it's all over!!!!, page-422

First 422 Last

Share
Profile

Follow
SilverTrade

5,910 Posts.

609

13/06/22

20:24

Post #: 61976753
Share

Originally posted by Moti: ↑

Zip is a great example of why fundamentals matter.
A legend in startup space explained to me how budgets, forecasts plans etc dont work
because it all about growth, and it moves too quickly to bother planning.

And so now they find themselves in this sad situation.
there is definitely value in Zip, and the value can be calculated, just not using charts.

It can either keep throwing money at trying to buy market share or be acquired.
The first is no longer an option, and downloads of its app have almost stopped.
Zip has some 5% of the US market, Klarna and Paypal a lot more.
The valae of zip is in what each customer is worth. That is, the price at which it's cheaper for Klarna, to acquire
zip, than organically grow its customers.
Zip doesnt have the firepower to take on paypal, klarna and the others, and is no longer able to keep plowing opm
into finding customers.
Its options are to a) wither and die or b) be bought. As noted, a) is no longer an option and for b),
customers are becoming less valuable to acquirers by the day, as the cof starts increasing
and customers, and regulators, wake up to the reality of this just being a credit facility
under a shiny new hood.

Its infrastructure and brand are worth zip, the value is # customers x ARPU (a metric that Ive been using in
the telecoms sector for over 30years. If theyre pulling in $10 pm per customer, and manage to hold
customers for 36 months, then at cof of 10% each customer is worth $9.67. At an entity value of $632m they
therefore have 63m customers ?. I dont think so. Maybe a tenth of this. and as cof goes up, each customer is worth less.
So the enterprise is worth maybe $60m to a buyer.

Just my opinion really. Perhaps some buyer will find another reason for acquiring this. Same goes for so many of the tech stocks - anyone look at how much canva, redbubble, atlassian are puling per customer pm ? Youre welcome.

Expand

Nothing wrong with throwing money as long as its in the right places and direction......Read about Growth Hacking Strategy and it will start to make sence.....just ignore the current market situation and noise.......

ZIP Price at posting: 63.0¢ Sentiment: Buy Disclosure: Held
Upvote

1 Great analysis

Reply

Top Stories

CHN

Chalice jumps on Putin nickel export ban threat – but then there's bad news

3 stocks with antimony news on Thursday

GTR

GTI extends uranium mineralisation at Lo Hema through development drilling

DXB

Dimerix begins recruiting young kidney disease patients in Mexico for Phase 3

CU6

Clarity progresses SECuRE trial with positive safety results