* 6/30/2021 Primary Benchmark of 2021* 6/30/2021 29.4% Small Cap 4.5% Baron Discovery Fund 6.07% 28.69% Russell 2000 Growth Index 3.92% 16.56% 12.8% Baron Growth Fund 7.80% 21.55% 12.1% Baron Small Cap Fund 6.37% 20.56% 4.0% Small/Mid Cap 4.0% Baron Focused Growth Fund 2.42% 38.13% Russell 2500 Growth Index 6.04% 19.65% 13.0% Mid Cap 13.0% Baron Asset Fund 10.03% 22.00% Russell Midcap Growth Index 11.07% 20.71% 8.0% Large Cap 6.3% Baron Fifth Avenue Growth Fund 13.82% 26.86% Russell 1000 Growth Index 11.93% 23.65% 1.7% Baron Durable Advantage Fund 13.14% 18.00%† S&P 500 Index 8.55% 16.44%† 21.0% All Cap 6.2% Baron Opportunity Fund 10.14% 39.47% Russell 3000 Growth Index 11.38% 23.14% 14.8% Baron Partners Fund 4.83% 45.52% Russell Midcap Growth Index 11.07% 20.71% 13.3% International 4.1% Baron Emerging Markets Fund 4.83% 8.03% MSCI EM Index 5.05% 7.45% 6.8% Baron Global Advantage Fund 11.91% 32.20%† MSCI ACWI Index 7.39% 11.38%† 2.4% Baron International Growth Fund 8.51% 13.29% MSCI ACWI ex USA Index 5.48% 6.81% 11.3% Specialty 4.7% Baron Real Estate Fund 4.65% 19.92% MSCI USA IMI Extended Real Estate Index 6.99% 11.29% 1.5% Baron Real Estate Income Fund 4.36%† 4.36%*† MSCI US REIT Index 5.31%† 5.31%*† 2.8% Baron Health Care Fund 11.43% 29.14%† Russell 3000 Health Care Index 8.16% 15.93%† 2.3% Baron FinTech Fund 16.79% 47.55%† S&P 500 Index 8.55% 33.71%†

* Not annualized. † Performance is calculated from the time the Fund was added to Baron WealthBuilder Fund: Baron Durable Advantage Fund – 3/13/2018; Baron Global Advantage Fund – 1/9/2018; Baron Health Care Fund – 10/18/2018; Baron FinTech Fund – 2/27/2020; and Baron Real Estate Income Fund – 5/17/2021. An investor cannot invest directly in an index. The indexes are unmanaged. The index performance is not Fund performance; one cannot invest directly into an index.

Fund of Funds Structure and Investment Strategy Combining all our portfolios into one fund has not only produced category leading returns, but it also has generated since inception Table IV. performance characteristics that we believe are stellar. Compared to the Performance Based Characteristics Since Inception (12/29/2017) as of June 30, Index, the Fund’s alpha is 5.99%, yet its beta is only 1.20. Its Sharpe ratio, a 2021 measure of return per level of risk, is 1.10 compared to the Index’s 0.87. And Baron Morningstar we believe its upside capture of 121.93% is even more impressive when WealthBuilder Allocation 85%+ viewed alongside its downside capture of only 93.92%. Fund-Institutional S&P Equity Shares 500 Index Category Baron WealthBuilder Fund closely mimics the way we would incrementally Alpha (%) – Annualized 5.99 0.00 –4.11 invest across our various funds and strategies. The Fund allows investors to Beta 1.20 1.00 0.96 diversify across all Baron Funds’ products, gain exposure to various market Sharpe Ratio 1.10 0.87 0.57 caps, sectors, and geographies in a single structure, and benefit from our Standard Deviation (%) rebalancing of the allocations in a tax efficient manner. The portfolio – Annualized 22.95 17.65 17.32 managers of each underlying fund abide by the same core investment Upside Capture (%) 121.93 100.00 84.72 process and philosophy, focused on proprietary research to discover Downside Capture (%) 93.92 100.00 99.22 competitively advantaged businesses with immense opportunities. These Source: FactSet SPAR. Except for Standard Deviation and Sharpe Ratio, the performance businesses are led by smart and honorable executives. based characteristics above were calculated relative to the S&P 500 Index.

110 June 30, 2021 Baron WealthBuilder Fund

Baron Funds has had broad historical success. Our investment approach and We believe the portfolio allocation of the underlying Baron Funds, their process have yielded outstanding results since the Firm’s founding in 1982. exposure to various industries, and their geographic diversification should As of 6/30/2021, 16 of 17 Baron Funds, representing 98.2% of Baron Funds’ continue to produce good returns over the long term. assets under management (“AUM”), have outperformed their respective passive benchmarks since their inceptions. In addition, 14 of those funds, Table V. representing 98.0% of Baron Funds’ AUM, rank in the top 17% of their Sector exposures as of June 30, 2021 respective Morningstar categories; and 11 funds, representing 71.8% of Percent AUM, rank in the top 8%. of Net S&P MSCI Assets 500 Index ACWI Index This strong relative performance has continued. Since their inclusion in Baron Information Technology 23.3% 27.4% 21.9% WealthBuilder Fund, all but one underlying Baron mutual fund have exceeded Consumer Discretionary 21.3 12.3 12.7 their respective benchmark indexes. And that only outlier, Baron Real Estate Health Care 16.6 13.0 11.6 Income Fund, was added to the Fund in the second quarter of 2021 because Industrials 10.7 8.5 9.9 of investment opportunities in the segment. We have always strived to Financials 10.7 11.3 14.1 provide top performance in various asset categories. Baron WealthBuilder Communication Services 7.9 11.1 9.4 Fund allows individuals to gain access to a variety of these strategies in Real Estate 5.7 2.6 2.6 asinglefund.We are pleased with the composition and results. Materials 1.4 2.6 4.9 Consumer Staples 0.7 5.9 6.9 The makeup of the underlying investments looks very different than the Unclassified 0.5 – – Fund’s key indexes. Therefore, the Fund has a high active share when Energy 0.3 2.9 3.4 measured against its benchmarks. We feel the diversity in regions and Utilities – 2.5 2.6 sectors should dampen risk while still providing strong absolute returns. While holding nearly the same number of securities as its primary Table VI. benchmark (510 in the underlying funds vs. 502 in the Index), the Country exposures as of June 30, 2021 similarities end there. The holdings in the underlying funds have a lower Percent dividend yield on average (0.4% vs. 1.4% for the Index), with companies of Net S&P MSCI electing to reinvest earnings back in their businesses for growth. And the Assets 500 Index ACWI Index approach is working; the projected earnings per share growth rate over United States 82.7% 100.0% 58.6% the next three to five years is 26.7% for the Funds’ holdings vs. 17.3% China 3.4 – 4.9 for the S&P 500 Index (or 54.3% higher growth). We think that many of United Kingdom 2.2 – 3.7 our investments can exceed those external projections. Many of these Netherlands 1.6 – 1.1 businesses have depressed margins as they sacrifice current profitability for Israel 1.4 – 0.2 more sustainable and higher long-term growth rates. We believe higher and Canada 1.3 – 2.9 prolonged growth should reward long-term investors. India 1.3 – 1.3 Brazil 0.7 – 0.7 The portfolio is also distinct in its industry weightings. The Index has a Sweden 0.5 – 1.0 higher share of companies in industries that we believe have lower growth Argentina 0.5 – 0.1 and fewer defensible advantages. The Index has a greater weight in Other 3.5 – 25.7 technology hardware storage & peripherals, semiconductors & semiconductor equipment, and banks. Instead, the Fund favors other Table VII. segments within IT and Financials, such as IT services, software, and capital Fund of fund holdings as of June 30, 2021 markets. The Fund is also overweight Health Care, and hotels, restaurants & Percent leisure, and automobiles within Consumer Discretionary. We believe these of Net sectors and industries have greater growth and their advantages can be Assets maintained over the long term. Baron Partners Fund 14.8% Baron Asset Fund 13.0 Finally, the Fund has exposure to non-U.S. companies unlike the Index, Baron Growth Fund 12.8 whose constituents are solely in domestic businesses. We believe geographic Baron Small Cap Fund 12.1 diversity provides benefits, such as lower volatility over time. The Fund is Baron Global Advantage Fund 6.8 also differentiated from the global coverage of the MSCI ACWI Index. The Baron Fifth Avenue Growth Fund 6.3 U.S. is 58.6% of the MSCI ACWI Index compared to 82.7% for the Fund. The Baron Opportunity Fund 6.2 greater international exposure for the MSCI ACWI Index is heavily skewed Baron Real Estate Fund 4.7 towards slow growth developed countries, whereas the Fund seeks faster Baron Discovery Fund 4.5 growth in emerging economies. Of WealthBuilder Fund’s non-U.S. exposure, Baron Emerging Markets Fund 4.1 43.9% was in emerging countries. These regions represented 31.5% of the Baron Focused Growth Fund 4.0 MSCI ACWI Index’s non-US investments. However, the MSCI ACWI Index Baron Health Care Fund 2.8 had larger exposure to lower growth economies like Japan and France. Of its Baron International Growth Fund 2.4 non-U.S. investments, Japan and France represented 14.3% and 7.1% of the Baron FinTech Fund 2.3 MSCI ACWI Index while they represented only 1.7% and 1.2% for the Fund, Baron Durable Advantage Fund 1.7 respectively. Baron Real Estate Income Fund 1.5

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Thank you for joining us as fellow shareholders in Baron WealthBuilder Fund. Respectfully, We continue to work hard to justify your confidence and trust in our stewardship of your hard-earned savings. We remain dedicated to provide you with the information we would like to have if our roles were reversed. We hope this letter enables you to make an informed decision about whether this Fund remains an appropriate investment. Ronald Baron Michael Baron CEO and Portfolio Manager Co-Portfolio Manager June 30, 2021 June 30, 2021

Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectus contain this and other information about the Funds. You may obtain them from its distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing. Risks: The Fund is a non-diversified fund because it invests, at any given time, in the securities of a select number of Baron mutual funds (the “Underlying Funds”), representing specific investment strategies. The Fund can invest in funds holding U.S. and international stocks; small-cap, small to mid-cap, large-cap, all-cap stocks; and specialty stocks. Each of the Underlying Funds has its own investment risks, and those risks can affect the value of the Fund’s investments and therefore the value of the Fund’s shares. To the extent that the Fund invests more of its assets in one Underlying Fund than in another, it will have greater exposure to the risks of that Underlying Fund. For further information regarding the investment risks of the Underlying Funds, please refer to the Underlying Funds’ prospectus. Active Share: a term used to describe the share of a portfolio’s holdings that differ from that portfolio’s benchmark index. It is calculated by comparing the weight of each holding in the Fund to that holding’s weight in the benchmark. Positions with either a positive or negative weighting versus the benchmark have Active Share. An Active Share of 100% implies zero overlap with the benchmark. Active Share was introduced in 2006 in a study by Yale academics, M. Cremers and A. Petajisto, as a measure of active portfolio management. Alpha measures the difference between a fund’s actual returns and its expected performance, given its level of risk as measured by beta. Beta measures a fund’s sensitivity to market movements. The beta of the market is 1.00 by definition. EPS Growth Rate (3-5-year forecast) indicates the long term forecasted EPS growth of the companies in the portfolio, calculated using the weighted average of the available 3-to-5 year forecasted growth rates for each of the stocks in the portfolio provided by FactSet Estimates. The EPS Growth rate does not forecast the Fund’s performance. Price/Earnings Ratio (trailing 12-months): is a valuation ratio of a company’s current share price compared to its actual earnings per share over the last twelve months. If a company’s actual EPS is negative, it is excluded from the portfolio level calculation. Sharpe Ratio is a risk-adjusted performance statistic that measures reward per unit of risk. The higher the Sharpe ratio, the better a fund’s risk adjusted performance. Upside Capture explains how well a fund performs in time periods where the benchmark’s returns are greater than zero. Downside Capture measures how well a fund performs in time periods where the benchmark’s returns are less than zero. Standard Deviation (Std. Dev) measures the degree to which a fund’s performance has varied from its average performance over a particular time period. The greater the standard deviation, the greater a fund’s volatility (risk). The discussions of the companies herein are not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed in this report reflect those of the respective portfolio managers only through the end of the period stated in this report. The portfolio manager’s views are not intended as recommendations or investment advice to any person reading this report and are subject to change at any time based on market and other conditions and Baron has no obligation to update them. This report does not constitute an offer to sell or a solicitation of any offer to buy securities of Baron WealthBuilder Fund by anyone in any jurisdiction where it would be unlawful under the laws of that jurisdiction to make such offer or solicitation. Ranking information provided is calculated for the Retail Share Class and is as of 6/30/2021. The number of share classes in each category may vary depending on the date that Baron downloaded information from Morningstar Direct. Morningstar calculates its category average performance and rankings using its Fractional Weighting methodology. Morningstar rankings are based on total returns and do not include sales charges. Total returns account for management, administrative, and 12b-1 fees and other costs automatically deducted from fund assets. The Morningstar Large Growth Category consisted of 1,239, 1,024, and 761 share classes for the 1-, 5-, and 10-year periods. Morningstar ranked Baron Opportunity Fund in the 2nd, 3rd, 9th, and 3rd percentiles for the 1-, 5-, 10-year, and since inception periods, respectively. The Fund launched 2/29/2000, and the category consisted of 269 share classes. Morningstar ranked Baron Partners Fund in the 1st, 2nd, 1st, and 1st percentiles for the 1-, 5-, 10-year, and since conversion periods, respectively. The Fund converted into a mutual Fund 4/30/2003, and the category consisted of 422 share classes. The Morningstar Mid-Cap Growth Category consisted of 579, 489, and 379 share classes for the 1-, 5-, and 10-year periods. Morningstar ranked Baron Asset Fund in the 93rd, 28th, 20th and 17th percentiles for the 1-, 5-, 10-year, and since inception periods, respectively. The Fund launched 6/12/1987, and the category consisted of 19 share classes. Morningstar ranked Baron Growth Fund in the 47th, 35th, 40th, and 8th percentiles for the 1-, 5-, 10-year, and since inception periods, respectively. The Fund launched 12/31/1994, and the category consisted of 54 share classes. Morningstar ranked Baron Focused Growth Fund in the 3rd, 2nd, 3rd, and 5th percentiles for the 1-, 5-, 10-year, and since conversion periods, respectively. The Fund converted into a mutual Fund 6/30/2008, and the category consisted of 316 share classes. The Morningstar Small Growth Category consisted of 612, 505, and 379 share classes for the 1-, 5-, and 10-year time periods. Morningstar ranked Baron Small Cap Fund in the 74th, 42nd, 50th, and 17th percentiles for the 1-, 5-, 10-year, and since inception periods, respectively. The Fund launched 9/30/1997, and the category consisted of 92 share classes. Morningstar ranked Baron Discovery Fund in the 14th, 6th, and 2nd percentiles for the 1-, 5-year, and since inception periods, respectively. The Fund launched 9/30/2013, and the category consisted of 432 share classes. The Morningstar Real Estate Category consisted of 246, 199, and 143 share classes for the 1-, 5-, and 10-year time periods. Morningstar ranked Baron Real Estate Fund in the 2nd, 1st, 1st, and 1st percentiles for the 1-, 5-, 10-year, and since inception periods, respectively. The Fund launched 12/31/2009, and the category consisted of 128 share classes. Morningstar ranked Baron Real Estate Income Fund in the 11th and 3rd percentiles for the 1-year and since inception periods, respectively. The Fund launched 12/29/2017, and the category consisted of 221 share classes. The Morningstar Foreign Large Growth Category consisted of 445, 323, 225, and 202 share classes for the 1-, 5-, 10-year, and since inception (12/31/2008) periods. Morningstar ranked Baron International Growth Fund in the 10th, 16th, 19th, and 11th percentiles, respectively. The

112 June 30, 2021 Baron WealthBuilder Fund

Morningstar Diversified Emerging Markets Category consisted of 789, 602, 306, and 280 share classes for the 1-, 5-, 10-year, and since inception (12/31/2010) periods. Morningstar ranked Baron Emerging Markets Fund in the 47th, 45th, 5th, and 7th percentiles, respectively. The Morningstar World Large-Stock Growth Category consisted of 352, 263, and 175 share classes for the 1-, 5-year, and since inception (4/30/2012) periods. Morningstar ranked Baron Global Advantage Fund in the 16th, 2nd, and 1st percentiles, respectively. The Morningstar Health Category consisted of 163 and 138 share classes for the 1-year and since inception (4/30/2018) periods. Morningstar ranked Baron Health Care Fund in the 10th and 5th percentiles, respectively. The Morningstar Allocation – 85%+ Equity Category consisted of 159 and 149 share classes for the 1-year and since inception (12/29/2017) periods. Morningstar ranked Baron WealthBuilder Fund in the 4th and 2nd percentiles, respectively. © 2021 Morningstar. All Rights Reserved. The Morningstar information contained herein: (1) is proprietary to Morningstar and/or its content providers; (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. Risk: All investments are subject to risk and may lose value. Index performance is not fund performance; one cannot invest directly into an index. BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a limited purpose broker-dealer registered with the SEC and member of the Financial Industry Regulatory Authority, Inc. (FINRA).

Baron Funds (Institutional Shares) and Benchmark Performance 6/30/2021

Annualized Annualized Benchmark Return Since Return Since Inception Average Annualized Returns Annual Fund Primary Benchmark Fund Inception Fund Inception Date 1-Year 3-Year 5-Year 10-Year Expense Ratio Net Assets SMALL CAP Baron Growth Fund Russell 2000 Growth Index 14.24% 9.22% 12/31/1994 46.19% 21.39% 20.92% 14.92% 1.04%(3) $9.00 billion Baron Small Cap Fund Russell 2000 Growth Index 11.65% 7.66% 9/30/1997 47.60% 20.66% 21.50% 14.20% 1.05%(3) $5.41 billion Baron Discovery Fund† Russell 2000 Growth Index 21.55% 13.23% 9/30/2013 70.06% 27.97% 30.53% N/A 1.08%(3) $2.00 billion SMALL/MID CAP Baron Focused Growth Fund(1) Russell 2500 Growth Index 14.48% 9.59% 5/31/1996 95.00% 39.58% 31.55% 18.44% 1.07%(4) $689.65 million MID CAP Baron Asset Fund Russell Midcap Growth Index 12.56% 11.19%(2) 6/12/1987 36.04% 21.91% 21.70% 15.73% 1.05%(3) $6.24 billion LARGE CAP Baron Fifth Avenue Growth Fund Russell 1000 Growth Index 12.25% 12.42% 4/30/2004 35.34% 25.94% 27.32% 18.67% 0.78%/0.75%(3)(6) $840.14 million Baron Durable Advantage Fund S&P 500 Index 18.93% 16.67% 12/29/2017 36.55% 21.14% N/A N/A 2.40%/0.70%(3)(7) $28.85 million ALL CAP Baron Partners Fund(1) Russell Midcap Growth Index 16.39% 11.03% 1/31/1992 119.55% 47.64% 38.45% 23.88% 1.30%(4)(5) $6.89 billion Baron Opportunity Fund† Russell 3000 Growth Index 11.01% 7.01% 2/29/2000 61.18% 38.62% 35.19% 19.39% 1.08%(3) $1.62 billion INTERNATIONAL Baron Emerging Markets Fund MSCI EM Index 7.24% 4.16% 12/31/2010 42.40% 12.76% 12.66% 7.70% 1.09%(4) $8.68 billion Baron Global Advantage Fund† MSCI ACWI Index 21.07% 11.10% 4/30/2012 45.78% 34.78% 33.68% N/A 0.92%/0.90%(4)(8) $2.90 billion Baron International Growth Fund MSCI ACWI ex USA Index 13.11% 8.50% 12/31/2008 44.18% 15.73% 16.50% 9.79% 1.01%/0.95%(4)(9) $722.10 million SECTOR Baron Real Estate Fund MSCI USA IMI Extended Real Estate Index 17.44% 13.00% 12/31/2009 61.07% 25.42% 20.49% 16.63% 1.08%(4) $1.78 billion Baron Real Estate Income Fund MSCI US REIT Index 17.01% 7.69% 12/29/2017 44.69% 20.18% N/A N/A 3.45%/0.80%(4)(10) $73.57 million Baron Health Care Fund Russell 3000 Health Care Index 27.14% 17.98% 4/30/2018 46.51% 26.81% N/A N/A 1.45%/0.85%(4)(11) $172.68 million Baron FinTech Fund S&P 500 Index 42.27% 23.03% 12/31/2019 46.93% N/A N/A N/A 2.43%/0.95%(12) $61.87 million EQUITY ALLOCATION Baron WealthBuilder Fund S&P 500 Index 26.49% 16.67% 12/29/2017 61.32% 28.45% N/A N/A 1.22%/1.11%(4)(13) $430.96 million

(1) Reflects the actual fees and expenses that were charged when the Funds were partnerships. The predecessor partnerships charged a 20% performance fee (Baron Partners Fund) or a 15% performance fee (Baron Focused Growth Fund) after reaching a certain performance benchmark. If the annual returns for the Funds did not reflect the performance fee for the years the predecessor partnerships charged a performance fee, returns would be higher. The Funds’ shareholders are not charged a performance fee. (2) For the period June 30, 1987 to June 30, 2021.

113 Baron WealthBuilder Fund

(3) As of 9/30/2020. (4) As of 12/31/2020. (5) Comprised of operating expenses of 1.05% and interest expenses of 0.25%. (6) Annual expense ratio was 0.78%, but the net annual expense ratio was 0.75% (net of Adviser’s fee waivers). (7) Annual expense ratio was 2.40%, but the net annual expense ratio was 0.70% (net of Adviser’s fee waivers). (8) Annual expense ratio was 0.92%, but the net annual expense ratio was 0.90% (net of Adviser’s fee waivers). (9) Annual expense ratio was 1.01%, but the net annual expense ratio was 0.95% (net of Adviser’s fee waivers). (10) Annual expense ratio was 3.45%, but the net annual expense ratio was 0.80% (net of Adviser’s fee waivers). (11) Annual expense ratio was 1.45%, but the net annual expense ratio was 0.85% (net of Adviser’s fee waivers). (12) Annual expense ratio was 2.43%, but the net annual expense ratio was 0.95% (net of Adviser’s fee waivers). (13) Annual expense ratio was 1.22%, but the net annual expense ratio was 1.11% (includes acquired fund fees and expenses, net of the Adviser’s fee waivers). † The Fund’s historical performance was impacted by gains from IPOs and/or secondary offerings. There is no guarantee that these results can be repeated or that the Fund’s level of participation in IPOs and secondary offerings will be the same in the future. (13) Annual expense ratio was 1.31%, but the net annual expense ratio was 1.21% (includes acquired fund fees and expenses, net of the Adviser’s fee waivers). * Not annualized. † The Fund’s historical performance was impacted by gains from IPOs. There is no guarantee that these results can be repeated or that the Fund’s level of participation in IPOs will be the same in the future.

114 June 30, 2021 Baron Health Care Fund

Dear Baron Health Care Fund Shareholder: Performance

In the quarter ended June 30, 2021, Baron Health Care Fund (the “Fund”) advanced 11.43% (Institutional Shares), compared with the 8.16% gain for the Russell 3000 Health Care Index (the “Benchmark”) and the 8.55% gain for the S&P 500 Index. Year-to-date, the Fund increased 12.08% compared with the 10.47% increase for the Benchmark and the 15.25% gain for the S&P 500 Index. Since inception (April 30, 2018), the Fund increased 27.14% on an annualized basis compared with the 17.98% gain for the Benchmark and the 18.73% gain for the S&P 500 Index.

Table I. Performance For periods ended June 30, 2021 Baron Baron Health Health Russell Care Care 3000 Fund Fund Health S&P Retail Institutional Care 500 NEAL KAUFMAN Retail Shares: BHCFX Shares1,2 Shares1,2 Index1 Index1 Institutional Shares: BHCHX Three Months3 11.35% 11.43% 8.16% 8.55% PORTFOLIO MANAGER R6 Shares: BHCUX Six Months3 11.95% 12.08% 10.47% 15.25% One Year 46.14% 46.51% 29.49% 40.79% Three Years 26.51% 26.81% 17.75% 18.67% after the company’s IPO was well received by investors. Several other Since Inception holdings also performed well in the sub-industry, such as Zai Lab Limited, (April 30, 2018) 26.82% 27.14% 17.98% 18.73% Arrowhead Pharmaceuticals, Inc., Beam Therapeutics Inc., Genmab A/S, and Denali Therapeutics Inc. Within pharmaceuticals, outperformance of During the quarter, the Fund outperformed the Benchmark by 327 basis Dechra Pharmaceuticals PLC and meaningfully lower exposure to this points due to stock selection and, to a lesser extent, differences in lagging sub-industry bolstered relative results. Shares of veterinary sub-industry exposures. pharmaceutical specialist Dechra increased on management’s issuance of Outperformance of investments in biotechnology, pharmaceuticals, health above-consensus revenue and earnings guidance for its fiscal year ended in care supplies, and health care equipment added the most value. Favorable June due to strong market fundamentals and lower selling, general, and stock selection in biotechnology accounted for most of the outperformance administrative expenses as a result of the pandemic. Strength in health care in the quarter, driven by triple-digit gains from BioNTech SE and Recursion supplies came from West Pharmaceutical Services, Inc., a leading provider Pharmaceuticals, Inc. BioNTech was the largest contributor driven by of components and systems for the packaging and delivery of injectable additional strong clinical data on its COVID-19 vaccine and comparatively drugs. West’s stock price was up after reporting excellent first quarter weaker data from competitors, while Recursion’s shares were up sharply financial results. The company grew organically at a rate of 31%, and

Performance listed in the above table is net of annual operating expenses. Annual expense ratio for the Retail Shares and Institutional Shares as of December 31, 2020 was 1.73% and 1.45%, respectively, but the net annual expense ratio was 1.10% and 0.85% (net of the Adviser’s fee waivers), respectively. The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original cost. The Adviser reimburses certain Baron Fund expenses pursuant to a contract expiring on August 29, 2031, unless renewed for another 11-year term and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted. For performance information current to the most recent month end, visit www.BaronFunds.com or call 1-800-99BARON. 1 The Russell 3000® Health Care Index is an unmanaged index representative of companies involved in medical services or health care in the Russell 3000 Index, which is comprised of the 3,000 largest U.S. companies as determined by total market capitalization. The S&P 500 Index measures the performance of 500 widely held large cap U.S. companies. Russell Investment Group is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. Russell is a trademark of Russell Investment Group. The indexes and the Fund include reinvestment of dividends, net of withholding taxes, which positively impact the performance results. The indexes are unmanaged. Index performance is not Fund performance; one cannot invest directly into an index. 2 The performance data in the table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemptions of Fund BARON shares. FUNDS 3 Not annualized.

115 Baron Health Care Fund

management materially raised revenue and earnings guidance. In addition to Bio-Techne Corporation is a leading provider of high-quality purified benefiting from increased sales of products used in COVID-19 vaccine proteins and protein analysis and other life sciences tools for biomedical packaging, West’s core business performed exceptionally well, driven by researchers and clinical research laboratories. Bio-Techne contributed to customer demand for its high-value packaging products. The Fund’s health performance in the quarter on strong financial results, highlighted by 22% care equipment holdings outperformed after appreciating double-digits as a organic revenue growth, 40% adjusted operating margin, and earnings per group, with intravascular lithotripsy medical device manufacturer share ahead of Street estimates. We continue to believe Bio-Techne has an ShockWave Medical, Inc. and pressure sensing guidewire manufacturer attractive core life sciences reagents business with multiple additional Opsens Inc. leading the way. ShockWave’s stock price rose after growth drivers. management increased sales guidance for 2021 based on the strong Moderna, Inc. is a leader in the emerging field of mRNA-based vaccines and commercial launch of its device for severely calcified coronary artery therapeutics. Shares performed well for the quarter. Moderna’s platform disease. Opsens shares were up in anticipation of first-in-human data for the continued to gain recognition as its COVID-19 vaccine rolled out. With this company’s guidewire for transcatheter aortic valve replacement that can success under its belt, we think Moderna has the potential to disrupt the both deliver the valve and provide continuous pressure measurement, entire biopharmaceutical space from infectious disease vaccines to oncology thereby enabling cardiologists to position and reposition the valve during and rare disease treatment. the procedure. U.K.-based Dechra Pharmaceuticals PLC manufactures and distributes Cash exposure in an up market and investments in life sciences tools & companion animal pharmaceuticals. Shares increased on management’s services detracted the most from relative performance. Stock-specific issuance of a positive trading update, which called for above-consensus weakness in life sciences tools & services, owing largely to share price revenue and earnings for its fiscal year ended in June due to strong market declines from precision oncology company Guardant Health, Inc. and long- fundamentals and lower selling, general, and administrative expenses as a read DNA sequencing systems provider Pacific Biosciences of California, result of the pandemic. We remain bullish on the animal health vertical in Inc., was somewhat offset by higher exposure to this top performing general and Dechra in particular. sub-industry. Edwards Lifesciences Corp. is a leading manufacturer of heart valves used Our strategy is to identify competitively advantaged growth companies that in replacement surgery. The company contributed on strong first quarter we can own for years. Similar to the other Baron Funds, we remain focused financial results driven by robust sales of its transcatheter aortic valve on finding businesses that we believe have open-ended secular growth replacement (“TAVR”). We believe Edwards can continue to generate opportunities, durable competitive advantages, and strong management attractive growth in its TAVR business driven by expanding indications, teams. We conduct independent research and take a long-term perspective. greater disease awareness, and new technologies, and we think the emerging We are particularly focused on businesses that solve problems in Health transcatheter mitral valve and tricuspid therapies business will add to Care, whether by reducing costs, enhancing efficiency and/or improving growth in the coming years. patient outcomes.

We continue to think the Health Care sector will offer attractive investment Table III. opportunities over the next decade and beyond. Health Care is one of the Top detractors from performance for the quarter ended June 30, 2021 largest and most complex sectors in the U.S. economy, accounting for Percent approximately 18% of GDP and encompassing a diverse array of Impact sub-industries. Health Care is also a dynamic industry undergoing changes BridgeBio Pharma, Inc. –0.34% driven by legislation, regulation, and advances in science and technology. Acceleron Pharma Inc. –0.26 We think navigating these changes requires investment experience and Guardant Health, Inc. –0.24 sector expertise, which makes the Health Care sector particularly well suited Inari Medical, Inc. –0.21 for active management. Abbott Laboratories –0.15

Table II. BridgeBio Pharma, Inc. is a biotechnology company developing drugs that Top contributors to performance for the quarter ended June 30, 2021 address a host of genetic disorders. Shares fell in the quarter given concerns Percent around increasing competition. While we expect positive results from Impact BridgeBio’s Phase 3 trial for its lead program for TTR amyloidosis, a disease BioNTech SE 0.82% in which toxic proteins build up in the heart and nerves, updates from Bio-Techne Corporation 0.70 Alnylam’s competing drug, Vitrusiran, and more recently, Intellia’s gene Moderna, Inc. 0.68 editing platform, pressured the stock. We retain conviction in BridgeBio Dechra Pharmaceuticals PLC 0.64 given its pipeline and diversified business model. Edwards Lifesciences Corp. 0.60 Acceleron Pharma Inc. is a biotechnology company focused on BioNTech SE is a leader in the emerging field of mRNA drugs, with additional therapeutics for rare blood and lung disorders. Shares fell slightly as the programs in engineered cell therapies, antibodies, and immunomodulators. company had limited impactful news flow during the quarter. Importantly, Shares performed well for the quarter as the COVID-19 vaccine rollout Acceleron issued positive updates on clinical trial data packages that progressed, and we believe the pandemic has been a strong proof point of the highlighted the strength of its drug Luspatercept in the treatment of Beta speed and efficacy of the mRNA platform. Beyond vaccines, we think Thalessemia (the BEYOND trial). More recently, the company highlighted its BioNTech has potential to disrupt the biopharmaceutical space with a development strategies during a deep dive R&D day. Acceleron remains a pipeline spanning oncology, infectious diseases, and rare diseases. top pick, and we have not changed our conviction.

