Chit Chat Stocks Podcast Summary Episode: Dave Inc. Is Up 500% In One Year: But Is The Stock Actually Still Cheap Today? (Ticker: DAVE)
Hosts: Ryan Henderson and Brett Schafer
Guest: Andrew Marshall from Capital Mindset
Release Date: August 13, 2025

1. Introduction

In this episode of Chit Chat Stocks, hosts Ryan Henderson and Brett Schafer delve into an in-depth analysis of Dave Inc. (Ticker: DAVE), a company that has experienced a remarkable 500% stock increase over the past year. Joined by recurring guest Andrew Marshall from Capital Mindset, the discussion aims to uncover whether Dave remains a bargain despite its significant appreciation.

2. Company Overview

Brett Shafer opens the conversation by clarifying that "Dave is not a person. Dave is a company," emphasizing that the company's name doesn't reflect its business model or services.

Ryan Henderson provides a succinct overview: “Dave is highly misunderstood. It's looked at as a NEO bank. I would more say it's a microlender” (01:08). He highlights the company's impressive EBITDA growth of approximately 250% in the past year, projecting a 120% increase in 2025.

Key Points:

• Industry: Earned Wage Access (EWA), a modern alternative to payday loans.
• Business Model: Charges a flat 5% fee for instant cash advances, significantly lower than traditional payday lenders' exorbitant APRs.

3. History and Stock Performance

Brett Shafer draws parallels between Dave's stock performance and that of Carvana, noting a dramatic collapse of over 90-95% upon going public, followed by a robust recovery (04:08).

Ryan Henderson elaborates on Dave's tumultuous journey:

• Founding: Established in 2017 by Jason Wilk.
• SPAC Launch: Initially surged then plummeted due to unprofitability and high leverage.
• Recovery: Between 2023-2024, Dave streamlined operations, reducing delinquency and write-off rates from nearly 10% to approximately 1-1.5%.

Notable Quote:

“Dave just kind of sounds like a meme like it. And then you look at it and you go, oh, they're a company that loans to the lowest quality consumer in the US this sounds like a disaster.” — Ryan Henderson (01:08)

4. Business Model and Economics

Andrew Marshall inquires about Dave's ability to maintain low delinquency rates in an industry prone to high defaults (09:42).

Ryan Henderson explains:

• Underwriting Process: Utilizes the Plaid API to access consumers' bank accounts and employs sophisticated algorithms to assess creditworthiness.
• Automated Repayment: Direct ACH withdrawals ensure timely repayment, contributing to low delinquencies.
• Revenue Model: Each loan generates a 5% fee, translating to a 500% effective interest rate for Dave due to the high loan turnover.

Key Insights:

• Short-Term Loans: Typically repaid within approximately eight days.
• Customer Behavior: High turnover with many customers taking out multiple loans in quick succession.

Notable Quote:

“The effective interest rate that Dave is receiving is somewhere close to 500% with a 1 to 2% write-off.” — Ryan Henderson (12:35)

5. Competition and Market Position

Brett Shafer asks about Dave's competitors and why consumers might prefer Dave over other options (13:55).

Ryan Henderson identifies primary competitors:

• Traditional Payday Lenders: Offer higher APRs compared to Dave’s flat fee.
• Other EWA Companies: Including Earnin, Bridget, Chime, and MoneyLion.

Competitive Advantages of Dave:

• Profitability: Dave stands out as one of the few EWA companies that have achieved profitability.
• First Mover: As a pioneer in the EWA space, Dave benefits from brand recognition and market leadership.
• Customer Acquisition Cost: Significantly lower at $18 per customer compared to competitors like Chime, which exceed $100.

Notable Quote:

“No one in this industry is as good as Dave at getting the underwriting and the charge offs as low as they are.” — Ryan Henderson (23:24)

6. Risks and Legal Issues

Ryan Henderson discusses the DOJ lawsuit against Dave, stemming from their previous business model involving optional tipping features that were allegedly misleading (08:55).

Key Points:

• Old Model: Offered "free" money with optional tips, leading to accusations of deceptive practices.
• Current Model: Shifted to a straightforward 5% fee with transparent caps and floors, enhancing profitability and simplifying the user experience.
• Legal Outcomes: Anticipated to result in fines rather than severe penalties.

