Chit Chat Stocks: “Manu Invests On Why Sezzle Stock Has Multibagger Potential (Ticker: SEZL)”

Date: February 4, 2026
Guests: Mark (“Manu” from Manu Invests, Fundamentally Sound)
Hosts: Ryan Henderson & Brett Schafer

Episode Overview

This episode explores Sezzle (NASDAQ: SEZL), a fast-growing “buy now, pay later” (BNPL) company, through an in-depth discussion with Mark of Manu Invests. Mark, a seasoned finance professional and Substack writer, explains why Sezzle stands out from its competitors, details its unique business model and growth strategies, and shares his bullish outlook for the stock’s “multi-bagger” potential. The conversation covers Sezzle’s origins, competitive landscape, financials, risks, and the broader future of BNPL.

Key Discussion Points & Insights

1. Mark’s Introduction & Investing Mindset [01:57]

• Mark splits his portfolio: “I really try to anchor it in big quality compounders, but I always try and put like 10% of my holdings into potential multi-baggers that I think are like asymmetrical opportunities.” [02:07]
• Sezzle first surfaced in his own high-growth “multi-bagger” screens.

2. Sezzle’s Business Model Explained [03:10]

• Compared to credit cards, Sezzle offers “pay in four” or “pay in five” solutions: a consumer pays an initial down payment, then equal installments over several weeks—with zero interest if paid on time.
• Sezzle serves near-prime and subprime consumers—a demographic often shunned or gouged by traditional financial institutions.
• Differentiation: Sezzle “is really like a financial well-being app ... giving credit-conscious consumers and consumers with higher financial literacy the ability to budget and almost reverse budget.” [03:41]

3. BNPL vs. Credit Cards & Rival BNPL Providers [04:54]

• BNPL’s appeal: no revolving interest or debt traps.
• “If you don't make your payments, you just don't have access to any more credit essentially.” [05:50]
• Sezzle’s unique pivot: shifted from a “merchant sided” model (a la Affirm/Klarna) to “consumer sided.” Subscribers pay a fee to use Sezzle anywhere Visa is accepted.
  • “They issue you a digital Visa card that is tied to your Sezzle account...” [16:54]

4. Company History & Management’s Turnaround [09:26]

• Founded by current CEO Charlie Yim, a significant owner (~45% of the company).
• Early days struggled: tried merchant integration, listed in Australia, considered acquisition—nearly ran out of cash post-2022.
• Pivotal moment: Ruthless cost cuts, staff reduction, and a focus on profitable growth.
  • “They ruthlessly did that... profitability kind of took off. They launched Sezzle Anywhere. Their business model completely changed...” [09:26]

5. Profitability & Business Strategy [13:00]

• CEO Charlie Yim is lauded for focus and discipline—famously closes earnings calls with Buffett/Munger quotes.
• “We are going to conservatively grow at a pace that maximizes profitability.” [13:51]
• Unlike peers, isn’t chasing unprofitable “grow now, monetize later” playbooks.

6. Merchant Relationships vs. Consumer Focus [14:55]

• Sezzle is more selective about merchant partnerships, pushing for quality over quantity, given its lower but more engaged user base.

7. Industry Growth & BNPL Perceptions [19:14]

• Explosive BNPL sector growth: from $3B originations in 2019 to $45B in 2023; forecasts of up to $900B by 2030. [19:14]
• “The fastest growing segment of BNPL is young people.” [21:20]
• Mark challenges stigma, arguing BNPL is as ethical if not more so than credit cards: “A credit card is the strictest definition of buy now, pay later.” [21:40]
• Candidly shares personal experience of falling into a credit card debt cycle as a young adult, highlighting BNPL’s virtues:
  • “As like a dad today... I’m much more comfortable being like, hey, if you want to build your credit, here’s Sezzle...” [23:59]

8. Financials & User Economics [27:03]

• Revenue growth: c. 70%; gross margins: 60+%; net income margin: 28-29%; free cash flow positive; low stock-based compensation (~2% of revenue).
• “Their primary driver of growth...is focusing on transitioning...customers to what they call mods, which is monthly and on-demand subscribers.” [30:29]

