Listen on Spotify here or Apple Podcasts here.

🔵 REMINDER! Join us at our next Contrarians Live on the 8th December hosted with BlueRock. Buy your tickets here. 🔵

1,300% growth, 900% NRR and the end of token maxing

Anthropic filed its S-1 on 26 October to list on Nasdaq as ANT. Revenue for the six months to 30 June was $16.3B, up from $1.2B a year earlier, growth of 1,300%. Revenue in 2023 was $41M. The filing reports net revenue retention of about 900% as of 30 September: customers who were paying a year ago are now paying roughly nine times as much.

Adam: “Have you ever seen a business grow this fast?” Adir: “Never. The question is, have you seen a business with over a billion dollars of revenue grow this fast? I doubt there’s been one in history.”

Adam: “My theory is they grew significantly through getting more cash out of their existing customers, from dabbling in Claude to using it massively and really token maxing. And we’ve seen that token maxing is over for most smart companies. People are asking: how do I reduce my spend? How do I divert to cheaper LLMs? How do I use open weight models?”

Adir: “In the first half of ‘25 it was a bit over a billion dollars of revenue, and in the first half of ‘26 it was $16 billion. That sounds amazing until you realise that the net revenue retention of 900% is nine of that 16.”

Adam: “Claude’s an incredible product. But is it five times as good as OpenAI? Is it a hundred times as good as the OpenAI models? No, we think it’s slightly better. And all the other guys are catching up as well.”

$475B of compute, customers who can walk at will

The S-1 shows at least $475B of future cloud compute commitments, most of them non-cancelable, including about $114.5B with Google and $110B with Amazon. Elon Musk’s SpaceXAI (formerly xAI) is in line for up to $120.5B through 2029, though once the initial periods end in early 2027 either side can cancel on 90 days’ notice. Around 80% of Anthropic’s revenue is consumption-based, and its largest customers buy on usage with no long-term contracts. Anthropic held $112.4B in cash at 30 June, out of $141.1B raised.

Adam, borrowing a line from Evan Armstrong: “Revenue, meanwhile, is consumption priced and cancellable at will. So this sounds a lot like a bank to me. They’re borrowing long and lending short, which is a recipe for a bank run and a recipe for a collapse. Am I being too dramatic?”

Adir: “You say they’re non-cancelable, but they are cancelable by the liquidator. These businesses have to not only stay alive, but continue to access funding in order for all your promises and dreams to come true as a supplier.”

Adir: “A hundred billion dollars feels like a lot of money to raise, but it turns out it’s not that much between friends when your business is AI, because you blow more than that in one year’s worth of compute. This cannot possibly be the end of their aggressive capital raising.”

Adam on what Claude said when he ran the S-1 through it: “The angle isn’t that it’s secretly losing a fortune today. The angle should be: today’s numbers are a snapshot taken at the most flattering moment. The bill hasn’t arrived yet.” Adir: “Good on you, Claude, for throwing your masters under the honesty bus.”

Hollywood, not SaaS: an 85% margin and models that expire in six months

Anthropic doesn’t report a gross margin, but cost of revenue of $2.38B against $16.3B of revenue implies about 85% for the first half. Compute for model development sits in R&D, and fees paid to cloud channel partners, up $2.7B year on year, sit in sales and marketing. Models released in the six months to 30 September accounted for more than 80% of third-quarter revenue.

Adir: “Basically in the gross profit, the only thing taken out is the air that people breathe inside the Anthropic office. It’s basically a useless, pointless number except for the purposes of catching out the lazy investor.”

Adam: “I think of foundation models as being akin to Hollywood, not Silicon Valley SaaS. In Tinseltown, you’re only as good as your next movie. In the LLM game, you’re only as good as your next model.”

Adam: “The more they scale, the more it costs them in compute to build the best training model. So it feels like the scale benefit here is at best weak and at worst non-existent.”

Adir: “All of this work and all of this effort to create this amazing software has turned out to just be building a commoditised piece of software that is interchangeable with the five other commoditised pieces of software, and the 500 that are probably not as good but good enough.”

One IPO record in seven years, three in one year

Saudi Aramco’s $25.6B float in 2019 held the record for the largest IPO for almost seven years. In 2026, SpaceX raised $85.7B on Nasdaq in June, SK Hynix raised $26.5B through a Nasdaq ADR listing in July, and Anthropic could raise $100B or more. Closer to home, AI data centre operator Firmus withdrew its ASX float on 9 October after weak demand.

Adir: “When you say the previous record holder held for seven years and then this year there’s going to be three record IPOs, that possibly tells you it’s bubble time.”

Adam: “Australia had its test two weeks ago with Firmus, and Australia passed with flying colours.”

Adir: “Ian Patrick, the chief investment officer of the Australian Retirement Trust, which is the second largest superannuation fund in Australia, told the AFR conference that AI-related investments accounted for more than 25% of the fund’s portfolio. I think this is the singularly highest risk moment in the AI boom slash bubble, this IPO.”

$2 trillion needs $10B of profit. Where’s the road?

Reports put the IPO at $100B or more at a valuation of $1.5T to $2T, with listing targeted for the week of 16 November. Anthropic was valued at $965B in its May private round, and at $183B in September 2025. Nvidia has reportedly considered investing as much as $10B in the offering.

Adir: “I’m going to be generous and say I’ll pay 200 times earnings for it. You’d have to make $10 billion of net profit after tax on a PE of 200 to justify $2 trillion. And what’s the road to $10 billion of NPAT on this business? There is no obvious road to get there.”