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Guardant Health, Inc. offers liquid biopsy tests for advanced stage cancer can be sequenced for roughly $600 in less than one day, and the cost and recurrence monitoring and is developing a test for early cancer continues to decline. As a result, the applications for DNA sequencing detection. Shares fell during the quarter as high-growth companies with are rapidly expanding. DNA sequencing is being used in cancer high valuations sold off. We maintain conviction for the long term as we diagnosis and treatment, diagnosis of rare genetic diseases, believe Guardant is a unique growth company that has the potential to non-invasive pre-natal testing, population genomics, and COVID-19 transform cancer care. surveillance. Our investments in genomics include DNA sequencing Inari Medical, Inc. offers catheter-based devices to remove clots from market leader Illumina, Inc., and genomics applications companies venous thromboembolism (“VTE”), the third most common vascular Guardant Health, Inc. and 10X Genomics, Inc. Guardant offers blood condition in the U.S. after heart attacks and strokes, and which can be fatal tests for cancer therapy selection and cancer recurrence monitoring, if left untreated. Shares declined during the quarter as high-growth and is developing a blood test for early detection of colon cancer. 10X companies with high valuations sold off. We maintain conviction, as the VTE Genomics enables life sciences researchers to conduct high throughput treatment space is still in the very early days of converting to device-based single-cell analysis and spatial interrogation, and is building out an in interventions, and we believe Inari is well positioned to benefit. situ platform that would enable sequencing directly in a tissue sample. We are also investing in emerging proteomics companies such Abbott Laboratories detracted from performance in the quarter. Abbott is as Olink Holding AB and Seer, Inc. Whereas genomics involves the a diversified large-cap med-tech company. Abbott lowered revenue and reading of DNA, which is a static indicator of health status, proteomics earnings guidance due to sales of COVID-19 testing products that missed involves the analysis of proteins, which is a dynamic indicator of Street estimates. As vaccination rates have increased, demand for cellular function. We believe proteomics has the potential to add a COVID-19 testing has declined. Despite the near-term impact on Abbott’s critical layer of information in high-value applications like drug revenue and earnings, we continue to think Abbott’s long-term growth discovery and clinical diagnostics. outlook remains attractive due to multiple growth drivers including Abbott’s diabetes and structural heart businesses. • Genetic Medicine: The field of genetic medicine – therapies derived by modifying the genetic code in a cell – has reached an inflection point. PORTFOLIO STRUCTURE Several cell and gene therapies have been approved and commercialized, and various companies are working on gene editing We build the portfolio from the bottom up, one stock at a time, using the approaches with promising early clinical trial results. Some genetic Baron investment approach. We do not try to mimic an index, and we medicines have the potential to cure diseases with a single treatment. expect the Fund to look very different from the Benchmark. We loosely Beam Therapeutics Inc. has a proprietary base editing technology group the portfolio into three categories of stocks: earnings compounders, which can edit a single base in the genome without making a double- high-growth companies, and biotechnology companies. We define earnings stranded break in the DNA, resulting in a more precise edit compared compounders as companies that we believe can compound earnings at to other gene editing methods. BridgeBio Pharma, Inc. is developing a double-digit rates over the long term. We define high-growth stocks as portfolio of breakthrough medicines for genetic diseases and cancers companies we expect to generate mid-teens or better revenue growth and with genetic drivers. Moderna, Inc. and BioNTech SE, whose mRNA which may not be profitable today but which we believe can be highly COVID-19 vaccines have proven to be safe and highly effective, have profitable in the future. We expect the portfolio to have a mix of earnings robust pipelines to expand their mRNA platforms into other vaccines compounders, high-growth, and biotechnology companies. We typically aim such as flu as well as other modalities and therapeutic areas. to have roughly 50% of the portfolio in earnings compounders with the Arrowhead Pharmaceuticals, Inc. and Dicerna Pharmaceuticals, Inc. balance divided between biotechnology and high-growth companies but our use RNA interference (RNAi) technology to “silence” the genes that allocations among these three categories can change depending upon our cause diseases. view of the opportunity set and the market environment. • Synthetic Biology: The field of synthetic biology, which involves As of June 30, 2021, the Fund’s active share was 73.3%. The Fund may designing DNA and programming cells to make products, is growing invest in stocks of any market capitalization and may hold both domestic rapidly and has potential to transform multiple industries. We have an and international stocks. As of June 30, 2021, the Fund held 52 positions. investment in Zymergen Inc., which has a platform that aims to use This compares with 607 positions in the Benchmark. International stocks biology to create better products faster, cheaper, and more sustainably represented 20.5% of the Fund’s net assets. The Fund’s 10 largest holdings than traditional chemistry. Zymergen’s first products are electronic represented 37.6% of net assets. Compared with the Benchmark, the Fund films for smartphones and insect repellent and the company has new was overweight in life sciences tools & services and biotechnology, and products in development in electronics, consumer care and agriculture underweight in pharmaceuticals and health care equipment and services. with potential to expand into other industries. We also own Twist The market cap range of the investments in the Fund was $196 million to Bioscience Corporation, which has a proprietary platform to $378 billion with a weighted average market cap of $62.2 billion. This manufacture synthetic DNA by writing DNA on a silicon chip. compared with the Benchmark’s weighted average market cap of $140.1 billion. • Technology-Enabled Drug Discovery and Development: We have investments in companies that use technology to help speed drug We discuss below some examples of investment themes that we are discovery and development and make it more efficient. Schrodinger, investing in. We do not intend this list to be exhaustive. We own stocks in Inc. offers a physics-based computational platform for drug discovery, the portfolio that do not fit neatly into the themes below. We evaluate each enabling scientists to discover high-quality, novel molecules more stock on its own merits. rapidly, at lower cost and with a higher likelihood of success compared • Genomics: The cost of sequencing DNA has fallen substantially since with traditional drug discovery methods. Recursion Pharmaceuticals, the sequencing of the first human genome. Today, the human genome Inc. is using large scale cell imaging and data science to discover novel

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drugs at a faster pace and broader scale. Veeva Systems Inc. provides UnitedHealth Group Incorporated and Humana Inc., two leading cloud-based software for the life sciences industry that helps clients managed care organizations that we believe are well positioned to bring drugs to market faster and more efficiently. Certara, Inc. offers benefit from enrollment growth in Medicare Advantage. biosimulation software which biopharmaceutical companies use to • Animal Health: We believe the animal health industry is attractive predict how medicines behave in the human body. based on the trends toward greater pet ownership, increased spending • Minimally Invasive Surgery: Less invasive surgery is less traumatic for on pets, increased consumption of animal protein, and increased focus the patient, enabling a faster recovery and in many cases resulting in on food safety. Further, compared with drug development for humans, cost savings to the system. We have investments in: Intuitive Surgical, the animal health industry is characterized by lower regulatory barriers, Inc., the pioneer in robotic surgery; Edwards Lifesciences Corp.,a shorter and less costly R&D, less generic competition, and lower third- leader in transcatheter heart valve replacement; Abbott Laboratories, party reimbursement risks. We have investments in Dechra a leader in transcatheter mitral valve repair; Teleflex Incorporated, Pharmaceuticals PLC and Zoetis Inc., both of which develop and sell which offers a new minimally invasive treatment for benign prostatic medicines for pets and food producing animals; and IDEXX hyperplasia, also known as enlarged prostate; and Silk Road Medical, Laboratories, Inc., the leading provider of diagnostic instruments and Inc., which offers a new minimally invasive approach for the treatment assays used for pet care in veterinarian offices. of carotid artery disease. Table IV. • Diabetes Management: Approximately 34 million Americans have Top 10 holdings as of June 30, 2021 diabetes and another 88 million have prediabetes. Diabetes was the Market Quarter Quarter seventh leading cause of death in the U.S. in 2017, and according to Cap End End the American Diabetes Association, the direct medical costs and When Market Investment Percent indirect expenditures attributable to diabetes in the U.S. were an Year Acquired Cap Value of Net Acquired (billions) (billions) (millions) Assets estimated $327 billion in 2017. Worldwide, the prevalence of diabetes is staggering: over 400 million people globally have diabetes and The UnitedHealth Group International Diabetes Federation estimates that by 2045, this number Incorporated 2018 $227.4 $377.9 $10.4 6.0% could reach 629 million people. We have investments in innovative ICON Plc 2018 8.0 10.9 8.9 5.2 medical technology companies which help patients better manage Bio-Techne Corporation 2018 5.7 17.5 7.1 4.1 their diabetes: DexCom, Inc. offers a continuous glucose monitoring Acceleron Pharma Inc. 2018 1.6 7.6 6.8 3.9 system which eliminates the need for fingersticks; Insulet Corp. offers Humana Inc. 2019 35.0 57.1 6.4 3.7 a unique tubeless, disposable insulin pump; and Abbott Laboratories argenx SE 2018 2.8 15.4 6.4 3.7 sells the FreeStyle Libre flash glucose monitoring system. Thermo Fisher Scientific Inc. 2019 117.6 198.3 5.7 3.3 • Tools Providers to Life Sciences Companies: We believe companies Edwards Lifesciences Corp. 2018 26.8 64.4 4.7 2.7 that provide products and services to life sciences companies can Mettler-Toledo benefit from the growth in life sciences without the risk inherent in International, Inc. 2018 14.3 32.2 4.3 2.5 drug development. Our investments in life sciences “picks and shovels” Dechra Pharmaceuticals companies include Thermo Fisher Scientific Inc., Bio-Techne PLC 2018 3.9 6.5 4.3 2.5 Corporation, West Pharmaceutical Services, Inc., MaxCyte, Inc., and Mettler-Toledo International, Inc., among others. Table V. • Medicare Advantage: Every day, approximately 10,000 people in this Fund investments in GICS sub-industries as of June 30, 2021 country turn 65 and become eligible for Medicare. Individuals have a Percent choice between enrolling in traditional fee-for-service Medicare of Net (“Original Medicare”) or a Medicare Advantage plan managed by a Assets private sector health insurer. Medicare Advantage is growing rapidly Biotechnology 22.7% because of its more attractive value proposition to Medicare Life Sciences Tools & Services 21.5 beneficiaries. Medicare Advantage plans cover all the services that Health Care Equipment 20.8 Original Medicare cover plus additional benefits such as vision, hearing, Managed Health Care 11.0 dental and wellness (gym memberships). Some Medicare Advantage Pharmaceuticals 6.7 plans also cover transportation to doctor visits, over-the-counter drugs, Health Care Supplies 3.1 adult-day care services, and assistance for daily living. Medicare Health Care Technology 2.2 Advantage plans also have annual out-of-pocket spend limits, which Specialized REITs 1.8 provides financial protection against the cost of catastrophic illness or Health Care Services 1.0 accident. The Center for Medicare and Medicaid Services estimates Commodity Chemicals 0.9 that Medicare Advantage penetration will rise from 36% of all Cash and Cash Equivalents 8.3 Medicare beneficiaries in 2020 to 50% in 2025. There is bipartisan 100.0% political support for Medicare Advantage. We have investments in

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RECENT ACTIVITY its prolific collaborations with academic scientists, the goal of which is to turn scientific breakthroughs into development candidates using the Table VI. company’s antibody engineering expertise. Top net purchases for the quarter ended June 30, 2021 Quarter End Amount We added to our position in Insulet Corp., which sells the OmniPod insulin Market Cap Purchased pump for people with diabetes who require insulin. We think the OmniPod (billions) (millions) pump has advantages over durable pumps, including a better form factor ICON Plc $ 10.9 $3.4 without tubing, easier patient access through the pharmacy channel (vs. the Acceleron Pharma Inc. 7.6 3.0 DME channel), a superior pay-as-you-go model (no upfront cost vs. upfront Eli Lilly and Company 220.1 2.8 4-year contracts), and broader reimbursement in the Type 2 diabetes argenx SE 15.4 2.2 population. The company expects to receive FDA approval of the OmniPod Insulet Corp. 18.2 1.9 5 soon, which will be the first and only wearable, tubeless automated insulin delivery device. The wearable OmniPod 5 will communicate with the During the June quarter, we established five new positions and exited eight DexCom continuous glucose monitoring system, it will have an adaptive positions. Below we discuss some of our top net purchases and sales. algorithm built in, and an app will allow users to control the system from a We added to our position in ICON Plc, a leading contract research smartphone. We think the OmniPod 5 will catalyze adoption in the large organization (“CRO”) which provides outsourced drug and device and underpenetrated global market for patients with diabetes who require development and commercialization services to pharmaceutical, insulin. biotechnology, medical device, and government and public health We initiated a position in Twist Bioscience Corporation, a provider of organizations. We continue to believe the merger with PRA Health synthetic DNA. The company’s proprietary semiconductor-based platform Sciences, Inc. will be a good, accretive transaction for ICON. The CRO has driven its position as the low-cost provider of DNA for a variety of high- sector is experiencing healthy growth driven by record levels of growth applications. These include the attractive areas of synthetic biology, biotechnology funding, solid biopharmaceutical R&D spend, and continued liquid biopsy, and antibody discovery. Of note, the antibody business has the outsourcing of clinical development. Long term, management targets high potential to become a source of high-margin royalty streams in the future. single-digit revenue growth and mid-teens earnings growth. We continue to As further optionality, we believe Twist has a shot at disrupting the entire see significant upside in the stock price over a multi-year period. digital data storage industry with DNA-based storage. We added to our position in Acceleron Pharma Inc. which is developing a novel new drug for pulmonary arterial hypertension (“PAH”). PAH is caused Table VII. by the progressive structural remodeling of the pulmonary arteries, which Top net sales for the quarter ended June 30, 2021 eventually results in right heart failure and death. Acceleron’s drug Amount Sold Sotatercept acts by rebalancing signaling, thereby reversing the vascular (millions) remodeling seen in PAH. This would be the first PAH drug with the potential BridgeBio Pharma, Inc. $2.0 to reverse the disease. Sotatercept demonstrated promising results in a Abbott Laboratories 1.9 Phase 2 study and Phase 3 development is underway. Acceleron is also HCA Healthcare, Inc. 1.9 pursuing development of the drug in additional pulmonary hypertension PTC Therapeutics 1.2 indications that would add to the addressable patient population. If trial Vertex Pharmaceuticals Incorporated 1.2 results are positive, we think the drug has the potential to be a blockbuster. In the near term, Acceleron receives royalties from Bristol- We reduced our position in BridgeBio Pharma, Inc. to manage risk ahead of Myers Squibb on commercial sales of a drug for serious and chronic clinical data. We reduced our position in Abbott Laboratories and sold our anemias, which provides current cash flow to support further development position in HCA Healthcare, Inc. due to valuation. We sold our positions in of Acceleron’s pipeline. PTC Therapeutics and Vertex Pharmaceuticals Incorporated due to lower We started a position in Eli Lilly and Company, a large-cap pharmaceutical conviction in their pipelines. company. We think Lilly has a healthy base business with limited near-term patent expirations, a strong pipeline, and potential for significant margin OUTLOOK expansion, which should translate to high single-digit revenue growth and The FDA’s decision to approve Biogen’s Alzheimer’s drug Aduhelm under the mid-teens earnings growth over the next five years. Lilly’s pipeline includes Accelerated Approval pathway was a controversial and significant event for donanemab, a potential blockbuster drug which the company is developing the Health Care sector this quarter. Aduhelm is the first novel therapy for Alzheimer’s disease and which recently received Breakthrough Therapy approved for Alzheimer’s disease since 2003. The FDA found that Aduhelm’s Designation by the FDA. reduction of amyloid plaque was expected to lead to a reduction in the We added to our position in argenx SE, a Netherlands-based biotechnology clinical decline associated with Alzehimer’s disease even though the clinical company with a platform for antibody discovery. The company’s lead drug, trials did not show that the drug slowed cognitive decline. The approval was efgartigimod, reduces levels of autoantibodies that cause autoimmune based on a surrogate endpoint, in this case the reduction of amyloid plaque diseases. The company has completed a Phase 3 clinical trial of efgartigimod in the brain. The FDA’s acceptance of a surrogate endpoint for approval has for myasthenia gravis and expects to commercialize the drug upon receipt implications for other therapeutics companies, such as Eli Lilly and of FDA approval. argenx is also studying the drug in multiple other Company which is also developing an Alzheimer’s drug targeting amyloid autoimmune diseases. We think efgartigimod has multi-billion-dollar sales plaque, as well as Denali Therapeutics Inc. which is pursuing biomarker- potential. argenx also has a pipeline of other drug candidates derived from driven development of drugs for neurodgenerative diseases. Aduhelm’s

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approval has other ripple effects across the sector. For example, companies The outlook for the Health Care sector is positive. Near term, the regulatory that provide bioprocessing services like Thermo Fisher Scientific Inc. could and funding environment is highly favorable. Long term, Health Care is in see increased demand for their services to meet the expected demand for the beginning of a transformational period marked by rapid innovation and the drug. Since most Alzheimer’s patients are over 65 and given the high advances in science. We think this is a unique and exciting time to be an cost and anticipated strong demand for the drug, Medicare managed care investor in Health Care. companies like Humana Inc. could see added costs and earnings headwinds, I would like to thank my colleague Josh Riegelhaupt, Assistant Portfolio though we note that it is likely that Medicare will cover the cost of the drug Manager of Baron Health Care Fund, for his invaluable contributions to the until the cost can be priced into their plans for calendar year 2023. Fund. Another significant event for the sector during the quarter was the first ever Thank you for investing in Baron Health Care Fund. I remain an investor in clinical data supporting the safety and efficacy of in vivo CRISPR genome the Fund, alongside you. editing in humans. The data was from a Phase 1 clinical study of Intellia Therapeutics’ in vivo genome editing candidate, which is being developed as a single-dose treatment for transthyretin amyloidosis. The drug is the first Sincerely, CRISPR/Cas9-based therapy candidate to be administered systemically, via intravenous infusion, for precision editing of a gene in a target tissue in humans. While still early and in a limited number of patients, the data is promising and indicates the potential for gene editing to cure diseases. We think the news bodes well for Beam Therapeutics Inc., a next generation gene editing company which we own in the Fund. Neal Kaufman Portfolio Manager June 30, 2021

Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectus contains this and other information about the Funds. You may obtain them from its distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing. Risks: In addition to general market conditions, the value of the Fund will be affected by investments in health care companies which are subject to a number of risks, including the adverse impact of legislative actions and government regulations. The Fund is non-diversified, which means it may have a greater percentage of its assets in a single issuer than a diversified fund. The Fund invests in small and medium sized companies whose securities may be thinly traded and more difficult to sell during market downturns. Portfolio holdings are subject to change. Current and future portfolio holdings are subject to risk. The discussions of the companies herein are not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed in this report reflect those of the respective portfolio manager only through the end of the period stated in this report. The portfolio manager’s views are not intended as recommendations or investment advice to any person reading this report and are subject to change at any time based on market and other conditions and Baron has no obligation to update them. This report does not constitute an offer to sell or a solicitation of any offer to buy securities of Baron Health Care Fund by anyone in any jurisdiction where it would be unlawful under the laws of that jurisdiction to make such offer or solicitation. BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a limited purpose broker-dealer registered with the SEC and member of the Financial Industry Regulatory Authority, Inc. (FINRA).

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Dear Baron FinTech Fund Shareholder: Performance

In the quarter ended June 30, 2021, Baron FinTech Fund (the “Fund”) rose 16.79% (Institutional Shares) compared with an 8.55% gain for the S&P 500 Index (the “Benchmark”) and a 5.40% gain for the FactSet Global FinTech Index. Year-to-date, the Fund has risen 15.29% compared with a 15.25% gain for the Benchmark and an 8.32% gain for the FactSet Global FinTech Index. Since inception (December 31, 2019), the Fund has risen 42.27% on an annualized basis compared with a 23.03% gain for the Benchmark and a 28.69% gain for the FactSet Global FinTech Index.

Table I. Performance For period ended June 30, 2021 Baron Baron FinTech FinTech FactSet Fund Fund Global Retail Institutional S&P 500 FinTech Shares1,2 Shares1,2 Index1 Index1 JOSH SALTMAN Retail Shares: BFINX Three Months3 16.70% 16.79% 8.55% 5.40% Institutional Shares: BFIIX Six Months3 15.11% 15.29% 15.25% 8.32% PORTFOLIO MANAGER R6 Shares: BFIUX One Year 46.53% 46.93% 40.79% 45.74% Since Inception (December 31, 2019) 41.94% 42.27% 23.03% 28.69% second quarter. Favorable stock selection in IT was the primary driver of outperformance thanks to sharp gains from e-commerce payments During the quarter, the Fund outperformed the Benchmark by 8.24% due to company Dlocal Ltd. and financial software company Intuit Inc. Dlocal’s stock selection and, to a lesser extent, differences in sector weights. Six of stock price more than doubled following the company’s successful IPO in the Fund’s seven investment themes outperformed the Benchmark in the early June, while Intuit’s shares moved higher after reporting strong period. quarterly financial results and raising full-year guidance, reflecting widespread strength across all business segments. Digital IT services The Fund benefited from a reversal of market trends seen in the prior businesses Endava plc and EPAM Systems, Inc. also performed well after quarter. Growth outperformed value, high quality outperformed low quality, delivering beat-and-raise quarters. Lastly, higher exposure to IT contributed and Information Technology (“IT”) outperformed Financials, all of which to relative performance as the sector bounced back during the quarter. were the opposite of what we saw in the first quarter. The Fund seeks to Within Financials, outperformance of digital bank TCS Group Holding PLC invest in high-quality growth companies, so these factors returning to favor and investment data and analytics provider MSCI, Inc. added the most benefited Fund performance. The shift in market leadership corresponded value. TCS’s shares rose after the company’s financial results surpassed with a decline in the U.S. 10-year Treasury yield from 1.74% to 1.45%, in analyst expectations for the first five months of 2021, and the company contrast to the near doubling of rates in the first quarter. Declining long- started providing detailed information about its fast-growing verticals, term rates pressured traditional financial stocks, which typically perform allowing investors to better value the company. MSCI’s stock price was up best when rates are rising. FinTech sits adjacent to traditional financials and, after the company reported strong first quarter earnings and management therefore, likely benefited from diminished enthusiasm for rate-sensitive provided an upbeat assessment of the economic and market backdrop going financial stocks. forward. Credit rating agencies Moody’s Corporation and S&P Global Inc. After weighing on performance last quarter, the Fund’s investments in IT, also performed well in the sector after bond issuance activity exceeded low Financials, and Industrials accounted for most of the outperformance in the Street expectations. Strength in Industrials was due to double-digit gains

Performance listed in the above table is net of annual operating expenses. Annual expense ratio for the Retail Shares and Institutional Shares as of December 31, 2020 was 3.09% and 2.43%, respectively, but the net annual estimated expense ratio was 1.20% and 0.95% (net of the Adviser’s fee waivers), respectively. The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original cost. The Adviser reimburses certain Baron Fund expenses pursuant to a contract expiring on August 29, 2031, unless renewed for another 11-year term and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted. For performance information current to the most recent month end, visit www.BaronFunds.com or call 1-800-99BARON.

1 The S&P 500 Index measures the performance of 500 widely held large cap U.S. companies. The FactSet Global FinTech Index™ is an unmanaged and equal-weighted index that measures the equity market performance of companies engaged in Financial Technologies, primarily in the areas of software and consulting, data, and analytics, digital payment processing, money transfer, and payment transactional-related hardware across 30 developed and emerging markets. The indexes and the Fund include reinvestment of dividends, net of withholding taxes, which positively impact the performance results. The indexes are unmanaged. The index performance is not Fund performance; one cannot invest directly into an index. 2 BARON The performance data in the table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemptions of Fund shares. FUNDS 3 Not annualized.

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from information services companies TransUnion and IHS Markit Ltd., both Nuvei Technologies Corp. is a Canadian-based payment processor that of which reported strong quarterly results and raised full-year guidance. serves online merchants around the world. The stock increased after the IHS Markit also benefited from appreciation of S&P Global’s share price company reported strong quarterly results with 44% pro forma revenue given the pending all-stock merger of the two companies. growth, a meaningful acceleration from the prior quarter. Management announced a step-up in growth investments and raised full-year guidance, Communication Services investments detracted the most from relative which excludes two pending acquisitions. We continue to own the stock due performance, with real estate and rental marketplace Zillow Group, Inc. to Nuvei’s numerous growth opportunities and founder-led management accounting for most of the weakness. Zillow was the top detractor after team. second quarter revenue guidance came in slightly below Street expectations. Investor concerns about the potential impact of rising interest rates on the Table III. housing market also weighed on the company’s shares. Top detractors from performance for the quarter ended June 30, 2021 Percent Table II. Impact Top contributors to performance for the quarter ended June 30, 2021 Zillow Group, Inc. –0.14% Percent Impact Network International Holdings Ltd. –0.11 MarketAxess Holdings Inc. –0.11 Dlocal Ltd. 2.09% Global Payments Inc. –0.09 Endava plc 1.44 Duck Creek Technologies, Inc. –0.03 Intuit Inc. 1.27 EPAM Systems, Inc. 1.15 Zillow Group, Inc. operates leading U.S. real estate websites, a mortgage Nuvei Technologies Corp. 0.94 marketplace, and the Zillow Offers home-buying business. Shares were down due to rising mortgage rates and the potential adverse effects on the Dlocal Ltd. is a Uruguay-based company that enables e-commerce housing environment. Zillow also issued second quarter revenue guidance payments in emerging market countries for large global merchants, such as that was slightly below Street expectations. Despite this intra-quarter Microsoft, Amazon, Facebook, and Netflix. The share price more than volatility, we continue to believe that Zillow has substantial upside in doubled after the company went public in early June. Dlocal is growing mortgages and Offers, which can grow its addressable market not only in rapidly due to the increasing globalization of commerce, higher penetration houses bought/sold but also in leads provided to Zillow Premier Agents. of digital payments, and rising purchasing power of middle-class consumers in lesser developed countries. The Fund participated in the IPO, and we Network International Holdings Ltd. is a leading payment processor in the expect Dlocal to benefit from a long runway for e-commerce growth in Middle East and Africa, enabling banks to issue cards and merchants to emerging markets. accept electronic payments. After a strong first quarter, shares gave back some gains as travel restrictions and lockdowns were lifted more slowly than Endava plc provides outsourced software development to business initially anticipated given the emergence of new, more contagious customers. Shares increased after the company reported quarterly results COVID-19 variants. We retain conviction in Network due to its favorable that beat Street estimates and raised full-year guidance. Following a brief market position and long-term trends that continue to drive digital payment slowdown last year, business has fully rebounded as clients recognize the adoption in the region. need for greater investment in digital transformation. Management expects organic revenue growth to exceed 20%, with upside from accretive MarketAxess Holdings Inc. operates the leading electronic platform for acquisitions. We continue to own the stock because we believe Endava will corporate bond trading. Shares fell due to a slowdown in trading activity, continue gaining share in a large global market for IT services. particularly against last year’s pandemic-driven spike. Market conditions were unfavorable due to lower volatility and narrower credit spreads. Intuit Inc. is the leading provider of accounting software for small MarketAxess continued to increase market share, but share gains are businesses and tax preparation software for individuals and tax typically slimmer during periods of low market volatility. We continue to professionals. Shares increased on strong quarterly results and raised full- own the stock because we believe MarketAxess will be the prime beneficiary year guidance. The QuickBooks business is rebounding after last year’s of the secular shift to electronic trading in the corporate bond market. slowdown, the TurboTax business is showing continued share gains and revenue growth, and the recently acquired Credit Karma business generated Global Payments Inc. provides payment processing and software solutions its highest ever quarterly revenue. We continue to own the stock due to to customers around the world. The company reported quarterly results that Intuit’s strong competitive position and numerous growth opportunities. beat Street estimates and raised full-year guidance as pandemic headwinds abate. However, shares fell due to concerns about the pace of COVID-19 EPAM Systems, Inc. provides outsourced software development to business vaccinations in certain countries and persistent worries about the customers. Shares increased after the company reported quarterly results competitive positioning of “legacy” payment companies. We continue to that beat Street estimates and raised full-year guidance. Client demand has own Global Payments because we believe it will benefit from an economic quickly rebounded after last year’s slowdown as the pandemic has recovery and generate significant value from its merger with Total System highlighted the need for greater investment in digital transformation. Services. Management expects organic revenue growth to exceed 20%, with upside from accretive acquisitions. We continue to own the stock due to EPAM’s long runway for growth and strong execution.

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Duck Creek Technologies, Inc. is a leading provider of core systems provides accounting and payroll solutions for small businesses as well software for the property & casualty insurance industry. The company as tax preparation software for consumers and tax professionals. reported results that beat Street estimates with subscription revenue up Guidewire Software, Inc. and Duck Creek Technologies, Inc. are 51% and SaaS annual recurring revenue up 75% as insurers of all sizes seek leading providers of core systems software for the global insurance to modernize their technology systems. Despite the company’s strong industry. momentum, the stock fell modestly during the quarter, which was enough 4. Information Services: Financial institutions increasingly rely on to make it a top five detractor. We continue to own Duck Creek due to its information and insights to improve loan pricing, insurance strong product set and long runway for growth. underwriting, marketing efficiency, and investment returns. We have Portfolio Structure several investments in companies that provide critical data to help financial institutions optimize performance and fulfill regulatory The Fund seeks to invest in competitively advantaged, growing FinTech requirements. Rating agencies S&P Global Inc. and Moody’s companies that we can own for years. We conduct independent, Corporation provide credit ratings that are deeply embedded into the fundamental research and take a long-term perspective. The Fund invests in financial ecosystem. TransUnion provides the data and Fair Isaac companies across all market capitalizations and geographies. The quality of Corporation provides the rating methodology used by lenders for the ideas and level of conviction determine the position size of each consumer credit decisions. The insurance industry relies on Verisk investment. We do not try to mimic an index, and we expect the Fund will Analytics, Inc. for underwriting data, and the real estate industry relies look very different from the Benchmark. on CoStar Group, Inc. and Zillow Group, Inc. for property data. As of June 30, 2021, the Fund held 51 positions. International stocks 5. Digital IT Services: Many banks, insurers, and other businesses have represented 24.2% of the Fund’s net assets. The Fund’s 10 largest holdings decades-old technology that is difficult to maintain. Disruption from represented 37.3% of net assets, and the 20 largest holdings represented new tech-enabled entrants is forcing incumbents to either upgrade 63.6% of net assets. The market capitalization range of the investments in their legacy systems or risk losing customers. EPAM Systems, Inc., the Fund was $814 million to $615 billion with a median of $20 billion and Endava plc, Accenture plc, and Grid Dynamics Holdings Inc. provide a weighted average of $105 billion. The Fund’s active share was 94.6%. consulting and outsourced software development for business customers to help them modernize their systems and navigate complex We segment the Fund’s holdings into seven investment themes. Some digital transformations. companies have characteristics that span more than one theme, but we classify each company by a single theme that we believe is most 6. Capital Markets: Investing decisions and trade execution increasingly representative. rely on digital solutions to improve efficiency and reduce costs. MarketAxess Holdings Inc. and Tradeweb Markets Inc. operate the 1. Payments: The world is increasingly going cashless, but $18 trillion of leading electronic trading platforms for fixed income markets and consumer payments each year are still made with cash or check. Visa, benefit from the secular shift from voice-based trading to electronic Inc. and Mastercard Incorporated operate the leading global networks trading. CME Group, Inc. is the world’s largest and most diversified that facilitate electronic payments for consumers, merchants, and derivatives marketplace whose electronic exchanges are used by banks. We own several companies that enable merchants to accept traders around the world to manage risk. electronic payments, including Square, Inc., Global Payments Inc., Shift4 Payments, Inc., and Bill.com Holdings, Inc. 7. Tech-Enabled Financials: Certain financial institutions are using technology in particularly innovative ways to better serve their 2. E-commerce: We have several investments that benefit from the customers and operate more efficiently. BlackRock Inc. uses secular growth of e-commerce. Online sales are growing much faster technology to evaluate risk for institutional investors and manage than in-store sales, but e-commerce penetration is still low at only trillions of dollars’ worth of ETF assets at very low cost. Kinsale around 15% of total U.S. retail sales. As payment processors for mostly Capital Group, Inc. is an insurance company that uses proprietary online merchants, PayPal Holdings, Inc., Adyen N.V., Nuvei technology to enable faster underwriting and create meaningful cost Technologies Corp., and Dlocal Ltd. benefit from the rapid growth of advantages over the competition. TCS Group Holding PLC, SoFi e-commerce around the world. MercadoLibre, Inc. and Alibaba Group Technologies, Inc., and Banco Inter S.A. offer banking and brokerage Holding Limited operate leading online marketplaces and payment services through mobile apps and are rapidly gaining market share from platforms. Shopify Inc. provides software and services that make it traditional banks. easier for merchants to sell online. As of June 30, 2021, Information Services represented 22.1% of net assets, 3. Enterprise Software: We have several investments in software E-commerce represented 19.9%, Payments represented 18.2%, Digital IT companies that help businesses manage their financial processes and Services represented 10.8%, Enterprise Software represented 10.6%, Tech- operations. Fidelity National Information Services, Inc., Jack Enabled Financials represented 8.3%, and Capital Markets represented 5.1% Henry & Associates, Inc., and nCino Inc. provide software that with the remainder in cash. enables banks to manage account and transaction data. Intuit Inc.

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Table IV. We participated in the IPO of Dlocal Ltd., a Uruguay-based company that Top 10 holdings as of June 30, 2021 enables e-commerce payments in emerging market countries for large Market Quarter Quarter global merchants, such as Microsoft, Amazon, Facebook, and Netflix. The Cap End End company’s technology platform connects over 330 merchants with millions When Market Investment Percent Year Acquired Cap Value of Net of consumers in 29 developing countries across 600 local payment methods Acquired (billions) (billions) (millions) Assets through a single application programming interface (API) and a single Intuit Inc. 2020 $ 69.3 $133.9 $2.6 4.2% platform. Dlocal addresses several pain points for global merchants looking PayPal Holdings, to expand sales in emerging markets. It facilitates compliance with complex Inc. 2020 130.0 342.4 2.6 4.2 regulatory and tax requirements, provides acceptance of local payment Endava plc 2020 2.6 6.2 2.6 4.2 methods, increases authorization rates, and reduces fraud losses. Dlocal is Visa, Inc. 2020 411.0 515.7 2.6 4.1 growing quickly by adding new merchants and increasing wallet share with S&P Global Inc. 2020 67.9 98.9 2.3 3.7 existing merchants. Processed volumes grew at a 97% compound annual EPAM Systems, Inc. 2020 11.9 28.8 2.2 3.6 growth rate over the last four years with no merchant losses and a net Square, Inc. 2020 73.9 111.0 2.1 3.5 revenue retention rate of 159% last year. Dlocal is benefiting from multiple Mastercard growth trends, including the globalization of commerce, increasing Incorporated 2020 306.1 361.8 2.1 3.4 penetration of digital payments and rising purchasing power of middle-class Dlocal Ltd. 2021 9.5 15.4 2.0 3.2 consumers in developing countries. In addition, the company’s processed Adyen N.V. 2020 24.9 74.7 2.0 3.2 volumes are tied to the sales growth of some of the largest and most successful multi-national companies. With strong tailwinds for revenue growth and a business model that’s highly profitable and capital-light, we Table V. believe Dlocal has the potential to deliver significant earnings growth for Fund investments in GICS sub-industries as of June 30, 2021 many years to come. Percent of Net Assets We participated in the IPO of Marqeta, Inc., a modern card-issuing platform Data Processing & Outsourced Services 33.6% that enables companies to run their own payment card programs. Marqeta Financial Exchanges & Data 12.7 is built on modern technology and can be accessed with open APIs that are Application Software 11.6 easy to use and developer-friendly, resulting in most of its clients coming IT Consulting & Other Services 10.8 from word-of-mouth referrals instead of outbound sales. The modern Research & Consulting Services 7.9 technology stack allows for the programmability of cards, enabling Internet & Direct Marketing Retail 3.7 companies to authorize transactions in real time and control how the cards Diversified Banks 2.9 are used. This programmable nature means that cards can be used in a range Internet Services & Infrastructure 2.8 of use cases for which traditional cards are not suitable. Examples include Asset Management & Custody Banks 2.5 cards with spending controls for different employees and purchase Interactive Media & Services 2.2 categories as well as cards for food delivery companies that restrict spending Consumer Finance 1.5 only to authorized purchases to reduce fraud. While there are other card Investment Banking & Brokerage 1.4 issuers, none can provide the level of functionality at large scale that Insurance Brokers 0.8 Marqeta can. Marqeta generates revenue from the interchange fees earned Property & Casualty Insurance 0.6 on transactions that are processed on its cards. It shares a portion of this with its customers, meaning that card solutions become a revenue stream Cash and Cash Equivalents 5.0 rather than a cost center. Many of the company’s clients are fast growing, 100.0% and Marqeta continues to innovate the features on its platform, which in turn give its clients more tools with which to develop new card payment Recent Activity products and experiences. Given a largely fixed cost structure, Marqeta earns high incremental margins on each dollar spent on its cards. Led by During the quarter, the Fund bought six new positions and exited three founder-CEO Jason Gardner, we believe that Marqeta is a high-quality, positions. Below we discuss some of our top net purchases and sales. differentiated business in the FinTech space with a long runway for growth.

