The revenue model is similar, but the product is obviously really different.
If anything, Credit Karma ARPU could be higher. Credit card referrals typically range from $50 to $200 dollars. Massive amounts of users come to Credit Karma through Google, sign up for a credit score/card, and then never come back.
This valuation would imply they refer at a rate of ~1-5 million cards a year I guess.
Profitably has never been the most pressing concern for these growth companies. Amazon went 20 years before turning a consistent profit, so it's not like there is a well-defined upper-limit where profitability is mandatory. Amazon made a trade-off choosing revenue over profitability, and that's what investors want.
Investors care less about actual profits than the ability to prove profits can be generated. Once it's demonstrated/proven that profits can be attained, investors become extremely patient. As long as potential profits keep rising, the enterprise value will rise, and investors will be happy. This is not the Warren Buffett approach, obviously, but that doesn't make it necessarily wrong or invalid. It's consistent within the theory of rational expectations.
I would hope their ARPU is higher...otherwise they'll never be profitable. Mint loses a ton of money. There are reasons why it makes sense for Intuit to fund that, but if CK can't be profitable, finding that kind of acquirer that will continue to operate them at a loss will be hard, especially with that massive valuation.
If anything, Credit Karma ARPU could be higher. Credit card referrals typically range from $50 to $200 dollars. Massive amounts of users come to Credit Karma through Google, sign up for a credit score/card, and then never come back.
This valuation would imply they refer at a rate of ~1-5 million cards a year I guess.