Adam: “Anthropic isn’t a luxury brand. People aren’t going to pay 30x for what you can get from DeepSeek.”

Adir: “I think this will get away. I think it will be a kicking-the-can-down-the-road moment, because they’re going to need more money.”

Adir: “Will you lose 90% of your money or more with Alphabet or Microsoft or Nvidia? Very unlikely. But much more likely you’ll lose 90% of your money here. If you want to bet on AI, this is not the risk-return curve to bet on.”

Anthropic has finally opened its books, giving Adam and Adir their clearest look yet at the economics behind Claude and one of the fastest-growing businesses in history.

Join us on Substack for articles, news and more: https://www.thecontrarianspod.com/

Watch on Spotify here or listen on Apple Podcasts here.

The Contrarians catchup

• The special episode where Will interviews Adam is out now on YouTube and podcast platforms. Adir is next, so drop any questions you want Will to put to him in the comments (best biceps exercises, etc).

• Will on why liking and subscribing matters: “Our YouTube is up to 10,000 subscribers. We’re doing a quarter of a million views on a monthly basis. Last month our subscribers grew 5%, which on a pretty big number is material. But we really want to push that 5% up.” You know what to do, folks…

• The Contrarians Live is back on December 8, hosted by BlueRock. 26% of tickets had sold within a week of the announcement. Five free scholarship tickets are available to university or school students who aren’t working: the first five to message us on LinkedIn get them. Adir: “If they can’t figure out how to message us, they don’t deserve a ticket.”

• Airbnb will bar hosts from requiring guests to strip beds, wash dishes, start laundry or take rubbish off-site, for bookings made from November 20. One host complained guests lose the “personal touch”. Adir: “Well, that is the worst sales pitch I’ve ever heard.” Adam: “They’re going to protect whichever side of the market needs more. So this implies there are some demand issues with Airbnb.”

PE and VC carry: from 23.5% to 47%

The AFR reported that private equity and venture capital partners face up to 47% tax on their carried interest, the share of fund profits paid to managers, under the CGT changes. The 2026-27 Federal Budget removes the 50% CGT discount for gains accruing from 1 July 2027, replacing it with cost base indexation and a 30% minimum tax on capital gains. Adir used venture capital to explain it, because that’s where the concession is written into law: since 2002, carried interest paid to general partners of venture capital limited partnerships has been treated as a capital gain, for a top effective rate of about 23.5%. Because managers have only a nominal cost base in their carry, that rate can now rise to as much as 47%, unless the investment qualifies for Treasury’s proposed innovation concession for eligible startups. Carry that becomes payable after July 2027 can be caught even where the underlying investment was made years earlier.

Adir: “Unlike in the fund manager world, there is a specific clause in the legislation that effectively says that is treated as a capital gain. It’s as if they put money in and derived a return on their investment.”

Adir on private equity: “Private equity does this as well, but they do it in a different way, because they weave their way through with structures.”

Adam: “I’ve never been a fan of the carried interest exemption.”

Adir: “No one really outside the industry realised how good this is. But unfortunately for them, it’s now on the front page of the news, and you don’t want good stuff that no one knows about to be on the front page of the paper. Because then people try to take it away from you.”

France and the inverted pyramid

Adam brought a quiz from a post by fund manager Chris Joye ranking countries by government spending as a share of GDP, citing IMF figures, and a thread by Arnaud Bertrand on who receives France’s social spending. The discussion widened into ageing populations, housing affordability and the protests in France.

Adam: “It’s 57%. I told you they were socialist states.”

Adam: “People over 60 in France are a quarter of the population and own 60% of France’s wealth. That same quarter, who are the wealthiest quarter, received two-thirds of all social spending.”

Adam: “We can’t keep funding old people who are now living longer. We’re going to make decisions: either people have to die younger or die poorer.”

Adir: “In a Western country, the job of the far left and their violence is to pave the way for the rise of the far right. That’s what they do.”

Adir on what he’d be angry about if he were young: “What’s going on around the world is these aristocrats essentially throwing crumbs to regular people. That is just going to make the pitchforks and the torches come out more.”

Canva builds a frontier image model, and asks creatives to come back

Canva launched Craft on October 22, its first image-generation model built and trained in-house by Canva Research. It debuted fourth on the DesignArena image leaderboard. The same week, Adir forwarded Adam and Will a Canva marketing email with a subject line about creatives coming back to Canva.

Adir: “They have built a genuinely homegrown model that seems to be very good at imagery. The reviews are that it’s surprisingly no worse than the frontier models at creating imagery, which is astonishing. And we should feel enthusiastic and proud about that coming out of Australia, because not many countries can pull that off.”

Adir on the email: “When you’ve put that in an email subject, you’ve accepted the reality that you’ve lost a lot of customers to churn, and you’re trying to get them back.”

Adam: “They’ve come up against this wall of frontier models with unlimited funding and these irrational valuations. It’s just not Canva’s fault.”

Adam: “There’s no switching cost for Canva. They’re not a real SaaS business. They’re a sort of semi-SaaS business.”

Adam: “I used to use Canva for investor presentations. It was a slog. Now I can literally run something through Claude Design and get an ASX-style presentation in 10 minutes.”

Adir: “Now they’re running against players that are not just much better capitalised, but they’re definitely not dumber than Canva. That is a totally different game to play.”

