Deep Dive: DLocal Stock With Robert Cantwell and Joe Kowaleski From UPholdings
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Show Notes
This week we brought on two new guests, Robert and Joe from UPholdings (check out their website here). We discussed dLocal, a payments company similar to Adyen and Stripe. Here are some questions we asked them about the company:
How’d you come across dLocal?
Can you describe what dLocal does? Can you provide an example of a customer use case?
dLocal makes money by taking fees on total payment volume flowing through its service. What is driving that growth? Are there any other important parts of the business?
Many companies from Amazon to Uber to Booking to Dropbox use dLocal. Why did they choose them? What’s stopping them from going to a competitor?
The team is based in Uruguay, and was the first unicorn in the market. What are your thoughts on management? What is their relation to Astropay?
dLocal’s take rate last year was ~4%. Do you believe that is sustainable? (for example, Adyen’s is much lower)
What metrics do you use to measure the success of an earlier- company like DLO?
Market cap right now is approximately $10 billion. What are your thoughts on valuation?
The stock has been really volatile since its IPO - how has that affected your investment?
What do you believe will drive top-line growth over the next few years? What kind of profit margins can they achieve at maturity?
What’s the biggest threat to dLocal’s business?
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Disclosure: The author and podcast guests are not your financial advisors. Ryan Henderson and Brett Schafer are general partners and portfolio managers at Arch Capital. Clients of Arch Capital may hold securities discussed on this show.