Table VI. We invested in SoFi Technologies, Inc., an online consumer finance Top net purchases for the quarter ended June 30, 2021 company or “neobank,” through a SPAC-PIPE transaction. The company was founded in 2011 to refinance student loans into lower interest rates and has Quarter End Amount Market Cap Purchased since expanded into other financial services, such as bank accounts, debit (billions) (thousands) and credit cards, brokerage, and cryptocurrency trading. We believe that Dlocal Ltd. $ 15.4 $906.0 SoFi now has the broadest product suite of any neobank in the U.S., and we BlackRock Inc. 134.3 613.7 view the core lending segment as a differentiated product line that few Marqeta, Inc. 15.1 594.0 other neobanks offer. With most competitors targeting un-banked and TCS Group Holding PLC 17.4 574.3 under-banked individuals, we believe SoFi’s focus on a higher-income SoFi Technologies, Inc. 15.2 495.1 demographic coupled with its wide range of products positions it to be one of the leading digital banks. The company’s product breadth enables it to

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serve customers throughout their lives, such as offering student loan stocks. We expect this fast pace of deal activity to continue. The large refinancing for new graduates or brokerage accounts when those graduates number of companies now going public through IPOs and SPACs increases accumulate savings. SoFi seeks to cross-sell products to existing customers, our investment opportunity set and casts a spotlight on the significant driving higher customer engagement and retention. SoFi also owns a growth opportunities and pace of innovation in FinTech. technology platform called Galileo that is used to power many other We evaluate almost every IPO and SPAC transaction in the FinTech sector neobanks. We believe Galileo gives SoFi attractive exposure to the broader but pass on the vast majority of them. While we are optimistic about the universe of fast-growing consumer FinTech companies. Over time, we growth potential for many of these businesses, we take a disciplined expect SoFi to continue adding members and cross-selling additional approach to evaluating each investment on its own merits and do not take a services, which should drive improving unit economics and earnings growth. “basket” approach to investing in FinTech. For each opportunity, we assess We added to existing positions in BlackRock Inc. and TCS Group Holding the expected magnitude and duration of growth, the strength of the PLC, both of which were new positions in the prior quarter. We also bought company’s competitive advantage, and the quality of management. To do new positions in Banco Inter S.A., Paymentus Holdings, Inc., and Alkami this, we speak with customers to understand what problems the company is Technology Inc. solving, we evaluate the competitive landscape to gauge relative winners and losers, and we always interview management before entrusting them Table VII. with our capital. Finally, we encapsulate our analysis by estimating the Top net sales for the quarter ended June 30, 2021 intrinsic value of the company and only investing when there is a sufficient Amount margin of safety. Sold (thousands) We believe the outlook for FinTech is very positive. In the near term, we Olo Inc. $141.9 expect reopening economies and higher consumer spending will support our FleetCor Technologies, Inc. 47.7 Payments investments, a more favorable environment for consumer credit Affirm Holdings Inc. 27.6 will support our Information Services investments, higher CEO confidence will lead to more investment in digital transformation projects with our We sold three small positions during the quarter to focus our efforts on Digital IT Services investments, and continued low interest rates will support higher-conviction ideas. We sold Olo Inc. due to concerns about the valuations of our long-duration growth investments. In the long term, competition in the restaurant software industry and a dispute with its we expect FinTech companies to benefit from the secular growth trends we largest customer. We sold FleetCor Technologies, Inc. due to concerns often discuss in these letters: the shift to electronic payments, the rise of about the cyclicality and terminal value of its fuel card business. We also e-commerce, the need for data and analytics to inform decision making, the sold Affirm Holdings Inc. due to increasing competition in the electronification of the capital markets, and the need for more modern buy-now-pay-later space. technology and digital transformation in all areas of commerce. Thank you for investing in Baron FinTech Fund. We are working hard to OUTLOOK identify good investment ideas that we expect will generate attractive returns over the long term. I remain an investor in the Fund, alongside you. Investment activity in FinTech has never been higher. The second quarter was the most active quarter ever for FinTech financings with 875 transactions, surpassing the previous record set in the first quarter, Sincerely, according to investment bank FT Partners. There were 10 FinTech IPO’s this past quarter and 17 year-to-date, putting us on pace to exceed last year’s record of 23. There has also been a surge of SPAC transaction activity with 21 FinTech companies going public through reverse mergers with SPACs this year, already above last year’s record of 15. We have followed many of Josh Saltman these FinTech companies for years while they were privately held and are Portfolio Manager thrilled to finally have the opportunity to invest in them as publicly listed June 30, 2021

125 Baron FinTech Fund

Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectus contains this and other information about the Funds. You may obtain them from its distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing. Risks: In addition to general market conditions, FinTech Companies may be adversely impacted by government regulations, economic conditions and deterioration in credit markets. Companies in the information technology sector are subject to rapid changes in technology product cycles; rapid product obsolescence; government regulation; and increased competition, both domestically and internationally, including competition from foreign competitors with lower production costs. The IT services industry can be significantly affected by competitive pressures, such as technological developments, fixed-rate pricing, and the ability to attract and retain skilled employees, and the success of companies in the industry is subject to continued demand for IT services. The Fund is non-diversified, which means it may have a greater percentage of its assets in a single issuer than a diversified fund. The Fund invests in companies of all sizes, including small and medium sized companies whose securities may be thinly traded and more difficult to sell during market downturns.Portfolio holdings are subject to change. Current and future portfolio holdings are subject to risk. The discussions of the companies herein are not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed in this report reflect those of the respective portfolio manager only through the end of the period stated in this report. The portfolio manager’s views are not intended as recommendations or investment advice to any person reading this report and are subject to change at any time based on market and other conditions and Baron has no obligation to update them. This report does not constitute an offer to sell or a solicitation of any offer to buy securities of Baron FinTech Fund by anyone in any jurisdiction whereit would be unlawful under the laws of that jurisdiction to make such offer or solicitation. BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a limited purpose broker- dealer registered with the SEC and member of the Financial Industry Regulatory Authority, Inc. (FINRA).

126 Baron Funds

Portfolio Market Capitalization (Unaudited)

Baron Asset Fund

Baron Asset Fund invests in mid-sized growth companies with market capitalizations above $2.5 billion or the smallest market cap stock in the Russell Midcap Growth Index at reconstitution, whichever is larger, and below the largest market cap stock in the Russell Midcap Growth Index at reconstitution. Equity %of Equity %of Market Cap Net Market Cap Net Company (in millions) Assets Company (in millions) Assets The Charles Schwab Corp...... $137,345 2.1% Gartner, Inc...... $20,848 5.8% Fidelity National Information Services, Inc...... 87,853 1.4 ZoomInfo Technologies Inc...... 20,417 1.5 Equinix, Inc...... 71,897 1.0 Tradeweb Markets Inc...... 19,637 0.4 Illumina, Inc...... 69,089 1.9 The Cooper Companies, Inc...... 19,516 1.4 IDEXX Laboratories, Inc...... 53,859 7.2 Teleflex Incorporated ...... 18,777 1.2 Pinterest, Inc...... 50,280 0.7 SS&C Technologies Holdings, Inc...... 18,431 0.9 Roper Technologies Inc...... 49,483 2.0 Farfetch Limited ...... 17,866 0.8 Veeva Systems Inc...... 47,550 2.3 Clarivate Plc ...... 17,645 1.0 T. Rowe Price Group, Inc...... 44,911 0.7 MarketAxess Holdings Inc...... 17,608 1.9 MSCI, Inc...... 43,938 0.3 Bio-Techne Corporation ...... 17,511 2.9 DexCom, Inc...... 41,293 1.2 Rollins, Inc...... 16,831 0.9 Amphenol Corporation ...... 40,883 1.0 IDEX Corporation ...... 16,709 1.2 SBA Communications Corp...... 34,848 1.8 Wix.com Ltd...... 16,374 2.3 The Trade Desk ...... 33,704 1.0 Arch Capital Group Ltd...... 15,717 1.4 First Republic Bank ...... 32,989 0.6 argenx SE ...... 15,448 0.2 CoStar Group, Inc...... 32,709 2.9 GDS Holdings Limited ...... 14,670 0.9 Liberty Broadband Corporation ...... 32,691 0.9 Fair Isaac Corporation ...... 14,466 1.0 Mettler-Toledo International, Inc...... 32,236 4.3 Ceridian HCM Holding Inc...... 14,315 2.5 Zillow Group, Inc...... 30,289 2.5 Avalara, Inc...... 13,910 1.0 ANSYS, Inc...... 30,247 3.2 Vail Resorts, Inc...... 12,746 3.1 Willis Towers Watson Public Limited Company .. 29,667 0.6 FactSet Research Systems, Inc...... 12,704 2.0 EPAM Systems, Inc...... 28,821 1.1 Guardant Health, Inc...... 12,558 0.7 CBRE Group, Inc...... 28,776 0.7 Guidewire Software, Inc...... 9,373 2.6 Verisk Analytics, Inc...... 28,321 2.7 Aspen Technology, Inc...... 9,355 0.9 Alexandria Real Estate Equities, Inc...... 28,302 0.6 Bright Horizons Family Solutions, Inc...... 8,978 0.4 HubSpot, Inc...... 27,228 0.3 Hyatt Hotels Corp...... 7,902 0.7 West Pharmaceutical Services, Inc...... 26,510 2.6 Acceleron Pharma Inc...... 7,617 0.3 RingCentral, Inc...... 26,406 1.5 Choice Hotels International, Inc...... 6,604 1.0 Verisign, Inc...... 25,642 2.2 Stitch Fix, Inc...... 6,460 1.0 CDW Corporation ...... 24,487 1.1 Tripadvisor, Inc...... 5,518 0.9 10X Genomics, Inc...... 21,501 0.3 Diversey Holdings, Ltd...... 5,395 0.5 TransUnion ...... 21,007 2.6 98.6%

127 Baron Funds

Baron Growth Fund

Baron Growth Fund invests in small-sized growth companies with market capitalizations up to the largest market cap stock in the Russell 2000 Growth Index at reconstitution, or companies with market capitalizations up to $2.5 billion, whichever is larger. Equity %of Equity %of Market Cap Net Market Cap Net Company (in millions) Assets Company (in millions) Assets IDEXX Laboratories, Inc...... $53,859 5.2% Choice Hotels International, Inc...... $6,604 4.0% MSCI, Inc...... 43,938 10.0 Dechra Pharmaceuticals PLC ...... 6,542 0.4 CoStar Group, Inc...... 32,709 5.0 Littelfuse, Inc...... 6,256 0.2 Mettler-Toledo International, Inc...... 32,236 1.3 Primerica, Inc...... 6,036 2.8 ANSYS, Inc...... 30,247 4.7 Douglas Emmett, Inc...... 5,899 1.4 Alexandria Real Estate Equities, Inc...... 28,302 1.5 Adaptive Biotechnologies Corporation ...... 5,733 0.2 West Pharmaceutical Services, Inc...... 26,510 2.1 Houlihan Lokey, Inc...... 5,578 0.4 Gartner, Inc...... 20,848 4.2 Marel hf...... 5,357 0.3 SS&C Technologies Holdings, Inc...... 18,431 1.8 Iridium Communications Inc...... 5,338 3.5 Bio-Techne Corporation ...... 17,511 4.2 Schrodinger, Inc...... 5,331 0.8 The Carlyle Group Inc...... 16,481 1.0 Altair Engineering Inc...... 5,183 0.6 Wix.com Ltd...... 16,374 0.2 Essent Group Ltd...... 5,073 0.3 Arch Capital Group Ltd...... 15,717 4.0 Red Rock Resorts, Inc...... 4,971 0.8 Vail Resorts, Inc...... 12,746 7.0 Neogen Corp...... 4,945 0.6 FactSet Research Systems, Inc...... 12,704 4.5 Moelis & Company ...... 4,226 0.5 Penn National Gaming, Inc...... 11,960 5.0 Zymergen Inc...... 4,014 0.1 Trex Company, Inc...... 11,791 2.3 ACV Auctions Inc...... 3,961 0.1 Pegasystems, Inc...... 11,312 1.5 Cohen & Steers, Inc...... 3,960 1.7 Morningstar, Inc...... 11,042 2.8 Kinsale Capital Group, Inc...... 3,759 1.8 Gaming and Leisure Properties, Inc...... 10,785 2.8 Desktop Metal, Inc...... 2,941 0.1 Denali Therapeutics Inc...... 9,506 0.6 Manchester United plc ...... 2,475 0.7 Guidewire Software, Inc...... 9,373 1.3 American Assets Trust, Inc...... 2,255 0.1 Bright Horizons Family Solutions, Inc...... 8,978 2.2 BrightView Holdings, Inc...... 1,696 0.2 Boyd Gaming Corporation ...... 6,892 0.3 OneSpa World Holdings Limited ...... 877 0.0 Marriott Vacations Worldwide Corp...... 6,801 2.2 99.3%

128 Baron Funds

Baron Small Cap Fund

Baron Small Cap Fund invests 80% of its net assets in small-sized growth companies with market capitalizations up to the largest market cap stock in the Russell 2000 Growth Index at reconstitution, or companies with market capitalizations up to $2.5 billion, whichever is larger. Equity %of Equity %of Market Cap Net Market Cap Net Company (in millions) Assets Company (in millions) Assets IDEXX Laboratories, Inc...... $53,859 1.2% Inspire Medical Systems, Inc...... $5,259 1.1% DexCom, Inc...... 41,293 1.6 Altair Engineering Inc...... 5,183 1.0 TransDigm Group, Inc...... 35,531 1.5 Driven Brands Holdings Inc...... 5,176 1.1 SBA Communications Corp...... 34,848 1.9 ASGN Incorporated ...... 5,157 2.8 The Trade Desk ...... 33,704 1.7 RBC Bearings Incorporated ...... 5,031 0.5 Liberty Broadband Corporation ...... 32,691 1.1 Red Rock Resorts, Inc...... 4,971 1.5 Mettler-Toledo International, Inc...... 32,236 1.0 John Bean Technologies Corporation ...... 4,528 1.3 Waste Connections, Inc...... 31,253 1.3 Avient Corporation ...... 4,488 1.6 DraftKings, Inc...... 20,919 0.9 Certara, Inc...... 4,334 0.4 Gartner, Inc...... 20,848 4.5 Madison Square Garden Sports Corp...... 4,162 0.7 Clarivate Plc ...... 17,645 2.0 Olink Holding AB ...... 4,096 0.2 Wix.com Ltd...... 16,374 1.6 Jamf Holding Corp...... 3,964 0.4 Liberty SiriusXM Group ...... 15,620 0.5 Kinsale Capital Group, Inc...... 3,759 1.4 Cognex Corporation ...... 14,844 1.9 Mercury Systems, Inc...... 3,722 1.6 Ceridian HCM Holding Inc...... 14,315 1.5 Installed Building Products, Inc...... 3,634 3.6 Guardant Health, Inc...... 12,558 0.6 Kratos Defense & Security Solutions, Inc...... 3,527 1.2 Nuvei Technologies Corp...... 12,127 1.1 First Advantage Corporation ...... 3,043 0.6 Penn National Gaming, Inc...... 11,960 1.4 UTZ Brands, Inc...... 2,982 1.2 Trex Company, Inc...... 11,791 1.4 Axonics, Inc...... 2,908 1.2 Floor & Decor Holdings, Inc...... 11,089 2.5 Innovage Holding Corp...... 2,888 0.2 Liberty Media Corporation – CryoPort, Inc...... 2,883 0.4 Liberty Formula One ...... 11,022 1.1 The Cheesecake Factory, Inc...... 2,692 1.0 ICON Plc ...... 10,927 2.3 BRP Group, Inc...... 2,563 1.5 PRA Health Sciences, Inc...... 10,705 1.5 Repay Holdings Corporation ...... 2,366 1.6 Vertiv Holdings, LLC ...... 9,615 3.5 Hydrofarm Holdings Group, Inc...... 2,353 0.5 Americold Realty Trust ...... 9,559 2.0 E2open Inc...... 2,136 1.1 Guidewire Software, Inc...... 9,373 2.6 Madison Square Garden Entertainment Corp. .... 2,028 0.3 Aspen Technology, Inc...... 9,355 2.0 Array Technologies, Inc...... 1,981 0.5 Bright Horizons Family Solutions, Inc...... 8,978 1.7 Janus International Group, Inc...... 1,924 0.8 Berry Global Group, Inc...... 8,798 1.0 Silk Road Medical, Inc...... 1,650 1.0 WEX Inc...... 8,675 1.3 Paya Holdings Inc...... 1,396 0.7 Figs Inc...... 8,023 0.5 MaxCyte, Inc...... 1,053 0.5 Shift4 Payments, Inc...... 7,584 0.7 OneSpa World Holdings Limited ...... 877 0.0 SiteOne Landscape Supply, Inc...... 7,520 2.5 Grid Dynamics Holdings Inc ...... 814 0.7 HealthEquity, Inc...... 6,711 1.4 Landcadia Holdings III, Inc...... 775 0.4 The AZEK Company Inc...... 6,570 0.9 Origin Materials, Inc...... 743 0.1 Dechra Pharmaceuticals PLC ...... 6,542 1.1 Empower Ltd...... 602 0.3 Planet Fitness, Inc...... 6,516 1.1 SOC Telemed, Inc...... 561 0.3 Endava plc ...... 6,231 1.6 Whole Earth Brands, Inc...... 557 0.1 Shoals Technologies Group, Inc...... 5,915 0.8 Fifth Wall Acquisition Corp. I ...... 438 0.3 Houlihan Lokey, Inc...... 5,578 0.9 98.3% Ollie’s Bargain Outlet Holdings, Inc...... 5,492 0.9

129 Baron Funds

Baron Opportunity Fund

Baron Opportunity Fund invests in high growth businesses of any market capitalization selected for their capital appreciation potential. Equity %of Equity %of Market Cap Net Market Cap Net Company (in millions) Assets Company (in millions) Assets Microsoft Corporation ...... $2,040,304 8.2% Take-Two Interactive Software, Inc...... $20,565 0.5% Amazon.com, Inc...... 1,734,954 5.1 ZoomInfo Technologies Inc...... 20,417 2.5 Alphabet Inc...... 1,658,759 6.1 Farfetch Limited ...... 17,866 0.9 Tesla, Inc...... 654,776 2.8 MarketAxess Holdings Inc...... 17,608 0.4 Alibaba Group Holding Limited ...... 614,828 1.5 Wix.com Ltd...... 16,374 1.2 Visa, Inc...... 515,712 2.1 argenx SE ...... 15,448 2.1 NVIDIA Corporation ...... 498,462 2.5 SoFi Technologies, Inc...... 15,245 1.2 Mastercard Incorporated ...... 361,822 1.6 GDS Holdings Limited ...... 14,670 1.1 PayPal Holdings, Inc...... 342,410 2.0 Ceridian HCM Holding Inc...... 14,315 2.0 Adobe Inc...... 279,936 1.3 Avalara, Inc...... 13,910 0.6 Netflix, Inc...... 234,210 0.8 Guardant Health, Inc...... 12,558 0.8 Square, Inc...... 111,019 0.6 Endeavor Group Holdings, Inc...... 12,413 1.1 Intuitive Surgical, Inc...... 108,897 1.2 Opendoor Technologies Inc...... 10,243 1.2 ServiceNow, Inc...... 108,508 1.3 Guidewire Software, Inc...... 9,373 1.6 Snap Inc...... 103,811 1.8 Arrowhead Pharmaceuticals, Inc...... 8,620 2.5 MercadoLibre, Inc...... 77,659 0.8 Figs Inc...... 8,023 0.2 Adyen N.V...... 74,712 0.5 Acceleron Pharma Inc...... 7,617 2.1 Equinix, Inc...... 71,897 0.7 ShockWave Medical, Inc...... 6,637 1.6 Snowflake Inc...... 71,604 0.5 Stitch Fix, Inc...... 6,460 2.0 Illumina, Inc...... 69,089 0.8 Endava plc ...... 6,231 1.4 Atlassian Corporation Plc ...... 64,519 0.8 Tripadvisor, Inc...... 5,518 2.4 Edwards Lifesciences Corp...... 64,383 0.8 Schrodinger, Inc...... 5,331 0.5 Workday, Inc...... 58,969 1.1 CareDx, Inc...... 4,764 1.3 CrowdStrike, Inc...... 56,749 1.0 Zymergen Inc...... 4,014 0.5 Pinterest, Inc...... 50,280 2.1 Kratos Defense & Security Solutions, Inc...... 3,527 1.1 Electronic Arts Inc...... 41,097 1.0 Butterfly Network, Inc...... 2,770 0.5 The Trade Desk ...... 33,704 0.7 Taboola.com Ltd...... 2,407 0.3 CoStar Group, Inc...... 32,709 1.6 The Original BARK Company ...... 1,847 0.3 Zillow Group, Inc...... 30,289 1.5 PAR Technology Corporation ...... 1,810 1.2 HubSpot, Inc...... 27,228 0.8 similarweb Ltd...... 1,464 0.4 RingCentral, Inc...... 26,406 2.6 Indie Semiconductor, Inc...... 1,430 0.8 10X Genomics, Inc...... 21,501 0.6 95.1% Gartner, Inc...... 20,848 2.0

130 Baron Funds

Baron Partners Fund

Baron Partners Fund is a non-diversified fund that invests primarily in U.S. companies of any size with significant growth potential. Equity %of Equity %of Market Cap Total Market Cap Total Company (in millions) Investments Company (in millions) Investments Tesla, Inc...... $654,776 38.1% HEICO Corporation ...... $ 17,635 0.4% Shopify Inc...... 182,127 1.3 Arch Capital Group Ltd...... 15,717 3.4 Brookfield Asset Management Inc...... 175,035 0.7 GDS Holdings Limited ...... 14,670 1.0 The Charles Schwab Corp...... 137,345 3.8 Vail Resorts, Inc...... 12,746 4.2 Airbnb, Inc...... 94,567 0.0 FactSet Research Systems, Inc...... 12,704 3.2 Moderna, Inc...... 94,351 0.2 Gaming and Leisure Properties, Inc...... 10,785 1.1 Adyen N.V...... 74,712 2.0 Guidewire Software, Inc...... 9,373 1.4 Activision Blizzard, Inc...... 74,159 1.0 Hyatt Hotels Corp...... 7,902 3.0 BioNTech SE ...... 54,072 0.2 Marriott Vacations Worldwide Corp...... 6,801 1.5 IDEXX Laboratories, Inc...... 53,859 6.8 Douglas Emmett, Inc...... 5,899 0.5 Spotify Technology S.A...... 52,581 1.2 Iridium Communications Inc...... 5,338 0.8 MSCI, Inc...... 43,938 1.1 Red Rock Resorts, Inc...... 4,971 0.3 CoStar Group, Inc...... 32,709 8.2 Zymergen Inc...... 4,014 0.4 Zillow Group, Inc...... 30,289 4.5 Cohen & Steers, Inc...... 3,960 0.4 Applovin Corporation ...... 27,412 0.1 Manchester United plc ...... 2,475 1.2 RingCentral, Inc...... 26,406 1.2 Atlas Crest Investment Corp...... 626 0.1 Gartner, Inc...... 20,848 2.3 95.6%

Baron Fifth Avenue Growth Fund

Baron Fifth Avenue Growth Fund invests in large-sized growth companies with market capitalizations no smaller than the top 85th percentile by total market capitalization of the Russell 1000 Growth Index at June 30, or companies with market capitalizations above $10 billion, whichever is smaller. Equity %of Equity %of Market Cap Net Market Cap Net Company (in millions) Assets Company (in millions) Assets Amazon.com, Inc...... $1,734,954 7.9% Equinix, Inc...... $71,897 2.1% Alphabet Inc...... 1,658,759 6.4 Snowflake Inc...... 71,604 1.4 Facebook, Inc...... 985,920 4.8 Illumina, Inc...... 69,089 3.0 Alibaba Group Holding Limited ...... 614,828 2.8 Twilio Inc...... 68,070 3.8 Visa, Inc...... 515,712 2.8 CrowdStrike, Inc...... 56,749 2.8 NVIDIA Corporation ...... 498,462 2.2 Veeva Systems Inc...... 47,550 3.7 Mastercard Incorporated ...... 361,822 3.4 UiPath, Inc...... 34,565 0.2 PayPal Holdings, Inc...... 342,410 3.0 Datadog, Inc...... 32,097 1.0 ASML Holding N.V...... 288,205 3.2 EPAM Systems, Inc...... 28,821 3.9 Adobe Inc...... 279,936 3.8 RingCentral, Inc...... 26,406 2.9 Shopify Inc...... 182,127 2.5 Splunk, Inc...... 23,699 1.6 Zoom Video Communications, Inc...... 114,037 0.9 10X Genomics, Inc...... 21,501 2.1 Square, Inc...... 111,019 2.3 ZoomInfo Technologies Inc...... 20,417 1.9 Intuitive Surgical, Inc...... 108,897 3.4 Dynatrace Holdings LLC ...... 16,571 1.8 ServiceNow, Inc...... 108,508 3.9 Wix.com Ltd...... 16,374 2.4 S&P Global Inc...... 98,877 2.2 argenx SE ...... 15,448 1.5 Airbnb, Inc...... 94,567 0.0 BridgeBio Pharma, Inc...... 9,100 1.1 MercadoLibre, Inc...... 77,659 2.3 Acceleron Pharma Inc...... 7,617 1.7 Adyen N.V...... 74,712 1.8 98.5%

131 Baron Funds

Baron Focused Growth Fund

Baron Focused Growth Fund is a non-diversified fund that invests in small and mid-sized growth companies with market capitalizations up to the largest market cap stock in the Russell Midcap Growth Index at reconstitution. Equity %of Equity %of Market Cap Net Market Cap Net Company (in millions) Assets Company (in millions) Assets Tesla, Inc...... $654,776 31.6% Denali Therapeutics Inc...... $9,506 1.5% Adyen N.V...... 74,712 2.1 Guidewire Software, Inc...... 9,373 1.7 BioNTech SE ...... 54,072 3.6 Figs Inc...... 8,023 2.1 Spotify Technology S.A...... 52,581 3.4 Hyatt Hotels Corp...... 7,902 3.8 CoStar Group, Inc...... 32,709 7.4 Choice Hotels International, Inc...... 6,604 2.7 Arch Capital Group Ltd...... 15,717 3.4 Stitch Fix, Inc...... 6,460 1.1 GDS Holdings Limited ...... 14,670 2.0 Iridium Communications Inc...... 5,338 2.3 Vail Resorts, Inc...... 12,746 6.2 Schrodinger, Inc...... 5,331 1.3 FactSet Research Systems, Inc...... 12,704 3.6 Red Rock Resorts, Inc...... 4,971 1.2 American Homes 4 Rent ...... 12,636 1.3 Manchester United plc ...... 2,475 2.3 Penn National Gaming, Inc...... 11,960 6.3 91.5% Americold Realty Trust ...... 9,559 0.6

132 Baron Funds

Baron International Growth Fund

Baron International Growth Fund is a diversified fund that invests in non-U.S companies with significant growth potential. Investments may be made across all market capitalizations. The Fund invests principally in companies of developed countries and may invest up to 35% in companies of developing countries. Equity %of Equity %of Market Cap Net Market Cap Net Company (in millions) Assets Company (in millions) Assets Tencent Holdings Limited ...... $722,519 1.4% Wix.com Ltd...... $16,374 1.1% Alibaba Group Holding Limited ...... 614,828 1.1 Suzano S.A...... 16,369 0.8 LVMH Moet Hennessy Louis Vuitton SE ...... 395,799 1.6 Arch Capital Group Ltd...... 15,717 1.2 Nestle S.A...... 350,548 1.1 argenx SE ...... 15,448 1.8 Reliance Industries Limited ...... 186,011 1.0 Dlocal Ltd...... 15,387 1.5 AstraZeneca PLC ...... 157,270 1.2 GDS Holdings Limited ...... 14,670 0.5 Linde plc ...... 149,911 1.6 MonotaRO Co., Ltd...... 11,948 0.8 Keyence Corporation ...... 123,142 1.2 Kingdee International Software Group Co. Ltd. ... 11,775 0.7 Sony Corporation ...... 122,600 0.4 Notre Dame Intermedica Participacoes S.A...... 10,506 0.6 HDFC Bank Limited ...... 111,375 0.5 InPost S.A...... 10,035 0.7 Industria de Diseno Textil, S.A...... 109,795 1.1 Monday.com Ltd...... 9,866 0.4 China Tourism Group Duty Free CAE Inc...... 9,038 0.7 Corporation Limited ...... 90,682 0.4 Korea Shipbuilding & Offshore Shenzhen Mindray Bio-Medical Engineering Co., Ltd...... 8,264 1.5 Electronics Co., Ltd...... 90,319 0.6 Kingsoft Corporation Ltd...... 8,230 0.6 Sberbank of Russia PJSC ...... 89,613 0.8 B&M European Value Retail S.A...... 7,936 1.0 Recruit Holdings Co., Ltd...... 84,069 1.2 China Conch Venture Holdings Ltd...... 7,694 0.6 BNP Paribas S.A...... 78,351 2.8 TeamViewer AG ...... 7,565 0.9 Midea Group Co., Ltd...... 77,846 0.4 Hua Hong Semiconductor Limited ...... 7,184 0.5 Compagnie Financiere Richemont SA ...... 69,475 0.7 Han’s Laser Technology Industry Tokyo Electron Limited ...... 67,854 1.0 Group Co., Ltd ...... 6,670 0.5 Novatek PJSC ...... 66,586 1.1 Clariant AG ...... 6,601 1.0 Housing Development Finance Dechra Pharmaceuticals PLC ...... 6,542 0.8 Corporation Limited ...... 60,133 0.6 Endava plc ...... 6,231 1.5 Pernod Ricard SA ...... 58,129 1.3 Square Enix Holdings Co., Ltd...... 5,901 0.4 Glencore PLC ...... 57,036 0.9 Winning Health Technology Group Co., Ltd...... 5,392 0.5 Itau Unibanco Banco Holding SA ...... 55,797 0.6 Godrej Properties Limited ...... 5,227 0.7 Takeda Pharmaceutical Company Limited ...... 52,962 1.4 Future plc ...... 5,226 2.7 Spotify Technology S.A...... 52,581 0.7 Max Financial Services Limited ...... 4,923 1.1 FANUC Corp...... 48,971 1.0 S4 Capital plc ...... 4,764 2.2 Bajaj Finance Limited ...... 48,852 1.6 NEXTDC Limited ...... 4,086 0.8 Lloyds Banking Group plc ...... 45,837 1.8 Tower Semiconductor Ltd...... 3,177 0.6 Kotak Mahindra Bank Ltd...... 45,495 0.2 Befesa S.A...... 3,064 1.6 Agilent Technologies, Inc...... 44,852 1.1 Nippon Life India Asset Management Limited .... 3,047 0.5 Will Semiconductor Co., Ltd...... 43,285 0.7 Network International Holdings Ltd...... 2,782 0.2 Cellnex Telecom, S.A...... 43,272 1.0 Watches of Switzerland Group Limited ...... 2,769 1.1 Telefonaktiebolaget LM Ericsson ...... 41,942 1.0 SMS Co., Ltd...... 2,608 0.8 Vivendi SA ...... 38,602 1.0 Afya Limited ...... 2,416 0.7 Grupo Mexico, S.A.B. de C.V...... 36,617 0.8 Taboola.com Ltd...... 2,407 0.6 Experian plc ...... 35,531 0.8 Hemnet Group AB ...... 2,161 0.1 Galaxy Entertainment Group Limited ...... 34,838 0.7 J D Wetherspoon plc ...... 2,098 0.9 Koninklijke DSM N.V...... 32,535 1.0 Arco Platform Limited ...... 1,766 0.5 Constellation Software, Inc...... 32,095 1.2 Detsky Mir PJSC ...... 1,528 0.7 Techtronic Industries Co. Ltd...... 32,020 0.8 similarweb Ltd...... 1,464 0.5 Credit Suisse Group AG ...... 27,767 1.4 Golar LNG Ltd...... 1,457 0.8 Genmab A/S ...... 26,793 1.0 AMG Advanced Metallurgical Group N.V...... 1,178 1.4 Epiroc AB ...... 26,423 1.0 JM Financial Limited ...... 1,135 0.4 XP Inc...... 24,347 0.6 eDreams ODIGEO SA ...... 956 0.5 Eurofins Scientific SE ...... 21,857 1.5 Edelweiss Financial Services Limited ...... 912 0.3 StoneCo Ltd...... 20,794 0.7 Okamoto Industries, Inc...... 716 0.5 NEXON Co., Ltd...... 19,525 0.4 WANdisco plc ...... 317 0.3 Symrise AG ...... 18,909 1.2 ION Acquisition Corp 2 Ltd...... 313 0.2 Advantest Corporation ...... 17,766 1.0 ION Acquisition Corp. 3 Ltd...... 310 0.2 TCS Group Holding PLC ...... 17,439 2.2 95.5% Zai Lab Limited ...... 16,798 1.6

133 Baron Funds

Baron Real Estate Fund

Baron Real Estate Fund is a diversified fund that invests 80% of its net assets in equity securities of U.S. and non-U.S. real estate and real estate-related companies of any size. The Fund’s investment in non-U.S. companies will not exceed 25%. Equity %of Equity %of Market Cap Net Market Cap Net Company (in millions) Assets Company (in millions) Assets Home Depot, Inc...... $339,063 1.1% Vornado Realty Trust ...... $8,936 2.5% Brookfield Asset Management Inc...... 175,035 3.4 Rexford Industrial Realty, Inc...... 8,147 1.1 Lowe’s Companies, Inc...... 137,116 3.0 Melco Resorts & Entertainment Limited ...... 7,933 1.1 American Tower Corp...... 122,832 3.0 SiteOne Landscape Supply, Inc...... 7,520 0.9 Prologis, Inc...... 88,422 1.8 Toll Brothers, Inc...... 7,132 0.6 Equinix, Inc...... 71,897 2.6 Boyd Gaming Corporation ...... 6,892 2.7 Cellnex Telecom, S.A...... 43,272 2.1 Marriott Vacations Worldwide Corp...... 6,801 2.5 Simon Property Group, Inc...... 42,868 2.6 CoreSite Realty Corporation ...... 6,614 1.4 Las Vegas Sands Corporation ...... 40,253 2.3 The AZEK Company Inc...... 6,570 1.5 SBA Communications Corp...... 34,848 1.0 Douglas Emmett, Inc...... 5,899 2.2 CoStar Group, Inc...... 32,709 2.2 Tripadvisor, Inc...... 5,518 1.5 D.R. Horton, Inc...... 32,577 0.5 The Howard Hughes Corporation ...... 5,371 2.1 Lennar Corporation ...... 30,461 1.1 Travel + Leisure Co...... 5,124 1.9 Zillow Group, Inc...... 30,289 2.6 Red Rock Resorts, Inc...... 4,971 3.4 Equity Residential ...... 28,798 0.9 JBG SMITH Properties ...... 4,144 0.9 CBRE Group, Inc...... 28,776 2.6 NEXTDC Limited ...... 4,086 0.8 Alexandria Real Estate Equities, Inc...... 28,302 1.5 Seaworld Entertainment Inc...... 3,948 0.4 Vulcan Materials Company ...... 23,093 2.2 DigitalBridge Group, Inc...... 3,849 0.8 Invitation Homes, Inc...... 21,168 2.0 Latham Group, Inc...... 3,848 2.0 Pool Corporation ...... 18,395 0.6 Six Flags Entertainment Corporation ...... 3,696 2.0 GDS Holdings Limited ...... 14,670 3.6 Installed Building Products, Inc...... 3,634 1.1 Wynn Resorts Ltd...... 14,145 1.8 Hilton Grand Vacations Inc...... 3,541 2.0 Fortune Brands Home & Security, Inc...... 13,806 1.3 American Assets Trust, Inc...... 2,255 1.0 Equity Lifestyle Properties, Inc...... 13,548 1.5 Janus International Group, Inc...... 1,924 0.9 Penn National Gaming, Inc...... 11,960 1.7 Go Acquisition Corp...... 703 0.4 Trex Company, Inc...... 11,791 0.3 Fifth Wall Acquisition Corp. I ...... 438 2.0 Gaming and Leisure Properties, Inc...... 10,785 1.0 RXR Acquisition Corp...... 430 0.7 Opendoor Technologies Inc...... 10,243 0.7 Tishman Speyer Innovati-Cl a (Shell) ...... 372 0.3 Jones Lang LaSalle Incorporated ...... 10,029 2.8 Fifth Wall Acquisition Corp III ...... 351 0.7 MGM Growth Properties LLC ...... 9,697 1.3 97.7% Americold Realty Trust ...... 9,559 1.2