NextDC loses 42% in a day, and the hyperscalers hold all the cards

NEXTDC (ASX: NXT) cut its FY27 underlying EBITDA guidance to $245M–$265M, from $385M–$410M, after Jemena suspended grid works for its M3 Melbourne data centre in West Footscray amid community opposition. Jemena has told NEXTDC it doesn’t intend to restart before February. The shares closed down 41.7% at $5.35, their lowest level since 2018. Adir used the fall to walk through the economics of deals like IREN’s five-year, US$9.7B AI cloud contract with Microsoft.

Adam: “This has been an absolute disaster of a week for anything related to data centres, which I think you predicted a while ago.”

Adir: “The constraint is not on the side of the data centres. The constraint is on the side of the five hyperscalers and their power to anoint.”

Adir on Microsoft: “What they’re doing, in my view, is buying compute at 85 cents in the dollar and selling it to a frontier model at two dollars in the dollar. It’s just an arbitrage on the way through.”

Adir: “The main problem is it’s linear depreciation. There is no way this curve is linear. If you want to make the easiest bet in this whole industry, just bet on hundreds of billions of dollars of write-downs to hyperscalers in two years’ time.”

Temple & Webster jumps 30% on revenue that’s still going backwards

At its October 23 AGM, Temple & Webster (ASX: TPW) said revenue from 1 July to 19 October was down 8% on the prior year while contribution margin dollars were up 16%, after it cut promotions and raised some prices. New CEO Susie Sugden said the revenue run-rate since August had improved to -4%, from -13% at the August update, and the company expects to return to growth from mid-February. It reaffirmed FY27 EBITDA guidance of $33M–$40M. The shares jumped around 30% on the day.

Adam: “Admittedly, the August update was so horrid the bar was pretty low.”

Adir: “The next day they released this work of fiction. I mean, it’s not fiction. It’s based on a true story, we can say. They’re not lying. Everything in that release I suspect is completely true.”

Adir: “They’re building their entire investment case around this EBITDA number. I think that is the absolute wrong thing.”

Adam: “It’s kind of a junk number.”

Adir: “I think the argument for shorting this business, not investment advice, has increased further. I think this announcement makes me more confident about my thesis.”

Adam: “Really well-run business in just a really tough sector. They’ve got every headwind you can possibly imagine.”

Five other stories worth following:

1. AI wearables startup Nirva raised an $8M seed round led by Lightspeed and South Park Commons. It makes AI jewellery designed to be worn all day, building a running record of the wearer’s life as a memory layer for personal AI apps.

2. Meta launched about $35B of stock offerings to fund its AI build-out, with only $12.5B arriving upfront and a further $60B at-the-market program planned for 2027. Nvidia, AMD and Broadcom have expressed non-binding interest in buying up to $5B of the shares between them. Meta’s Q3 capex of $34.9B ran ahead of its operating cash flow.

3. Major US banks are restricting third-party AI agents from accessing customer accounts. Citi now blocks outside agents from logging in or transacting, while still allowing read-only access through open-banking providers, and Bank of America’s Brian Moynihan says a human should authorise any money leaving an account. JPMorgan’s Jamie Dimon says his bank will restrict outside agents too.

4. Elvis Presley’s music rightsholders, led by Authentic Brands Group, have sued Anthropic in California, alleging it trained Claude on lyrics to 274 Presley songs without a licence and generated infringing output. The complaint puts statutory damages at about $41M, or $48.6M including DMCA claims, and seeks an injunction.

5. Lula won Brazil’s presidential runoff 51.8% to 48.2% over Flávio Bolsonaro, securing a fourth, non-consecutive term after trailing Bolsonaro in the first round. Bolsonaro has refused to recognise the result and says he will seek to have it annulled.

They also look at France's extraordinary levels of government spending and the growing tension between generations over wealth, housing and welfare.

Then it's back to tech and business. Canva launches its own image generation model as it fights to stay relevant in the AI era, Airbnb finally cracks down on excessive checkout chores, NextDC loses more than 40% in a single day after delays to its Melbourne data centre, and Temple & Webster rallies after an update that leaves Adir even more convinced of his short thesis.

CHAPTERS
00:00 - Inside The Pod, Media and The Contrarians Live

23:33 - Myeloma Australia and Adam's Family Story

27:12 - The 47% Carried Interest Tax Shock

43:48 - France, Government Spending and Generational Wealth

01:00:12 - Canva Fights Back With AI

01:09:07 - Airbnb Ends Excessive Checkout Chores

01:17:09 - NextDC Crashes 42%

01:32:46 - Temple & Webster's 31% Rally

LINKS

Myeloma Australia: https://myeloma.org.au/

Join us on Substack for articles, news and more: https://www.thecontrarianspod.com/

Watch on Spotify here, listen on Apple Podcasts here.

$1.4B through the till, 700 staff, and the CEO still signs off every deal

Contrarians CEO and co-founder Will Hayward takes the other chair for a different kind of episode: a look at how Adam runs Luxury Escapes, the Melbourne travel business he co-founded in 2010. Like most travel businesses it runs on negative working capital, with customers paying well before they travel. It sells through two models: its original flash deals, and a curated marketplace.

Adam: “The biggest challenge most founders have is how do I fund my growth. Travel doesn’t have that issue. You’ve got other issues with travel. It’s certainly not the perfect business.”

Adam: “We’re about $1.3, $1.4 billion through the till. But travel businesses have high scale. If you look at Flight Centre, which is probably the best travel business in the country, $25 billion through the till. And Booking.com is like $200 billion. We’re actually a bit of a minnow in the world of travel mega companies.”

