Square to acquire Afterpay for $29B • Hacker News Board

Re: Square to acquire Afterpay for $29B

#111

Post by megablast » Mon, Aug 02, 2021, 2:16 AM UTC

siquick wrote: post #70

shell0x wrote: post #58

As a foreigner in Australia, I can't help but to think that Australians really don't know how to handle finances and are too irresponsible to use a credit card, so Afterpay and Zip stepped in. Maybe it's because I grew up in Europe, but "Don't buy it if you can't afford it" has served me well. The majority of people I know just use credit cards for the perks but never miss a full payment.

I’ve lived in Australia for 10 years and still cannot believe how flippant people here seem to about getting into debt. Tens of thousands of dollars of credit card debt, a mortgage covering 60% of a salary, and a leased car seem to be fairly standard for a lot of my peers. It feels like they’re all 3 missed months of salary away from having absolutely nothing. Obviously all anecdotal but still astounding and probably…

Compared to what?? Canada?? The us?? Uk???

Re: Square to acquire Afterpay for $29B

#112

Post by roenxi » Mon, Aug 02, 2021, 2:18 AM UTC

AussieWog93 wrote: post #102

systemvoltage wrote: post #100

Earlier quoted context omitted.

Oh boy...so this 6% fee is then indirectly passed onto consumers.

Yep. To be fair, so are the (lower, but non-zero) fees from Visa/MasterCard/Amex/PayPal. It's a textbook example of an externality.

The fee is paid by the customer. It isn't an externality. An externality is when the cost is paid by someone who isn't party to the transaction.

Re: Square to acquire Afterpay for $29B

#113

Post by pcurve » Mon, Aug 02, 2021, 2:20 AM UTC

siquick wrote: post #70

shell0x wrote: post #58

As a foreigner in Australia, I can't help but to think that Australians really don't know how to handle finances and are too irresponsible to use a credit card, so Afterpay and Zip stepped in. Maybe it's because I grew up in Europe, but "Don't buy it if you can't afford it" has served me well. The majority of people I know just use credit cards for the perks but never miss a full payment.

I’ve lived in Australia for 10 years and still cannot believe how flippant people here seem to about getting into debt. Tens of thousands of dollars of credit card debt, a mortgage covering 60% of a salary, and a leased car seem to be fairly standard for a lot of my peers. It feels like they’re all 3 missed months of salary away from having absolutely nothing. Obviously all anecdotal but still astounding and probably…

Sounds 100% like America. :-/

Re: Square to acquire Afterpay for $29B

#114

Post by dd36 » Mon, Aug 02, 2021, 2:20 AM UTC

55555 wrote: post #107

dangrossman wrote: post #30

Earlier quoted context omitted.

My merchant account is cheap (interchange plus 0.1% or so) and the gateway they set me up on is Authorize.net. Still using it after 17 years or so, although indirectly via Spreedly. If you go to a craft show or popup market or anything like that, every vendor has a Square reader to take cards. They're super successful with "offline solopreneurs" -- the independent one-person small businesses. One of my many side gigs…

> My merchant account is cheap (interchange plus 0.1% or so) and the gateway they set me up on is Authorize.net It's crazy most people don't know you can get this. Seems like every popular merchant account provider is a bad deal in comparison. For those curious, you get it from banks. Open a company account at a major conventional bank then ask them for a merchant account. The default they offer you is interchange +…

What’s the high end of the range?

Re: Square to acquire Afterpay for $29B

#115

Post by jollybean » Mon, Aug 02, 2021, 2:25 AM UTC

vmception wrote: post #61

BugsJustFindMe wrote: post #47

Every time I see one of these announcements, the valuations go up and up and up and up. I remember not long ago being wowed by a 1B acquisition. That was called a unicorn because of how incredible it was. And now we're at 29B. Is this just because money is all a joke?

Kind of? If you follow monetary policy circles, you would know that we are only close to the predicted level of fantastic market distortions that should be expected. It is fantastic to see it play out, such as valuations much larger than before, as well as the unexpected areas of speculation and shifts in market tolerances for worse deals. But we aren't even done yet! And this comes with a pretty clear agreement on t…

+1. This is the real comment about the situation, because the valuation is so 'ridiculous', it almost makes the nature of the business activity secondary.