134 Baron Funds

Baron Emerging Markets Fund

Baron Emerging Markets Fund is a diversified fund that invests 80% of its net assets in non-U.S. companies of all sizes domiciled, headquartered or whose primary business activities or principal trading markets are in developing countries. The Fund may invest up to 20% in companies in developed market countries and in Frontier Countries. Equity %of Equity %of Market Cap Net Market Cap Net Company (in millions) Assets Company (in millions) Assets Tencent Holdings Limited ...... $722,519 4.4% Zai Lab Limited ...... $16,798 2.2% Taiwan Semiconductor Manufacturing China Molybdenum Co., Ltd...... 16,441 0.7 Company Ltd...... 623,159 3.5 Suzano S.A...... 16,369 1.2 Alibaba Group Holding Limited ...... 614,828 3.4 Divi’s Laboratories Ltd...... 15,744 1.2 Samsung Electronics Co., Ltd...... 425,145 3.2 OTP Bank Plc...... 15,074 1.0 Meituan Inc...... 252,190 1.0 GDS Holdings Limited ...... 14,670 1.1 Reliance Industries Limited ...... 186,011 2.1 SBI Life Insurance Company Limited ...... 13,565 0.8 Ping An Insurance (Group) Company of Glodon Company Limited ...... 12,529 0.4 China, Ltd...... 180,791 0.5 Dr. Reddy’s Laboratories Ltd...... 12,137 1.1 Keyence Corporation ...... 123,142 0.7 Ozon Holdings PLC ...... 11,954 0.8 HDFC Bank Limited ...... 111,375 1.0 Banco Inter S.A...... 11,944 0.4 China Tourism Group Duty Free Kingdee International Software Group Co. Ltd. ... 11,775 1.0 Corporation Limited ...... 90,682 1.0 Credicorp Ltd...... 11,431 0.4 Shenzhen Mindray Bio-Medical Ayala Land, Inc...... 10,865 0.6 Electronics Co., Ltd...... 90,319 1.1 Notre Dame Intermedica Participacoes S.A...... 10,506 1.2 Sberbank of Russia PJSC ...... 89,613 1.8 BDO Unibank, Inc...... 10,168 0.6 Hindustan Unilever Limited ...... 78,118 0.6 InPost S.A...... 10,035 1.1 Midea Group Co., Ltd...... 77,846 1.0 Localiza Rent a Car S.A...... 9,760 1.0 Novatek PJSC ...... 66,586 1.9 ICICI Lombard General Insurance Housing Development Finance Company Limited ...... 9,585 0.7 Corporation Limited ...... 60,133 1.2 Tata Consumer Products Limited ...... 9,353 0.9 Glencore PLC ...... 57,036 1.7 Korea Shipbuilding & Offshore Wal-Mart de Mexico, S.A.B. de C.V...... 56,999 1.1 Engineering Co., Ltd...... 8,264 2.1 Itau Unibanco Banco Holding SA ...... 55,797 1.1 Kingsoft Corporation Ltd...... 8,230 1.2 Bajaj Finance Limited ...... 48,852 2.3 Lojas Americanas S.A...... 8,058 1.0 S. F. Holding Co., Ltd...... 47,740 0.5 Muthoot Finance Ltd...... 7,997 0.8 Kotak Mahindra Bank Ltd...... 45,495 0.6 China Conch Venture Holdings Ltd...... 7,694 1.2 Will Semiconductor Co., Ltd...... 43,285 1.0 Fix Price Group Ltd...... 7,438 0.6 Budweiser Brewing Company APAC Limited ..... 41,789 0.8 Hua Hong Semiconductor Limited ...... 7,184 0.8 Bharti Airtel Limited ...... 38,839 0.6 Han’s Laser Technology Industry Asian Paints Limited ...... 38,620 0.9 Group Co., Ltd ...... 6,670 0.8 Shenzhou International Group Holdings Ltd...... 37,966 1.3 Jubilant FoodWorks Limited ...... 5,469 0.5 Grupo Mexico, S.A.B. de C.V...... 36,617 1.0 Winning Health Technology Group Co., Ltd...... 5,392 0.5 Galaxy Entertainment Group Limited ...... 34,838 1.1 Godrej Properties Limited ...... 5,227 0.5 Techtronic Industries Co. Ltd...... 32,020 1.3 Tata Communications Limited ...... 4,935 1.0 Delta Electronics, Inc...... 28,248 1.4 Max Financial Services Limited ...... 4,923 1.7 Lufax Holding Ltd...... 27,824 0.4 Venustech Group Inc...... 4,192 0.7 Yum China Holdings Inc...... 27,438 1.1 Aarti Industries Ltd ...... 4,087 0.5 PJSC Polyus ...... 26,329 0.5 Nippon Life India Asset Management Limited .... 3,047 0.7 Hangzhou Tigermed Consulting Co., Ltd...... 25,301 1.1 Network International Holdings Ltd...... 2,782 0.3 Yandex N.V...... 25,248 0.6 Shanghai Henlius Biotech, Inc...... 2,667 0.2 XP Inc...... 24,347 1.0 Afya Limited ...... 2,416 0.5 China Mengniu Dairy Co. Ltd...... 23,875 1.1 ACM Research, Inc...... 1,946 0.3 Yunnan Baiyao Group Co., Ltd...... 22,877 0.8 Aeris Industria Comercio Equipamentos Beijing Oriental Yuhong Waterproof Geracao Energia SA ...... 1,528 0.5 Technology Co., Ltd...... 21,606 1.3 New Frontier Health Corporation ...... 1,473 0.3 StoneCo Ltd...... 20,794 1.2 Golar LNG Ltd...... 1,457 0.6 Titan Company Limited ...... 20,693 0.8 JM Financial Limited ...... 1,135 0.5 Kanzhun Limited ...... 18,650 0.0 Edelweiss Financial Services Limited ...... 912 0.3 Sino Biopharmaceutical Ltd...... 18,511 0.8 Hemisphere Properties India Limited ...... 529 0.1 PagSeguro Digital Ltd...... 18,389 0.1 DD3 Acquisition Corp. II ...... 132 0.0 TCS Group Holding PLC ...... 17,439 0.9 93.4%

135 Baron Funds

Baron Global Advantage Fund

Baron Global Advantage Fund is a diversified fund that invests primarily in established and emerging markets companies located throughout the world with capitalization within the range of companies included in the MSCI ACWI Index. Equity %of Equity %of Market Cap Net Market Cap Net Company (in millions) Assets Company (in millions) Assets Amazon.com, Inc...... $1,734,954 4.6% Zai Lab Limited ...... $16,798 2.2% Alphabet Inc...... 1,658,759 5.4 Dynatrace Holdings LLC ...... 16,571 1.9 Facebook, Inc...... 985,920 3.9 Wix.com Ltd...... 16,374 2.4 Alibaba Group Holding Limited ...... 614,828 3.9 TAL Education Group ...... 16,269 0.6 ASML Holding N.V...... 288,205 0.9 argenx SE ...... 15,448 2.5 Meituan Inc...... 252,190 2.0 Dlocal Ltd...... 15,387 1.5 Shopify Inc...... 182,127 2.2 SoFi Technologies, Inc...... 15,245 2.6 Pinduoduo Inc...... 159,193 0.8 GDS Holdings Limited ...... 14,670 1.8 Sea Limited ...... 144,009 0.3 Guardant Health, Inc...... 12,558 1.4 Airbnb, Inc...... 94,567 0.0 Nuvei Technologies Corp...... 12,127 1.7 MercadoLibre, Inc...... 77,659 2.5 Opendoor Technologies Inc...... 10,243 1.2 Adyen N.V...... 74,712 1.4 InPost S.A...... 10,035 0.5 Coupang, LLC ...... 72,456 0.9 Monday.com Ltd...... 9,866 0.3 Snowflake Inc...... 71,604 1.4 BridgeBio Pharma, Inc...... 9,100 1.0 Illumina, Inc...... 69,089 2.3 Globant, S.A...... 9,099 0.6 Twilio Inc...... 68,070 2.6 Fiverr International Ltd...... 8,692 2.7 CrowdStrike, Inc...... 56,749 2.0 Arrowhead Pharmaceuticals, Inc...... 8,620 1.1 Bajaj Finance Limited ...... 48,852 1.5 Acceleron Pharma Inc...... 7,617 2.8 Veeva Systems Inc...... 47,550 2.0 Endava plc ...... 6,231 2.8 Okta, Inc...... 36,946 0.5 nCino Inc...... 5,719 0.0 Cloudflare, Inc...... 32,877 1.4 Schrodinger, Inc...... 5,331 1.1 Datadog, Inc...... 32,097 0.8 Zymergen Inc...... 4,014 1.0 Zscaler, Inc...... 29,597 0.9 Afya Limited ...... 2,416 1.2 EPAM Systems, Inc...... 28,821 3.0 Taboola.com Ltd...... 2,407 0.9 RingCentral, Inc...... 26,406 2.6 Arco Platform Limited ...... 1,766 0.7 10X Genomics, Inc...... 21,501 2.0 MaxCyte, Inc...... 1,053 0.4 StoneCo Ltd...... 20,794 1.2 ION Acquisition Corp 2 Ltd...... 313 0.2 ZoomInfo Technologies Inc...... 20,417 1.8 Sarissa Capital Acquisition Corp...... 248 0.5 Allegro.eu ...... 17,610 0.0 DD3 Acquisition Corp. II ...... 132 0.4 Bill.com Holdings, Inc...... 17,108 0.9 93.7%

136 Baron Funds

Baron Discovery Fund

Baron Discovery Fund invests in small-sized growth companies with market capitalizations up to the largest market cap stock in the Russell 2000 Growth Index at reconstitution, or companies with market capitalizations up to $2.5 billion, whichever is larger. Equity %of Equity %of Market Cap Net Market Cap Net Company (in millions) Assets Company (in millions) Assets Dynatrace Holdings LLC ...... $16,571 1.0% Accolade, Inc...... $3,587 0.9% Penn National Gaming, Inc...... 11,960 0.6 Kratos Defense & Security Solutions, Inc...... 3,527 1.6 Trex Company, Inc...... 11,791 1.1 Alkami Technology Inc...... 3,065 1.2 Floor & Decor Holdings, Inc...... 11,089 1.9 Berkeley Lights, Inc...... 2,990 0.1 Liberty Media Corporation – Liberty UTZ Brands, Inc...... 2,982 0.8 Formula One ...... 11,022 0.4 Axonics, Inc...... 2,908 2.0 Americold Realty Trust ...... 9,559 0.8 Nova Measuring Instruments Ltd...... 2,907 1.3 Rexford Industrial Realty, Inc...... 8,147 1.0 CryoPort, Inc...... 2,883 0.6 Shift4 Payments, Inc...... 7,584 0.9 Melco International Development Limited ...... 2,785 0.7 SiteOne Landscape Supply, Inc...... 7,520 1.5 Butterfly Network, Inc...... 2,770 0.4 DoubleVerify, Inc...... 6,656 1.9 The Cheesecake Factory, Inc...... 2,692 0.5 Biohaven Pharmaceutical Holding Veracyte, Inc...... 2,689 1.7 Company Ltd...... 6,317 0.7 MYT Netherlands Parent B.V...... 2,629 0.5 Endava plc ...... 6,231 2.6 BRP Group, Inc...... 2,563 1.0 Recursion Pharmaceuticals, Inc...... 6,144 0.7 Helios Technologies, Inc...... 2,516 1.2 Varonis Systems, Inc...... 6,117 1.8 ESCO Technologies, Inc...... 2,443 0.4 Petco Health and Wellness Company, Inc...... 5,922 0.6 Hydrofarm Holdings Group, Inc...... 2,353 0.7 Shoals Technologies Group, Inc...... 5,915 0.4 American Assets Trust, Inc...... 2,255 0.5 Kornit Digital Ltd...... 5,730 1.6 Revance Therapeutics, Inc...... 2,120 1.7 Tripadvisor, Inc...... 5,518 1.7 The Beauty Health Company ...... 2,106 2.1 Ollie’s Bargain Outlet Holdings, Inc...... 5,492 0.6 Raven Industries Inc...... 2,078 1.3 Medallia Inc...... 5,352 0.4 Seer, Inc...... 2,011 0.1 Inspire Medical Systems, Inc...... 5,259 0.5 Ping Identity Corporation ...... 1,880 1.7 Allegro MicroSystems, Inc...... 5,252 1.2 PAR Technology Corporation ...... 1,810 1.6 Future plc ...... 5,226 2.1 The RealReal, Inc...... 1,794 0.4 Progyny, Inc...... 5,223 2.0 TPI Composites, Inc...... 1,778 1.7 Everbridge, Inc...... 5,125 1.5 Viant Technology Inc...... 1,755 0.7 Red Rock Resorts, Inc...... 4,971 2.1 Silk Road Medical, Inc...... 1,650 1.3 Novanta Inc...... 4,768 0.1 Eargo, Inc...... 1,546 0.6 S4 Capital plc ...... 4,764 1.7 Ichor Holdings, Ltd...... 1,511 1.6 CareDx, Inc...... 4,764 2.3 Inogen, Inc...... 1,460 2.3 SailPoint Technologies Holdings, Inc...... 4,715 1.6 Indie Semiconductor, Inc...... 1,430 1.1 Wingstop Inc...... 4,687 0.1 Montrose Environmental Group, Inc...... 1,398 1.6 Inari Medical, Inc...... 4,634 0.4 ViewRay Incorporated ...... 1,068 1.3 Advanced Energy Industries, Inc...... 4,330 2.3 Cerus Corporation ...... 1,012 0.8 Paymentus Holdings, Inc...... 4,166 0.5 AxoGen, Inc...... 886 0.6 Fevertree Drinks plc ...... 4,148 1.6 Applied Therapeutics, Inc...... 542 0.2 JBG SMITH Properties ...... 4,144 1.6 Acutus Medical, Inc...... 478 0.8 Olink Holding AB ...... 4,096 0.3 TherapeuticsMD, Inc...... 468 0.2 Zymergen Inc...... 4,014 0.6 Sientra, Inc...... 458 0.9 ACV Auctions Inc...... 3,961 1.3 Fifth Wall Acquisition Corp. I ...... 438 0.2 Qualys, Inc...... 3,941 0.4 Jaws Spitfire Acquisition Corporation ...... 432 0.4 Kinsale Capital Group, Inc...... 3,759 1.9 Laird Superfood, Inc...... 269 0.1 Mercury Systems, Inc...... 3,722 2.5 92.2%

137 Baron Funds

Baron Durable Advantage Fund

Baron Durable Advantage Fund invests primarily in large-sized companies with market capitalizations no smaller than the top 90th percentile by market capitalization of the S&P 500 Index at June 30, or companies with market capitalizations above $10 billion, whichever is smaller. Equity %of Equity %of Market Cap Net Market Cap Net Company (in millions) Assets Company (in millions) Assets Microsoft Corporation ...... $2,040,304 7.6% CME Group, Inc...... $76,373 2.4% Alphabet Inc...... 1,658,759 8.2 Equinix, Inc...... 71,897 1.0 Facebook, Inc...... 985,920 6.7 Moody’s Corporation ...... 67,836 3.7 Alibaba Group Holding Limited ...... 614,828 1.2 Ecolab Inc...... 58,895 1.0 Visa, Inc...... 515,712 4.5 Iqvia Holdings Inc...... 46,443 2.8 UnitedHealth Group Incorporated ...... 377,896 2.7 Constellation Brands, Inc...... 45,133 2.4 Mastercard Incorporated ...... 361,822 3.9 IHS Markit Ltd...... 44,908 2.4 Adobe Inc...... 279,936 4.3 Agilent Technologies, Inc...... 44,852 1.7 Thermo Fisher Scientific Inc...... 198,271 2.9 TE Connectivity Ltd...... 44,650 1.1 Danaher Corporation ...... 191,416 4.5 MSCI, Inc...... 43,938 2.8 Accenture plc ...... 187,220 2.6 Mettler-Toledo International, Inc...... 32,236 1.5 Texas Instruments Incorporated ...... 177,594 1.7 Alexandria Real Estate Equities, Inc...... 28,302 0.9 Costco Wholesale Corporation ...... 174,914 1.9 SS&C Technologies Holdings, Inc...... 18,431 1.6 Charter Communications, Inc...... 153,877 1.3 HEICO Corporation ...... 17,635 1.7 BlackRock Inc...... 134,302 2.6 Monolithic Power Systems, Inc...... 17,087 1.5 Intuit Inc...... 133,944 2.9 Arch Capital Group Ltd...... 15,717 1.8 The Estee Lauder Companies Inc...... 115,308 1.0 Fair Isaac Corporation ...... 14,466 1.7 S&P Global Inc...... 98,877 2.8 97.1% Fidelity National Information Services, Inc...... 87,853 1.8

Baron Real Estate Income Fund

Baron Real Estate Income Fund is a non-diversified fund that under normal circumstances, invests at least 80% of its net assets in real estate income- producing securities and other real estate securities of any market capitalization, including common stocks and equity securities, debt and preferred securities, non-U.S. real estate income-producing securities, and any other real estate-related yield securities. Equity %of Equity %of Market Cap Net Market Cap Net Company (in millions) Assets Company (in millions) Assets American Tower Corp...... $122,832 5.1% Gaming and Leisure Properties, Inc...... $10,785 2.2% Prologis, Inc...... 88,422 3.5 MGM Growth Properties LLC ...... 9,697 2.6 Crown Castle International Corp...... 84,320 1.9 Americold Realty Trust ...... 9,559 1.8 Equinix, Inc...... 71,897 3.6 STORE Capital Corporation ...... 9,335 0.4 Public Storage Incorporated ...... 52,614 3.2 Vornado Realty Trust ...... 8,936 3.5 Simon Property Group, Inc...... 42,868 3.7 Rexford Industrial Realty, Inc...... 8,147 1.9 Las Vegas Sands Corporation ...... 40,253 1.4 Melco Resorts & Entertainment Limited ...... 7,933 1.1 SBA Communications Corp...... 34,848 1.1 CoreSite Realty Corporation ...... 6,614 3.6 Welltower Inc...... 34,696 1.5 Douglas Emmett, Inc...... 5,899 2.7 Equity Residential ...... 28,798 1.5 Travel + Leisure Co...... 5,124 2.3 Alexandria Real Estate Equities, Inc...... 28,302 2.5 Red Rock Resorts, Inc...... 4,971 2.9 Brookfield Infrastructure Partners L.P...... 23,186 3.6 Park Hotels & Resorts Inc...... 4,874 2.5 Invitation Homes, Inc...... 21,168 5.7 Terreno Realty Corporation ...... 4,488 0.4 Sun Communities, Inc...... 19,167 2.3 JBG SMITH Properties ...... 4,144 2.3 Boston Properties, Inc...... 17,885 0.5 DigitalBridge Group, Inc...... 3,849 2.5 Duke Realty Corporation ...... 17,756 1.1 Pebblebrook Hotel Trust ...... 3,094 3.1 GDS Holdings Limited ...... 14,670 2.5 Kennedy-Wilson Holdings, Inc...... 3,037 1.6 Wynn Resorts Ltd...... 14,145 0.9 American Assets Trust, Inc...... 2,255 1.5 Equity Lifestyle Properties, Inc...... 13,548 2.3 Paramount Group, Inc...... 2,205 1.5 American Homes 4 Rent ...... 12,636 2.9 Fifth Wall Acquisition Corp. I ...... 438 1.6 Host Hotels & Resorts, Inc...... 12,067 2.8 97.2% Penn National Gaming, Inc...... 11,960 1.6

138 Baron Funds

Baron Health Care Fund

Baron Health Care Fund is a non-diversified fund that under normal circumstances, invests at least 80% of its net assets in equity securities in the form of common stock of companies engaged in the research, development, production, sale, delivery or distribution of products and services related to the health care industry. Equity %of Equity %of Market Cap Net Market Cap Net Company (in millions) Assets Company (in millions) Assets UnitedHealth Group Incorporated ...... $377,896 6.0% Denali Therapeutics Inc...... $9,506 1.3% Eli Lilly and Company ...... 220,116 1.8 BridgeBio Pharma, Inc...... 9,100 1.0 Abbott Laboratories ...... 205,987 1.6 Arrowhead Pharmaceuticals, Inc...... 8,620 2.0 Thermo Fisher Scientific Inc...... 198,271 3.3 Beam Therapeutics Inc...... 8,054 1.1 Intuitive Surgical, Inc...... 108,897 1.8 Acceleron Pharma Inc...... 7,617 3.9 Moderna, Inc...... 94,351 1.4 HealthEquity, Inc...... 6,711 1.3 Zoetis Inc...... 88,478 2.4 ShockWave Medical, Inc...... 6,637 1.4 Cigna Corporation ...... 81,350 1.0 Dechra Pharmaceuticals PLC ...... 6,542 2.5 Illumina, Inc...... 69,089 0.8 Twist Bioscience Corporation ...... 6,515 1.3 Edwards Lifesciences Corp...... 64,383 2.7 Recursion Pharmaceuticals, Inc...... 6,144 1.0 Humana Inc...... 57,117 3.7 Schrodinger, Inc...... 5,331 1.4 BioNTech SE ...... 54,072 1.3 Inspire Medical Systems, Inc...... 5,259 1.4 IDEXX Laboratories, Inc...... 53,859 1.4 Inari Medical, Inc...... 4,634 1.6 Veeva Systems Inc...... 47,550 0.7 Certara, Inc...... 4,334 0.1 DexCom, Inc...... 41,293 1.0 Olink Holding AB ...... 4,096 1.3 Mettler-Toledo International, Inc...... 32,236 2.5 Zymergen Inc...... 4,014 0.9 Alexandria Real Estate Equities, Inc...... 28,302 1.8 CryoPort, Inc...... 2,883 0.8 Genmab A/S ...... 26,793 1.9 Dicerna Pharmaceuticals, Inc...... 2,870 0.8 West Pharmaceutical Services, Inc...... 26,510 2.0 Butterfly Network, Inc...... 2,770 0.2 10X Genomics, Inc...... 21,501 1.0 Establishment Labs Holdings Inc...... 2,069 1.1 Teleflex Incorporated ...... 18,777 2.2 Seer, Inc...... 2,011 0.1 Insulet Corp...... 18,192 1.9 Silk Road Medical, Inc...... 1,650 0.7 Bio-Techne Corporation ...... 17,511 4.1 Eargo, Inc...... 1,546 0.6 Zai Lab Limited ...... 16,798 2.0 MaxCyte, Inc...... 1,053 1.2 argenx SE ...... 15,448 3.7 Opsens Inc...... 196 1.5 Guardant Health, Inc...... 12,558 2.0 91.7% ICON Plc ...... 10,927 5.2

139 Baron Funds

Baron FinTech Fund

Baron FinTech Fund is a non-diversified fund that, under normal circumstances, invests at least 80% of its net assets in securities of companies that develop, use, or rely on innovative technologies or services, in a significant way, for banking, lending, capital markets, financial data analytics, insurance, payments, asset management, or wealth management. The Fund may purchase securities of companies of any market capitalization and may invest in foreign stocks, including emerging market securities. Equity %of Equity %of Market Cap Net Market Cap Net Company (in millions) Assets Company (in millions) Assets Alibaba Group Holding Limited ...... $614,828 1.2% MarketAxess Holdings Inc...... $17,608 1.2% Visa, Inc...... 515,712 4.1 TCS Group Holding PLC ...... 17,439 2.2 Mastercard Incorporated ...... 361,822 3.4 Bill.com Holdings, Inc...... 17,108 1.3 PayPal Holdings, Inc...... 342,410 4.2 Dlocal Ltd...... 15,387 3.2 Accenture plc ...... 187,220 2.2 SoFi Technologies, Inc...... 15,245 1.5 Shopify Inc...... 182,127 2.8 Marqeta, Inc...... 15,075 1.0 BlackRock Inc...... 134,302 2.5 Fair Isaac Corporation ...... 14,466 3.0 Intuit Inc...... 133,944 4.2 Ceridian HCM Holding Inc...... 14,315 0.6 Square, Inc...... 111,019 3.5 Jack Henry & Associates, Inc...... 12,146 0.9 S&P Global Inc...... 98,877 3.7 Nuvei Technologies Corp...... 12,127 2.8 Fidelity National Information Services, Inc...... 87,853 2.3 Banco Inter S.A...... 11,944 0.8 MercadoLibre, Inc...... 77,659 2.5 Guidewire Software, Inc...... 9,373 2.0 CME Group, Inc...... 76,373 0.7 Shift4 Payments, Inc...... 7,584 1.1 Adyen N.V...... 74,712 3.2 Endava plc ...... 6,231 4.2 Moody’s Corporation ...... 67,836 2.5 Duck Creek Technologies, Inc...... 5,725 0.4 London Stock Exchange Group PLC ...... 61,430 0.5 nCino Inc...... 5,719 0.0 Global Payments Inc...... 55,365 1.0 Houlihan Lokey, Inc...... 5,578 1.4 IHS Markit Ltd...... 44,908 2.4 Paymentus Holdings, Inc...... 4,166 0.9 MSCI, Inc...... 43,938 2.8 Kinsale Capital Group, Inc...... 3,759 0.6 CoStar Group, Inc...... 32,709 1.9 Alkami Technology Inc...... 3,065 0.1 Zillow Group, Inc...... 30,289 1.5 Network International Holdings Ltd...... 2,782 0.8 EPAM Systems, Inc...... 28,821 3.6 BRP Group, Inc...... 2,563 0.8 Verisk Analytics, Inc...... 28,321 1.0 Repay Holdings Corporation ...... 2,366 0.7 TransUnion ...... 21,007 2.7 Paya Holdings Inc...... 1,396 0.4 ZoomInfo Technologies Inc...... 20,417 0.7 Grid Dynamics Holdings Inc ...... 814 0.8 Tradeweb Markets Inc...... 19,637 1.2 95.0%

140 Baron Funds

Baron Asset Fund — PORTFOLIO HOLDINGS June 30, 2021 (Unaudited)

Shares Cost Value Shares Cost Value Common Stocks (98.57%) Common Stocks (continued) Communication Services (6.53%) Health Care (26.41%) Cable & Satellite (0.92%) Biotechnology (0.51%) 330,000 Liberty Broadband 136,925 Acceleron Pharma, Inc.1 $ 13,026,017 $ 17,182,718 Corporation, Cl C1 $ 23,532,283 $ 57,307,800 48,366 argenx SE, ADR 1,2 15,852,353 14,561,552 Interactive Media & 28,878,370 31,744,270 Services (5.61%) Health Care Equipment (9.57%) 542,000 Pinterest, Inc., Cl A1 21,216,031 42,790,900 173,000 DexCom, Inc.1 55,276,881 73,871,000 1,453,144 Tripadvisor, Inc.1 51,198,572 58,561,703 708,630 IDEXX Laboratories, Inc.1 12,876,509 447,535,276 1,287,965 Zillow Group, Inc., Cl C1 44,039,787 157,415,082 189,644 Teleflex, Inc. 37,305,542 76,197,063 1,755,709 ZoomInfo Technologies Inc., Cl A1 44,675,584 91,595,339 105,458,932 597,603,339 161,129,974 350,363,024 Health Care Supplies (3.95%) Total Communication Services 184,662,257 407,670,824 215,418 The Cooper Companies, Inc. 36,713,299 85,363,691 Consumer Discretionary (6.97%) 449,404 West Pharmaceutical Services, Inc. 19,479,340 161,380,976 56,192,639 246,744,667 Education Services (0.35%) 150,000 Bright Horizons Family Health Care Technolgy (2.29%) Solutions, Inc.1 16,921,054 22,066,500 459,386 Veeva Systems, Inc., Cl A1 27,115,596 142,846,077 Hotels, Resorts & Cruise Life Sciences Tools & Lines (1.72%) Services (10.09%) 546,442 Choice Hotels International, Inc. 5,198,084 64,950,096 100,682 10X Genomics, Inc., Cl A1 3,926,598 19,715,549 543,233 Hyatt Hotels Corp., Cl A1 16,817,762 42,176,610 399,986 Bio-Techne Corporation 39,595,545 180,097,696 22,015,846 107,126,706 351,000 Guardant Health, Inc.1,4 32,239,895 43,590,690 247,552 Illumina, Inc.1 10,591,861 117,144,082 Internet & Direct Marketing 194,117 Mettler-Toledo International, Inc.1 11,674,111 268,918,045 Retail (1.84%) 98,028,010 629,466,062 1,025,000 Farfetch Limited, Cl A1,2 29,811,176 51,619,000 1,050,000 Stitch Fix, Inc., Cl A1 62,079,746 63,315,000 Total Health Care 315,673,547 1,648,404,415 91,890,922 114,934,000 Industrials (13.20%) Leisure Facilities (3.06%) Environmental & Facilities 603,538 Vail Resorts, Inc.1,5 11,683,688 191,031,848 Services (0.90%) Total Consumer Discretionary 142,511,510 435,159,054 1,643,418 Rollins, Inc. 24,597,482 56,204,896 Industrial Conglomerates (1.98%) Financials (10.09%) 262,192 Roper Technologies, Inc. 27,877,853 123,282,678 Asset Management & Custody Banks (0.75%) Industrial Machinery (1.20%) 237,514 T. Rowe Price Group, Inc.1 5,729,987 47,020,647 340,760 IDEX Corporation 24,525,881 74,984,238 Financial Exchanges & Research & Consulting Data (4.60%) Services (9.12%) 370,725 FactSet Research Systems, Inc. 19,898,420 124,419,017 2,230,474 Clarivate Plc1,2 35,903,681 61,404,949 257,267 MarketAxess Holdings, Inc. 31,487,484 119,266,409 2,154,930 CoStar Group, Inc.1 42,162,593 178,471,303 30,000 MSCI, Inc. 7,783,774 15,992,400 1,468,500 TransUnion 79,691,638 161,255,985 326,189 Tradeweb Markets, Inc., Cl A 11,978,713 27,582,542 961,206 Verisk Analytics, Inc. 23,863,743 167,941,912 71,148,391 287,260,368 181,621,655 569,074,149 Total Industrials 258,622,871 823,545,961 Insurance Brokers (0.58%) 2 158,421 Willis Towers Watson plc 19,439,430 36,439,998 Information Technology (30.62%) Investment Banking & Application Software (14.86%) Brokerage (2.13%) 576,856 ANSYS, Inc.1 21,397,893 200,203,643 1,825,936 The Charles Schwab Corp. 1,609,715 132,946,400 395,300 Aspen Technology, Inc.1 40,628,908 54,369,562 390,000 Avalara, Inc.1 55,839,446 63,102,000 Property & Casualty 1,636,093 Ceridian HCM Holding, Inc.1 64,026,866 156,934,041 Insurance (1.38%) 125,000 Fair Isaac Corp.1 51,657,237 62,835,000 2,203,444 Arch Capital Group Ltd.1,2 7,933,936 85,802,109 1,421,809 Guidewire Software, Inc.1 77,473,157 160,266,310 Regional Banks (0.65%) 35,000 HubSpot, Inc.1 18,056,213 20,395,200 216,421 First Republic Bank 5,518,736 40,507,519 322,000 RingCentral, Inc., Cl A1 77,597,681 93,566,760 771,076 SS&C Technologies Holdings, Inc. 20,933,204 55,563,737 Total Financials 111,380,195 629,977,041 780,000 The Trade Desk, Inc., Cl A1 15,425,650 60,340,800 443,036,255 927,577,053

141 Baron Funds

Baron Asset Fund — PORTFOLIO HOLDINGS (Continued) June 30, 2021 (Unaudited)

Shares Cost Value Shares Cost Value Common Stocks (continued) Private Preferred Stocks (0.61%) Information Technology (continued) Industrials (0.61%)

Data Processing & Outsourced Aerospace & Defense (0.61%) 96,298 Space Exploration Services (1.43%) Technologies Corp., Cl N 629,217 Fidelity National Information 1,3,4 Services, Inc. $ 36,278,576 $ 89,141,172 $ 26,000,460 $ 38,352,605 Electronic Components (0.99%) 900,000 Amphenol Corp., Cl A 42,881,684 61,569,000 Principal Amount Internet Services & Short Term Investments (0.82%) Infrastructure (5.34%) 1,2 $51,045,138 Repurchase Agreement 680,000 GDS Holdings Limited, ADR 40,586,224 53,373,200 with Fixed Income 592,103 Verisign, Inc.1 27,318,889 134,815,932 1,2 Clearing Corp., dated 500,000 Wix.com Ltd. 46,031,911 145,140,000 6/30/2021, 0.00% due 113,937,024 333,329,132 7/1/2021; Proceeds at maturity - $51,045,138; IT Consulting & Other (Fully collateralized by Services (6.89%) $47,122,600 U.S. 132,000 EPAM Systems, Inc.1 47,054,412 67,446,720 Treasury Note, 2.625% 1,497,323 Gartner, Inc.1 32,461,274 362,651,631 due 2/15/2029; Market 79,515,686 430,098,351 value - $52,066,060) $ 51,045,138 $ 51,045,138 Technology Distributors (1.11%) TOTAL INVESTMENTS (100.00%) $1,911,288,210 6,241,803,638 397,363 CDW Corp. 26,228,965 69,399,448 LIABILITIES LESS CASH AND OTHER Total Information Technology 741,878,190 1,911,114,156 ASSETS (0.00%)6 (175,676) Materials (0.53%) NET ASSETS $6,241,627,962 Specialty Chemicals (0.53%) 1,2 RETAIL SHARES (Equivalent to $120.84 per share 1,853,529 Diversey Holdings Ltd. 27,802,935 33,196,704 based on 24,141,184 shares outstanding) $2,917,243,914

Real Estate (4.22%) INSTITUTIONAL SHARES (Equivalent to $126.65 per share Real Estate Services (0.75%) based on 24,777,612 shares outstanding) $3,138,012,121 542,323 CBRE Group, Inc., Cl A1 6,067,334 46,493,351 R6 SHARES (Equivalent to $126.62 per share Specialized REITs (3.47%) based on 1,471,852 shares outstanding) $ 186,371,927 205,000 Alexandria Real Estate Equities, Inc.4 31,042,395 37,297,700 80,416 Equinix, Inc. 5,298,108 64,541,882 360,856 SBA Communications Corp. 9,303,270 115,004,807 % Represents percentage of net assets. 1 Non-income producing securities. 45,643,773 216,844,389 2 Foreign corporation. 3 Total Real Estate 51,711,107 263,337,740 At June 30, 2021, the market value of restricted and fair valued securities amounted to $38,352,605 or 0.61% of net assets. This security is not deemed TOTAL COMMON STOCKS 1,834,242,612 6,152,405,895 liquid. 4 The Adviser has reclassified/classified certain securities in or out of this sub-industry. Such reclassifications/classifications are not supported by S&P or MSCI (unaudited). 5 All or a portion of these securities are segregated for an unfunded commitment. Total value of securities segregated is $21,206,840. 6 Includes unrealized depreciation of $205,192 on an unfunded commitment with a special purpose acquisition company to purchase a when-issued private investment in a public entity. ADR American Depositary Receipt.

