Ghost Stories #10: Unpacking the Trauma at Transaction Capital (with David Hurwitz, CEO)
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In this special episode of Ghost Stories, there’s no sponsor. There is no company partnering with me to bring a message to market under normal conditions.
Instead, we find a CEO who was willing to engage with me on very short notice after comments I made in Ghost Mail. Given the circumstances around Transaction Capital at the moment, I jumped at the opportunity.
With David Hurwitz in the hot seat, we talked about:
- In layman’s terms, what does SA Taxi do and what are the conditions under which the business performs?
- What did Transaction Capital mean about the issues in SA Taxi being “structural” and is this really an accurate view on the industry?
- A discussion on how the banks play in this space and why Transaction Capital is different.
- Whether there is likely to ever be a viable alternative to the taxi sector and how government could play a role in the industry.
- The funding model for SA Taxi and how that balance sheet works, including a discussion on the contamination / cross-default risks and the duration of debt.
- SANTACO’s position in this crisis and how they are thinking about the relationship.
- Bluntly – is SA Taxi going to be OK and to what extent did the management team see this coming?
- An overview of the Nutun business and how it will grow.
- How can investors be confident that an SA Taxi-style nightmare isn’t brewing at WeBuyCars?
- A discussion on the margins at WeBuyCars in cheaper vehicles vs. more expensive vehicles.
- An overview of GoMo and how quickly this business can be built up.
I haven’t edited even a single “um” out of this podcast, so this is the conversation precisely as I had it with David.
As anyone who regularly follows me will know, I hold a long position in Transaction Capital at the time of release of this podcast. Please note that you must do your own research before deciding to enter or exit a position in Transaction Capital, or any other company for that matter!
I hope that this podcast will enhance your understanding of what has happened at Transaction Capital and what could happen in future.