Will: “People outside of this company would find it extraordinary to know that you personally sign off every deal.”

Adam: “I might spend five minutes. Sometimes less, sometimes more, but it’s not like I’m spending hours and hours on each deal, because we’ve got a really strong management team that sits in the middle and does a lot of the work. I’ll just be that final sign-off.”

Sale of the Century, the 2am partner and never being the blocker

Will’s observation is that Adam almost never takes more than an hour to reply to a message. Adam, a former Freehills lawyer, traces it to two places: a run on Nine’s Sale of the Century, and his years as a junior lawyer.

Adam: “The reason I was good at that show is because it’s about speed, not intelligence. Almost everybody I beat would have been much more intelligent than me, better recollection, better trivia, but Sale of the Century is a game of guessing the question and being really quick. If I spend an hour on it, I’m probably going to come to the same answer anyway.”

Adam: “Nothing is worse than when you do all this work and you give it to a partner, you work till 2am, and the partner sits on it for two days. I never want to be a blocker in this business. If a deal approval comes on my desk, I don’t want to be the person who makes the poor PCM wait a day after they’ve slaved over this deal for a week.”

Adam on CEOs going on holiday: “I think CEOs should be able to go away, but I think they should be checking three to four hours a day. There’s no excuse to not work three to four hours a day.”

No strategy days, and the grads’ pitch that beat everyone’s

Adam says Luxury Escapes budgets by financial year, with each part of the business submitting plans for him to approve or cut. The budget assumes a broadly steady state and leaves room for ideas that turn up mid-year — including one pitched a few weeks ago by three graduates.

Adam: “We’ve done the strategy day stuff in the past. I genuinely don’t like it, as you’d be shocked to know.”

Adam: “You don’t get all your ideas in April before you budget. We’ll budget for a largely steady state with some growth, but we know we’re going to come up with these new customer-driven initiatives. If we had an idea in April and it’s not a good idea by June, we’ll kill it.”

Adam: “Three grads who’ve been with us for less than a year came up with probably one of the best ideas anybody’s ever had in the business. Having that sponsorship from a founder allows a great idea to be put into place more quickly.”

Tough when it’s going well, easy when it’s not

Will raises Canva, where co-founder Cliff Obrecht posted a Slack note to staff on lifting the company’s pace to match Anthropic’s release velocity. The note was deleted within hours after it sparked fears of job cuts, and Canva said it had no plans for layoffs. Will’s point: high expectations and a place people love working aren’t mutually exclusive. Adam’s test for mistakes is whether they were made trying.

Will: “I think the most impressive thing is to have a high-performance culture with a low tolerance for slacking that is also somewhere that people love working.”

Adam: “Canva’s been an amazing business, but obviously as you get bigger, it becomes harder and harder.”

Adam: “Is it a mistake of commission or omission? If someone hasn’t called someone back or has just been too lazy, that’s really bad. If somebody’s made a mistake of commission, like they’ve worked through the night and they’ve charged an extra dollar to somebody because they’re trying to get this done, they’ve maybe stuffed something small up, but they’ve done it with the right intentions.”

Adam on when it’s time for a senior person to go: “Once you get to four really trusted people saying the same feedback, you know it’s time.”

Scale beats brand, and why there’s no $100M marketing budget

Will’s theory is that Luxury Escapes is underinvested in top-of-funnel brand marketing. Adam ranks the business’s advantages against Hamilton Helmer’s 7 Powers and puts scale first: Luxury Escapes says one in two Australians travelling to the Maldives books through it, and it launched Australia’s first direct flights to the Maldives in December 2025.

Adam: “Most times scale is like a Netflix type version of scale, where it’s global scale. Our scale is not that at all. Our scale is massive scale in certain niches, which is rare. We’ve got a flight to Maldives every week and we can only do that because of our scale.”

Adam: “Our marketing budget’s $65 million a year. Ultimately most of it’s Google. But the reason we don’t spend $100 million on marketing is because we want to be a profitable business. We’re a business that just wants to grow profitability, pay dividends, and create a brand that’s around in 100 years.”

Adam on the name: “The reason we were called Luxury Escapes wasn’t customer-facing, it was hotel-facing. We want to get better hotels to work with us. Some customers go, I can’t buy from Luxury Escapes, you’re too fancy. We’re not Hermès, we sell $100 a night.”

Thanks for reading! Please make sure to share this email with anyone you think might enjoy it, and like and subscribe wherever you get your podcasts!

Adam explains why CEOs should never become blockers, why he dislikes traditional strategy days, how Luxury Escapes stays entrepreneurial with hundreds of employees, what makes a great salesperson, how he thinks about culture and when it's time to move someone on.

They also unpack Luxury Escapes' competitive advantages, its approach to brand and marketing, sustainable growth over inflated valuations, and why Adam treats mistakes very differently depending on whether someone was taking initiative or simply failed to act.

CHAPTERS

01:33 - The Schwab Method: How Adam Runs Luxury Escapes
08:32 - Why Adam Still Signs Off Every Deal
15:42 - Speed, Decisions and Never Being The Blocker
28:04 - Sales, Culture and Building High-Performance Teams
39:49 - Competitive Advantage, Growth and How Adam Thinks About Mistakes

LINKS

Adam recently joined Sarah Grynberg on A Life of Greatness to discuss building Luxury Escapes, taking risks and why success is about more than money:
Listen on Apple Podcasts

Listen on Spotify

Luxury Escapes:
https://luxuryescapes.com

BlueRock:
https://www.bluerock.com.au/thecontrarians

Acquire Intelligence:
https://acquire.ai/contrarians

Braze:
https://www.braze.com/

Join us on Substack for articles, news and more:
https://www.thecontrarianspod.com/

Join us at this exclusive live recording of the pod in Melbourne CBD at BlueRock! From 3.30 on December 8th.

