Chart - Z1P, page-1169

It's really important to understand that the posts on hotcopper are highly biased and written by people that don't know the difference between a warehouse funding facility and capital. So I'd recommend listening to unbiased comments, if you can find them.

There are a couple of things that should be understood by Z1P investors. Z1P is in fact "too late" in the US in terms of competing with Afterpay, yes. But that does NOT mean Quadpay is a bad investment. Quadpay in the US will be what ZipPay is in Australia.

Regarding margins, this is something that is one of the main reasons for my holding in Z1P being tiny compared to my APT holdings. Margins is everything in this business, and the larger the company (more customers, more merchants etc) the more pricing power you possess. Afterpay and Klarna won't have this issue to the same extend as FXL in Australia or Quadpay/Sezzle in the US. In Australia, the most mature BNPL market, there are already signs that smaller player's pricing is under pressure. FXL's latest FY report showed lower BNPL revenue, and the reason was that they had to lower their fees to be competitive. This is Afterpay's biggest moat in my opinion.

Lastly, Z1P has higher bad debt than the likes of Afterpay as stated by the article, however I don't like the way the article has portrait this by saying "despite Z1P running credit checks". As someone who works in credit risk management I can tell you that this discrepancy has everything to do with the differences in products (e.g. Z1P Money being higher risk) when compared to ZipPay and Afterpay. This has nothing to do with Afterpay having better credit models or anything like that.

I disagree that Larry is making "all the wrong moves". If the market got ahead of itself a few months ago when Z1P was $9+, this has nothing to do with management but market dynamics. I think Z1P's management are doing a fine job.