Can Jack Dorsey Lead Block to Its 10x Potential?

Over the past several quarters, Block (SQ -1.68%) has experienced significant growth. However, in this video clip from "The Rank" on Motley Fool Live, recorded on March 21, Fool.com contributors Connor Allen and Jason Hall discuss whether CEO Jack Dorsey is the right person to lead the company's cryptocurrency strategy and overall business.

Connor Allen: Square for those that don't know, they are a fintech company that does peer-to-peer payments through its Cash App business. Cash App has been experiencing tremendous revenue growth over the past few years. It's really weird when you talk about Cash App because if you talk to some people in different regions of the United States, sometimes Cash App is the primary app used for peer-to-peer payments, and then in other regions, Venmo [a part of PayPal (PYPL -1.14%) is, so it's just a weird dynamic there. I'm in the area where Venmo is much more popular but I understand that Cash App has significant market share in that space, which is interesting.

But they did do an acquisition of Afterpay, which is a buy now pay later company that they bought to offer microloans. Afterpay is a business that was really exciting for a lot of investors, but the whole buy now pay later space hasn't really held up to expectations. A lot of expectations have been shifted a little bit in that space about whether it can be a stand-alone industry or whether it's going to be part of other fintech companies. I tend to agree with the second option there.

But as far as why I think it'll 10x, I think it's a leader in the war on cash. When you talk about the war on cash, that just means that in 10 years, I don't think people are going to be pulling dollar bills out of their pocket in order to pay for many items. Already that's taking place with companies like Visa (V 0.05%) and Mastercard (MA -0.08%) and I think Square is going to continue to take advantage of that.

They are trying to be a leader in the crypto space. I am not 100% sold on them being the leader there, because they have somewhat of a central focus on Bitcoin (BTC 0.89%) alone and that's because Jack Dorsey, their CEO, thinks that Bitcoin is the sole future of internet payments. I think that he should take a more diverse approach to crypto, but that's just my personal opinion. Jack Dorsey might know more than me.

As far as some of their financial metrics, their gross profit grew 50-100% in the last four quarters, year-over-year in each of their quarters. Revenue is growing in the 20-30% range of every single quarter. It grew 45% last year. I expect it to continue to grow in that over 20% range in the future. I will say that their CEO, Jack Dorsey, did step down from his position at Twitter, so he has some more focus on Block going forward. I think it's a better business. I'm glad he did that.

Jason Hall: I'm not convinced that that's good for Block, to be honest with you Connor.

Allen: You're not a Jack Dorsey fan, Jason?

Hall: I'm not.

Allen: Tell me about it.

Hall: I ranked it seventh. I own Bitcoin too. Full disclosure I own Bitcoin. I own multiple different crypto-currencies, very small amount of exposure. That to me is the biggest risk to the company is it's missing out on the bigger opportunity in crypto that I think all of these fintechs, should they curate to some extent? I think so because there's a lot of junk out there. There's a lot of garbage crypto assets that were literally created as jokes and are worth millions of dollars now and people are going to lose money because the technology, the blockchain that they built, nobody is building anything else on it, and that's the thing.

Sure, a lot of stuff's getting built on Bitcoin, and I think it's going to be important, but it misses the bigger opportunity in how blockchain is going to work. It just makes me concerned that he's so focused on that. The other thing, if you follow his Twitter (TWTR) about hyperinflation and things like that, I'm just concerned that he is so focused and distracted that maybe there's not a loud enough voice on the board or in that executive suite to really, I think he's a visionary, I really do.

I'm just concerned about his ability to lead Block in the way that a diversified company like this. They are a bank now too, they do all these things, and it worries me but it's such a big business, that big market all things are doing. It's trillions of dollars of market opportunity, that the potential for this to be at 10x stock plus is definitely there, it really is. I'm just not sure they have the right leader.