Get your tickets here before they sell out.

What to expect:

• The best business analysis and commentary in Australia

• Amazing guests (last time Chris Judd joined!)

• Food and drink

• Plenty of discussion of Adir’s biceps

See you there! Get your ticket now.

We are delighted to announce the return of The Contrarians Live!

On the 8th December we will be back in person at BlueRock in Melbourne. Expect world class business analysis, special guests and the latest news on Adir’s biceps.

Is it true they have grown even bigger?

Get your tickets now to find out!

The Contrarians catchup

• STOP THE PRESSES: The next The Contrarians Live is on December 8 at the BlueRock offices in Melbourne from 3pm. Will: “We will have some amazing guests that I think we probably will announce in advance this time.” Tickets are available here.

• Adir spent a Sunday in Springvale. His verdict: “I think it should be a Melbourne tourist attraction. It feels like you’re in another country. It really does.” The entire experience was cash or PayID only, no credit cards. “I started using a payment technique when I was in Springvale that I haven’t used before very much at all.”

• The Springvale Homemakers Centre, meanwhile, was a ghost town. Nick Scali: two groups in the entire store. “Everything was 40% off, 50% off, everything.” Adir’s prediction stands: “I think a lot of businesses won’t be able to hold on past February. Not listed businesses. Like just single store owner businesses.”

• Victoria’s new property auction reserve laws require sellers to disclose a reserve seven days before the auction. Adir’s verdict: the law will kill auctions, not fix them. “If your objective was to dramatically reduce the number of auctions in Victoria and shift things to a private sale, I will say mission accomplished. ’Cause that is what I think the consequence of this is going to be.”

• Adir spoke at the Austbrokers conference on the Gold Coast and came home with stories of devoted listeners. One attendee: “I drove up from Sydney and all I listened to on my entire drive from Sydney was The Contrarians podcast episodes.”

The surcharge ban: the government knew all along

Secret documents obtained by the AFR revealed that Jim Chalmers and Anthony Albanese knew for months that the ATO was preparing to stop accepting credit cards, and backed the decision before being forced into a humiliating reversal. Chalmers had publicly claimed they only became aware of the ATO’s stance in September.

Adir: “The sheer idiocy of a concept that says there are users and they’ve all been fine with the idea of a user pays system. And now we’re gonna move from a user pay system to a non-user pay system. So five percent of people have their fees removed and the other 95% percent fund it.”

Adam: “We had hard data that people were very happy to pay this fee because they thought they were getting great value in return. They were. And now we don’t have that and everybody’s losing out.”

Adir: “Who is the government to tell business what they can and can’t charge for? Like it’s capitalism. If I want to charge a fee if you use credit card, I can charge that fee. I can say if you wear red shoes into my store, it’s an extra $10. It’s my business.”

Adir: “It just comes in tiny increments, right? It’s just the creeping barrage of government control over private citizens.”

A preview of Australia’s future

Seven million Britons, more than 10% of the population, are on sickness or disability benefits. Among working-age people, that number surged 60% in six years, from 2.9M to 4.7M. Mental health claims, including depression, anxiety and ADHD, have risen fourfold since 2017. Britain’s borrowing costs are now the highest in the G7.

Adir: “I think about how does what’s happening in England and France relate to Australia? And I think Australia is earlier from this. The first is that before we even talk about the debt side of things, there’s this idea of what does it really mean to be an Australian. And I think that is one of the reasons, the lack of a clear answer to that question or even a willingness to have the discussion, is one of the reasons for the rise of One Nation.”

Adir: “The far left just paves the way historically for the far right to come to power. That is what happens in Western countries. And so the real terrifying thing, if you look at France, is all of these protests, which are being led by far-left politicians, they are not the real problem. They are just a step on the road to the far right seizing power.”

Adir: “I’ve got bad news for you. No one’s gonna wake up to this. Like basically history marches to the beat of its own drum, and there’s not really anything that human beings can do to change the trajectory. And whatever historical moment we’re in just picks the leader for that moment. And Donald Trump did not create this US. This US was created and it chose Donald Trump.”

The most important company nobody’s heard of

Adam ran a quiz on the largest listed company in each major European stock market. The answers, in order: ASML (Netherlands), HSBC (UK), L’Oreal (France), Santander (Spain), and Novo Nordisk (Denmark), down 69% from its peak.

Adir: “ASML is the company that effectively is making the machines that are essential to make the chips that are being used for all of AI. And they were the most obscure company ten years ago. And now they’re the biggest company. They make like whatever it is, forty machines a year or some tiny number. And so a company that makes a few dozen products a year is the largest listed company in Europe. Welcome to the AI bubble.”

Adir: “But they’re not even in it, it’s not even a real bubble that one, by the way, because they actually have lots of earnings. Funded by the bubble.”

The neo-cloud collapse accelerates

Firmus’ failed IPO has now caused real damage across the entire neo-cloud sector. Coreweave bonds are yielding 15%, up from 9.5% in July, a level signalling significant distress. CoreWeave shares are down 67% from their June peak. Iron is down 43% since June. AirTrunk has quietly shelved plans to list a Singapore data centre. Maas Group is down 50% in a fortnight, with founder Wes Maas a no-show at the Morgans Investor Conference in Noosa.

