Another capital raising and sell-down has only cemented the buy now, pay later company’s relationship with the capital market.

Meanwhile, the emergence of Tencent on the share register seemed to validate its business model, providing the catalyst for its share price run.
So with Afterpay on the verge of entry into the index of top 20 companies, the company is once again tapping the capital markets.
Who can blame it?
If one believes Afterpays valuation is on the excessive side, then it is sensible to harvest those bullish market expectations for real dollars to shore up the balance sheet and fund future growth.
And for the founders, it is an opportunity to cash in on a near seven-fold surge since the depths of March’s despair.
Betting against Afterpay is deadly as short-sellers have found out.
And now large-cap fund managers are experiencing the same dilemma as their small-cap peers.
That is, the extraordinary share price rise can create performance-tracking error. Not owning Afterpay is a risk most are unwilling to take.
In the case of Afterpay, insider selling has proved a faulty signal to exit as the share price has surged to new heights.
The critics have well and truly been silenced while Afterpay’s board has pledged to learn the lessons of the capital raising and sell-down.
But there’s a hint of controversy once again in this raising. It came within 24 hours of the company updating its share-trading policy but which it says did not change the conditions for Tuesday’s founder sell-down to have taken place.
Afterpay has chosen not to wait for its full-year results to do this transaction which was seemingly done to take advantage of the favourable capital market conditions so that it can press ahead with its ambitious plans.
Does all this matter? Seemingly not.
Investors who have focused on Afterpay’s top-line growth have been on to a winner.
Everything else is mere detail in this success story.