142 Baron Funds

Baron Growth Fund — PORTFOLIO HOLDINGS June 30, 2021 (Unaudited)

Shares Cost Value Shares Cost Value Common Stocks (99.39%) Common Stocks (continued) Communication Services (4.24%) Health Care (15.41%) Alternative Carriers (3.53%) Biotechnology (0.59%) 7,950,000 Iridium Communications, Inc.1,4 $ 49,070,299 $ 317,920,500 678,051 Denali Therapeutics, Inc.1 $ 12,825,338 $ 53,186,321 Movies & Entertainment (0.71%) Health Care Equipment (5.20%) 4,179,925 Manchester United plc, Cl A2 57,977,822 63,493,061 740,000 IDEXX Laboratories, Inc.1 10,565,702 467,347,000 Total Communication Services 107,048,121 381,413,561 Health Care Supplies (2.68%) 1,147,434 Neogen Corp.1 13,141,411 52,827,861 Consumer Discretionary (21.53%) 525,000 West Pharmaceutical Services, Inc. 17,892,374 188,527,500 Casinos & Gaming (6.12%) 31,033,785 241,355,361 440,000 Boyd Gaming Corporation1 11,056,072 27,055,600 5,900,000 Penn National Gaming, Inc.1 77,439,857 451,291,000 Health Care Technology (0.80%) 1,695,000 Red Rock Resorts, Inc., Cl A1 31,634,189 72,037,500 950,000 Schrödinger, Inc.1 15,170,276 71,829,500 120,130,118 550,384,100 Life Sciences Tools & Services (5.74%) Education Services (2.20%) 400,000 Adaptive Biotechnologies 1,345,000 Bright Horizons Family 1 1 Corporation 12,792,857 16,344,000 Solutions, Inc. 42,571,904 197,862,950 850,000 Bio-Techne Corporation 44,923,357 382,721,000 Hotels, Resorts & Cruise 85,000 Mettler-Toledo International, Inc.1 3,889,531 117,753,900 Lines (6.18%) 61,605,745 516,818,900 3,000,000 Choice Hotels International, Inc.4 72,782,127 356,580,000 1,255,000 Marriott Vacations Pharmaceuticals (0.40%) Worldwide Corp.1 67,098,661 199,921,500 598,076 Dechra Pharmaceuticals PLC (United Kingdom)2 18,422,044 36,153,819 139,880,788 556,501,500 Total Health Care 149,622,890 1,386,690,901 Leisure Facilities (7.03%) 2,000,000 Vail Resorts, Inc.1,6 56,102,209 633,040,000 Industrials (8.09%) Total Consumer Discretionary 358,685,019 1,937,788,550 Building Products (2.26%) 1,995,000 Trex Company, Inc.1 18,026,985 203,908,950 Financials (29.74%) Diversified Support Asset Management & Custody Services (0.14%) Banks (2.73%) 485,453 ACV Auctions, Inc., Cl A1 12,136,325 12,442,161 1,925,000 The Carlyle Group, Inc. 40,151,787 89,474,000 1,900,000 Cohen & Steers, Inc. 43,941,528 155,971,000 Environmental & Facilities 84,093,315 245,445,000 Services (0.22%) 1,220,102 BrightView Holdings, Inc.1 15,117,285 19,668,044 Financial Exchanges & Data (17.27%) Industrial Machinery (0.46%) 1,200,000 FactSet Research Systems, Inc. 59,954,575 402,732,000 1,000,000 Desktop Metal, Inc.1 10,000,000 11,500,000 985,000 Morningstar, Inc. 20,175,455 253,253,350 4,275,000 Marel hf (Netherlands)2 18,281,670 29,704,819 1,685,000 MSCI, Inc. 31,666,491 898,239,800 28,281,670 41,204,819 111,796,521 1,554,225,150 Research & Consulting Investment Banking & Services (5.01%) Brokerage (0.89%) 5,440,000 CoStar Group, Inc.1 22,751,587 450,540,800 450,000 Houlihan Lokey, Inc. 19,625,874 36,805,500 Total Industrials 96,313,852 727,764,774 760,000 Moelis & Co., Cl A 16,518,301 43,236,400 36,144,175 80,041,900 Information Technology (14.51%) Application Software (9.89%) Life & Health Insurance (2.79%) 725,000 Altair Engineering, Inc., Cl A1 11,330,019 50,003,250 1,640,000 Primerica, Inc. 34,474,886 251,149,600 1,210,000 ANSYS, Inc.1 28,048,125 419,942,600 Property & Casualty 1,025,000 Guidewire Software, Inc.1 31,789,104 115,538,000 Insurance (5.80%) 1,000,000 Pegasystems, Inc. 13,997,009 139,190,000 9,165,000 Arch Capital Group Ltd.1,2 28,618,247 356,885,100 2,300,000 SS&C Technologies 1,000,000 Kinsale Capital Group, Inc. 35,007,763 164,770,000 Holdings, Inc. 17,679,331 165,738,000 63,626,010 521,655,100 102,843,588 890,411,850 Thrifts & Mortgage Finance (0.26%) 520,000 Essent Group Ltd.2 14,300,210 23,374,000 Total Financials 344,435,117 2,675,890,750

143 Baron Funds

Baron Growth Fund — PORTFOLIO HOLDINGS (Continued) June 30, 2021 (Unaudited)

Shares Cost Value Shares Cost Value Common Stocks (continued) Warrants (0.00%) Information Technology (continued) Consumer Discretionary (0.00%) Electronic Components (0.17%) Hotels, Resorts & Cruise 60,000 Littelfuse, Inc. $ 6,452,400 $ 15,287,400 Lines (0.00%) 96,515 OneSpaWorld Holdings Ltd. Warrants, Internet Services & Exp 3/19/20241,2,5 $ 0 $ 299,197 Infrastructure (0.21%) 65,000 Wix.com Ltd.1,2 3,017,698 18,868,200 TOTAL INVESTMENTS (99.91%) $1,413,921,860 8,990,853,364

IT Consulting & Other CASH AND OTHER ASSETS Services (4.24%) LESS LIABILITIES (0.09%)7 8,098,955 1,575,000 Gartner, Inc.1 22,061,707 381,465,000 NET ASSETS $8,998,952,319 Total Information Technology 134,375,393 1,306,032,450 RETAIL SHARES (Equivalent to $113.60 per share Materials (0.11%) based on 26,300,266 shares outstanding) $2,987,665,143 Commodity Chemicals (0.11%) 249,756 Zymergen, Inc.1 7,742,436 9,992,737 INSTITUTIONAL SHARES (Equivalent to $118.44 per share based on 48,920,662 shares outstanding) $5,794,017,304 Real Estate (5.76%) R6 SHARES (Equivalent to $118.45 per share Diversified REITs (0.08%) based on 1,834,253 shares outstanding) $ 217,269,872 200,000 American Assets Trust, Inc. 3,506,055 7,458,000

Office REITs (1.38%) % Represents percentage of net assets. 3,700,000 Douglas Emmett, Inc. 40,811,196 124,394,000 1 Non-income producing securities. 2 Foreign corporation. Specialized REITs (4.30%) 3 At June 30, 2021, the market value of restricted and fair valued securities 750,000 Alexandria Real Estate amounted to $46,491,444 or 0.52% of net assets. These securities are not Equities, Inc.5 26,366,340 136,455,000 deemed liquid. 5,400,000 Gaming and Leisure Properties, Inc. 114,990,451 250,182,000 4 An “Affiliated” investment may include any company in which the Fund owns 141,356,791 386,637,000 5% or more of its outstanding shares. 5 The Adviser has reclassified/classified certain securities in or out of this Total Real Estate 185,674,042 518,489,000 sub-industry. Such reclassifications/classifications are not supported by S&P or MSCI (unaudited). TOTAL COMMON STOCKS 1,383,896,870 8,944,062,723 6 All or a portion of these securities are segregated for unfunded commitments. Total value of securities segregated is $61,088,360. 7 Includes net unrealized appreciation of $1,154,327 on unfunded commitments Private Convertible Preferred Stocks (0.52%) with special purpose acquisition companies to purchase when-issued private investments in public entities. Industrials (0.18%) Electrical Components & Equipment (0.18%) 59,407,006 Northvolt AB, Series E (Sweden)2,3,5 9,374,988 16,197,320 Materials (0.34%) Commodity Chemicals (0.18%) 418,777 Zymergen, Inc., Series D1,3 9,350,000 15,687,386 Fertilizers & Agricultural Chemicals (0.16%) 341,838 Farmers Business Network, Inc., Series F1,3,5 11,300,002 14,606,738 Total Materials 20,650,002 30,294,124 TOTAL PRIVATE CONVERTIBLE PREFERRED STOCKS 30,024,990 46,491,444

144 Baron Funds

Baron Small Cap Fund — PORTFOLIO HOLDINGS June 30, 2021 (Unaudited)

Shares Cost Value Shares Cost Value Common Stocks (98.23%) Common Stocks (continued) Communication Services (3.80%) Financials (3.87%) Cable & Satellite (1.62%) Insurance Brokers (1.48%) 80,000 Liberty Broadband 3,000,000 BRP Group, Inc., Cl A1 $ 48,364,954 $ 79,950,000 Corporation, Cl A1 $ 319,985 $ 13,453,600 260,000 Liberty Broadband Investment Banking & Corporation, Cl C1 1,017,091 45,151,600 Brokerage (0.94%) 625,000 Liberty Media Corp.-Liberty 625,000 Houlihan Lokey, Inc. 28,909,333 51,118,750 1 SiriusXM, Cl C 1,322,731 28,993,750 Property & Casualty 2,659,807 87,598,950 Insurance (1.45%) 475,000 Kinsale Capital Group, Inc. 67,820,848 78,265,750 Movies & Entertainment (2.18%) 1,250,000 Liberty Media Corporation-Liberty Total Financials 145,095,135 209,334,500 Formula One, Cl C1 22,521,105 60,262,500 225,000 Madison Square Garden Health Care (16.33%) Entertainment Corp.1 3,552,159 18,893,250 Health Care Equipment (6.38%) 225,000 Madison Square Garden 1,000,000 Axonics, Inc.1 35,459,918 63,410,000 Sports Corp.1 8,416,556 38,828,250 300,000 CryoPort, Inc.1 13,683,573 18,930,000 34,489,820 117,984,000 200,000 DexCom, Inc.1 2,652,860 85,400,000 100,000 IDEXX Laboratories, Inc.1 1,383,489 63,155,000 Total Communication Services 37,149,627 205,582,950 320,000 Inspire Medical Systems, Inc.1,5 16,558,159 61,843,200 1,100,000 Silk Road Medical, Inc.1,5 45,930,627 52,646,000 Consumer Discretionary (14.59%) 115,668,626 345,384,200 Casinos & Gaming (3.79%) 925,000 DraftKings, Inc., Cl A1 11,844,047 48,257,250 Health Care Services (0.54%) 1,025,000 Penn National Gaming, Inc.1 18,170,393 78,402,250 500,000 Innovage Holding Corp. 1 11,059,903 10,655,000 1,850,000 Red Rock Resorts, Inc., Cl A1 38,035,830 78,625,000 3,250,000 SOC Telemed, Inc.1 32,300,144 18,492,500 68,050,270 205,284,500 43,360,047 29,147,500 Education Services (1.70%) Health Care Supplies (0.46%) 625,000 Bright Horizons Family 500,000 Figs, Inc., Cl A1 12,760,012 25,050,000 Solutions, Inc.1 19,174,147 91,943,750 Health Care Technology (0.39%) General Merchandise 741,845 Certara, Inc.1 17,505,744 21,016,469 Stores (0.94%) 600,000 Ollie’s Bargain Outlet Life Sciences Tools & Services (6.07%) 1,5 Holdings, Inc.1 36,339,481 50,478,000 250,000 Guardant Health, Inc. 4,953,266 31,047,500 600,000 ICON plc1,2 16,994,341 124,026,000 Home Improvement 2,250,000 MaxCyte, Inc. (United Kingdom)1,5 26,123,920 27,949,576 Retail (2.49%) 37,500 Mettler-Toledo International, Inc.1 1,817,455 51,950,250 1,275,000 Floor & Decor Holdings, Inc., Cl A1 45,156,042 134,767,500 315,373 Olink Holding AB, ADR1,2 7,482,198 10,855,138 500,000 PRA Health Sciences, Inc.1 9,000,000 82,605,000 Homebuilding (3.56%) 1,575,000 Installed Building Products, Inc.4 88,774,702 192,717,000 66,371,180 328,433,464 Leisure Facilities (1.11%) Managed Health Care (1.37%) 800,000 Planet Fitness, Inc., Cl A1 28,416,505 60,200,000 925,000 HealthEquity, Inc.1 18,699,522 74,444,000 Restaurants (1.00%) Pharmaceuticals (1.12%) 1,000,000 The Cheesecake Factory, Inc.1 22,120,507 54,180,000 1,000,000 Dechra Pharmaceuticals PLC (United Kingdom)2 28,027,985 60,450,209 Total Consumer Discretionary 308,031,654 789,570,750 Total Health Care 302,393,116 883,925,842 Consumer Staples (1.21%) Industrials (24.81%) Packaged Foods & Meats (1.21%) 3,000,000 UTZ Brands, Inc. 49,020,000 65,370,000 Aerospace & Defense (4.29%) 2,350,000 Kratos Defense & Security Solutions, Inc.1 35,335,984 66,951,500 1,275,000 Mercury Systems, Inc.1 43,874,314 84,507,000 125,000 TransDigm Group, Inc.1 0 80,911,250 79,210,298 232,369,750

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Shares Cost Value Shares Cost Value Common Stocks (continued) Common Stocks (continued) Industrials (continued) Information Technology (continued) Building Products (2.99%) Electronic Equipment & Instruments (1.86%) 1,090,609 The AZEK Co., Inc.1 $ 25,084,007 $ 46,307,258 1,200,000 Cognex Corp. $ 9,420,069 $ 100,860,000 3,000,000 Janus International Group, Inc. Cl A3 30,000,000 41,280,000 725,000 Trex Company, Inc.1 27,101,408 74,102,250 Internet Services & Infrastructure (1.61%) 300,000 Wix.com Ltd.1,2 15,501,799 87,084,000 82,185,415 161,689,508 IT Consulting & Other Services (6.82%) Diversified Support Services (1.06%) 786,473 Endava plc, ADR1,2 25,308,704 89,170,309 1,850,000 Driven Brands Holdings, Inc.1 45,803,401 57,202,000 1,000,000 Gartner, Inc.1 14,988,362 242,200,000 2,500,000 Grid Dynamics Holdings, Inc.1 24,881,763 37,575,000 Electrical Components & Equipment (4.82%) 65,178,829 368,945,309 1,750,000 Array Technologies, Inc.1 37,616,575 27,300,000 1,200,000 Shoals Technologies Systems Software (0.42%) Group, Inc., Cl A 1 32,825,720 42,600,000 682,429 Jamf Holding Corp.1,5 19,287,457 22,909,142 7,000,000 Vertiv Holdings Co. 69,871,612 191,100,000 Total Information Technology 382,576,071 1,408,949,983 140,313,907 261,000,000 Materials (2.75%) Environmental & Facilities Commodity Chemicals (0.15%) Services (1.32%) 1,000,000 Origin Materials, Inc.3 10,000,000 7,980,000 600,000 Waste Connections, Inc.2 26,200,000 71,658,000 Metal & Glass Human Resource & Employment Containers (0.96%) Services (3.42%) 800,000 Berry Global Group, Inc.1 12,652,147 52,176,000 1,550,000 ASGN, Inc.1 34,021,695 150,241,500 1,750,000 First Advantage Corp.1 26,390,061 34,842,500 Specialty Chemicals (1.64%) 60,411,756 185,084,000 1,809,631 Avient Corp. 57,788,524 88,961,460 Total Materials 80,440,671 149,117,460 Industrial Machinery (1.83%) 500,000 John Bean Technologies Corp. 42,775,112 71,310,000 Real Estate (3.84%) 140,000 RBC Bearings, Incorporated1 8,868,639 27,918,800 Specialized REITs (3.84%) 51,643,751 99,228,800 2,800,000 Americold Realty Trust5 63,378,545 105,980,000 Research & Consulting Services (2.03%) 320,000 SBA Communications Corp. 1,289,008 101,984,000 4,000,000 Clarivate Plc1,2 44,078,833 110,120,000 Total Real Estate 64,667,553 207,964,000 Trading Companies & Distributors (3.05%) 500,000 Hydrofarm Holdings Group, Inc.1,5 23,336,421 29,555,000 Special Purpose 800,000 SiteOne Landscape Supply, Inc.1,6 19,405,950 135,408,000 Acquisition Company (1.00%) 42,742,371 164,963,000 Special Purpose Acquisition Company (1.00%) Total Industrials 572,589,732 1,343,315,058 1,500,000 Empower Ltd., Cl A 1,2 15,125,768 15,015,000 1,250,000 Fifth Wall Acquisition Information Technology (26.03%) Corp. I, Cl A1 13,300,697 15,387,500 Application Software (9.86%) 1,903,162 Landcadia Holdings III, Inc., Cl A1 21,262,512 23,599,209 1 750,000 Altair Engineering, Inc., Cl A 11,935,619 51,727,500 Total Special Purpose Acquisition Company 49,688,977 54,001,709 800,000 Aspen Technology, Inc.1 29,983,938 110,032,000 850,000 Ceridian HCM Holding, Inc.1 23,711,721 81,532,000 TOTAL COMMON STOCKS 1,991,652,536 5,317,132,252 3,000,000 E2open Parent Holdings, Inc., Cl A3 30,000,000 33,060,000 2,500,000 E2open Parent Holdings, Inc.1 26,380,601 28,550,000 1,225,000 Guidewire Software, Inc.1 31,269,358 138,082,000 Warrants (0.07%) 1 1,175,000 The Trade Desk, Inc., Cl A 4,171,250 90,898,000 Consumer Discretionary (0.01%) 157,452,487 533,881,500 Hotels, Resorts & Cruise Data Processing & Outsourced Lines (0.01%) Services (5.46%) 260,850 OneSpaWorld Holdings Ltd. 750,000 Nuvei Corp. (Canada)1,2 20,780,312 61,875,000 Warrants, Exp 3/19/20241,5 0 808,635 3,500,000 Paya Holdings, Inc., Cl A1 36,561,336 38,570,000 3,500,000 Repay Holdings Corporation1 33,000,000 84,140,000 Consumer Staples (0.06%) 405,170 Shift4 Payments, Inc., Cl A1 9,677,975 37,972,532 Packaged Foods & Meats (0.06%) 375,000 WEX, Inc.1 15,715,807 72,712,500 1,403,600 Whole Earth Brands, Inc., 115,735,430 295,270,032 Exp 6/25/2025 1 0 3,115,992 TOTAL WARRANTS 0 3,924,627

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Principal Amount Cost Value Short Term Investments (1.56%) $84,671,422 Repurchase Agreement with Fixed Income Clearing Corp., dated 6/30/2021, 0.00% due 7/1/2021; Proceeds at maturity - $84,671,422; (Fully collateralized by $87,962,600 U.S. Treasury Bond, 1.875% due 2/15/2041 Market value - $86,364,883) $ 84,671,422 $ 84,671,422 TOTAL INVESTMENTS (99.86%) $2,076,323,958 5,405,728,301

CASH AND OTHER ASSETS LESS LIABILITIES (0.14%)7 7,586,000 NET ASSETS $5,413,314,301

RETAIL SHARES (Equivalent to $40.17 per share based on 45,591,407 shares outstanding) $1,831,323,086

INSTITUTIONAL SHARES (Equivalent to $42.56 per share based on 77,856,478 shares outstanding) $3,313,343,802

R6 SHARES (Equivalent to $42.54 per share based on 6,314,793 shares outstanding) $ 268,647,413

% Represents percentage of net assets. 1 Non-income producing securities. 2 Foreign corporation. 3 At June 30, 2021, the market value of restricted and fair valued securities amounted to $82,320,000 or 1.52% of net assets. These securities are not deemed liquid. 4 An “Affiliated” investment may include any company in which the Fund owns 5% or more of its outstanding shares. 5 The Adviser has reclassified/classified certain securities in or out of this sub-industry. Such reclassifications/classifications are not supported by S&P or MSCI (unaudited). 6 All or a portion of these securities are segregated for unfunded commitments. Total value of securities segregated is $89,369,280. 7 Includes net unrealized appreciation of $9,193 on unfunded commitments with special purpose acquisition companies to purchase when-issued private investments in public entities. ADR American Depositary Receipt.

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Shares Cost Value Shares Cost Value Common Stocks (94.97%) Common Stocks (continued) Communication Services (20.06%) Health Care (continued) Interactive Home Health Care Technology (0.54%) Entertainment (1.53%) 116,374 Schrödinger, Inc.1 $ 2,485,556 $ 8,799,038 114,000 Electronic Arts, Inc. $ 13,119,491 $ 16,396,620 47,500 Take-Two Interactive Software, Inc.1 5,288,027 8,408,450 Life Sciences Tools & Services (3.47%) 18,407,518 24,805,070 50,419 10X Genomics, Inc., Cl A1 3,006,785 9,873,049 227,500 CareDx, Inc.1,4 7,236,973 20,820,800 Interactive Media & 98,637 Guardant Health, Inc.1,4 10,366,504 12,249,729 Services (16.63%) 28,215 Illumina, Inc.1 5,301,531 13,351,620 39,550 Alphabet, Inc., Cl C1,5 53,222,693 99,124,956 431,500 Pinterest, Inc., Cl A1 13,138,359 34,066,925 25,911,793 56,295,198 428,000 Snap, Inc., Cl A1 6,424,270 29,163,920 Total Health Care 116,318,407 242,114,847 444,001 Taboola.com Ltd. (formerly, ION Acquisition Corp. 1 Limited)1,2,3,4 4,440,010 4,431,130 Industrials (2.74%) 949,406 Tripadvisor, Inc.1 32,758,749 38,261,062 199,303 Zillow Group, Inc., Cl C1 12,604,492 24,358,812 Aerospace & Defense (1.13%) 778,369 ZoomInfo Technologies Inc., Cl A1 25,572,629 40,607,511 642,969 Kratos Defense & Security Solutions, Inc.1 10,282,149 18,318,187 148,161,202 270,014,316 Research & Consulting Movies & Entertainment (1.90%) Services (1.61%) 650,000 Endeavor Group Holdings, Inc., Cl A1 15,600,000 18,011,500 315,330 CoStar Group, Inc.1 12,772,623 26,115,630 24,425 Netflix, Inc.1 3,966,732 12,901,529 Total Industrials 23,054,772 44,433,817 19,566,732 30,913,029 Total Communication Services 186,135,452 325,732,415 Information Technology (39.84%) Application Software (13.05%) Consumer Discretionary (13.17%) 34,900 Adobe, Inc.1 8,174,023 20,438,836 1,2 Automobile Manufacturers (2.84%) 49,000 Atlassian Corp. PLC 11,935,490 12,586,140 57,000 Avalara, Inc.1 7,910,726 9,222,600 67,900 Tesla, Inc.1 2,677,714 46,151,630 333,070 Ceridian HCM Holding, Inc.1 23,544,543 31,948,074 Internet & Direct Marketing 232,100 Guidewire Software, Inc.1 11,878,404 26,162,312 Retail (10.33%) 21,000 HubSpot, Inc.1 10,883,860 12,237,120 105,500 Alibaba Group Holding 145,100 RingCentral, Inc., Cl A1 30,943,581 42,163,158 Limited, ADR1,2 17,661,028 23,925,290 39,500 ServiceNow, Inc.1,4 9,588,431 21,707,225 1,2 24,275 Amazon.com, Inc.1 29,742,116 83,509,884 333,283 SimilarWeb Ltd. 7,167,469 6,565,675 1 293,900 Farfetch Limited, Cl A1,2 13,864,220 14,800,804 149,410 The Trade Desk, Inc., Cl A 1,424,601 11,558,358 1 8,529 MercadoLibre, Inc.1 4,838,488 13,286,391 72,700 Workday, Inc., Cl A 17,226,487 17,356,398 533,000 Stitch Fix, Inc., Cl A1 28,973,389 32,139,900 140,677,615 211,945,896 95,079,241 167,662,269 Data Processing & Outsourced Total Consumer Discretionary 97,756,955 213,813,899 Services (6.88%) 3,000 Adyen N.V., 144A (Netherlands)1,2 2,422,754 7,356,988 Financials (1.56%) 72,300 MasterCard Incorporated, Cl A 16,486,273 26,396,007 112,200 PayPal Holdings, Inc.1 15,729,601 32,704,056 Consumer Finance (1.17%) 42,500 Square, Inc., Cl A1 7,600,761 10,361,500 990,099 SoFi Technologies, Inc.1 9,900,990 18,980,198 149,300 Visa, Inc., Cl A 25,109,011 34,909,326 Financial Exchanges & 67,348,400 111,727,877 Data (0.39%) 13,600 MarketAxess Holdings, Inc. 2,665,441 6,304,824 Electronic Equipment & Instruments (1.18%) Total Financials 12,566,431 25,285,022 275,000 PAR Technology Corp.1 10,889,761 19,233,500 Health Care (14.91%) Internet Services & Infrastructure (2.27%) Biotechnology (6.65%) 220,677 GDS Holdings Limited, ADR1,2 11,246,223 17,320,938 265,779 Acceleron Pharma, Inc.1 22,137,670 33,352,607 67,043 Wix.com Ltd.1,2 3,803,923 19,461,242 113,639 argenx SE, ADR1,2 13,172,425 34,213,294 487,600 Arrowhead Pharmaceuticals, Inc.1 22,064,385 40,383,032 15,050,146 36,782,180 57,374,480 107,948,933 IT Consulting & Other Services (3.42%) Health Care Equipment (4.05%) 202,368 Endava plc, ADR1,2 6,819,469 22,944,484 525,000 Butterfly Network, Inc.1 5,250,000 7,602,000 134,587 Gartner, Inc.1 7,154,309 32,596,971 131,100 Edwards Lifesciences Corp.1 7,561,453 13,578,027 20,435 Intuitive Surgical, Inc.1 9,530,452 18,792,843 13,973,778 55,541,455 136,000 Shockwave Medical, Inc.1 6,757,535 25,803,280 Semiconductors (3.36%) 29,099,440 65,776,150 390,000 indie Semiconductor, Inc., Cl A1 4,158,481 3,853,200 1,000,000 indie Semiconductor Inc., Cl A1,3 10,000,000 9,490,000 Health Care Supplies (0.20%) 51,600 NVIDIA Corp. 18,021,141 41,285,160 65,779 Figs, Inc., Cl A1 1,447,138 3,295,528 32,179,622 54,628,360

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Shares Cost Value Shares Cost Value Common Stocks (continued) Warrants (0.02%) Information Technology (continued) Communication Services (0.02%) Systems Software (9.68%) Interactive Media & 61,723 Crowdstrike Holdings, Inc., Cl A1 $ 3,067,061 $ 15,511,607 Services (0.02%) 493,900 Microsoft Corporation 78,400,719 133,797,510 106,682 Taboola.com Ltd. 32,508 Snowflake, Inc., Cl A1,4 3,900,960 7,860,435 Exp 10/15/20271,2 $ 192,759 $ 330,714 85,368,740 157,169,552 Total Information Technology 365,488,062 647,028,820 Principal Amount Materials (0.49%) Short Term Investments (1.01%) Commodity Chemicals (0.49%) $16,392,013 Repurchase Agreement with 199,805 Zymergen, Inc.1 6,193,955 7,994,198 Fixed Income Clearing Corp., dated 6/30/2021, 0.00% Real Estate (1.87%) due 7/1/2021; Proceeds at maturity - $16,392,013; (Fully Real Estate Services (1.17%) 1 collateralized by $13,042,100 1,073,230 Opendoor Technologies, Inc. 10,732,300 19,028,368 U.S. Treasury Bond, 5.25% Specialized REITs (0.70%) due 11/15/2028 Market 14,225 Equinix, Inc. 2,122,124 11,416,985 value - $16,719,868) 16,392,013 16,392,013 Total Real Estate 12,854,424 30,445,353 TOTAL INVESTMENTS (99.11%) $ 878,237,645 1,609,431,321 Special Purpose Acquisition Company (0.33%) CASH AND OTHER ASSETS 6 500,000 The Original Bark Co.1,3 5,000,000 5,305,000 LESS LIABILITIES (0.89%) 14,481,280 TOTAL COMMON STOCKS 825,368,458 1,542,153,371 NET ASSETS $1,623,912,601 RETAIL SHARES (Equivalent to $44.42 per share Private Common Stocks (0.29%) based on 20,558,851 shares outstanding) $ 913,240,460 Industrials (0.29%) INSTITUTIONAL SHARES (Equivalent to $46.80 per share 9,099 Space Exploration based on 14,416,157 shares outstanding) $ 674,639,606 Technologies Corp., Cl A1,3,4 3,821,489 3,623,859 2,806 Space Exploration R6 SHARES (Equivalent to $46.85 per share Technologies Corp., Cl C1,3,4 1,178,492 1,117,545 based on 769,084 shares outstanding) $ 36,032,535 TOTAL PRIVATE COMMON STOCKS 4,999,981 4,741,404 % Represents percentage of net assets. 1 Non-income producing securities. Private Convertible Preferred Stocks (1.93%) 2 Foreign corporation. 3 At June 30, 2021, the market value of restricted and fair valued securities Consumer Discretionary (1.35%) amounted to $69,781,353 or 4.30% of net assets. These securities are not deemed liquid. Automobile Manufacturers (1.35%) 4 The Adviser has reclassified/classified certain securities in or out of this 484,183 Rivian Automotive, Inc., Series E1,3,4 7,499,995 17,498,374 sub-industry. Such reclassifications/classifications are not supported by S&P 122,117 Rivian Automotive, Inc., Series F1,3,4 4,500,011 4,464,597 or MSCI (unaudited). Total Consumer Discretionary 12,000,006 21,962,971 5 All or a portion of these securities are segregated for unfunded commitments. Total value of securities segregated is $25,063,200. 6 Materials (0.58%) Includes net unrealized depreciation of $609,369 on unfunded commitments with special purpose acquisition companies to purchase when-issued private Fertilizers & Agricultural investments in public entities. Chemicals (0.58%) ADR American Depositary Receipt. 219,321 Farmers Business Network, Inc., 144A Security is exempt from registration pursuant to Rule 144A under the Series F1,3,4 7,250,007 9,371,587 Securities Act of 1933. This security may be resold in transactions that are exempt from registration, normally to qualified institutional buyers. At TOTAL PRIVATE CONVERTIBLE June 30, 2021, the market value of Rule 144A securities amounted to PREFERRED STOCKS 19,250,013 31,334,558 $7,356,988 or 0.45% of net assets.