Adir: “I did not give Firmus enough credit. I thought they were just gonna be a blip. But they’ve actually caused some high quality damage to the industry. Which was unpredicted. I did not think that was gonna happen.”

Adir: “The true neo-cloud owns nothing. They are basically an infrastructure middleman. That says on one side is the data center, one of life’s great infrastructure assets. On the other side is the customer, and we’ll sit in between them. And what economic value are they actually providing? Minimal.”

Adam: “There’s only one thing that causes booms and bubbles. Too much debt. If you’re just using equity to do stuff, you can’t have a bubble. If you start imbuing all these trillions of dollars of debt, that’s what causes prices to make it.”

On Maas Group and Wes Maas:

Adir: “This guy’s not a dummy, that’s for sure. But what business is there inside Maas Group? Because I think it’s a terrible contract. So they’re pummeled.”

Adir: “What an amazing situation where a bubble business, is what I’ll call where it was, gets turned into a value transaction in the space of a week and a half. Like if they weren’t propping up this share price, you could basically say I’m buying cash for less than a hundred cents in the dollar and getting an operating business for free. As long as you didn’t pile more money into Firmus.”

Adir: “I think Wes Maas may well be the most honest person involved in this entire episode. There is no bigger believer in Firmus than Wes Maas. He might believe in it more than the founders.”

The most overvalued business in history

Anthropic is preparing for a $2 trillion USD IPO, having grown quarterly revenue from $11.6B to $16.8B in Q3, a 45% increase. But annualised growth has dropped from 3,500% in Q2 to 2,040% in Q3, and token prices have fallen 50% in three months. OpenAI, open source models like DeepSeek and small specialist models now account for more than 80% of token usage globally.

Adam: “I’m so bearish about this business. I don’t know how this isn’t the biggest story in business this week. This is a business that everybody said it’s gonna 10X. And it’s not going to now.”

Adir: “If Anthropic was three times the price of OpenAI, no one would buy them. And vice versa.”

Adam: “Can Anthropic ever get to $400B revenue? The growth’s slowing. How do I get from $65B revenue to two, three hundred, four hundred billion on a commoditised product when you’re getting smashed from OpenAI, smashed from from DeepSeek?”

Adir: “I think AI, that is real and amazing, and it’s gonna be more and more amazing in the future. But all the accoutrements of this AI, which is basically the bubble, I’m opposed to all of those things. I think it’s madness.”

Adam: “You called it really well probably a year ago when you said AI feels like the airline business. One of the most transformational things we experienced, but every airline bar a couple has lost money for their entire life. So great for consumers, but the value gets snatched away to consumers, away from the enterprise.”

Adir: “The safest bets if you believe in AI: Alphabet. Amazon, probably. Meta. I mean that’d be my stuff. Like I don’t think our view on this has changed. Despite all of the noise and all of the whatever, our view hasn’t changed on who the winners become in this space.”

Five other stories worth following:

1. Over 500,000 people protested across France over rising living costs, fuel prices and school conditions. Demonstrations turned violent, with 1,500 businesses damaged or looted. President Macron promised accountability for those responsible for violence.

2. Anthropic pledged 5% of its shares to a new public benefit fund, potentially supporting research into AI driven job disruption. The fund could grow alongside Anthropic’s valuation, pending shareholder approval, with political spending prohibited.

3. Berkshire Hathaway invested another $330 million in Bending Spoons, taking a 4% stake in the $30B tech company. The move signals CEO Greg Abel’s growing appetite for higher growth technology investments.

4. Tesla unveiled its next generation Roadster, demonstrating a dramatic airborne flip powered by thrusters. The two seat sports car offers three configurations, with the thrust version requiring a $250,000 deposit and rocket trim invite only.

5. Abby Care raised $82M to train and pay family members caring for loved ones. The Medicaid provider certifies relatives as home health aides, addressing caregiver shortages while improving support for vulnerable patients.

Then they turn to the growing cracks in the AI boom: the Firmus fallout spreading through CoreWeave and other data-centre names, MAAS Group’s brutal sell-off and aggressive buybacks, and Anthropic’s extraordinary growth, and whether a potential $2 trillion valuation can possibly be justified.

01:58 - Ticket Bots and Radiohead

07:15 - Springvale, Retail and PayID

14:12 - The Surcharge Ban

29:17 - Europe’s Biggest Companies Quiz

38:09 - AI Clones Software

44:31 - Property Density and Victoria’s New Auction Rules

53:25 - Firmus, MAAS, Anthropic and The AI Bubble

We're delighted to announce the next Contrarians Live, hosted at BlueRock!

Join us on the 8th December in Melbourne CBD for the best live pod recording in Australia. Special guests to be announced. Get your tickets now at the link below:

https://events.humanitix.com/the-contrarians-live-at-bluerock

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From one Pitt Street chemist to $17.5B, and almost nobody’s heard of it

Caleb Soul and his son Washington opened a pharmacy at 177 Pitt Street, Sydney, in 1872. Lewy Pattinson opened his own in Balmain in 1886, bought out Soul in 1902, and Washington H. Soul Pattinson listed in January 1903 with 21 pharmacies. It is Australia’s second-oldest listed company and has had only four chairmen from the same family line: Lewy, his son William Pattinson, grandson Jim Millner (1969–1998) and great-grandson Rob Millner, chair since 1998. Soul Patts (ASX: SOL) now trades around $46 a share, a market cap of roughly $17.5B. Terem Capital’s Scott Middleton joins Adam and Adir for the deep dive.

