I would suggest Grabs current share price is due to the human unwillingness to realise 80% losses.
Please enlighten me on how the communication "We've spent $19 billion dollars and have $16 billion dollars in return" is better than what IOU has communicated.
MORE GROWTH.. MORE LOSS.
I'm just repeating myself at this stage so I will answer Stig and Kev's concerns.
>which went to reinforce that by stating they're not chasing revenue growth in thier response via holder relations, all the while putting the fire out of bnpl which was primed to show that with scale should grow exponentially. ( but they choose not to)
BNPL companies gained exponential growth for one reason : It's not regulated aka "Free money". "Do u have an income and an expenses" "what do u mean I just want money" "K".That's why they also have exponential losses.
Afterpay, Zip, Grab etc' "success" is measured by growth. But *they are selling the product at a loss*.
Demand for credit is always there. Doesn't mean anything if you don't get the money back from the customer.
IDSB is not a capital burn, it's an asset purchase. Like buying a piece of factory equipment. If a farm buys a tractor for 1 million bucks, do they get their money back in 1 year? No. Is the tractor worth 1 million bucks after 1 year? No. It doesn't mean the purchase of the tractor was a bad deal for the farm business wise. On the plus side in this case, IDSB is probably not going to depreciate in value given the growing nature of the Malaysian digital economy.
IDSB have reputation, and, as I see it, operating in Malaysia relies on reputation. So they bought reputation, business intelligence, access to things they couldn't get otherwise or easily. How is a tiny player like IOU going to get something as valuable as an AG code license? They're nobodies. People were talking about the DBL, which was a joke because IOU is nobody. They gotta become somebody.
>What is now missing is Funding imv, its the key they don't want to turn, why not when it's demand is rising, as the company implies.
Who would give a "traditional" model BNPL company funding right now, you'd have to be crazy! Why don't they want to turn it? Because it will cost them money. The pressure will be on for them to grow faster if they have debt/ interest to service which will necessarily tempt them to loosen their credit policy. I like this conservative approach.
As I also note above, consider the Malaysian banking and government perspective. BNPL will be regulated in Malaysia, well before it is in Aus, maybe as early as the end of this year. I feel they won't be very liberal policies. I've never read the phrase "Debt bondage" in Australian news media.
IOU, in my view, is positioning themselves to not get smashed by regulation.
I agree with the sentiment that communication is trash. Why do they have 133 people, what are they spending money on. How much is their true BNPL churn, because TTV isn't that instructive. I'm totally just making excuses for them and I 100% acknowledge that hahah..
BUT.. it's not reasonable to conclude that because we don't know what they've spent the money on, they've wasted it. Why do they have 133 staff?
Kev says because they're bad at management. I don't really think there's any evidence of that and I will oppose that conclusion until proven otherwise. I'm responding to supposition with supposition.
"This business can't continue at this rate without funding" , Grab was up to circa 17 USD last year and people *knew they lost 1 billion dollars the previous financial year* .. All I'm trying to argue here in general is that if you want to apply a metric to something, it better apply universally.
