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Hi, thanks for the compliment. I'll be the first to admit that I can be useful to provide some subjective insight into Visa, having worked with their business as one of their key IT vendors for the past 8 years, however when it comes to valuing Visa from a financial standpoint i.e. intrinsic value I would fall to the bottom of the heap. I don't even think there is enough public financial data out there yet to do that kind of analysis.

What I can say, building on my previous post i.e. the "country club" environment, I don't even mean that in a derogatory way. The Visa folks I work with are among the nicest I have ever encountered. What in part engendered that environment is lack of accountability for profits. No real pressure. Not only is Visa not public but they are actually more of a "not for profit" in the sense that the member banks own and fund Visa, and the actually business of Visa is to provide transaction processing (i.e. everytime the card is swiped), fraud detection, and marketing services for the Visa brand.

However I see a sea change at Visa as they go from a "not for profit" environment to a "pre IPO for profit" public company. They are tightening up budgets, consolidating vendors, thinning out management ranks etc. and in general preparing themselves to be lean and mean vs. AXP and Mastercard. Can the culture do it, I think so, they are in the heart of the Bay Area and everybody likes to get rich including the Visa employees. This IPO may just shore up housing prices around San Mateo.

Visa is by far the big daddy brand leader in terms of number of cards issued and number of transactions handled daily. AMEX definitely has a much better developed business offering, but with the consumer Visa is king.

I will try to dig around a bit on one question I have in how they are dealing with the member banks/branding issues as they go public and become more independent. There has always been a bit of a problem with member banks wanting to promote their own brands at least on an equal basis as the Visa brand. i.e. you see the Chase Visa or the Citi Visa. I think the brand is the biggest attraction here so hopefully that doesn't get diluted and it remains Visa first and foremost.

So great business hurdle, no question about it. Value? Wait and see as the IPO documents start to surface.
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