Klarna , Afterpay and Credit Checks, page-35

By your logic the system should have filtered away all the bad credit customers in CC's, Mortgages etc decades ago - losses should be 0 right?

Xero -> You pay upfront for a licence to use their accounting software. Cost of aquisition of a customer is high, and the software dev cost is high, but the hope is that the customer stays for a long time and hence you recoup that cost. Customers tend to stay because the product is great and its difficult (hassle) to migrate to another accounting platform
Tesla -> Capex is high for building a car.. and the R&D costs are huge in the new space of EVs.. the hope is they productionise this and sell more and more cars in the future.
FMG -> Iron ore minor who had to strip out significant costs and got a tailwind from the commodity price

None of these are even remotely like APTs business model. APT needs to aquire a customer, and then need them to not only stay on their platform (and not use another BNPL), but also continue spending using BNPL (and not another method e.g. debit card). APT also needs a certain portion to miss payments on their purchases and pay late fees. In addition, at any point economic events can lead to significant delinquency rates (with less/no late fees collected), and customer churn can be high.