Notable Quote:

“They are very unforgiving too, with this. Like I was reading a story, someone paid back Dave two weeks later and Dave banned them from ever taking a loan from them again.” — Ryan Henderson (28:12)

7. Management and Integrity

Andrew Marshall raises concerns about potential manipulative accounting and the integrity of CEO Jason Wilk (35:02).

Ryan Henderson responds by defending the management:

• Historical Resilience: Highlighted how Dave navigated near-bankruptcy without signs of shady practices.
• CEO’s Approach: Jason Wilk is portrayed as a focused operator who prioritizes product development over aggressive investor relations.
• No Current Allegations: No evidence or accusations suggest unethical behavior within the management team.

Notable Quote:

“He just seems like a pure operator. Dave never does any investor conferences.” — Ryan Henderson (35:02)

8. Valuation and Growth Prospects

Brett Shafer and Ryan Henderson delve into why Dave's stock appears undervalued and the potential for future growth (43:07).

Ryan Henderson's Analysis:

• Current Valuation: Trading at approximately 15x EBITDA based on conservative sell-side estimates.
• EBITDA Growth: Forecasted to reach $220 million by 2025 and $275 million by 2026.
• Revenue Projections: Anticipates scaling up to $1 billion in annual revenue through expanded product offerings, such as higher-ticket loans and potential BNPL (Buy Now, Pay Later) services.
• Market Cap Potential: Envisions a rise to $5-10 billion within five years, driven by sustained profitability and market expansion.

Key Insights:

• Revenue Growth: Exponential increase from a $440 million run-rate to a projected $1 billion.
• Operational Efficiency: Improved gross margins due to the new pricing model enhancing profitability.
• Repeat Business: Despite higher churn rates, the ability to acquire customers at low costs supports continuous growth.

Notable Quote:

“The effective interest rate that Dave is receiving is somewhere close to 500% with a 1 to 2% write-off.” — Ryan Henderson (22:44)

9. Conclusion

Brett Shafer summarizes the investment thesis:

• Misunderstood Business Model: Dave's unique positioning as a microlender offers significant advantages over traditional payday lenders.
• Reasonable Valuation: The current market cap under $3 billion presents an opportunity for substantial upside.
• Growth Potential: With robust EBITDA growth and potential market expansion, Dave could achieve multi-bagger returns in the coming years.

Final Thoughts:

• Risk Mitigation: Strong balance sheet and low delinquency rates position Dave favorably against competitors.
• Strategic Growth: Plans to introduce higher-ticket loans and explore BNPL markets could unlock additional revenue streams.

Notable Quote:

“I fully think [Dave] could easily trade at a 20 times dividend even.” — Ryan Henderson (43:07)

Notable Quotes with Timestamps

1. Ryan Henderson [01:08]:

   “Dave is highly misunderstood. It's looked at as a NEO bank. I would more say it's a microlender.”

2. Ryan Henderson [04:08]:

   “Dave just kind of sounds like a meme like it. And then you look at it and you go, oh, they're a company that loans to the lowest quality consumer in the US this sounds like a disaster.”

3. Ryan Henderson [09:42]:

   “They actually for these consumers kind of sit in front of the credit stack over a credit card, over most of their other payments...”

4. Ryan Henderson [12:35]:

   “The effective interest rate that Dave is receiving is somewhere close to 500% with a 1 to 2% write-off.”

5. Ryan Henderson [23:24]:

   “No one in this industry is as good as Dave at getting the underwriting and the charge offs as low as they are.”

6. Ryan Henderson [28:12]:

   “They are very unforgiving too, with this. Like I was reading a story, someone paid back Dave two weeks later and Dave banned them from ever taking a loan from them again.”

7. Ryan Henderson [35:02]:

   “He just seems like a pure operator. Dave never does any investor conferences.”

8. Ryan Henderson [43:07]:

   “The effective interest rate that Dave is receiving is somewhere close to 500% with a 1 to 2% write-off.”

Additional Resources

• Capital Mindset: The guest, Andrew Marshall, represents Capital Mindset, a platform focused on stock research and investment insights. Listeners interested in deeper analyses can explore their offerings on YouTube and other social media channels.

Disclaimer: Chit Chat Stocks and its hosts, Ryan Henderson and Brett Schafer, as well as guest Andrew Marshall, are not financial advisors. The discussions and opinions expressed are not formal advice or recommendations. Always conduct your own research or consult a professional before making investment decisions.