[Jess]

Good improvement. Stock’s up big.

[mcaguru]

its still down over 20 bucks per share from the high 3 years ago. its up alot but its from less then 15 million dollars of buying power supporting today's jump (on wall street that's tiny tiny amount of buying power--may not even be what i call smart money/ institutional ? ) ... my understanding from my sources was that the expectation was that this company would be worth several billion from the IPO going forward. It has NOT..its to early to tell which direction its going.

[Karen37a]

its still down over 20 bucks per share from the high 3 years ago. its up alot but its from less then 15 million dollars of buying power supporting today's jump (on wall street that's tiny tiny amount of buying power--may not even be what i call smart money/ institutional ? ) ... my understanding from my sources was that the expectation was that this company would be worth several billion from the IPO going forward. It has NOT..its to early to tell which direction its going.

Aug 7 (Reuters) - OnDeck Capital Inc topped second-quarter profit estimates on Tuesday, as the online lender gave out more loans and earned more from higher interest rates.

The company now expects a full-year 2018 profit of between $10 million and $16 million, from its previous forecast of up to $10 million

[mcaguru]

Aug 7 (Reuters) - OnDeck Capital Inc topped second-quarter profit estimates on Tuesday, as the online lender gave out more loans and earned more from higher interest rates.

The company now expects a full-year 2018 profit of between $10 million and $16 million, from its previous forecast of up to $10 million

well i need to study what the true valuation of a firm earning 15M with all the other growth trends.. fin-tech is typically valued 7/8 times ebitda. also if economy corrects would they still be able to sustain current model ( and im not talking funding model -- im talking how they sell the deals etc).

[Karen37a]

well i need to study what the true valuation of a firm earning 15M with all the other growth trends.. fin-tech is typically valued 7/8 times ebitda.

Im not going to comment on this anymore

I thought I entered cash advance to make 100k a month

[Jess]

Argh was looking at adjusted net income.

[Nunya]

ISO channel represents 29% of Q2 originations

[Jess]

ISO channel represents 29% of Q2 originations

Wow! Is that correct? They were around 60+% Q1—that doesn’t make sense. I didn’t listen to the call.

[Karen37a]

Wow! Is that correct? They were around 60+% Q1—that doesn’t make sense. I didn’t listen to the call.

I've said why in the past

And they are seeking out another banking referral relationship

"Breslow said the company was on track to announce a new bank partnership later this year and had a growing pipeline of potential partners".

[Jess]

I don’t think it’s ever been that low. No sense to me to see ISO cut in half in one quarter. Yeah they have been talking about this new partner for 2 years. No impact on this Q. But they are getting into equipment finance which is good for ISOs

[Kevin Henry-Seacoast]

I don’t think it’s ever been that low. No sense to me to see ISO cut in half in one quarter. Yeah they have been talking about this new partner for 2 years. No impact on this Q. But they are getting into equipment finance which is good for ISOs

I bet it goes lower.....

[Karen37a]

I don’t think it’s ever been that low. No sense to me to see ISO cut in half in one quarter. Yeah they have been talking about this new partner for 2 years. No impact on this Q. But they are getting into equipment finance which is good for ISOs

Isos have existing relationships already

id beg Kevin for help before i go there lol to each their own

[Nunya]

Wow! Is that correct? They were around 60+% Q1—that doesn’t make sense. I didn’t listen to the call.

No chance. Funding Advisor = ISO in OnDeck's lingo. This was taken from their press release.

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[Jess]

My bad. I just glanced at the nunbers

[fundingsmbs]

True, Kabbage also figured this out early on. They invested millions$ in automation from day 1 and today all of that investment paid off as they have a much lower cost of acquisition for customer's and lower overhead to service customers without having to pay a broker 12-15 points to acquire a new customer. But, I still contend, the broker space will be with the B-D funder's and layering as a future forward model of this MCA business as the behemoths continue to automate and not rely on third party business.

[Kevin Henry-Seacoast]

True, Kabbage also figured this out early on. They invested millions$ in automation from day 1 and today all of that investment paid off as they have a much lower cost of acquisition for customer's and lower overhead to service customers without having to pay a broker 12-15 points to acquire a new customer. But, I still contend, the broker space will be with the B-D funder's and layering as a future forward model of this MCA business as the behemoths continue to automate and not rely on third party business.

True.....you are leaving out a very important point. Most of the mature firms in the advance space much like all other alternative lending have access to cheaper cost of funds. When the advance companies partner with the large institutions with gobs of capital to deploy their costs go down significantly and they have captive customers. They will always have an "A" team referral network to help fill in the gaps and help build a clean sticky book. Deploying capital to sticky customers and getting it back is the key to building a book and being very profitable. Building relationships with large institutions that want to deploy capital helps because at the end of the day....he who has the most executable clean deal-flow wins. Once the larger more mature advance companies figure out a model and build a book with good clean paper and cheap money.....you bet your lucky stars they are going to use the same model at higher rates for somewhat riskier paper. If they have figured out how make money with good paper, they will certainly use the same model to go after riskier paper within reason. Will their be a market away from the larger players, sure....that's the way capital markets works.
Capital Markets is a fun business so long as you constantly evolve and never forget about the customer.