Private Preferred Stocks (0.89%) Industrials (0.89%) Aerospace & Defense (0.45%) 18,519 Space Exploration Technologies Corp., Cl N1,3,4 5,000,130 7,375,562 Trucking (0.44%) 266,956 GM Cruise Holdings, Cl G1,3,4 7,034,291 7,103,699 TOTAL PRIVATE PREFERRED STOCKS 12,034,421 14,479,261

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Shares Cost Value Shares Cost Value Common Stocks (103.31%) Common Stocks (continued) Communication Services (9.50%) Health Care (7.71%) Alternative Carriers (0.90%) Biotechnology (0.38%) 1,550,000 Iridium Communications, Inc.1 $ 36,086,794 $ 61,984,500 60,000 BioNTech SE, ADR1,2 $ 12,817,509 $ 13,432,800 55,000 Moderna, Inc.1 9,305,078 12,923,900 Interactive Home Entertainment (1.09%) 22,122,587 26,356,700 790,000 Activision Blizzard, Inc. 46,068,301 75,397,600 Health Care Equipment (7.33%) Interactive Media & 800,000 IDEXX Laboratories, Inc.1 35,048,046 505,240,000 Services (4.89%) 2,750,000 Zillow Group, Inc., Cl A1 107,616,334 336,957,500 Total Health Care 57,170,633 531,596,700 Movies & Entertainment (2.62%) Industrials (9.30%) 5,978,371 Manchester United plc, Cl A2 103,126,035 90,811,455 325,000 Spotify Technology SA1,2 74,931,790 89,566,750 Aerospace & Defense (0.47%) 125,625 HEICO Corp. 9,632,520 17,514,637 178,057,825 180,378,205 116,875 HEICO Corp., Cl A 7,586,429 14,513,538 Total Communication Services 367,829,254 654,717,805 17,218,949 32,028,175 Consumer Discretionary (51.05%) Research & Consulting Services (8.83%) Automobile 7,350,000 CoStar Group, Inc.1 98,974,400 608,727,000 Manufacturers (41.18%) 4,175,000 Tesla, Inc.1,5 188,464,376 2,837,747,500 Total Industrials 116,193,349 640,755,175 Casinos & Gaming (0.37%) Information Technology (9.98%) 600,000 Red Rock Resorts, Inc., Cl A1 14,182,756 25,500,000 Application Software (2.91%) Hotels, Resorts & Cruise 124,287 AppLovin Corp., Cl A1 9,942,960 9,342,654 Lines (4.89%) 925,000 Guidewire Software, Inc.1 74,997,711 104,266,000 2,900,000 Hyatt Hotels Corp., Cl A1 84,480,627 225,156,000 300,000 RingCentral, Inc., Cl A1 78,500,510 87,174,000 700,000 Marriott Vacations Worldwide Corp.1 81,762,309 111,510,000 163,441,181 200,782,654 166,242,936 336,666,000 Data Processing & Outsourced Internet & Direct Marketing Services (2.11%) Retail (0.02%) 59,246 Adyen N.V. , 144A (Netherlands)1,2 53,544,382 145,290,709 10,553 Airbnb, Inc., Cl A1,4 717,604 1,616,086 Internet Services & Leisure Facilities (4.59%) 1,000,000 Vail Resorts, Inc.1,6 48,702,009 316,520,000 Infrastructure (2.50%) 700,000 GDS Holdings Limited, ADR1,2 37,434,005 54,943,000 Total Consumer Discretionary 418,309,681 3,518,049,586 1,916,348 GDS Holdings Limited, Cl A (Hong Kong)1,2 20,200,657 18,823,624 Financials (13.53%) 67,500 Shopify, Inc., Cl A1,2 48,766,450 98,616,150 Asset Management & Custody 106,401,112 172,382,774 Banks (1.13%) 1,000,000 Brookfield Asset IT Consulting & Other Management, Inc., Cl A2 35,923,845 50,980,000 Services (2.46%) 333,079 Cohen & Steers, Inc. 23,794,543 27,342,455 700,000 Gartner, Inc.1 83,980,674 169,540,000 59,718,388 78,322,455 Total Information Technology 407,367,349 687,996,137 Reinsurance (0.01%) Materials (0.41%) 6,897 Brookfield Asset Management Reinsurance Partners Ltd., Cl A1,2 365,517 358,759 Commodity Chemicals (0.41%) 709,957 Zymergen, Inc.1 22,586,992 28,405,380 Financial Exchanges & Data (4.57%) Real Estate (1.75%) 700,000 FactSet Research Systems, Inc. 46,576,636 234,927,000 150,000 MSCI, Inc. 37,181,742 79,962,000 Office REITs (0.53%) 83,758,378 314,889,000 1,085,000 Douglas Emmett, Inc. 29,974,652 36,477,700 Investment Banking & Specialized REITs (1.22%) Brokerage (4.12%) 1,819,296 Gaming and Leisure Properties, Inc. 57,585,382 84,287,984 3,900,000 The Charles Schwab Corp. 86,233,677 283,959,000 Total Real Estate 87,560,034 120,765,684 Property & Casualty Insurance (3.70%) Special Purpose Acquisition Company (0.08%) 6,550,000 Arch Capital Group Ltd.1,2 30,153,582 255,057,000 500,000 Atlas Crest Investment Corp.1 5,000,000 5,226,200 Total Financials 260,229,542 932,586,214 TOTAL COMMON STOCKS 1,742,246,834 7,120,098,881

150 Baron Funds

Baron Partners Fund — PORTFOLIO HOLDINGS (Continued) June 30, 2021 (Unaudited)

Shares Cost Value Principal Amount Cost Value Private Common Stocks (1.45%) Short Term Investments (0.07%) Industrials (1.45%) $4,893,675 Repurchase Agreement with Fixed Income Clearing Corp., dated Aerospace & Defense (1.45%) 6/30/2021, 0.00% due 7/1/2021; 221,631 Space Exploration Proceeds at maturity - $4,893,675; Technologies Corp., Cl A1,3,4 $ 29,920,185 $ 88,268,978 (Fully collateralized by 30,221 Space Exploration $1,413,700 U.S. Treasury Bond, Technologies Corp., Cl C1,3,4 4,079,835 12,036,118 5.25% due 11/15/2028 Market TOTAL PRIVATE COMMON STOCKS 34,000,020 100,305,096 value - $1,812,352) and $2,877,400 U.S. Treasury Note, 2.625% due 2/15/2029 Market Private Convertible Preferred Stocks (0.11%) value - $3,179,258) $ 4,893,675 $ 4,893,675 Industrials (0.11%) TOTAL INVESTMENTS (108.14%) $1,883,234,137 7,453,196,897 Electrical Components & LIABILITIES LESS CASH AND Equipment (0.11%) OTHER ASSETS (-8.14%)7 (561,520,266) 21,213,656 Northvolt AB, Series E2 (Sweden)1,2,3,4 7,843,621 7,305,856 NET ASSETS $6,891,676,631 RETAIL SHARES (Equivalent to $171.23 per share Private Preferred Stocks (3.20%) based on 18,577,871 shares outstanding) $3,181,133,847 Industrials (3.20%) INSTITUTIONAL SHARES (Equivalent to $176.53 per share based on 18,210,369 shares outstanding) $3,214,676,405 Aerospace & Defense (3.20%) 311,111 Space Exploration 1,3,4 R6 SHARES (Equivalent to $176.52 per share Technologies Corp., Cl H 41,999,985 123,906,178 based on 2,809,121 shares outstanding) $ 495,866,379 131,657 Space Exploration Technologies Corp., Cl I1,3,4 22,250,032 52,435,033 111,111 Space Exploration % Represents percentage of net assets. Technologies Corp., Cl N1,3,4 29,999,970 44,252,178 1 Non-income producing securities. 2 Foreign corporation. TOTAL PRIVATE PREFERRED STOCKS 94,249,987 220,593,389 3 At June 30, 2021, the market value of restricted and fair valued securities amounted to $328,204,341 or 4.76% of net assets. These securities are not deemed liquid. 4 The Adviser has reclassified/classified certain securities in or out of this sub-industry. Such reclassifications/classifications are not supported by S&P or MSCI (unaudited). 5 Investors in the Fund may view Tesla, Inc.’s financial statements on the EDGAR website of the U.S. Securities and Exchange Commission by going to https://www.sec.gov/cgi-bin/browse-edgar?CIK=1318605&owner=exclude. Please note that the Fund is not responsible for Tesla’s financial statements and can provide no assurances as to their accuracy or completeness. 6 All or a portion of these securities are segregated for an unfunded commitment. Total value of securities segregated is $5,697,360. 7 Includes unrealized depreciation of $200,600 on an unfunded commitment with a special purpose acquisition company to purchase a when-issued private investment in a public entity. ADR American Depositary Receipt. 144A Security is exempt from registration pursuant to Rule 144A under the Securities Act of 1933. This security may be resold in transactions that are exempt from registration, normally to qualified institutional buyers. At June 30, 2021, the market value of Rule 144A securities amounted to $145,290,709 or 2.11% of net assets.

151 Baron Funds

Baron Fifth Avenue Growth Fund — PORTFOLIO HOLDINGS June 30, 2021 (Unaudited)

Shares Cost Value Shares Cost Value Common Stocks (98.55%) Common Stocks (continued) Communication Services (13.10%) Information Technology (continued) Interactive Media & Services (13.10%) Internet Services & 11,490 Alphabet, Inc., Cl A1 $ 17,696,238 $ 28,056,167 Infrastructure (4.91%) 10,283 Alphabet, Inc., Cl C1 4,420,382 25,772,489 14,315 Shopify, Inc., Cl A1,2 $ 17,403,397 $ 20,913,929 116,389 Facebook, Inc., Cl A1 16,229,480 40,469,619 70,014 Wix.com Ltd.1,2 9,796,907 20,323,664 1 301,416 ZoomInfo Technologies Inc., Cl A 9,285,584 15,724,873 27,200,304 41,237,593 Total Communication Services 47,631,684 110,023,148 IT Consulting & Other Consumer Discretionary (12.98%) Services (3.87%) 63,602 EPAM Systems, Inc.1 9,148,341 32,498,078 Internet & Direct Marketing Retail (12.98%) Semiconductor Equipment (3.22%) 1,107 Airbnb, Inc., Cl A1,3 75,276 169,526 39,157 ASML Holding N.V.2 4,042,938 27,051,222 104,576 Alibaba Group Holding Limited, ADR1,2 10,970,281 23,715,745 19,267 Amazon.com, Inc.1 8,804,069 66,281,563 Semiconductors (2.14%) 12,138 MercadoLibre, Inc.1 7,661,536 18,908,455 22,540 NVIDIA Corp. 12,544,356 18,034,254 Total Consumer Discretionary 27,511,162 109,075,289 Systems Software (11.13%) 93,792 Crowdstrike Holdings, Inc., Cl A1 5,972,732 23,570,868 Financials (2.21%) 83,835 Datadog, Inc., Cl A1,3 2,263,545 8,725,547 256,769 Dynatrace, Inc.1,3 11,122,881 15,000,445 Financial Exchanges & Data (2.21%) 49,773 Snowflake, Inc., Cl A1,3 6,209,275 12,035,111 45,219 S&P Global, Inc. 10,911,824 18,560,138 81,789 Twilio, Inc., Cl A1,3 11,034,337 32,237,952 28,607 UiPath, Inc., Cl A1 1,601,992 1,943,273 Health Care (16.58%) 38,204,762 93,513,196 Biotechnology (4.32%) 112,455 Acceleron Pharma, Inc.1 11,815,692 14,111,978 Total Information Technology 234,099,974 433,717,931 42,879 argenx SE, ADR1,2 12,945,859 12,909,581 151,572 BridgeBio Pharma, Inc.1 9,373,273 9,239,829 Real Estate (2.06%) 34,134,824 36,261,388 Specialized REITs (2.06%) 21,508 Equinix, Inc. 4,587,574 17,262,321 Health Care Equipment (3.43%) 31,366 Intuitive Surgical, Inc.1 13,622,943 28,845,428 TOTAL COMMON STOCKS 397,673,169 827,958,876 Health Care Technology (3.72%) 100,453 Veeva Systems, Inc., Cl A1 7,493,348 31,235,860 Private Common Stocks (0.17%) Life Sciences Tools & Services (5.11%) Industrials (0.17%) 90,959 10X Genomics, Inc., Cl A1 9,317,473 17,811,592 2,730 Space Exploration 53,181 Illumina, Inc.1 8,362,363 25,165,781 Technologies Corp., Cl A1,3,4 1,146,573 1,087,277 17,679,836 42,977,373 841 Space Exploration Technologies Corp., Cl C1,3,4 353,211 334,945 Total Health Care 72,930,951 139,320,049 TOTAL PRIVATE COMMON STOCKS 1,499,784 1,422,222 Information Technology (51.62%) Application Software (13.04%) Private Convertible Preferred Stocks (0.35%) 54,742 Adobe, Inc.1 27,393,137 32,059,105 82,883 RingCentral, Inc., Cl A1 17,980,960 24,084,142 Consumer Discretionary (0.35%) 60,004 ServiceNow, Inc.1,3 23,859,149 32,975,198 90,465 Splunk, Inc.1 12,002,179 13,079,430 Automobile Manufacturers (0.35%) 1,3,4 18,932 Zoom Video Communications, Inc., Cl A1 6,959,486 7,327,252 81,411 Rivian Automotive, Inc., Series F 2,999,996 2,976,386 88,194,911 109,525,127 Private Preferred Stocks (0.42%) Data Processing & Outsourced Services (13.31%) Industrials (0.42%) 6,218 Adyen N.V., 144A (Netherlands)1,2 4,711,862 15,248,584 77,774 MasterCard Incorporated, Cl A 7,508,689 28,394,510 Trucking (0.42%) 1,3,4 85,461 PayPal Holdings, Inc.1 18,388,284 24,910,172 133,288 GM Cruise Holdings, Cl G 3,512,139 3,546,794 80,839 Square, Inc., Cl A1 17,963,675 19,708,548 100,918 Visa, Inc., Cl A 6,191,852 23,596,647 54,764,362 111,858,461

152 Baron Funds

Baron Fifth Avenue Growth Fund — PORTFOLIO HOLDINGS (Continued) June 30, 2021 (Unaudited)

Principal Amount Cost Value Short Term Investments (0.64%) $5,358,665 Repurchase Agreement with Fixed Income Clearing Corp., dated 6/30/2021, 0.00% due 7/1/2021; Proceeds at maturity - $5,358,665; (Fully collateralized by $4,263,600 U.S. Treasury Bond, 5.25% due 11/15/2028 Market value - $5,465,901) $ 5,358,665 $ 5,358,665 TOTAL INVESTMENTS (100.13%) $411,043,753 841,262,943

LIABILITIES LESS CASH AND OTHER ASSETS (-0.13%) (1,120,840) NET ASSETS $840,142,103

RETAIL SHARES (Equivalent to $56.16 per share based on 3,390,314 shares outstanding) $190,402,969

INSTITUTIONAL SHARES (Equivalent to $57.64 per share based on 10,577,657 shares outstanding) $609,687,638

R6 SHARES (Equivalent to $57.66 per share based on 694,634 shares outstanding) $ 40,051,496

% Represents percentage of net assets. 1 Non-income producing securities. 2 Foreign corporation. 3 The Adviser has reclassified/classified certain securities in or out of this sub-industry. Such reclassifications/classifications are not supported by S&P or MSCI (unaudited). 4 At June 30, 2021, the market value of restricted and fair valued securities amounted to $7,945,402 or 0.94% of net assets. None of these securities are deemed liquid. ADR American Depositary Receipt. 144A Security is exempt from registration pursuant to Rule 144A under the Securities Act of 1933. This security may be resold in transactions that are exempt from registration, normally to qualified institutional buyers. At June 30, 2021, the market value of Rule 144A securities amounted to $15,248,584 or 1.82% of net assets.

153 Baron Funds

Baron Focused Growth Fund — PORTFOLIO HOLDINGS June 30, 2021 (Unaudited)

Shares Cost Value Shares Cost Value Common Stocks (91.51%) Common Stocks (continued) Communication Services (7.99%) Industrials (7.44%) Alternative Carriers (2.33%) Research & Consulting 401,472 Iridium Communications, Inc.1 $ 2,949,375 $ 16,054,865 Services (7.44%) 620,000 CoStar Group, Inc.1 $ 11,035,717 $ 51,348,400 Movies & Entertainment (5.66%) 1,027,365 Manchester United plc, Cl A2 17,423,113 15,605,675 Information Technology (5.74%) 85,000 Spotify Technology SA1,2 20,386,545 23,425,150 Application Software (1.67%) 37,809,658 39,030,825 101,870 Guidewire Software, Inc.1 4,816,691 11,482,786 Total Communication Services 40,759,033 55,085,690 Data Processing & Outsourced Services Consumer Discretionary (52.91%) (2.08%) 5,854 Adyen N.V. (Netherlands), 144A1,2 5,352,874 14,355,937 Automobile Manufacturers (31.64%) 321,000 Tesla, Inc.1,5 13,812,209 218,183,700 Internet Services & Infrastructure (1.99%) Casinos & Gaming (7.53%) 175,000 GDS Holdings Limited, ADR1,2 12,381,692 13,735,750 567,501 Penn National Gaming, Inc.1 10,857,402 43,408,151 Total Information Technology 22,551,257 39,574,473 201,100 Red Rock Resorts, Inc., Cl A1 1,154,579 8,546,750 12,011,981 51,954,901 Real Estate (1.90%) Residential REITs (1.27%) Hotels, Resorts & Cruise 225,000 American Homes 4 Rent, Cl A 4,700,804 8,741,250 Lines (6.50%) 155,000 Choice Hotels International, Inc. 5,375,923 18,423,300 Specialized REITs (0.63%) 340,000 Hyatt Hotels Corp., Cl A1 12,201,302 26,397,600 115,000 Americold Realty Trust4 3,907,873 4,352,750 17,577,225 44,820,900 Total Real Estate 8,608,677 13,094,000 TOTAL COMMON STOCKS 198,511,937 631,074,394 Internet & Direct Marketing Retail (1.09%) 125,000 Stitch Fix, Inc., Cl A1 6,165,914 7,537,500 Private Common Stocks (1.37%) Leisure Facilities (6.15%) Industrials (1.37%) 134,000 Vail Resorts, Inc.1,6 8,130,896 42,413,680 Aerospace & Defense (1.37%) Total Consumer Discretionary 57,698,225 364,910,681 20,859 Space Exploration Technologies Corp., Cl A1,3,4 2,815,965 8,307,514 Financials (7.04%) 2,844 Space Exploration Financial Exchanges & Technologies Corp., Cl C1,3,4 383,940 1,132,680 Data (3.65%) TOTAL PRIVATE COMMON STOCKS 3,199,905 9,440,194 75,000 FactSet Research Systems, Inc. 5,828,282 25,170,750 Property & Casualty Insurance (3.39%) Private Preferred Stocks (2.33%) 600,000 Arch Capital Group Ltd.1,2 12,581,802 23,364,000 Industrials (2.33%) Total Financials 18,410,084 48,534,750 Aerospace & Defense (2.33%) 29,630 Space Exploration Health Care (8.49%) Technologies Corp., Cl H1,3,4 4,000,050 11,800,740 Biotechnology (5.05%) 1,479 Space Exploration 110,000 BioNTech SE, ADR1,2 11,883,637 24,626,800 Technologies Corp., Cl I1,3,4 249,951 589,041 130,000 Denali Therapeutics, Inc.1 8,709,748 10,197,200 9,259 Space Exploration Technologies Corp., Cl N1,3,4 2,499,930 3,687,582 20,593,385 34,824,000 TOTAL PRIVATE PREFERRED STOCKS 6,749,931 16,077,363 Health Care Supplies (2.12%) 292,000 Figs, Inc., Cl A1 8,977,596 14,629,200 Health Care Technolgy (1.32%) 120,000 Schrödinger, Inc.1 9,877,963 9,073,200 Total Health Care 39,448,944 58,526,400

154 Baron Funds

Baron Focused Growth Fund — PORTFOLIO HOLDINGS (Continued) June 30, 2021 (Unaudited)

Principal Amount Cost Value Short Term Investments (4.72%) $32,549,272 Repurchase Agreement with Fixed Income Clearing Corp., dated 6/30/2021, 0.00% due 7/1/2021; Proceeds at maturity - $32,549,272; (Fully collateralized by $25,897,400 U.S. Treasury Bond, 5.25% due 11/15/2028 Market value - $33,200,260) $ 32,549,272 $ 32,549,272 TOTAL INVESTMENTS (99.93%) $241,011,045 689,141,223

CASH AND OTHER ASSETS LESS LIABILITIES (0.07%)7 507,327 NET ASSETS $689,648,550

RETAIL SHARES (Equivalent to $44.40 per share based on 3,972,304 shares outstanding) $176,355,662

INSTITUTIONAL SHARES (Equivalent to $45.69 per share based on 5,144,669 shares outstanding) $235,067,117

R6 SHARES (Equivalent to $45.72 per share based on 6,085,577 shares outstanding) $278,225,771

% Represents percentage of net assets. 1 Non-income producing securities. 2 Foreign corporation. 3 At June 30, 2021, the market value of restricted and fair valued securities amounted to $25,517,557 or 3.70% of net assets. These securities are not deemed liquid. 4 The Adviser has reclassified/classified certain securities in or out of this sub-industry. Such reclassifications/classifications are not supported by S&P or MSCI (unaudited). 5 Investors in the Fund may view Tesla, Inc.’s financial statements on the EDGAR website of the U.S. Securities and Exchange Commission by going to https://www.sec.gov/cgi-bin/browse- edgar?CIK=1318605&owner=exclude.Please note that the Fund is not responsible for Tesla’s financial statements and can provide no assurances as to their accuracy or completeness. 6 All or a portion of these securities are segregated for an unfunded commitment. Total value of securities segregated is $11,078,200. 7 Includes unrealized appreciation of $154,900 on an unfunded commitment with a special purpose acquisition company to purchase a when-issued private investment in a public entity. ADR American Depositary Receipt. 144A Security is exempt from registration pursuant to Rule 144A under the Securities Act of 1933. This security may be resold in transactions that are exempt from registration, normally to qualified institutional buyers. At June 30, 2021, the market value of Rule 144A securities amounted to $14,355,937 or 2.08% of net assets.

155 Baron Funds

Baron International Growth Fund — PORTFOLIO HOLDINGS June 30, 2021 (Unaudited)

Shares Cost Value Shares Cost Value Common Stocks (95.40%) Common Stocks (continued) Australia (0.80%) Hong Kong (0.75%) 644,822 NEXTDC Limited1 $ 3,195,309 $ 5,738,069 311,500 Techtronic Industries Co. Ltd. $ 2,131,519 $ 5,428,500 Brazil (4.62%) India (6.81%) 203,670 Afya Ltd., Cl A1 4,052,790 5,250,613 140,002 Bajaj Finance Limited1 7,057,302 11,355,389 120,934 Arco Platform Limited, Cl A1 3,928,368 3,707,836 2,458,770 Edelweiss Financial Services Ltd.1 2,033,042 2,397,347 758,451 Itaú Unibanco Holding SA, ADR 3,560,256 4,558,290 279,909 Godrej Properties Ltd.1 3,762,871 5,270,576 271,714 Notre Dame Intermedica 179,037 HDFC Bank Ltd. 2,695,614 3,616,162 Participacoes S.A. 3,091,592 4,639,646 125,802 Housing Development 70,011 StoneCo Ltd., Cl A1 4,690,522 4,694,938 Finance Corp., Ltd. 3,530,942 4,198,409 492,212 Suzano SA1 4,494,408 5,918,855 2,171,478 JM Financial Limited 2,615,303 2,591,446 105,119 XP, Inc., Cl A1 3,744,284 4,577,932 70,627 Kotak Mahindra Bank Ltd.1 1,217,705 1,623,435 548,081 Max Financial Services Limited1 3,895,199 7,825,052 Total Brazil 27,562,220 33,348,110 681,376 Nippon Life India Asset Management Ltd., 144A 2,395,677 3,359,539 Canada (1.92%) 233,839 Reliance Industries Limited 5,093,394 6,649,530 168,186 CAE, Inc.1 2,082,977 5,180,172 12,984 Reliance Industries Limited PP 115,279 260,365 5,753 Constellation Software, Inc. 1,761,296 8,713,085 Total India 34,412,328 49,147,250 Total Canada 3,844,273 13,893,257 Israel (3.59%) China (10.88%) 128,423 ION Acquisition Corp. 2 Limited1 1,284,230 1,295,788 36,118 Alibaba Group Holding Limited, ADR1,3 6,452,603 8,190,840 150,000 ION Acquisition Corp. 3 Limited, Cl A1 1,500,000 1,471,500 955,387 China Conch Venture Holdings Ltd. 4,199,666 4,019,846 12,905 monday.com Ltd.1 2,054,845 2,885,429 68,159 China Tourism Group Duty Free 166,042 SimilarWeb Ltd.1 3,584,739 3,271,027 Corporation Limited, Cl A 775,658 3,161,444 200,450 Taboola.com Ltd.1 1,931,400 2,074,657 625,178 Galaxy Entertainment Group Ltd.1 4,744,733 4,998,976 229,509 Taboola.com Ltd. (formerly, ION 29,333 GDS Holdings Limited, ADR1 1,256,623 2,302,347 Acquisition Corp. 1 Limited)1,2 2,295,090 2,290,500 153,308 GDS Holdings Limited, Cl A 152,785 Tower Semiconductor Ltd.1 3,043,112 4,496,463 (Hong Kong)1 1,616,054 1,505,891 28,060 Wix.com Ltd.1 3,231,212 8,145,257 585,931 Han’s Laser Technology Industry Total Israel 18,924,628 25,930,621 Group Co., Ltd., Cl A 3,140,221 3,659,604 597,906 Hua Hong Semiconductor Japan (10.01%) Limited, 144A1 1,399,011 3,300,855 1,543,374 Kingdee International Software 77,173 Advantest Corporation 4,104,008 6,929,117 Group Co. Ltd.1 1,375,808 5,227,195 29,100 FANUC Corp. 4,834,548 6,978,117 749,180 Kingsoft Corp. Ltd. 3,177,602 4,486,761 17,843 Keyence Corporation 5,478,737 8,986,147 248,925 Midea Group Co., Ltd., Cl A 1,766,612 2,745,786 231,600 MonotaRO Co, Ltd. 2,363,486 5,457,563 57,639 Shenzhen Mindray Bio-Medical 118,160 Nexon Co, Ltd. 1,759,983 2,629,593 Electronics Co. Ltd., Cl A 1,625,815 4,274,123 104,365 Okamoto Industries, Inc. 4,791,854 3,852,864 120,824 Tencent Holdings Limited 6,132,637 9,097,138 177,000 Recruit Holdings Co, Ltd. 4,885,462 8,679,861 17,588 Tencent Holdings Limited, ADR 832,623 1,324,376 188,200 SMS Co. Ltd. 5,152,739 5,623,909 103,143 Will Semiconductor Co. Ltd. 28,316 Sony Corporation, ADR 1,017,216 2,752,881 Shanghai, Cl A 3,692,074 5,128,105 64,800 Square Enix Holdings Co, Ltd. 2,218,353 3,200,139 1,298,975 Winning Health Technology 302,300 Takeda Pharmaceutical Group Co. Ltd., Cl A 3,641,404 3,267,281 Company Limited 11,976,315 10,145,354 67,094 Zai Lab Limited, ADR1 1,585,596 11,874,967 16,302 Tokyo Electron Limited 3,928,027 7,048,727 Total China 47,414,740 78,565,535 Total Japan 52,510,728 72,284,272 Denmark (1.04%) Korea, Republic of (1.48%) 89,715 Korea Shipbuilding & Offshore 183,153 Genmab A/S, ADR1 7,473,667 7,478,137 Engineering Co. Ltd.1 8,515,646 10,670,668 France (8.14%) Mexico (0.78%) 319,942 BNP Paribas S.A. 14,662,429 20,079,442 1,191,220 Grupo México S.A.B. de C.V., Series B 3,208,027 5,614,881 91,320 Eurofins Scientific SE1 2,327,909 10,445,060 14,509 LVMH Moët Hennessy Louis Vuitton SE 4,811,986 11,413,603 42,741 Pernod Ricard SA 8,264,435 9,499,714 Netherlands (4.17%) 218,710 Vivendi SA 5,883,632 7,348,463 290,160 AMG Advanced Metallurgical Group NV 9,044,500 9,949,406 43,181 argenx SE, ADR1 1,904,769 13,000,504 Total France 35,950,391 58,786,282 38,366 Koninklijke DSM NV 5,145,464 7,171,874 Germany (3.60%) Total Netherlands 16,094,733 30,121,784 146,490 Befesa SA, 144A 7,071,613 11,258,620 Norway (0.79%) 60,194 Symrise AG 5,218,374 8,388,437 1 168,057 TeamViewer AG, 144A1 6,563,059 6,311,705 431,796 Golar LNG Ltd. 6,252,146 5,721,297 Total Germany 18,853,046 25,958,762 Poland (0.73%) 263,772 InPost SA1 5,175,660 5,293,906

156 Baron Funds

Baron International Growth Fund — PORTFOLIO HOLDINGS (Continued) June 30, 2021 (Unaudited)

Shares Cost Value Shares Cost Value Common Stocks (continued) Warrants (0.02%) Russia (4.78%) Israel (0.02%) 2,571,069 Detsky Mir PJSC, 144A $ 3,841,525 $ 5,308,229 56,745 Taboola.com Ltd. Exp 10/5/20271 $ 104,540 $ 175,909 36,018 Novatek PJSC, GDR 5,452,498 7,898,748 1,100 Novatek PJSC, GDR (London) 153,019 241,377 333,867 Sberbank of Russia PJSC, ADR 3,957,007 5,547,864 Convertible Bonds (0.06%) 177,534 TCS Group Holding PLC, GDR 4,902,171 15,534,225 Switzerland (0.06%) Total Russia 18,306,220 34,530,443 $350,000 Credit Suisse Group Guernsey VII Spain (2.60%) Ltd., 144A, 3.00% due 11/12/2021 385,399 425,977 111,195 Cellnex Telecom S.A., 144A 6,227,391 7,092,155 TOTAL CONVERTIBLE BONDS 385,399 425,977 449,476 eDreams ODIGEO SA1 3,698,968 3,618,841 227,691 Industria de Diseno Textil, S.A. 7,335,086 8,039,042 Principal Amount Total Spain 17,261,445 18,750,038 Short Term Investments (4.63%) Sweden (2.84%) $33,446,185 Repurchase Agreement with Fixed 328,985 Epiroc AB, Cl A 5,190,793 7,488,899 Income Clearing Corp., dated 30,000 Hemnet Group AB1 412,112 674,799 6/30/2021, 0.00% due 7/1/2021; 19,316 Spotify Technology SA1 2,790,396 5,323,296 Proceeds at maturity - 558,825 Telefonaktiebolaget LM Ericsson, ADR 5,191,588 7,030,019 $33,446,185; (Fully collateralized Total Sweden 13,584,889 20,517,013 by $29,656,200 U.S. Treasury Note, 3.125% due 11/15/2028; Switzerland (4.21%) Market value - $33,623,881) and 376,689 Clariant AG 7,747,136 7,500,733 $383,200 U.S. Treasury Bond, 43,150 Compagnie Financiere Richemont SA 5,086,461 5,231,013 5.25% due 11/15/2028 Market 951,966 Credit Suisse Group AG 10,237,832 9,965,109 value - $491,259) 33,446,185 33,446,185 61,830 Nestle S.A. 6,496,788 7,706,928 TOTAL INVESTMENTS (100.11%) $486,291,549 722,893,553 Total Switzerland 29,568,217 30,403,783 LIABILITIES LESS CASH AND OTHER United Arab Emirates (0.21%) ASSETS (-0.11%)4 (791,905) 294,649 Network International NET ASSETS $722,101,648 Holdings plc, 144A1 1,471,622 1,492,852 RETAIL SHARES (Equivalent to $35.46 per share United Kingdom (16.85%) based on 2,687,157 shares outstanding) $ 95,290,209 144,508 AstraZeneca PLC, ADR 5,429,097 8,656,029 920,893 B&M European Value Retail S.A. 4,218,892 7,310,832 INSTITUTIONAL SHARES (Equivalent to $36.10 per share 98,806 Dechra Pharmaceuticals PLC 3,329,156 5,972,843 based on 12,916,857 shares outstanding) $466,326,420 97,910 Endava plc, ADR1 2,300,130 11,101,036 152,703 Experian plc 3,184,532 5,895,732 R6 SHARES (Equivalent to $36.08 per share 442,543 Future PLC 7,584,254 19,173,156 based on 4,447,583 shares outstanding) $160,485,019 1,581,932 Glencore PLC 6,554,498 6,789,793 1 379,691 J D Wetherspoon PLC 4,481,096 6,187,169 % Represents percentage of net assets. 39,713 Linde Public Limited Company 7,560,276 11,482,219 1 Non-income producing securities. 19,779,279 Lloyds Banking Group PLC 7,967,123 12,794,345 2 At June 30, 2021, the market value of restricted and fair valued securities 1,865,252 S4 Capital PLC1 6,064,102 16,203,675 amounted to $2,290,500 or 0.32% of net assets. This security is not deemed 435,206 WANdisco plc1 3,773,599 2,319,649 liquid. 674,144 Watches of Switzerland 3 All or a portion of these securities are segregated for an unfunded Group PLC, 144A1 5,999,471 7,796,063 commitment. Total value of securities segregated is $5,669,500. 4 Includes unrealized depreciation of $451,750 on an unfunded commitment Total United Kingdom 68,446,226 121,682,541 with a special purpose acquisition company to purchase a when-issued private investment in a public entity. United States (2.27%) ADR American Depositary Receipt. 54,278 Agilent Technologies, Inc. 2,697,622 8,022,831 GDR Global Depositary Receipt. 215,344 Arch Capital Group Ltd.1 4,878,484 8,385,495 144A Security is exempt from registration pursuant to Rule 144A under the Securities Act of 1933. This security may be resold in transactions that are Total United States 7,576,106 16,408,326 exempt from registration, normally to qualified institutional buyers. At June 30, 2021, the market value of Rule 144A securities amounted to Uruguay (1.53%) $46,345,995 or 6.42% of net assets. 210,911 Dlocal Ltd., Cl A1 4,621,639 11,079,155 TOTAL COMMON STOCKS 452,355,425 688,845,482

157 Baron Funds

Baron International Growth Fund — PORTFOLIO HOLDINGS (Continued) June 30, 2021 (Unaudited)

Summary of Investments by Percentage of Sector as of June 30, 2021 Net Assets Information Technology 16.9% Financials 16.5% Health Care 12.1% Consumer Discretionary 11.9% Industrials 11.9% Communication Services 10.6% Materials 9.2% Energy 2.9% Consumer Staples 2.4% Real Estate 0.7% Special Purpose Acquisition Company 0.4% Cash and Cash Equivalents* 4.5% 100.0%

* Includes short term investments.

