Originate to Sell: The Fragile Foundation of Upstart’s Revenue Surge

When the tide’s coming in, everything floats and in bull markets blind monkey’s can throw darts and hit bullseye’s. SPACs with no revenue. Meme stocks with no plan. Mortgage companies left for dead. Retail department stores with high short interest. Clothing brands with new spokesmodels. Crypto tokens with cartoon mascots. EV startups with one prototype and a $30b valuation. People putting nuclear reactors on the moon. Companies promising to reinvent an industry with nothing more than a buzzword and an investor deck. Even digital dollar bank accounts trade at stupid multiples.

When money is easy, everything gets a bid and I’ve seen this movie enough to know the ending: the tide eventually goes out. It always goes back out. And when it does, you find out which stories are fully clothed and which aren’t wearing their trunks. The smart investor’s job isn’t to admire the froth but instead to understand the risk hiding underneath it. Every position in your book should have a “what happens when the music stops” chapter. This doesn’t mean ignore the bullish vibes, it just means thinking about the downside if the narrative flips and the world doesn’t look so rosy all of a sudden.

Which brings us to Upstart.