[mcaguru]

"On Deck Capital, which belongs to the Zacks Financial - Miscellaneous Services industry, posted revenues of $95.62 million for the quarter ended June 2018, surpassing the Zacks Consensus Estimate by 8.01%. This compares to year-ago revenues of $86.65 million"

I mean year over years quarter revenues ONLY grew by 9Mish ..I don't see extra ordinary growth ..YES its growth but seems really small to me... wondering what Kabbage and Paypals funding revenues grew in those same quarters YOY.

[Kevin Henry-Seacoast]

"On Deck Capital, which belongs to the Zacks Financial - Miscellaneous Services industry, posted revenues of $95.62 million for the quarter ended June 2018, surpassing the Zacks Consensus Estimate by 8.01%. This compares to year-ago revenues of $86.65 million"

I mean year over years quarter revenues ONLY grew by 9Mish ..I don't see extra ordinary growth ..YES its growth but seems really small to me... wondering what Kabbage and Paypals funding revenues grew in those same quarters YOY.

It's cleaner more profitable growth! If they can do more of that methodically they are MUCH better off.

[fundingsmbs]

"Square and PayPal’s lending businesses differ from other online lenders in that they can solicit their existing payments customer base at virtually no cost. OnDeck, meanwhile, spent $53 million last year alone on sales and marketing to acquire loan customers. " We can throw in Kabbage as having a similiar model as these two and mentioned they may enter the payment processing space by end of year to add addtl revenues.

[mcaguru]

"Square and PayPal’s lending businesses differ from other online lenders in that they can solicit their existing payments customer base at virtually no cost. OnDeck, meanwhile, spent $53 million last year alone on sales and marketing to acquire loan customers. " We can throw in Kabbage as having a similiar model as these two and mentioned they may enter the payment processing space by end of year to add addtl revenues.

more likely for the credit card processors (i'm talking large acquirers/vantiv-first data etc) to become funding houses then for an ondeck to become a payment processor and acquire merchants for the sake of funding them..its a non-starter in my opinion !

[mcaguru]

Just wanted to add seems 20-29M was used to buy on deck stock today..now today's news was great but with tens of Billions in hedge fund money with the best analysts on staff seeking bargains and game-changing events 30M alone tells me the real big smart money has not come to the table today. (perhaps they are sitting on the long island railroad or on choppers to Bedford and/or Greenwich studying the stats for a late party entry). will see.

[Kevin Henry-Seacoast]

Just wanted to add seems 20-29M was used to buy on deck stock today..now today's news was great but with tens of Billions in hedge fund money with the best analysts on staff seeking bargains and game-changing events 30M alone tells me the real big smart money has not come to the table today. (perhaps they are sitting on the long island railroad or on choppers to Bedford and/or Greenwich studying the stats for a late party entry). will see.

Nobody has cared about the stock for a long time. The Company has somewhat shifted their model and starting to show profitability. If it continues, it's not the fin-tech crowd that buys as their is a lot of scorched earth with the Company. Value financial services funds will take a look. Let's see what happens next quarter and watch the volume. Volume precedes price every time.

You have to look at this company differently than the original investor groups. The model seemed great, but the Company could not stop the bleeding. Lower cost of funds and better customers for the future are key.

Remember...Schwab started out as a fin-tech company that was going to revolutionize the brokerage business. The fin-tech investors got in and out. When the Company became an asset gatherer a different type of investor base started supporting the Company as they executed on their plan: Get the customer! Give them easy access to markets and plenty of products and gather their assets. All at a cost that is a better value than most traditional brokerage firms.
ONDK Shorted 50K in lots of 10K with an average of 14.21. My buy stop covered me at 4.57 and I was a little pissed, but glad it was triggered. Have a long buy order down at 7 thinking the stock may drift back a little as volume slows.

[Karen37a]

The reasons these companies do not make the profit compared to volume is because of HUGE operational costs. The operational cost went UP not down.

This is the # 1 reason for me believing in the 1099 model vs the w/2

If I make 1 million I am lean and mean on costs

Costs

Computers
Desks
Office
Phones
data leads
prossor
accountant
payroll

add a few more on

= 1 million...taxes...lower rate florida

Add costs in for brokers... ( leads ) same infrastructure...add more commission in. 10 million..pay out commission

When 1099 makes that money its very very low margins

Which is probably why, stock brokerage firms, insurance companies, Loan companies use the model as well...successfully

You guys can say whatever ...but I know the "algorithms".. Quantitive analysis, ..

[Kevin Henry-Seacoast]

The reasons these companies do not make the profit compared to volume is because of HUGE operational costs. The operational cost went UP not down.

This is the # 1 reason for me believing in the 1099 model vs the w/2

If I make 1 million I am lean and mean on costs

Costs

Computers
Desks
Office
Phones
data leads
prossor
accountant
payroll

add a few more on

= 1 million...taxes...lower rate florida

Add costs in for brokers... ( leads ) same infrastructure...add more commission in. 10 million..pay out commission

When 1099 makes that money its very very low margins

Which is probably why, stock brokerage firms, insurance companies, Loan companies use the model as well...successfully

Correction-cost of funds went down. They appear to be working on operational costs while they are changing the model.

[Karen37a]

Correction-cost of funds went down. They appear to be working on operational costs while they are changing the model.

Changing the model to what?? 1099? lol