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#Bear Case
Added 6 days ago

Hey guys, some initial bearish thoughts.

  1. Yet to see a digital or financial product.
  2. Yet to see customers
  3. Absolutely no comparison to Afterpay as a business, saw this mentioned in other forums. ??????? 
  4. Proposed product features are easily replicatable. I saw nothing new as someone who works in the digital banking space. No moat.
  5. Whole bunch of execution risks
  6. Very competitive and barriers to entry are dropping so expect to see more especially when open banking arrives. My fav of the current Neos is Up. But they're all suffering because of Covid, losing customers.
  7. Really not sure what BaaS means. Yet to see their business model in operation.

In saying that Dou will have achieved amazing audience reach just listing and likely up on all the other neos for getting their name out there.

Fun fact: Interesting baseline, one of the most recent Aussie neos Hay launched in Feb this year and is on the cusp of its first 10,000 customers. Hardly explosive stuff. Here's hoping Dou does better for holders.


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#Bear Case
Last edited 5 days ago

Currently, $246mil EV for a company that hasnt even launched its product, questionable path to profitability. $6mil has been invested in developing the platform its EV now trading 41x that level with not a single sale or user established.The average EV/Sales for Australian fintech is 12.3, lets say Douugh with expected explosive growth that it can warrant an EV/Sales of 20. This would mean that at their current enterprise value, they need revenue of $12.3 million to be at a steep fair value for how undeveloped they are. Douugh's main income stream is card interaction fees, Douugh's ceo has stated they have been receiving up to 1% , they would need $12.3 billion in card transactions to earn $12.3 million in revenue. The average neobank revenue per customer in the UK in 2019 was $16.40, lets say generously despite earning no interest revenue Douugh has $30 in revenue per customer which is twice the industry average they would need 410,000 customers. To put this into scope, 250,000 users is about the size of Up bank (largest/oldest neobank in Australia). Additionally Douughs, current advertising budget is only $2,700,000 with a customer acquisition cost of $37.05 (mobile fintech average) this would deliver about 73,000 users. The company has a promising business model and its capital light model will allow it to reach profitability faster than competitors but clearly this is a huge pump with dump soon to come. In addition, taking into consideration the uncertainty of the feasability of their business model, competitive landscape, tight margins (competing with free personal finance apps) and publically untested/unreleased product.

Product is not overly revolutionary plenty of free personal budgeting apps & neobanks already available and far more developed. Few red flags for their execution, director knows how to make a quick buck from investors, previously ran a company that was trading when it was insolvent for numerous months and paying himself a fat salary whilst doing so The company is paying base salary of $841,200 to management collectively right off the bat thats 11% of their cash balance and 14% of the capital raising with the company bleeding cash. Capital raisings targeted at retail investors using fintech buzzwords to generate BNPL like blind interest and using platforms such as Equitise to raise funds, additionally it publically listed just for seed funding. If it goes under 5cents, might scale into an entry, an EV of $54mil / SP of $0.1 would be close to a steep fair value at this stage of its infancy.

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#Bull Case
Added 7 days ago

This stock was listed at around three cents on the ASX a week ago today it is trading at 34c  This is a very Speculative stock and mostly  Hype but the market runs on about 50% hype 50% actual reality Being one of the first Neo banks to list on the ASX I think there's more hype yet  to come in regarding the stock

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