For non-financial folks, dust off the little equation you may have learned in high school, where you value something that goes out forever, but where the rate of growth is higher than that of inflation and the risk-free cost of capital. It goes to infinity. So as interest rates go down, valuations grow. But as interest rates really get low ... the valuations vault into the stratosphere.

Only in a weird universe can we really expect these companies to grow at those rates for very long periods of time ahead of absolutely everything else without much risk.

So the discussion is really about markets, less so local types of consumer payments.

Re: Square to acquire Afterpay for $29B

#116

Post by siquick » Mon, Aug 02, 2021, 2:28 AM UTC

Tehdasi wrote: post #95

catmanjan wrote: post #89

Earlier quoted context omitted.

Other than mortgage (and HECS) nobody I know uses debt - Australians love second hand cars

So basically it's 90+% of debt for housing (scroll down to the pie chart): https://www.finder.com.au/australias-personal-debt-reported-... I'm including 'Investment debt' cause who are we kidding? It's all investment properties.

Feels like that chart is slightly misleading - it’s easy for credit card debt to appear to be low when there are so many high value mortgages. $20k CC debt is only 2% of the value of a $1m mortgage.

Re: Square to acquire Afterpay for $29B

#117

Post by granzymes » Mon, Aug 02, 2021, 2:31 AM UTC

xyst wrote: post #88

Like the payment networks, payment gateways will soon be dominated by a few big players: Stripe, Square I really wish digital currency (ETH, BTC) would take off in the main stream world. The amount of silent middlemen involved in paying a merchant with a credit/debit card is nauseating to say the least.

There is room for far more than 2 large players.

https://2c2p.com/

https://adyen.com/

https://checkout.com/

https://braintreepayments.com/

Re: Square to acquire Afterpay for $29B

#118

Post by jjeaff » Mon, Aug 02, 2021, 2:33 AM UTC

dd36 wrote: post #114

55555 wrote: post #107

Earlier quoted context omitted.

> My merchant account is cheap (interchange plus 0.1% or so) and the gateway they set me up on is Authorize.net It's crazy most people don't know you can get this. Seems like every popular merchant account provider is a bad deal in comparison. For those curious, you get it from banks. Open a company account at a major conventional bank then ask them for a merchant account. The default they offer you is interchange +…

What’s the high end of the range?

The high end will be around 3.5% for amex.

Re: Square to acquire Afterpay for $29B

#119

Post by pcurve » Mon, Aug 02, 2021, 2:34 AM UTC

BugsJustFindMe wrote: post #47

Every time I see one of these announcements, the valuations go up and up and up and up. I remember not long ago being wowed by a 1B acquisition. That was called a unicorn because of how incredible it was. And now we're at 29B. Is this just because money is all a joke?

That's part of it, but it's concentrated around certain sectors (technology and startups) There is x5 ~ x10 premium being put on these companies compared to others.

Valuations in other sectors are still somewhat reasonable.

Re: Square to acquire Afterpay for $29B

#120

Post by jjeaff » Mon, Aug 02, 2021, 2:35 AM UTC

55555 wrote: post #107

dangrossman wrote: post #30

Earlier quoted context omitted.

My merchant account is cheap (interchange plus 0.1% or so) and the gateway they set me up on is Authorize.net. Still using it after 17 years or so, although indirectly via Spreedly. If you go to a craft show or popup market or anything like that, every vendor has a Square reader to take cards. They're super successful with "offline solopreneurs" -- the independent one-person small businesses. One of my many side gigs…

> My merchant account is cheap (interchange plus 0.1% or so) and the gateway they set me up on is Authorize.net It's crazy most people don't know you can get this. Seems like every popular merchant account provider is a bad deal in comparison. For those curious, you get it from banks. Open a company account at a major conventional bank then ask them for a merchant account. The default they offer you is interchange +…

I have never been able to get interchange plus just 0.1 or 0.2%.

Is anyone getting this for SaaS? It seems many processors consider digital goods or services like software to be more risky.