158 Baron Funds

Baron Real Estate Fund — PORTFOLIO HOLDINGS June 30, 2021 (Unaudited)

Shares Cost Value Shares Cost Value Common Stocks (97.68%) Common Stocks (continued) Communication Services (6.17%) Financials (3.43%) Integrated Telecommunication Asset Management & Custody Services (2.06%) Banks (3.41%) 574,496 Cellnex Telecom S.A., 144A (Spain)2 $ 31,932,710 $ 36,642,068 1,190,557 Brookfield Asset Management, Inc., Cl A2 $ 37,559,581 $ 60,694,596 Interactive Media & Services (4.11%) Reinsurance (0.02%) 677,654 Tripadvisor, Inc.1 23,938,338 27,309,456 7,866 Brookfield Asset Management 376,260 Zillow Group, Inc., Cl C1 34,108,751 45,986,497 Reinsurance Partners Ltd., Cl A1,2 416,893 409,185 58,047,089 73,295,953 Total Financials 37,976,474 61,103,781 Total Communication Services 89,979,799 109,938,021 Industrials (7.10%) Building Products (3.97%) Consumer Discretionary (31.84%) 620,101 AZEK Co., Inc.1 24,649,657 26,329,488 Casinos & Gaming (13.11%) 228,100 Fortune Brands Home & 796,400 Boyd Gaming Corporation1 19,022,908 48,970,636 Security, Inc. 17,288,986 22,721,041 775,600 Las Vegas Sands Corp.1 40,460,982 40,866,364 208,138 Janus International Group, Inc.1 2,934,364 2,940,990 1,206,989 Melco Resorts & 1,000,000 Janus International 1,3 Entertainment Ltd., ADR1,2 20,494,063 19,999,808 Group, Inc., Cl A 10,000,000 13,760,000 1 406,260 Penn National Gaming, Inc.1 12,646,682 31,074,827 48,800 Trex Co., Inc. 1,446,739 4,987,848 1,430,417 Red Rock Resorts, Inc., Cl A1 16,953,492 60,792,723 56,319,746 70,739,367 261,647 Wynn Resorts Ltd.1 19,222,735 31,999,428 Research & Consulting 128,800,862 233,703,786 Services (2.24%) 483,500 CoStar Group, Inc.1 30,297,359 40,043,470 Distributors (0.56%) 21,850 Pool Corp. 4,370,642 10,021,721 Trading Companies & Distributors (0.89%) Home Improvement 93,477 SiteOne Landscape Supply, Inc.1 10,670,710 15,821,917 Retail (4.06%) 60,050 The Home Depot, Inc. 12,361,385 19,149,345 Total Industrials 97,287,815 126,604,754 274,750 Lowe’s Companies, Inc. 41,151,066 53,293,257 Information Technology (4.42%) 53,512,451 72,442,602 Internet Services & Homebuilding (3.32%) Infrastructure (4.42%) 106,647 D.R. Horton, Inc. 3,458,125 9,637,689 816,100 GDS Holdings Limited, ADR1,2 37,276,714 64,055,689 164,373 Installed Building Products, Inc. 8,986,233 20,112,680 1,660,900 NEXTDC Limited (Australia)1,2 8,234,614 14,779,828 196,900 Lennar Corp., Cl A 12,601,875 19,562,015 Total Information Technology 45,511,328 78,835,517 171,250 Toll Brothers, Inc. 5,729,225 9,899,963 30,775,458 59,212,347 Materials (2.22%) Hotels, Resorts & Cruise Construction Materials (2.22%) Lines (6.43%) 227,250 Vulcan Materials Co. 34,393,246 39,557,407 867,373 Hilton Grand Vacations, Inc.1 24,840,939 35,900,568 278,736 Marriott Vacations Real Estate (38.47%) Worldwide Corp.1 30,447,751 44,402,645 Diversified Real Estate 576,697 Travel + Leisure Co. 36,383,336 34,284,637 Activities (2.12%) 180,322 CoreSite Realty Corp. 24,567,069 24,271,341 91,672,026 114,587,850 1,728,470 DigitalBridge Group, Inc. (formerly, 1 Leisure Facilities (2.41%) Colony Capital, Inc.) 8,730,133 13,654,913 145,650 SeaWorld Entertainment, Inc.1 2,658,980 7,273,761 33,297,202 37,926,254 825,424 Six Flags Entertainment Corp.1 24,010,256 35,724,351 Diversified REITs (0.99%) 26,669,236 42,998,112 472,600 American Assets Trust, Inc. 13,655,912 17,623,254 Leisure Products (1.95%) Hotel & Resort REITs (1.30%) 1,090,000 Latham Group, Inc.1 20,710,000 34,836,400 631,600 MGM Growth Properties LLC, Cl A 16,115,442 23,129,192 Total Consumer Discretionary 356,510,675 567,802,818 Industrial REITs (2.96%) 274,000 Prologis, Inc. 19,543,707 32,751,220 350,759 Rexford Industrial Realty, Inc. 14,778,586 19,975,725 34,322,293 52,726,945

159 Baron Funds

Baron Real Estate Fund — PORTFOLIO HOLDINGS (Continued) June 30, 2021 (Unaudited)

Shares Cost Value Principal Amount Cost Value Common Stocks (continued) Short Term Investments (3.21%) $57,298,915 Repurchase Agreement with Real Estate (continued) Fixed Income Clearing Corp., dated 6/30/2021, 0.00% due Office REITs (5.64%) 1,180,150 Douglas Emmett, Inc. $ 33,143,388 $ 39,676,643 7/1/2021; Proceeds at 523,445 JBG SMITH Properties 16,679,403 16,493,752 maturity - $57,298,915; (Fully 950,850 Vornado Realty Trust 40,611,218 44,376,170 collateralized by $51,548,300 U.S. Treasury Note, 3.125% 90,434,009 100,546,565 due 11/15/2028 Market value - $58,444,908) $ 57,298,915 $ 57,298,915 Real Estate Development (2.10%) 384,900 The Howard Hughes Corp.1 32,700,405 37,512,354 TOTAL INVESTMENTS (100.89%) $1,281,101,691 1,798,964,694

Real Estate Services (6.10%) LIABILITIES LESS CASH AND 539,450 CBRE Group, Inc., Cl A1 28,204,325 46,247,048 OTHER ASSETS (-0.89%)7 (15,817,239) 258,500 Jones Lang LaSalle, Inc.1 35,608,120 50,526,410 677,872 Opendoor Technologies, Inc.1 6,778,720 12,018,671 NET ASSETS $1,783,147,455 70,591,165 108,792,129 RETAIL SHARES (Equivalent to $40.88 per share Residential REITs (4.39%) based on 11,770,320 shares outstanding) $ 481,147,844 365,750 Equity LifeStyle Properties, Inc. 21,021,028 27,178,883 206,500 Equity Residential 12,509,075 15,900,500 INSTITUTIONAL SHARES (Equivalent to $41.87 per share 945,400 Invitation Homes, Inc. 27,310,761 35,253,966 based on 30,446,209 shares outstanding) $1,274,676,697 60,840,864 78,333,349 R6 SHARES (Equivalent to $41.87 per share based on 652,591 shares outstanding) $ 27,322,914 Retail REITs (2.61%) 356,350 Simon Property Group, Inc. 34,875,928 46,496,548 % Represents percentage of net assets. Specialized REITs (10.26%) 1 Non-income producing securities. 147,200 Alexandria Real Estate Equities, Inc.5 15,402,490 26,781,568 2 Foreign corporation. 198,800 American Tower Corp.6 34,705,694 53,703,832 3 At June 30, 2021, the market value of restricted and fair valued securities 542,290 Americold Realty Trust5 15,561,503 20,525,676 amounted to $13,760,000 or 0.77% of net assets. This security is not deemed 57,240 Equinix, Inc. 18,123,374 45,940,824 liquid. 385,348 Gaming and Leisure Properties, Inc. 11,501,945 17,853,173 4 An “Affiliated” investment may include any company in which the Fund owns 56,850 SBA Communications Corp. 14,225,432 18,118,095 5% or more of its outstanding shares. 5 The Adviser has reclassified/classified certain securities in or out of this 109,520,438 182,923,168 sub-industry. Such reclassifications/classifications are not supported by S&P Total Real Estate 496,353,658 686,009,758 or MSCI (unaudited). 6 All or a portion of these securities are segregated for an unfunded Special Purpose Acquisition Company (4.03%) commitment. Total value of securities segregated is $16,748,680. 7 Includes unrealized depreciation of $197,400 on an unfunded commitment 2,835,301 Fifth Wall Acquisition with a special purpose acquisition company to purchase a when-issued Corp. I, Cl A1,4 28,607,896 34,902,555 private investment in a public entity. 1,250,000 Fifth Wall Acquisition ADR American Depositary Receipt. Corp. III, Cl A1 12,500,000 12,437,500 144A Security is exempt from registration pursuant to Rule 144A under the 700,000 GO Acquisition Corp., Cl A1 7,026,345 6,846,000 Securities Act of 1933. This security may be resold in transactions that are 1,290,554 RXR Acquisition Corp.1 12,905,540 12,853,918 exempt from registration, normally to qualified institutional buyers. At 475,000 Tishman Speyer June 30, 2021, the market value of Rule 144A securities amounted to Innovation Corp. II1 4,750,000 4,773,750 $36,642,068 or 2.05% of net assets. Total Special Purpose Acquisition Company 65,789,781 71,813,723 TOTAL COMMON STOCKS 1,223,802,776 1,741,665,779

160 Baron Funds

Baron Emerging Markets Fund — PORTFOLIO HOLDINGS June 30, 2021 (Unaudited)

Shares Cost Value Shares Cost Value Common Stocks (93.55%) Common Stocks (continued) Brazil (9.24%) China (continued) 21,608,704 Aeris Indústria E Comércio De 17,371,967 Winning Health Technology Equipamentos Para Geracão De Group Co. Ltd., Cl A $ 49,286,633 $ 43,695,291 Energia SA1 $ 24,053,917 $ 43,097,500 840,265 Yum China Holdings, Inc. 46,544,324 55,667,556 1,728,747 Afya Ltd., Cl A1 44,946,895 44,567,098 539,983 Yum China Holdings, Inc. 2,159,229 Banco Inter SA Units 27,129,752 33,770,241 (Hong Kong) 29,819,495 35,205,391 15,652,753 Itaú Unibanco Holding SA, ADR 75,063,301 94,073,045 3,980,827 Yunnan Baiyao Group 6,524,545 Localiza Rent a Car SA 45,644,839 83,954,095 Co. Ltd., Cl A 59,266,465 71,238,187 20,679,430 Lojas Americanas SA 95,412,123 89,722,566 1,099,203 Zai Lab Limited, ADR1 23,498,988 194,547,939 5,945,700 Notre Dame Intermedica Participacoes S.A. 70,158,634 101,525,654 Total China 1,797,021,838 2,956,595,191 215,453 PagSeguro Digital Ltd., Cl A1 4,039,701 12,048,132 1,514,120 StoneCo Ltd., Cl A1 66,233,117 101,536,887 Hong Kong (2.10%) 8,940,874 Suzano SA1 86,150,604 107,514,109 22,831,323 Budweiser Brewing Co. 2,078,803 XP, Inc., Cl A1 75,947,225 90,531,871 APAC Ltd., 144A 73,751,880 71,890,200 6,343,950 Techtronic Industries Co. Ltd. 27,600,967 110,555,798 Total Brazil 614,780,108 802,341,198 Total Hong Kong 101,352,847 182,445,998 China (34.06%) 1,303,924 Alibaba Group Holding Hungary (1.04%) Limited, ADR1,3 164,336,347 295,703,885 1,676,242 OTP Bank Nyrt1 69,227,317 90,234,990 12,713,946 Beijing Oriental Yuhong Waterproof Technology Co. Ltd., Cl A 63,951,680 108,820,660 India (21.38%) 24,522,160 China Conch Venture 3,651,299 AARTI Industries Ltd. 42,000,009 42,822,816 Holdings Ltd. 98,197,526 103,178,396 1,972,136 Asian Paints Ltd. 51,065,999 79,506,676 16,411,732 China Mengniu Dairy Co. Ltd. 41,962,727 99,147,426 2,442,902 Bajaj Finance Limited 111,059,011 198,140,753 53,522,892 China Molybdenum Co. Ltd., Cl A 41,912,055 42,668,574 7,247,716 Bharti Airtel Ltd. 52,989,447 51,326,406 36,862,026 China Molybdenum Co. Ltd., Cl H 20,930,090 21,843,083 1,700,442 Divi’s Laboratories Ltd.1 21,682,417 100,914,278 1,952,929 China Tourism Group Duty Free 976,956 Dr. Reddy’s Laboratories Ltd. 43,044,964 71,433,217 Corporation Ltd., Cl A 24,923,793 90,583,441 327,566 Dr. Reddy’s Laboratories Ltd., ADR 14,297,565 24,079,377 11,618,446 Galaxy Entertainment Group Ltd.1 92,031,189 92,902,072 28,707,607 Edelweiss Financial Services Ltd. 43,093,752 27,990,453 917,744 GDS Holdings Limited, ADR1 35,540,754 72,033,727 2,239,103 Godrej Properties Ltd.1 43,545,600 42,161,426 2,527,535 GDS Holdings Limited, Cl A 4,232,484 HDFC Bank Ltd. 66,916,707 85,487,079 (Hong Kong)1 27,143,383 24,827,103 3,925,013 Hemisphere Properties 3,447,459 Glodon Co. Ltd., Cl A 15,634,662 36,306,863 India Limited1 14,835,694 7,304,055 11,372,808 Han’s Laser Technology 1,671,749 Hindustan Unilever Ltd. 47,804,427 55,646,305 Industry Group Co., Ltd., Cl A 64,615,499 71,032,206 3,034,746 Housing Development 3,253,862 Hangzhou Tigermed Finance Corp., Ltd. 83,718,005 101,279,034 Consulting Co. Ltd., CI A 44,492,082 97,137,453 2,806,297 ICICI Lombard General 11,980,293 Hua Hong Semiconductor Insurance Co. Ltd., 144A 51,397,299 59,215,244 Limited, 144A1 28,991,221 66,139,505 38,260,642 JM Financial Limited 56,062,324 45,660,334 51,276 Kanzhun Ltd., ADR1 974,244 2,033,093 1,120,128 Jubilant FoodWorks Ltd.1 46,533,795 46,473,646 25,585,166 Kingdee International Software 2,427,790 Kotak Mahindra Bank Ltd.1 29,356,062 55,805,269 Group Co. Ltd. 21,688,662 86,653,431 10,047,947 Max Financial Services Ltd.1 89,132,386 143,456,359 16,726,374 Kingsoft Corp. Ltd. 74,528,357 100,172,516 3,620,278 Muthoot Finance Ltd. 55,962,558 72,236,632 2,769,127 Lufax Holding Ltd., ADR1 37,071,657 31,291,135 12,240,204 Nippon Life India Asset 2,197,290 Meituan Inc., Cl B, 144A1 35,013,142 90,640,726 Management Ltd., 144A 44,661,124 60,350,585 7,654,096 Midea Group Co., Ltd., Cl A 53,291,715 84,429,078 6,123,910 Reliance Industries Limited 125,475,817 174,141,703 2,330,550 New Frontier Health Corp.1 24,085,361 26,032,243 378,065 Reliance Industries Limited PP 3,433,391 7,581,254 4,213,176 Ping An Insurance (Group) 5,365,072 SBI Life Insurance Company Company of China, Ltd., CI H 44,939,819 41,185,469 Limited, 144A 58,005,463 72,864,279 4,110,044 SF Holding Co. Ltd., Cl A 30,526,350 42,995,304 5,167,699 Tata Communications Ltd. 40,713,353 89,483,995 4,035,967 Shanghai Henlius 7,363,351 Tata Consumer Products Ltd. 28,711,053 74,802,686 Biotech, Inc., Cl H, 144A1 25,409,986 19,787,878 2,817,562 Titan Co. Ltd. 46,652,075 65,760,422 1,340,319 Shenzhen Mindray Bio-Medical Electronics Co. Ltd., Cl A 42,578,089 99,389,091 Total India 1,312,150,297 1,855,924,283 4,302,486 Shenzhou International Group Holdings Ltd. 24,262,812 108,649,750 Japan (0.74%) 74,225,047 Sino Biopharmaceutical Ltd. 57,221,906 72,720,633 126,861 Keyence Corporation5 46,564,676 63,890,132 4,852,982 Tencent Holdings Limited 207,960,451 365,393,014 194,437 Tencent Holdings Limited, ADR 10,779,783 14,641,106 Korea, Republic of (5.35%) 12,953,319 Venustech Group, Inc., Cl A 65,921,862 58,125,748 1,547,005 Korea Shipbuilding & Offshore 1,805,694 Will Semiconductor Co. Ltd. Engineering Co. Ltd.1 159,504,691 184,000,188 Shanghai, Cl A 67,688,729 89,776,218 3,913,024 Samsung Electronics Co., Ltd. 130,238,272 280,118,236 Total Korea, Republic of 289,742,963 464,118,424

161 Baron Funds

Baron Emerging Markets Fund — PORTFOLIO HOLDINGS (Continued) June 30, 2021 (Unaudited)

Shares Cost Value Shares Cost Value Common Stocks (continued) Private Common Stocks (0.45%) Mexico (2.09%) India (0.45%) 26,518 DD3 Acquisition Corp. II 27,027 Pine Labs PTE. Ltd., Series 11,2 $ 10,077,362 $ 9,871,612 Private Units1,2 $ 265,180 $ 265,445 6,833 Pine Labs PTE. Ltd., Series A1,2 2,547,771 2,495,753 18,071,165 Grupo México S.A.B. de C.V., 7,600 Pine Labs PTE. Ltd., Series B1,2 2,833,757 2,775,900 Series B 47,356,118 85,179,425 6,174 Pine Labs PTE. Ltd., Series B21,2 2,302,055 2,255,053 29,443,497 Wal-Mart de Mexico, 9,573 Pine Labs PTE. Ltd., Series C1,2 3,569,416 3,496,538 S.A.B de C.V.1 75,969,718 96,170,668 1,932 Pine Labs PTE. Ltd., Series C11,2 720,371 705,663 2,459 Pine Labs PTE. Ltd., Series D1,2 916,870 898,150 Total Mexico 123,591,016 181,615,538 45,680 Pine Labs PTE. Ltd., Series J1,2 17,032,398 16,684,620 Norway (0.57%) TOTAL PRIVATE COMMON STOCKS 40,000,000 39,183,289 3,762,328 Golar LNG Ltd.1 39,116,123 49,850,846 Peru (0.40%) Private Convertible Preferred Stocks (0.55%) 283,943 Credicorp, Ltd.1 37,233,871 34,388,337 India (0.55%) Philippines (1.23%) 15,334 Think & Learn Private Limited, Series F1,2 49,776,072 47,710,808 70,414,865 Ayala Land, Inc. 53,079,728 52,001,554 23,562,436 BDO Unibank, Inc. 50,443,376 54,640,331 Total Philippines 103,523,104 106,641,885 Principal Amount Poland (1.06%) Short Term Investments (5.74%) 4,601,226 InPost SA1 96,120,184 92,346,637 $498,116,757 Repurchase Agreement with Fixed Income Clearing Corp., Russia (7.05%) dated 6/30/2021, 0.00% due 1,001,680 Fix Price Group Ltd., GDR1 9,569,653 8,764,700 7/1/2021; Proceeds at 4,746,202 Fix Price Group Ltd., GDR, 144A1 46,272,864 41,529,267 maturity - $498,116,757; 706,771 Novatek PJSC, GDR 110,198,710 154,994,880 (Fully collateralized by 42,392 Novatek PJSC, GDR (London) 8,119,531 9,302,246 $89,886,600 U.S. Treasury 1,155,805 Ozon Holdings PLC, ADR1 50,829,388 67,753,289 Note, 1.25% due 130,365 Polyus PJSC 25,890,213 25,195,253 6/30/2028 Market value - 179,766 Polyus PJSC, GDR 17,983,107 17,392,361 $89,942,779 and 9,710 Polyus PJSC, GDR (London) 1,009,071 940,444 $368,795,500 U.S. Treasury 9,244,678 Sberbank of Russia PJSC, ADR 104,976,411 153,645,574 Note, 3.125% due 691,796 TCS Group Holding PLC, GDR 41,273,832 60,532,150 11/15/2028 Market value - 192,168 TCS Group Holding PLC, $418,136,373) 498,116,757 498,116,757 GDR (London) 12,902,788 16,823,040 TOTAL INVESTMENTS (100.29%) $5,974,624,773 8,706,321,983 783,753 Yandex N.V., Cl A1 15,244,639 55,450,525 Total Russia 444,270,207 612,323,729 LIABILITIES LESS CASH AND OTHER ASSETS (-0.29%)4 (24,787,983) Taiwan (4.92%) NET ASSETS $8,681,534,000 11,113,879 Delta Electronics, Inc. 48,287,386 120,739,615 2,550,695 Taiwan Semiconductor RETAIL SHARES (Equivalent to $19.84 per share Manufacturing Co., Ltd., ADR 89,316,490 306,491,511 based on 26,777,111 shares outstanding) $ 531,333,296 Total Taiwan 137,603,876 427,231,126 INSTITUTIONAL SHARES (Equivalent to $19.95 per share United Arab Emirates (0.29%) based on 407,628,152 shares outstanding) $8,134,075,850 4,965,504 Network International Holdings plc, 144A1 30,249,729 25,157,943 R6 SHARES (Equivalent to $19.97 per share based on 807,619 shares outstanding) $ 16,124,854 United Kingdom (1.71%) 34,503,433 Glencore PLC 119,644,254 148,091,816 United States (0.32%) 275,025 ACM Research, Inc., Cl A1 24,539,534 28,113,056 TOTAL COMMON STOCKS 5,386,731,944 8,121,311,129

162 Baron Funds

Baron Emerging Markets Fund — PORTFOLIO HOLDINGS (Continued) June 30, 2021 (Unaudited)

% Represents percentage of net assets. 1 Non-income producing securities. 2 At June 30, 2021, the market value of restricted and fair valued securities amounted to $87,159,542 or 1.00% of net assets. These securities are not deemed liquid. See Note 6 regarding Restricted Securities. 3 All or a portion of these securities are segregated for an unfunded commitment. Total value of securities segregated is $19,729,860. 4 Includes unrealized appreciation of $2,076,291 on an unfunded commitment with a special purpose acquisition company to purchase a when-issued private investment in a public entity. ADR American Depositary Receipt. GDR Global Depositary Receipt. 144A Security is exempt from registration pursuant to Rule 144A under the Securities Act of 1933. This security may be resold in transactions that are exempt from registration, normally to qualified institutional buyers. At June 30, 2021, the market value of Rule 144A securities amounted to $507,575,627 or 5.85% of net assets.

Summary of Investments by Percentage of Sector as of June 30, 2021 Net Assets Financials 18.7% Information Technology 17.4% Consumer Discretionary 14.6% Health Care 10.6% Industrials 8.4% Materials 7.8% Communication Services 6.7% Consumer Staples 4.6% Energy 4.5% Real Estate 1.2% Special Purpose Acquisition Company 0.0% Cash and Cash Equivalents* 5.5% 100.0%

* Includes short term investments.

163 Baron Funds

Baron Global Advantage Fund — PORTFOLIO HOLDINGS June 30, 2021 (Unaudited)

Shares Cost Value Shares Cost Value Common Stocks (93.62%) Common Stocks (continued) Argentina (3.06%) United States (53.08%) 76,873 Globant S.A.1 $ 5,591,434 $ 16,849,024 296,371 10X Genomics, Inc., Cl A1 $ 26,654,003 $ 58,035,369 46,026 MercadoLibre, Inc.1 31,748,310 71,698,843 639,858 Acceleron Pharma, Inc.1 53,505,388 80,295,780 1 Total Argentina 37,339,744 88,547,867 3,651 Airbnb, Inc., Cl A 248,268 559,114 62,964 Alphabet, Inc., Cl C1 98,418,779 157,807,933 1 Brazil (3.15%) 38,418 Amazon.com, Inc. 91,152,664 132,164,067 402,314 Arrowhead Pharmaceuticals, Inc.1 27,471,371 33,319,646 1,350,809 Afya Ltd., Cl A1 30,749,276 34,823,856 137,887 Bill.Com Holdings, Inc.1 5,238,091 25,258,141 671,264 Arco Platform Limited, Cl A1 27,148,976 20,580,954 461,820 BridgeBio Pharma, Inc.1 28,867,909 28,152,547 535,148 StoneCo Ltd., Cl A1 18,692,727 35,887,025 371,841 Cloudflare, Inc., Cl A1 9,123,087 39,355,651 Total Brazil 76,590,979 91,291,835 236,309 Crowdstrike Holdings, Inc., Cl A1 20,825,845 59,386,815 214,501 Datadog, Inc., Cl A1 10,250,761 22,325,264 Canada (3.91%) 933,945 Dynatrace, Inc.1 33,781,139 54,561,067 1 1 171,386 EPAM Systems, Inc. 40,897,771 87,571,391 587,696 Nuvei Corp., 144A 21,077,497 48,484,920 1 44,242 Shopify, Inc., Cl A1 33,882,773 64,636,677 321,312 Facebook, Inc., Cl A 70,543,701 111,723,396 327,879 Guardant Health, Inc.1 25,308,759 40,719,293 Total Canada 54,960,270 113,121,597 138,687 Illumina, Inc.1 44,958,886 65,628,075 923,813 MaxCyte, Inc.1 10,715,379 11,475,636 China (11.26%) 8,586 nCino, Inc.1 266,166 514,473 492,439 Alibaba Group Holding 58,333 Okta, Inc.1 6,160,802 14,272,918 Limited, ADR1,4 101,881,803 111,675,316 1,953,501 Opendoor Technologies, Inc.1 19,535,010 34,635,573 673,206 GDS Holdings Limited, ADR1 44,161,310 52,839,939 258,892 RingCentral, Inc., Cl A1 70,464,733 75,228,837 1,381,225 Meituan Inc., Cl B, 144A1 26,631,860 56,977,111 1,493,774 Sarissa Capital Acquisition Corp.1,3 14,937,740 15,565,125 189,309 Pinduoduo, Inc., ADR1 9,401,278 24,046,029 422,406 Schrödinger, Inc.1 15,544,854 31,938,118 663,624 TAL Education Group, ADR1 33,010,270 16,743,234 166,087 Snowflake, Inc., Cl A1 21,425,516 40,159,837 360,337 Zai Lab Limited, ADR1 24,796,803 63,776,046 3,960,396 SoFi Technologies, Inc. 39,603,960 75,920,791 190,027 Twilio, Inc., Cl A1 32,336,272 74,901,042 Total China 239,883,324 326,057,675 189,872 Veeva Systems, Inc., Cl A1 34,015,516 59,040,698 1,000,838 ZoomInfo Technologies Inc., Cl A1 32,829,689 52,213,719 India (1.50%) 123,983 Zscaler, Inc.1 8,588,945 26,787,767 534,508 Bajaj Finance Limited 33,760,009 43,353,281 686,999 Zymergen, Inc.1 21,296,969 27,486,830 Indonesia (0.30%) Total United States 914,967,973 1,537,004,913 31,632 Sea Ltd., ADR1 7,379,405 8,686,147 Uruguay (1.47%) Israel (6.51%) 807,566 Dlocal Ltd., Cl A1 17,807,000 42,421,442 326,882 Fiverr International Ltd.1 7,503,852 79,265,616 TOTAL COMMON STOCKS 1,617,804,772 2,710,853,187 551,889 ION Acquisition Corp. 2 Limited1 5,518,890 5,568,560 36,656 monday.com Ltd.1 5,681,680 8,195,915 1,326,490 Taboola.com Ltd. (formerly, ION Private Common Stocks (0.32%) Acquisition Corp. 1 Limited)1,2 13,264,900 13,238,370 1,143,741 Taboola.com Ltd.1 11,020,310 11,837,720 United States (0.32%) 242,889 Wix.com Ltd.1 43,240,533 70,505,819 18,197 Space Exploration 1,2 Total Israel 86,230,165 188,612,000 Technologies Corp., Cl A 7,642,558 7,247,319 5,613 Space Exploration Korea, Republic of (0.94%) Technologies Corp., Cl C1,2 2,357,404 2,235,490 654,000 Coupang, Inc., Cl A1 22,890,000 27,350,280 TOTAL PRIVATE COMMON STOCKS 9,999,962 9,482,809 Mexico (0.33%) 996,069 DD3 Acquisition Corp. II1,2,3 9,115,057 9,462,655 Private Convertible Preferred Stocks (2.43%) 8,652 DD3 Acquisition Corp. II Private Units1,2,3 86,516 86,607 India (0.99%) Total Mexico 9,201,573 9,549,262 9,201 Think & Learn Private Limited, Series F1,2 29,867,591 28,628,352 Netherlands (4.76%) United States (1.44%) 16,186 Adyen N.V., 144A1 16,437,273 39,693,404 238,698 argenx SE, ADR1 45,917,552 71,864,807 219,321 Farmers Business Network, Inc., 1,2 38,227 ASML Holding N.V. 8,394,703 26,388,835 Series F 7,250,006 9,371,586 69,926 Resident Home, Inc. Series B11,2 4,999,968 4,593,439 Total Netherlands 70,749,528 137,947,046 484,183 Rivian Automotive, Inc., Series E 1,2 7,499,995 17,498,374 176,391 Rivian Automotive, Inc., Series F1,2 6,500,008 6,448,855 Poland (0.50%) 100,775 Zymergen, Inc., Series D1,2 2,249,993 3,775,031 1 62,873 Allegro.eu SA, 144A 805,513 1,082,016 Total United States 28,499,970 41,687,285 668,821 InPost SA1 13,261,506 13,423,242 TOTAL PRIVATE CONVERTIBLE Total Poland 14,067,019 14,505,258 PREFERRED STOCKS 58,367,561 70,315,637 United Kingdom (2.85%) 726,800 Endava plc, ADR1 31,977,783 82,404,584

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Baron Global Advantage Fund — PORTFOLIO HOLDINGS (Continued) June 30, 2021 (Unaudited)

Shares Cost Value Summary of Investments by Percentage of Private Preferred Stocks (0.42%) Sector as of June 30, 2021 Net Assets Information Technology 34.8% United States (0.42%) Consumer Discretionary 21.9% 461,004 GM Cruise Holdings, Cl G1,2 $ 12,147,455 $ 12,267,316 Health Care 18.8% Communication Services 12.3% Warrants (0.05%) Financials 4.1% Materials 1.4% Israel (0.02%) Industrials 1.2% 228,748 Taboola.com Ltd. Real Estate 1.2% 1 Exp 10/5/2027 417,099 709,119 Special Purpose Acquisition Company 1.1% Mexico (0.03%) Cash and Cash Equivalents* 3.2% 498,034 DD3 Acquisition Corp. II, 100.0% Exp 12/10/20271,2,3 845,632 727,129 TOTAL WARRANTS 1,262,731 1,436,248 * Includes short term investments.

Principal Amount Short Term Investments (2.87%) $82,971,185 Repurchase Agreement with Fixed Income Clearing Corp., dated 6/30/2021, 0.00% due 7/1/2021; Proceeds at maturity - $82,971,185; (Fully collateralized by $84,577,800 U.S. Treasury Note, 1.25% due 6/30/2028 Market value - $84,630,661) 82,971,185 82,971,185 TOTAL INVESTMENTS (99.71%) $1,782,553,666 2,887,326,382

CASH AND OTHER ASSETS LESS LIABILITIES (0.29%)5 8,278,585 Net Assets $2,895,604,967

RETAIL SHARES (Equivalent to $56.33 per share based on 17,239,459 shares outstanding) $ 971,173,756

INSTITUTIONAL SHARES (Equivalent to $57.41 per share based on 33,189,649 shares outstanding) $1,905,366,073

R6 SHARES (Equivalent to $57.44 per share based on 331,908 shares outstanding) $ 19,065,138

% Represents percentage of net assets. 1 Non-income producing securities. 2 At June 30, 2021, the market value of restricted and fair valued securities amounted to $115,580,523 or 3.99% of net assets. These securities are not deemed liquid. 3 An “Affiliated” investment may include any company in which the Fund owns 5% or more of its outstanding shares. 4 All or a portion of these securities are segregated for unfunded commitments. Total value of securities segregated is $31,975,980. 5 Includes net unrealized appreciation of $431,163 on unfunded commitments with special purpose acquisition companies to purchase when-issued private investments in public entities. ADR American Depositary Receipt. 144A Security is exempt from registration pursuant to Rule 144A under the Securities Act of 1933. This security may be resold in transactions that are exempt from registration, normally to qualified institutional buyers. At June 30, 2021, the market value of Rule 144A securities amounted to $146,237,451 or 5.05% of net assets.

