Looking for sensible explanation, page-72

@Permabear don’t think 2.3% net margin in Oz can be assumed.

I don’t think there is enough information to calculate net margin in US. I am reasonably confident that the gross merchant rates are 3.8% for AU/NZ and 3% for US.

I don’t actually think it’s all that important. I think they have presented the data in a way:
- that lays out the big picture for investors
- sounds good to regulators

the investment case is really simple, you just have to sift through the noise:
1) Afterpay is growing exponentially- I have posted elsewhere but easily verifiable
2) The business model is profitable at maturity- can be back tested in numerous ways including-
a) op cashflow - increase in receivables (+13 even taking out impairments and intangibles
b) segment reporting and Oz contribution
3) There is a life cycle to the business:
i) grow quickly by partnering with enterprises to grow network loss leading on margins
ii) acquire customers quickly, weed out non-payers (***a really simple way of getting good quality customers is by having a product people use again and again)
iii) use data generated to optimise backend algorithms
iv) make product stickier by introducing app first, then in-store
v) as network takes off get more SMBs into the mix which generate higher margins *we are here in Oz*
vi) monetise data and advertising on platform appeal

importantly, everything is executed perfectly (except perhaps expectation management of investor base), meaning that the vitality of Afterpay is significantly (light-years) better than competitors. After all, they have been doing this the longest...

you then just have to look to see to see when the thesis fails to cut and run....eg. If only 3M users in Us by year end this is a major problem.