Adam: “It’s a name that surprisingly I don’t think many people recognise, despite probably being one of Australia’s best-performing businesses of the last hundred-plus years. It’s an $18 billion business that I reckon 95% of Australians, even people listening to the pod who are super smart, may not have heard of.”

Scott on Jim Millner’s first big deal, a distressed lender: “They were borrowing on one side, then lending it out to property projects, and earning a bit on the spread of the interest. Sounds like a private credit firm.”

Scott: “In reading this, I’m like, wow, this Jim guy is fantastic. I’d love to have had a conversation with him.”

Bricks, a poison pill and a mine they called No Hope

In 1969 Soul Patts and building products maker Brickworks took large stakes in each other to keep corporate raiders out. The structure saw off Guinness Peat Group’s bid for Brickworks in 2000 and years of pressure from Perpetual, including Federal Court action in 2014. It was finally unwound by a $14B merger announced in June 2025 and completed that September; at the time Soul Patts owned 43% of Brickworks and Brickworks 26% of Soul Patts. In the 1970s Jim Millner also bought a Queensland coal miner known in-house as the “No Hope Colliery”. New Hope listed separately in 2003 (ASX: NHC), and Soul Patts remains its major shareholder.

Adam: “This is back from the Holmes à Court, John Elliott corporate raider days, when people were scared of being taken over. This is like the ultimate poison pill.”

Adir: “People don’t often talk about bricks because they’re quite boring, but it is a great business. Bricks are cheap and they’re heavy, and no one’s going to import them from China.”

Scott on the 1970s mining fund prospectus: “You could almost replace it with a VC or a PE firm doing a fundraise around AI or software at the moment. This was mining.”

Adir: “You go to this barbecue and it’s like, what are you involved in? And the answer is coal. Someone’s going to go talk to the next person, right? But this is a gold mine.”

Selling the same TV station twice, then riding TPG for 18 years

Soul Patts owned Newcastle’s NBN Television from the 1980s. In 2004 it sold NBN to its own listed subsidiary, SP Telemedia, for $145M. In 2007 SP Telemedia sold NBN and its production business to James Packer’s PBL Media for $250M. A year later David Teoh’s TPG reverse-merged into SP Telemedia, which was renamed TPG Telecom in 2009. TPG merged with Vodafone Hutchison Australia in 2020 and sold its fixed enterprise, government and wholesale business to Vocus in 2025. Soul Patts has since sold out of TPG completely, including a $245M block of 61.5M shares, and Rob Millner has retired from the TPG board.

Adam: “They took that original $37 million in ‘89 and turned it into $250 million by 2007. This is what these guys seem to do time and time again.”

Adir: “He’s a good guy to be the counterparty. I like that guy. What’s he selling now?”

Scott: “This is where these huge results are coming from. They’re not trying to get something off in three years.”

Adam: “These guys are the masters of finding unloved assets.”

The best business in Australia at 26x earnings and zero Powers

For the year to 31 July 2026, Soul Patts reported pre-tax net asset value of $13.7B ($14.5B post-tax), net cash flow from investments of $572M and its 28th consecutive year of dividend growth. Its 25-year total shareholder return is 12.8% a year against 8.4% for the ASX200. The 2021 merger with Milton Corporation lifted it into the ASX 50. At around $17.5B in market value, it trades above that net asset value.

Adam: “It’s probably my favourite business in Australia. But even I’m not sure I could justify it at this price. Would the fund manager that is Soul Patts buy Soul Patts at 27x? I don’t know.”

Adir: “If you want to buy this business, you have to pay a price that feels expensive but will feel cheap twenty years later.”

Adir on Hamilton Helmer’s 7 Powers: “Could a crappy chairman or CEO that took over ruin this business? Pretty quickly. And so I think you’re really betting on leadership in this business.”

Adir’s sales pitch: “In specie half the value of this business to shareholders and shrink down. It gets harder and harder to make money as you get bigger. Go and be smaller again so you can go back to buying the stuff that you know best.”

Scott: “This is the hard bit. You found something you like, and you’ve got to sit and not do anything.”

Thanks for reading! And to Scott and the team at Terem Capital for sponsoring today’s episode. Make sure to check them out on their own substack at the link below.

Mopoke Cloud Newsletter

Deep dives into ASX tech. Powered by terem.capital

By Scott Middleton

They trace Soul Patts from its pharmacy roots through Brickworks, New Hope, NBN and TPG, unpack how permanent capital and patient dealmaking have compounded across generations, and examine the investment philosophy that has made the company one of Australia’s most enduring businesses.

Then they tackle the harder question: after more than a century of extraordinary results, is Soul Patts’ premium valuation still justified today?

00:08 - The Soul Patts Story

18:43 - How Soul Patts Compounds Wealth

30:10 - Is Soul Patts Too Expensive?

Join us on Substack for articles, news and more: https://www.thecontrarianspod.com/

Watch on Spotify here or Apple podcasts here.

The Contrarians catchup

• Adam ran the Melbourne Half Marathon in brutal conditions. The race was pushed to a 9:45am start, and the clouds cleared exactly when runners set off. Adam: “I’ve never seen so many people walking. Like usually you see the one person walking. There would have been a thousand people walking. People collapsing everywhere, like a heat stroke. They ran out of water.” The culprit: IMG, which owns the marathon franchise globally. “All they want to do is maximise profit. And this is where capitalism falls down. When you’ve got a monopoly provider, there’s only one marathon in every city per year. And the councils just willingly hand it over to these guys.”

