The old joke about investing in China with its limitless opportunities for profitless growth does not apply to buy now pay later.
And it is just as well investors do not have to care about anything as old economy as a profit.
The only thing more astounding than Afterpay and Zip’s soaring revenue and customer numbers today is the continental-sized losses they are generating.
Afterpay – which is being acquired by Square for $39 billion in stock – reports revenue grew 78 per cent to $924.7 million, while its losses blew out to $159.4 million from just $22.9 million of red ink the prior year.
Zip says its revenue jumped 150 per cent to $403.2 million, while losses ballooned to $653 million, from $19.9 million of red ink the prior year.
The first important point that both groups would probably make is that the losses do not reflect a sudden collapse in the economics of…