9. Products & The Ecosystem [36:50]

• Sezzle app is “cooler than I expected...It’s become like a shopping app," aggregating deals, rewards, cash back, and personalized offers. [36:50]

10. Growth Outlook & 2030 Vision [32:18]

• “As young people become more financially savvy...they start to turn to like 0% BNPL more than they do credit cards.” [33:09]
• Sezzle aims to be the “go-to” payment tool in Gen Z’s wallet, fueled by rewards, budgeting tools, and credit-building features.

11. Valuation Discussion [39:00]

• At $2.6B market cap, Sezzle trades at 14–15x forward P/E; EPS nearly doubling YoY.
• “If we can get to like the average multiple that they've had 23, 22ish over the last few years, you're talking like a potential 30% CAGR for five years, right?” [41:22]
• CEO’s alignment/incentives praised (never sold a share, substantial buybacks, cautious capital allocation).

12. Risks & Industry Headwinds [44:50]

• Main concerns:
  • Recession: Could curtail consumer spending and drive up defaults; yet Sezzle loans are small and short-term, allowing for rapid risk management.
  • Regulation: Ongoing, but recent Consumer Finance Protection Bureau (CFPB) reports have been favorable to BNPL.
  • Misconceptions: Many see BNPL as high-risk, yet data suggests lower default rates than traditional credit. “Both reports found that BNPL had a much lower financial burden on the consumer than traditional credit.” [46:27]

13. Common Investor Misunderstandings [49:54, 50:11]

• Most assume “it’s just your run of the mill BNPL and that it's for subprime people who can't get access to credit” [50:24]
• But Mark argues: “It's more of a reverse budgeting financial tool. [And] they have low customer acquisition costs because their main target is transitioning new users and existing users into premium subscribers, which just flows right to the bottom line.” [52:06]

Notable Quotes & Memorable Moments

• On Sezzle’s unique positioning:

  “They are actually working to like live in the top of the consumer's wallets.” — Mark [07:21]

• On personal experience with credit cards:

  “...The reality is I was their ideal customer, living with maximum limits stuck, paying a minimum balance over and over as interest accrued, right? So as like a dad today, if I fast forward my kids to when they're 18, I'm much more comfortable being like, hey, if you want to build your credit, here's Sezzle...” — Mark [22:44]

• BNPL vs. Credit Card attitude:

  “It is funny how credit card users look at BNPL like it's this bearish signal...when in reality, credit cards are far more predatory.” — Ryan [25:52]

• On Sezzle’s 2030 Vision:

  “The way Sezzle continues to grow, that generation continues to age. It becomes their primary means of using credit...the more that the conversation, like my point, becomes normalized, the more opportunity I think they have for growth.” — Mark [34:27]

• On CEO’s shareholder focus:

  “He’s 44, invested in the company. It's his prime net worth has never sold a share.” — Mark [43:20]

Essential Timestamps

• Mark’s investing philosophy & Sezzle intro [01:57–03:10]
• BNPL vs. Credit Cards basics [03:10–05:43]
• Sezzle's merchant-sided vs. consumer-sided BNPL [06:41–08:44]
• Company history & business pivot [09:26–13:00]
• Profitability turnaround & CEO impact [13:00–14:55]
• State of BNPL industry & perceptions [17:50–21:20]
• Personal credit card experience [21:20–25:52]
• Income statement & growth [27:03–31:30]
• 2030 vision [32:18–35:13]
• Valuation analysis [39:00–43:11]
• Risks/recession discussion [44:50–49:06]
• Investor misconceptions [49:54–54:23]

Conclusion & Where to Find Mark

Mark (“Manu Invests”) publishes deep dives and portfolio updates at manuinvests.substack.com and posts on Twitter/X @manuinvests.

Summary prepared to retain the tone, nuance, and flow of the episode for listeners seeking an actionable, nuanced understanding of Sezzle and the BNPL space.