Thread by @pbcinc

Stay tuned as I am about to tell you of an incredible up-and-coming Marketplace in North America no one noticed. It's a highly profitable innovative unit econ growing microcap tackling a massive opportunity. I think it's a double short-term and 10Bagger material.

1. Powerband Solutions ($PBX.V) is an under-the-radar, Second-hand US Car marketplace platform Canada traded microcap already on its way offering a conservative 100% upside in 2 years for smart investors paying attention.

2. The business seems to have just passed its inflection point with what seems like a viral hockey stick like revenue, adoption patterns (Revs up 31% m/m Y2D above 10M CAD July 2021 at Gross margin of ~52%) with the platform closing fast on Breakeven and funding from Ops CFs.

3. While the flywheel is composed of several moving parts, profitability comes from a fast-growing core vertical (Drivrz Financial) for the time being. DF is a software-based solution facilitating closing a short-term second-hand car lease by…

4. Dealers from credit checks through paperwork to matching credit from a low-cost 2BUSD line backed by Credit Unions (without any Credit Risk to DF).

5. DF’s solution is already integrated into two of the leading CRM solutions preinstalled at about 80% of the US dealers – a massive marketing advantage making a complex and long process a few clicks, 8 min. long with a close to next day car pickup possible.

6. Short term leasing for second-hand cars solves painful Car retail problems: 1) since the buyer pays only for 2-3 years worth of usage and begins with a depreciated asset, the cost of use is drastically lower from term loan, allowing better or “more” car or major savings,

7. 2) it solves standard term loan negative equity, payment < depreciation, 3) Most people do not wish to drive the same car for many years and would really like to change for a newer car after 2-3 years anyway, certainly if not deterred by negative equity.

8. DF saves Dealers time & labor (a critical factor when closing a used car deal an experience most find unpleasant as it is) and helps them lower the Car usage costs for their clients.

9. At the lease end, the car keys only needs to be dropped at the dealer and a new car picked up – generating a recurring sales revenue stream for the Dealer. Most exciting: Dealers make significantly more money on short term leases (despite lower cost per use for the end client)

10. DF’s makes ~3,400USD revs, ~2,500USD gross profit, over-fixed costs, and a light asset model (Dealers carry inventory and locations). We could see, 40% EBITDA margin at scale just on this vertical alone.

11. Variables: a) Dealer onboarding (guidance to 1,000 originations per month 2021, 1,000 dealers by 22 out of ~14K dealers in the US), b) 2-3 originations per dealer per month (40% of the active dealers already generated 4+ transactions July 21) c) 27.5 M revs and 6.9M EBITDA.

12. As the platform scales, OpLev will manifest itself allowing $PBX.V for further reinvest into the platform CFOs without diluting current owners.

13. The Biz plan economics secret sauce is a new financing model, tech integration, and the existence of a 2BUSD line at very low terms extended by Credit Unions. Just to be clear: $PBX.V assumes no financial risk, making its revenue stream the holy grail of platforms

14. Insiders are buying shares and are large holders themselves although it does seem like an early PP holder is happy to sell you his shares, for the time being…

15. Per DF guidance to 2022 (find it) we think current prices support, under pretty conservative assumptions, at least a double or around 40% CAGR, even without any of the other verticals. Your mileage may vary.

16. We think this is an extremely early attractive opportunity. In our eyes, this is a potential 10Bagger within short few years. In fact, in many ways, $PBX.V reminds us of XPEL's in its microcap days.

17. Please do your own DD (lots more to find out), this is not a formal rec, we are long. This IS a microcap and this is very early days.

Thanks to incredible @mascarosergi who found the idea and @SharogradskyM.