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Baron Discovery Fund — PORTFOLIO HOLDINGS June 30, 2021 (Unaudited)

Shares Cost Value Shares Cost Value Common Stocks (92.17%) Common Stocks (continued) Communication Services (5.80%) Health Care (23.49%) Advertising (1.69%) Biotechnology (1.65%) 3,875,000 S4 Capital PLC (United Kingdom)1,2 $ 12,841,181 $ 33,662,605 237,800 Applied Therapeutics, Inc.1 $ 9,274,716 $ 4,941,484 146,000 Biohaven Pharmaceutical Interactive Media & Holding Co. Ltd.1,2 6,453,537 14,173,680 Services (1.66%) 380,143 Recursion Pharmaceuticals, Inc., Cl A1 6,842,574 13,875,220 825,000 Tripadvisor, Inc.1 28,690,867 33,247,500 22,570,827 32,990,384 Movies & Entertainment (0.39%) 185,000 Liberty Media Corporation-Liberty Health Care Equipment (10.85%) Formula One, Cl A1 5,634,811 7,886,550 935,000 Acutus Medical, Inc.1 18,263,968 15,876,300 580,084 AxoGen, Inc.1 9,919,925 12,535,615 Publishing (2.06%) 637,982 Axonics, Inc.1 28,878,670 40,454,439 950,000 Future PLC (United Kingdom)2 18,404,637 41,158,707 527,500 Butterfly Network, Inc.1 5,275,000 7,638,200 202,500 CryoPort, Inc.1 5,127,704 12,777,750 Total Communication Services 65,571,496 115,955,362 308,580 Eargo, Inc.1 9,305,920 12,315,428 89,823 Inari Medical, Inc.1 2,337,837 8,378,689 Consumer Discretionary (8.07%) 707,985 Inogen, Inc.1 32,258,659 46,139,382 Casinos & Gaming (3.42%) 50,000 Inspire Medical Systems, Inc.1,3 2,923,748 9,663,000 7,750,000 Melco International 540,208 Silk Road Medical, Inc.1,3 21,944,575 25,854,355 Development Ltd. (Hong Kong)1,2 15,367,374 14,212,371 3,800,000 ViewRay, Inc.1 19,150,429 25,080,000 1 150,371 Penn National Gaming, Inc. 2,663,946 11,501,878 155,386,435 216,713,158 1,000,000 Red Rock Resorts, Inc., Cl A1 27,022,123 42,500,000 45,053,443 68,214,249 Health Care Services (0.88%) 323,963 Accolade, Inc.1 9,020,518 17,594,431 General Merchandise Health Care Supplies (1.72%) Stores (0.63%) 1 150,000 Ollie’s Bargain Outlet Holdings, Inc.1 10,471,280 12,619,500 2,629,967 Cerus Corp. 14,027,651 15,543,105 2,365,363 Sientra, Inc.1 17,781,625 18,828,289 Home Improvement 31,809,276 34,371,394 Retail (1.85%) 350,000 Floor & Decor Holdings, Inc., Cl A1 11,227,099 36,995,000 Life Sciences Tools & Services (4.45%) Internet & Direct Marketing 50,000 Berkeley Lights, Inc.1 1,100,000 2,240,500 Retail (0.93%) 499,729 CareDx, Inc.1,3 10,068,530 45,735,198 350,000 MYT Netherlands Parent 1,2 1,2,3 150,000 Olink Holding AB, ADR 5,649,156 5,163,000 BV, ADR 9,100,000 10,650,500 1 1 68,980 Seer, Inc. 1,310,620 2,261,165 400,000 The RealReal, Inc. 7,688,189 7,904,000 834,090 Veracyte, Inc.1,3 24,356,550 33,346,918 16,788,189 18,554,500 42,484,856 88,746,781 Restaurants (0.62%) 1 Managed Health Care (2.03%) 200,000 The Cheesecake Factory, Inc. 4,145,091 10,836,000 688,279 Progyny, Inc.1 16,465,247 40,608,461 10,000 Wingstop, Inc. 874,199 1,576,300 5,019,290 12,412,300 Pharmaceuticals (1.91%) 1,133,932 Revance Therapeutics, Inc.1 23,485,800 33,609,744 Specialty Stores (0.62%) 3,831,500 TherapeuticsMD, Inc.1 16,199,093 4,559,485 550,000 Petco Health & Wellness Co., Inc.1 11,449,581 12,325,500 39,684,893 38,169,229 Total Consumer Discretionary 100,008,882 161,121,049 Total Health Care 317,422,052 469,193,838 Consumer Staples (4.63%) Industrials (16.86%) Packaged Foods & Meats (0.97%) 100,000 Laird Superfood, Inc.1 2,547,796 2,987,000 Aerospace & Defense (4.07%) 750,000 UTZ Brands, Inc. 12,255,000 16,342,500 1,102,370 Kratos Defense & Security Solutions, Inc.1 19,500,520 31,406,521 14,802,796 19,329,500 752,680 Mercury Systems, Inc.1 41,981,485 49,887,631 Personal Products (2.10%) 61,482,005 81,294,152 2,500,000 The Beauty Health Co.1 27,055,430 42,000,000 Building Products (1.13%) Soft Drinks (1.56%) 220,000 Trex Company, Inc.1 7,416,878 22,486,200 875,000 Fevertree Drinks PLC (United Kingdom)2 26,629,565 31,143,270 Diversified Support Services (1.27%) Total Consumer Staples 68,487,791 92,472,770 989,712 ACV Auctions, Inc., Cl A1 28,429,380 25,366,318 Financials (2.90%) Electrical Components & Equipment (0.40%) Insurance Brokers (1.00%) 1 222,521 Shoals Technologies 750,007 BRP Group, Inc., Cl A 15,155,098 19,987,687 Group, Inc., Cl A1 5,563,025 7,899,495 Property & Casualty Environmental & Facilities Insurance (1.90%) Services (1.61%) 230,000 Kinsale Capital Group, Inc. 16,845,760 37,897,100 599,642 Montrose Environmental Total Financials 32,000,858 57,884,787 Group, Inc.1 10,554,326 32,176,790

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Baron Discovery Fund — PORTFOLIO HOLDINGS (Continued) June 30, 2021 (Unaudited)

Shares Cost Value Shares Cost Value Common Stocks (continued) Common Stocks (continued) Industrials (continued) Materials (0.62%) Heavy Electrical Commodity Equipment (1.70%) Chemicals (0.62%) 702,000 TPI Composites, Inc.1 $ 15,929,051 $ 33,990,840 308,808 Zymergen, Inc.1 $ 9,654,124 $ 12,355,408 Industrial Conglomerates (1.30%) Real Estate (3.83%) 450,000 Raven Industries, Inc.1 11,048,864 26,032,500 Diversified REITs (0.47%) Industrial Machinery (3.16%) 250,000 American Assets Trust, Inc. 6,544,637 9,322,500 86,600 ESCO Technologies, Inc. 4,658,023 8,123,946 300,000 Helios Technologies, Inc. 12,051,607 23,415,000 Industrial REITs (1.00%) 350,000 Rexford Industrial Realty, Inc. 12,654,993 19,932,500 253,105 Kornit Digital Ltd.1,2 8,856,307 31,468,545 25,565,937 63,007,491 Office REITs (1.58%) 1,000,000 JBG SMITH Properties 33,666,311 31,510,000 Trading Companies & Distributors (2.22%) Specialized REITs (0.78%) 250,000 Hydrofarm Holdings Group, Inc.1,3 13,723,547 14,777,500 415,000 Americold Realty Trust3 8,047,275 15,707,750 175,000 SiteOne Landscape Supply, Inc.1,5 9,431,317 29,620,500 Total Real Estate 60,913,216 76,472,750 23,154,864 44,398,000 Special Purpose Acquisition Total Industrials 189,144,330 336,651,786 Company (0.57%) Information Technology (25.40%) Special Purpose Application Software (5.65%) Acquisition Company (0.57%) 1 325,000 Fifth Wall Acquisition 650,000 Alkami Technology, Inc. 20,362,670 23,185,500 1 875,000 DoubleVerify Holdings, Inc.1 28,327,791 37,047,500 Corp. I, Cl A 4,026,685 4,000,750 1 731,239 Jaws Spitfire Acquisition 215,500 Everbridge, Inc. 24,899,739 29,325,240 1,2 250,000 Medallia, Inc.1 6,635,670 8,437,500 Corp., Cl A 7,552,364 7,319,702 500,000 Viant Technology, Inc., Cl A1 13,515,462 14,890,000 Total Special Purpose Acquisition Company 11,579,049 11,320,452 93,741,332 112,885,740 TOTAL COMMON STOCKS 1,173,712,544 1,840,613,620 Data Processing & Outsourced Services (1.47%) 300,000 Paymentus Holdings, Inc., Cl A1 6,775,612 10,650,000 Principal Amount 200,000 Shift4 Payments, Inc., Cl A1 7,218,579 18,744,000 Short Term Investments (8.18%) 13,994,191 29,394,000 $163,351,094 Repurchase Agreement with Electronic Equipment & Fixed Income Clearing Corp., Instruments (3.96%) dated 6/30/2021, 0.00% due 410,000 Advanced Energy Industries, Inc. 29,968,519 46,211,100 7/1/2021; Proceeds at 10,431 Novanta, Inc.1,2 272,590 1,405,682 1 maturity - $163,351,094; 450,000 PAR Technology Corp. 13,275,366 31,473,000 (Fully collateralized by 43,516,475 79,089,782 $166,514,100 U.S. Treasury IT Consulting & Other Bond, 1.25% due 6/30/2028 Services (2.56%) Market value - $166,618,171) 163,351,094 163,351,094 1,2 450,000 Endava plc, ADR 13,125,641 51,021,000 TOTAL INVESTMENTS (100.35%) 1,337,063,638 2,003,964,714 Semiconductor Equipment (2.89%) LIABILITIES LESS CASH AND 6 585,800 Ichor Holdings Ltd.1,2 16,144,595 31,516,040 OTHER ASSETS (-0.35%) (7,003,920) 1,2 255,000 Nova Measuring Instruments Ltd. 8,116,967 26,236,950 NET ASSETS $1,996,960,794 24,261,562 57,752,990 Semiconductors (2.36%) RETAIL SHARES (Equivalent to $38.90 per share 875,000 Allegro MicroSystems, Inc.1 12,250,000 24,237,500 based on 7,623,857 shares outstanding) $ 296,540,457 1,000,000 indie Semiconductor Inc., Cl A1,4 10,000,000 9,490,000 INSTITUTIONAL SHARES (Equivalent to $39.66 per share 1,349,074 indie Semiconductor, Inc., Cl A1 13,729,587 13,328,851 based on 41,989,482 shares outstanding) $1,665,094,600 35,979,587 47,056,351 Systems Software (6.51%) R6 SHARES (Equivalent to $39.66 per share 333,775 Dynatrace, Inc.1,3 6,243,606 19,499,135 based on 890,732 shares outstanding) $ 35,325,737 1,527,131 Ping Identity Holding Corp.1 32,570,696 34,971,300 70,000 Qualys, Inc.1 1,963,529 7,048,300 640,000 Sailpoint Technologies Holdings, Inc.1 34,106,314 32,684,800 621,000 Varonis Systems, Inc.1 19,427,813 35,782,020 94,311,958 129,985,555 Total Information Technology 318,930,746 507,185,418

167 Baron Funds

Baron Discovery Fund — PORTFOLIO HOLDINGS (Continued) June 30, 2021 (Unaudited)

% Represents percentage of net assets. 1 Non-income producing securities. 2 Foreign corporation. 3 The Adviser has reclassified/classified certain securities in or out of this sub-industry. Such reclassifications/classifications are not supported by S&P or MSCI (unaudited). 4 At June 30, 2021, the market value of restricted and fair valued securities amounted to $9,490,000 or 0.48% of net assets. This security is not deemed liquid. See Note 6 regarding Restricted Securities. 5 All or a portion of these securities are segregated for unfunded commitments. Total value of securities segregated is $17,941,560. 6 Includes net unrealized depreciation of $438,180 on unfunded commitments with special purpose acquisition companies to purchase when-issued private investments in public entities. ADR American Depositary Receipt.

168 Baron Funds

Baron Durable Advantage Fund — PORTFOLIO HOLDINGS June 30, 2021 (Unaudited)

Shares Cost Value Shares Cost Value Common Stocks (97.10%) Common Stocks (continued) Communication Services (16.14%) Industrials (4.10%) Cable & Satellite (1.27%) Aerospace & Defense (1.71%) 507 Charter Communications, Inc., Cl A1 $ 198,094 $ 365,775 3,973 HEICO Corp., Cl A $ 418,959 $ 493,367 Interactive Media & Services (14.87%) Research & Consulting Services (2.39%) 944 Alphabet, Inc., Cl C1 1,570,193 2,365,966 6,116 IHS Markit Ltd.2 376,063 689,029 1 5,533 Facebook, Inc., Cl A 1,398,693 1,923,880 Total Industrials 795,022 1,182,396 2,968,886 4,289,846 Information Technology (35.18%) Total Communication Services 3,166,980 4,655,621 Application Software (10.45%) 2,130 Adobe, Inc.1 776,559 1,247,413 Consumer Discretionary (1.24%) 946 Fair Isaac Corp.1 401,748 475,535 Internet & Direct Marketing 1,714 Intuit, Inc. 684,284 840,152 Retail (1.24%) 6,263 SS&C Technologies Holdings, Inc. 367,681 451,312 1,575 Alibaba Group Holding Limited, ADR1,2 357,240 357,178 2,230,272 3,014,412 Consumer Staples (5.39%) Data Processing & Outsourced Services (10.20%) Distillers & Vintners (2.44%) 3,763 Fidelity National Information Services, Inc. 522,722 533,104 3,016 Constellation Brands, Inc., Cl A 631,016 705,412 3,041 MasterCard Incorporated, Cl A 879,545 1,110,239 5,550 Visa, Inc., Cl A 1,206,242 1,297,701 Hypermarkets & Super Centers (1.94%) 1,414 Costco Wholesale Corp. 433,158 559,478 2,608,509 2,941,044 Personal Products (1.01%) Electronic Manufacturing 912 The Estée Lauder Companies, Inc., Cl A 177,856 290,089 Services (1.11%) 2,369 TE Connectivity Ltd.2 242,531 320,312 Total Consumer Staples 1,242,030 1,554,979 IT Consulting & Other Services (2.61%) 2 Financials (16.05%) 2,558 Accenture plc, Cl A 487,657 754,073 Asset Management & Custody Semiconductors (3.20%) Banks (2.56%) 1,180 Monolithic Power Systems, Inc. 392,662 440,671 845 BlackRock, Inc. 544,860 739,350 2,510 Texas Instruments, Inc. 355,374 482,673 748,036 923,344 Financial Exchanges & Data (11.73%) 3,194 CME Group, Inc. 596,649 679,300 Systems Software (7.61%) 2,958 Moody’s Corp. 656,268 1,071,890 8,101 Microsoft Corporation 1,476,572 2,194,561 1,541 MSCI, Inc. 537,985 821,476 Total Information Technology 7,793,577 10,147,746 1,977 S&P Global, Inc. 462,402 811,460 2,253,304 3,384,126 Materials (0.99%) Property & Casualty Insurance (1.76%) Specialty Chemicals (0.99%) 1,388 Ecolab, Inc. 285,843 285,886 12,992 Arch Capital Group Ltd.1,2 486,490 505,908 Total Financials 3,284,654 4,629,384 Real Estate (1.95%) Specialized REITs (1.95%) Health Care (16.06%) 1,501 Alexandria Real Estate Equities, Inc.3 225,447 273,092 Health Care Equipment (4.46%) 359 Equinix, Inc. 178,765 288,133 4,791 Danaher Corp. 822,476 1,285,713 Total Real Estate 404,212 561,225 Life Sciences Tools & Services (8.95%) TOTAL COMMON STOCKS 20,420,770 28,008,153 3,339 Agilent Technologies, Inc. 359,967 493,538 3,379 Iqvia Holdings, Inc.1 532,502 818,799 312 Mettler-Toledo International, Inc.1 275,478 432,226 1,660 Thermo Fisher Scientific, Inc. 563,979 837,420 1,731,926 2,581,983 Managed Health Care (2.65%) 1,913 UnitedHealth Group, Incorporated 536,810 766,042 Total Health Care 3,091,212 4,633,738

169 Baron Funds

Baron Durable Advantage Fund — PORTFOLIO HOLDINGS (Continued) June 30, 2021 (Unaudited)

Principal Amount Cost Value Short Term Investments (5.09%) $1,467,968 Repurchase Agreement with Fixed Income Clearing Corp., dated 6/30/2021, 0.00% due 7/1/2021; Proceeds at maturity - $1,467,968; (Fully collateralized by $1,496,400 U.S. Treasury Note, 1.25% due 6/30/2028 Market value - $1,497,335) $ 1,467,968 $ 1,467,968 TOTAL INVESTMENTS (102.19%) $21,888,738 29,476,121 LIABILITIES LESS CASH AND OTHER ASSETS (-2.19%) (630,690) NET ASSETS $28,845,431 RETAIL SHARES (Equivalent to $18.12 per share based on 387,564 shares outstanding) $ 7,022,368 INSTITUTIONAL SHARES (Equivalent to $18.26 per share based on 984,322 shares outstanding) $17,978,539 R6 SHARES (Equivalent to $18.26 per share based on 210,498 shares outstanding) $ 3,844,524

% Represents percentage of net assets. 1 Non-income producing securities. 2 Foreign corporation. 3 The Adviser has reclassified/classified certain securities in or out of this sub-industry. Such reclassifications/classifications are not supported by S&P or MSCI (unaudited). ADR American Depositary Receipt.

170 Baron Funds

Baron Real Estate Income Fund — PORTFOLIO HOLDINGS June 30, 2021 (Unaudited)

Shares Cost Value Shares Cost Value Common Stocks (97.17%) Common Stocks (continued) Consumer Discretionary (10.16%) Real Estate (continued) Casinos & Gaming (7.89%) Retail REITs (3.72%) 19,575 Las Vegas Sands Corp.1 $ 1,035,923 $ 1,031,407 20,960 Simon Property Group, Inc. $ 2,182,966 $ 2,734,861 47,672 Melco Resorts & Entertainment Ltd., ADR1,2 810,495 789,925 Specialized REITs (24.92%) 15,731 Penn National Gaming, Inc.1 959,526 1,203,264 10,107 Alexandria Real Estate Equities, Inc.3 1,717,719 1,838,868 50,382 Red Rock Resorts, Inc., Cl A1 1,098,359 2,141,235 13,857 American Tower Corp. 3,235,053 3,743,330 5,230 Wynn Resorts Ltd.1 508,667 639,629 34,696 Americold Realty Trust3 1,200,178 1,313,244 19,693 CoreSite Realty Corp. 2,468,663 2,650,678 4,412,970 5,805,460 7,165 Crown Castle International Corp. 1,101,215 1,397,891 3,322 Equinix, Inc. 2,222,030 2,666,237 Hotels, Resorts & Cruise Lines (2.27%) 28,128 Travel + Leisure Co. 1,547,655 1,672,209 35,118 Gaming and Leisure Properties, Inc. 1,514,096 1,627,017 7,714 Public Storage 1,989,944 2,319,523 Total Consumer Discretionary 5,960,625 7,477,669 2,442 SBA Communications Corp. 680,547 778,265 Information Technology (2.52%) 16,129,445 18,335,053 50,964,686 58,359,673 Internet Services & Total Real Estate Infrastructure (2.52%) 23,673 GDS Holdings Limited, ADR1,2 1,781,269 1,858,094 Special Purpose Acquisition Company (1.58%) Special Purpose Acquisition Real Estate (79.33%) Company (1.58%) 94,224 Fifth Wall Acquisition Corp. I, Cl A1 961,740 1,159,897 Diversified REITs (4.38%) 29,590 American Assets Trust, Inc. 877,020 1,103,411 234,779 DigitalBridge Group, Inc. (formerly, Utilities (3.58%) Colony Capital, Inc.)1 1,160,186 1,854,754 Multi-Utilities (3.58%) 7,750 STORE Capital Corp. 210,231 267,453 47,371 Brookfield Infrastructure Partners L.P.2 2,409,162 2,631,459 2,247,437 3,225,618 TOTAL COMMON STOCKS 62,077,482 71,486,792 Health Care REITs (1.46%) 12,901 Welltower, Inc. 903,427 1,072,073 Principal Amount Hotel & Resort REITs (10.94%) 121,574 Host Hotels & Resorts, Inc.1 2,019,675 2,077,700 Short Term Investments (2.66%) 51,552 MGM Growth Properties LLC, Cl A 1,685,560 1,887,834 $1,954,026 Repurchase Agreement with Fixed 1 89,256 Park Hotels & Resorts, Inc. 1,851,719 1,839,566 Income Clearing Corp., dated 95,355 Pebblebrook Hotel Trust 1,903,508 2,245,610 6/30/2021, 0.00% due 7/1/2021; 7,460,462 8,050,710 Proceeds at maturity - $1,954,026; Industrial REITs (6.94%) (Fully collateralized by $1,991,900 U.S. 17,687 Duke Realty Corp. 687,219 837,480 Treasury Note, 1.25% due 6/30/2028 21,678 Prologis, Inc. 2,103,191 2,591,171 Market value - $1,993,145) 1,954,026 1,954,026 24,298 Rexford Industrial Realty, Inc. 1,163,762 1,383,771 TOTAL INVESTMENTS (99.83%) $64,031,508 $73,440,818 4,543 Terreno Realty Corp. 255,832 293,114 4,210,004 5,105,536 CASH AND OTHER ASSETS Office REITs (10.49%) LESS LIABILITIES (0.17%) 126,526 3,320 Boston Properties, Inc. 312,344 380,439 NET ASSETS $73,567,344 59,095 Douglas Emmett, Inc. 1,820,695 1,986,774 52,844 JBG SMITH Properties 1,698,383 1,665,114 RETAIL SHARES (Equivalent to $16.31 per share 107,750 Paramount Group, Inc. 1,099,408 1,085,043 based on 783,880 shares outstanding) $12,784,978 55,688 Vornado Realty Trust 2,431,635 2,598,959 7,362,465 7,716,329 INSTITUTIONAL SHARES (Equivalent to $16.42 per share based on 3,659,625 shares outstanding) $60,098,883 Real Estate Operating Companies (1.62%) R6 SHARES (Equivalent to $16.41 per share 59,809 Kennedy-Wilson Holdings, Inc. 1,084,529 1,188,405 based on 41,655 shares outstanding) $ 683,483 Residential REITs (14.86%) 55,475 American Homes 4 Rent, Cl A 1,833,381 2,155,204 % Represents percentage of net assets. 23,220 Equity LifeStyle Properties, Inc. 1,433,447 1,725,478 1 Non-income producing securities. 14,602 Equity Residential 867,370 1,124,354 2 Foreign corporation. 112,885 Invitation Homes, Inc. 3,768,610 4,209,481 3 The Adviser has reclassified/classified certain securities in or out of this 10,015 Sun Communities, Inc. 1,481,143 1,716,571 sub-industry. Such reclassifications/classifications are not supported by S&P or MSCI (unaudited). 9,383,951 10,931,088 ADR American Depositary Receipt.

171 Baron Funds

Baron WealthBuilder Fund — PORTFOLIO HOLDINGS June 30, 2021 (Unaudited)

Shares Cost Value Affiliated Mutual Funds (100.02%) Small Cap Funds (29.40%) 490,875 Baron Discovery Fund - Institutional Shares $ 13,771,547 $ 19,468,120 466,216 Baron Growth Fund - Institutional Shares 43,600,621 55,218,662 1,222,140 Baron Small Cap Fund - Institutional Shares 42,940,992 52,014,269 Total Small Cap Funds 100,313,160 126,701,051 Small to Mid Cap Funds (3.97%) 374,912 Baron Focused Growth Fund - Institutional Shares 9,740,340 17,129,716 Mid Cap Funds (13.06%) 444,274 Baron Asset Fund - Institutional Shares 42,726,858 56,267,352 Large Cap Funds (8.02%) 412,403 Baron Durable Advantage Fund - Institutional Shares 5,848,017 7,530,471 468,664 Baron Fifth Avenue Growth Fund - Institutional Shares 19,130,218 27,013,769 Total Large Cap Funds 24,978,235 34,544,240 All Cap Funds (20.98%) 569,023 Baron Opportunity Fund - Institutional Shares 16,699,528 26,630,274 361,386 Baron Partners Fund - Institutional Shares 26,935,653 63,795,466 Total All Cap Funds 43,635,181 90,425,740 International Funds (13.27%) 881,779 Baron Emerging Markets Fund - Institutional Shares 14,420,121 17,591,498 507,935 Baron Global Advantage Fund - Institutional Shares 20,572,640 29,160,574 289,454 Baron International Growth Fund - Institutional Shares 7,989,473 10,449,286 Total International Funds 42,982,234 57,201,358 Sector Funds (11.32%) 594,431 Baron FinTech Fund - Institutional Shares 7,994,541 10,087,487 562,362 Baron Health Care Fund - Institutional Shares 9,645,601 11,899,578 489,171 Baron Real Estate Fund - Institutional Shares 15,693,400 20,481,574 383,448 Baron Real Estate Income Fund - Institutional Shares 6,168,973 6,296,212 Total Sector Funds 39,502,515 48,764,851 TOTAL AFFILIATED INVESTMENTS (100.02%) $303,878,523 431,034,308

LIABILITIES LESS CASH AND OTHER ASSETS (-0.02%) (77,545) NET ASSETS $430,956,763

RETAIL SHARES (Equivalent to $21.38 per share based on 3,855,429 shares outstanding) $ 82,430,487

TA SHARES (Equivalent to $21.55 per share based on 1,569,975 shares outstanding) $ 33,825,450

INSTITUTIONAL SHARES (Equivalent to $21.55 per share based on 14,603,094 shares outstanding) $314,700,826

% Represents percentage of net assets.

172 Baron Funds

Baron Health Care Fund — PORTFOLIO HOLDINGS June 30, 2021 (Unaudited)

Shares Cost Value Shares Cost Value Common Stocks (91.67%) Common Stocks (continued) Health Care (88.98%) Health Care (continued) Biotechnology (22.66%) Managed Health Care (11.03%) 54,025 Acceleron Pharma, Inc.1 $ 5,943,074 $ 6,779,597 27,000 HealthEquity, Inc.1 $ 2,104,809 $ 2,172,960 21,378 argenx SE, ADR1,2 5,428,328 6,436,275 14,550 Humana, Inc. 5,834,070 6,441,576 42,253 Arrowhead Pharmaceuticals, Inc.1 2,456,933 3,499,393 26,072 UnitedHealth Group, Incorporated 8,609,313 10,440,272 1 15,117 Beam Therapeutics, Inc. 1,412,925 1,945,709 16,548,192 19,054,808 10,175 BioNTech SE, ADR1,2 1,072,509 2,277,979 28,164 BridgeBio Pharma, Inc.1 1,271,540 1,716,877 Pharmaceuticals (6.70%) 29,200 Denali Therapeutics, Inc.1 2,105,148 2,290,448 71,222 Dechra Pharmaceuticals PLC 34,762 Dicerna Pharmaceuticals, Inc.1 821,180 1,297,318 (United Kingdom)2 3,335,995 4,305,385 81,414 Genmab A/S, ADR1,2 3,131,661 3,324,134 13,592 Eli Lilly & Co. 2,826,035 3,119,636 10,032 Moderna, Inc.1 1,314,758 2,357,319 22,228 Zoetis, Inc. 3,487,503 4,142,410 44,857 Recursion Pharmaceuticals, Inc., Cl A1 807,426 1,637,281 16,500 Twist Bioscience Corp.1 1,871,908 2,198,625 9,649,533 11,567,431 19,036 Zai Lab Limited, ADR1,2 2,065,700 3,369,182 Total Health Care 122,972,994 153,647,569 29,703,090 39,130,137 Materials (0.92%) Health Care Equipment (20.82%) Commodity Chemicals (0.92%) 24,262 Abbott Laboratories 2,250,311 2,812,694 39,698 Zymergen, Inc.1 1,223,843 1,588,317 22,500 Butterfly Network, Inc.1 225,000 325,800 1 22,191 CryoPort, Inc. 764,574 1,400,252 Real Estate (1.77%) 4,147 DexCom, Inc.1 1,251,833 1,770,769 26,116 Eargo, Inc.1 950,321 1,042,289 Specialized REITs (1.77%) 45,351 Edwards Lifesciences Corp.1 3,711,720 4,697,003 16,829 Alexandria Real Estate Equities, Inc.3 2,773,868 3,061,868 1 3,895 IDEXX Laboratories, Inc. 1,598,485 2,459,887 TOTAL COMMON STOCKS 126,970,705 158,297,754 30,028 Inari Medical, Inc.1 2,401,123 2,801,012 12,035 Inspire Medical Systems, Inc.1,3 1,768,419 2,325,884 1 12,115 Insulet Corp. 2,791,858 3,325,689 Principal Amount 3,411 Intuitive Surgical, Inc.1 2,293,360 3,136,892 1,387,480 Opsens, Inc. (Canada)1,2 2,019,084 2,540,803 Short Term Investments (8.93%) 12,500 Shockwave Medical, Inc.1 918,119 2,371,625 24,662 Silk Road Medical, Inc.1,3 1,118,684 1,180,323 $15,423,432 Repurchase Agreement with Fixed 9,349 Teleflex, Inc. 3,539,948 3,756,335 Income Clearing Corp., dated 6/30/2021, 0.00% due 7/1/2021; 27,602,839 35,947,257 Proceeds at maturity - $15,423,432; (Fully collateralized Health Care Services (0.95%) by $15,722,100 U.S. Treasury 6,900 Cigna Corp. 1,642,559 1,635,783 Note, 1.25% due 6/30/2028 Health Care Supplies (3.07%) Market value - $15,731,926) 15,423,432 15,423,432 21,100 Establishment Labs Holdings, Inc.1,2 1,652,035 1,842,874 TOTAL INVESTMENTS (100.60%) $142,394,137 173,721,186 9,634 West Pharmaceutical Services, Inc. 2,518,660 3,459,569 4,170,695 5,302,443 LIABILITIES LESS CASH AND OTHER ASSETS (-0.60%) (1,043,214) Health Care Technology (2.22%) 6,738 Certara, Inc.1 154,974 190,887 NET ASSETS $172,677,972 31,519 Schrödinger, Inc.1 1,548,832 2,383,152 4,060 Veeva Systems, Inc., Cl A1 945,478 1,262,457 RETAIL SHARES (Equivalent to $20.99 per share based on 2,241,708 shares outstanding) $ 47,052,167 2,649,284 3,836,496 Life Sciences Tools & INSTITUTIONAL SHARES (Equivalent to $21.16 per share Services (21.53%) based on 5,657,874 shares outstanding) $119,717,740 8,740 10X Genomics, Inc., Cl A1 983,351 1,711,467 15,730 Bio-Techne Corporation 5,477,260 7,082,590 R6 SHARES (Equivalent to $21.15 per share 27,754 Guardant Health, Inc.1,3 3,198,527 3,446,769 based on 279,311 shares outstanding) $ 5,908,065 43,223 ICON plc1,2 8,456,964 8,934,626 2,837 Illumina, Inc.1 848,377 1,342,497 % Represents percentage of net assets. 171,654 MaxCyte, Inc. (United Kingdom)1,2,3 1,812,362 2,132,292 1 Non-income producing securities. 3,110 Mettler-Toledo International, Inc.1 3,304,433 4,308,407 2 Foreign corporation. 67,322 Olink Holding AB, ADR1,2 1,838,639 2,317,223 3 The Adviser has reclassified/classified certain securities in or out of this 6,020 Seer, Inc.1 114,380 197,336 sub-industry. Such reclassifications/classifications are not supported by S&P or 11,299 Thermo Fisher Scientific, Inc. 4,972,509 5,700,007 MSCI (unaudited). ADR American Depositary Receipt. 31,006,802 37,173,214

173 Baron Funds

Baron FinTech Fund — PORTFOLIO HOLDINGS June 30, 2021 (Unaudited)

Shares Cost Value Shares Cost Value Common Stocks (94.98%) Common Stocks (continued) Communication Services (2.16%) Information Technology (continued) Interactive Media & Services (2.16%) Data Processing & Outsourced 7,500 Zillow Group, Inc., Cl C1 $ 956,220 $ 916,650 Services (33.56%) 8,000 ZoomInfo Technologies Inc., Cl A1 279,630 417,360 800 Adyen N.V., 144A (Netherlands)1,2 $ 1,193,184 $ 1,961,864 Total Communication Services 1,235,850 1,334,010 38,000 Dlocal Ltd., Cl A1,2 906,023 1,996,140 10,000 Fidelity National Information Consumer Discretionary (3.69%) Services, Inc. 1,430,601 1,416,700 3,300 Global Payments, Inc. 649,966 618,882 Internet & Direct Marketing 3,500 Jack Henry & Associates, Inc. 568,980 572,285 Retail (3.69%) 22,000 Marqeta, Inc.1 594,000 617,540 3,200 Alibaba Group Holding Limited, ADR1,2 778,385 725,696 1 5,800 MasterCard Incorporated, Cl A 1,939,874 2,117,522 1,000 MercadoLibre, Inc. 1,426,843 1,557,790 100,000 Network International Holdings plc, 144A Total Consumer Discretionary 2,205,228 2,283,486 (United Kingdom)1,2 507,940 506,654 21,000 Nuvei Corp. (Canada)1,2 912,606 1,732,500 Financials (22.48%) 25,000 Paya Holdings, Inc., Cl A1 281,291 275,500 16,000 Paymentus Holdings, Inc., Cl A1 356,901 568,000 Asset Management & Custody 1,3 Banks (2.48%) 8,900 PayPal Holdings, Inc. 1,635,006 2,594,172 1,750 BlackRock, Inc. 1,371,261 1,531,197 17,000 Repay Holdings Corporation1 320,579 408,680 7,000 Shift4 Payments, Inc., Cl A1 345,977 656,040 Consumer Finance (1.53%) 8,800 Square, Inc., Cl A1 1,677,472 2,145,440 49,505 SoFi Technologies, Inc.1 495,050 949,011 11,000 Visa, Inc., Cl A 2,294,510 2,572,020 Diversified Banks (2.95%) 15,614,910 20,759,939 30,000 Banco Inter SA (Brazil)2 387,383 469,199 8,000 TCS Group Holding PLC, GDR2 471,203 700,000 Internet Services & 7,500 TCS Group Holding PLC, GDR2,5 574,270 656,575 Infrastructure (2.83%) 1,200 Shopify, Inc., Cl A1,2 1,376,343 1,753,176 1,432,856 1,825,774 IT Consulting & Other Financial Exchanges & Data (12.73%) Services (10.78%) 2,000 CME Group, Inc. 395,044 425,360 4,600 Accenture plc, Cl A2 1,108,690 1,356,034 3,000 London Stock Exchange Group plc 22,800 Endava plc, ADR1,2 1,358,700 2,585,064 (United Kingdom)2,3 336,035 331,531 4,400 EPAM Systems, Inc.1 1,259,649 2,248,224 1,600 MarketAxess Holdings, Inc. 750,037 741,744 1 4,300 Moody’s Corp. 1,216,563 1,558,191 32,000 Grid Dynamics Holdings, Inc. 391,672 480,960 3,300 MSCI, Inc. 1,202,342 1,759,164 4,118,711 6,670,282 5,600 S&P Global, Inc. 1,885,140 2,298,520 9,000 Tradeweb Markets, Inc., Cl A 668,211 761,040 Total Information Technology 26,857,936 36,352,644 6,453,372 7,875,550 TOTAL COMMON STOCKS 45,851,802 58,759,809 Insurance Brokers (0.78%) 18,000 BRP Group, Inc., Cl A1 522,547 479,700 Principal Amount Investment Banking & Short Term Investments (10.24%) Brokerage (1.45%) 11,000 Houlihan Lokey, Inc. 706,990 899,690 $6,338,710 Repurchase Agreement with Fixed Income Clearing Corp., dated Property & Casualty Insurance (0.56%) 6/30/2021, 0.00% due 7/1/2021; 2,100 Kinsale Capital Group, Inc. 271,854 346,017 Proceeds at maturity - $6,338,710; Total Financials 11,253,930 13,906,939 (Fully collateralized by $6,461,500 U.S. Treasury Note, 1.25% due 6/30/2028 Industrials (7.89%) Market value - $6,465,538) 6,338,710 6,338,710 Research & Consulting Services (7.89%) TOTAL INVESTMENTS (105.22%) $52,190,512 65,098,519 14,000 CoStar Group, Inc.1 1,153,265 1,159,480 13,000 IHS Markit Ltd.2 1,130,402 1,464,580 LIABILITIES LESS CASH AND 15,000 TransUnion 1,396,798 1,647,150 OTHER ASSETS (-5.22%)4 (3,231,830) 3,500 Verisk Analytics, Inc. 618,393 611,520 NET ASSETS $61,866,689 Total Industrials 4,298,858 4,882,730 RETAIL SHARES (Equivalent to $16.91 per share Information Technology (58.76%) based on 508,945 shares outstanding) $ 8,605,991 Application Software (11.59%) 2,664 Alkami Technology, Inc.1 79,920 95,025 INSTITUTIONAL SHARES (Equivalent to $16.97 per share 4,300 Bill.Com Holdings, Inc.1 472,774 787,674 based on 2,829,428 shares outstanding) $48,001,853 3,600 Ceridian HCM Holding, Inc.1 328,451 345,312 5,500 Duck Creek Technologies, Inc.1 148,500 239,305 R6 SHARES (Equivalent to $16.97 per share 3,700 Fair Isaac Corp.1 1,665,412 1,859,916 based on 309,943 shares outstanding) $ 5,258,845 11,000 Guidewire Software, Inc.1 1,275,495 1,239,920 5,300 Intuit, Inc. 1,775,250 2,597,901 70 nCino, Inc.1 2,170 4,194 5,747,972 7,169,247

174 Baron Funds

Baron FinTech Fund — PORTFOLIO HOLDINGS (Continued) June 30, 2021 (Unaudited)

% Represents percentage of net assets. 1 Non-income producing securities. 2 Foreign corporation. 3 All or a portion of these securities are segregated for an unfunded commitment. Total value of securities segregated is $874,440. 4 Includes unrealized depreciation of $8,208 on an unfunded commitment with a special purpose acquisition company to purchase a when-issued private investment in a public entity. ADR American Depositary Receipt. GDR Global Depositary Receipt. 144A Security is exempt from registration pursuant to Rule 144A under the Securities Act of 1933. This security may be resold in transactions that are exempt from registration, normally to qualified institutional buyers. At June 30, 2021, the market value of Rule 144A securities amounted to $2,468,518 or 3.99% of net assets.

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June 30 Quarterly 063021