• Adir surveyed retail on Church Street, Richmond, on a warm Sunday afternoon. The verdict: catastrophic. “King Living had the most customers. I think they’re the most well-known brand. They probably had four groups though in that whole store. Nick Scali had like two groups in that enormous store. Almost every other store was devoid of a customer.” Victoria is the worst state for retail sales data he sees across his businesses. “My prediction is that February next year, there will be a wave of retail bankruptcies, especially in Victoria.”

• Adir’s bank sent him an email announcing his savings account interest rate had gone up. The increase: 0.01%. “After this massive interest rate rise I might have to reconsider my options.”

• A banker lunch with eight attendees and not a single alcoholic drink ordered. Adam: “10 years ago, you’d have four or five beers or a couple of wines. This was eight people. It was unbelievable. These are 40-year-old dudes.”

• Over the last decade, population growth has run at 1.6% per year while growth in government payroll has run at 3.3%. Adam: “250,000 new public servants working from home on $100K+ a year. That is 100% why it’s a productivity problem.”

The ATO credit card backflip

The ATO was forced into an embarrassing reversal after removing credit card payments, with Jim Chalmers announcing taxpayers would now fund the $200M annual cost of card processing fees to allow the ATO to continue accepting credit cards. The ATO had tried to negotiate lower fees with card providers before pulling out, but couldn’t get the rates low enough.

Adir: “The sheer idiocy of a concept that says there are users and they’ve all been fine with the idea of a user pays system. And now we’re gonna move from a user pay system to a non-user pay system. So five percent of people have their fees removed and the other ninety-five percent fund it.”

Adam: “We had hard data that people were very happy to pay this fee because they thought they were getting great value in return. They were. And now we don’t have that and everybody’s losing out.”

Adir: “Another cafe I walked into and I said, what have you done about the surcharge? They said the coffee’s gone from $5.50 to $6. We’ve got no choice because everyone pays with Amex around here. And I said, guess what? I just paid with Amex. And instead of paying $5.50 plus what, a 1.5%, 2% surcharge, $5.60, let’s call it, I paid $6.”

Adir: “I don’t understand where this is coming from. And like it was Albanese that put pressure on Chalmers for the backflip. I doubt he understood necessarily what was going on. I just think someone said politically this is starting to become a catastrophe.”

John Stensholt on Firmus, Oliver Curtis, and Swipejobs

John Stensholt, journalist and co-author of Tech Bros, joins to debrief on the Firmus IPO collapse and the Swipejobs float.

On how the Firmus story unravelled:

John: “If you didn’t believe the story at these tightly held investor meetings or roadshows or pre-IPO chats, you were quickly ostracised. In the media’s case, if you didn’t write positively enough about it, you were shut out.”

John: “You’ve got a person with a past, and that’s okay, there’s a redemption story there. But it’s also a story of something that was meant to be the biggest thing since Telstra, and was held so tightly. There was no access to the protagonist. There was no access to the information that was held by a few banks and Morgans. And if you didn’t believe it, you were shut out.”

Adir: “He should have got out in front of the insider trading thing and owned it. And crafted a narrative that was better than what felt like a tack-on narrative afterwards. I think he probably thinks that whole thing is irrelevant, judging by the way he generally carries himself.”

On the Singapore video:

Adir: “I don’t think this is an evil guy. I think there’s a self-awareness issue, but that is not unique to him. The criticism of Australia is a good headline. It’s a bit of the Donald Trump approach, which is never show weakness, never take a step backwards.”

Adir: “The fundamental problem with Firmus is they took $7B of equity, put it in a box, and said abracadabra, and then try to convince people actually this is worth $43B now. And no one could give an answer to what just happened inside that box.”

John: “He was actually pretty conciliatory about the media coverage when I met him. I actually came out of that in general terms pretty impressed with him. I thought, who is this guy, he’s gonna be full of himself. I actually thought, you know, he was a nice guy to chat to.”

On where Firmus ends up:

Adam: “My valuation now is about $5B.”

Adir: “I think the data centers will be here. There won’t be as many as we think there are going to be. And the data centers will be owned by infrastructure players, providing the same yield as every other type of infrastructure. That is not a logical asset for a razzle-dazzle company to own.”

Adir: “I think the whole industry is dead in two years. Like basically what’s gonna happen, the data centers will be here, they just won’t be owned by Firmus.”

On Maas Group:

Adam: “We basically said $1.5B is the legacy stuff. And the $1.1B on top of that, the Firmus option, went away. That was the obvious short.”

Adir: “I don’t know, three weeks ago when we talked about Maas Group, I mean I think this was largely our prediction. But you can’t show these things that are so unpredictable. Like it is actually crazy.”

On SwipeJobs:

Swipejobs, founded by Katrina Leslie, is rumoured to be eyeing an ASX IPO at up to a $2B valuation. The business delivered $178M in net revenue and $71M in EBITDA in 2025, and is almost entirely US-based.

Adam: “Katrina should be feted as one of Australia’s greatest entrepreneurs, let alone female or male founders.”

John: “She just does not like publicity. She’s just one of these people that’s under the radar and gets it done. It’s incredible.”

Adir: “When you sales pitch it and say it connects people to LinkedIn and does blah blah, that sounds like you can do that with vibe coding. There must be some more special source to this.”

John: “I think there’s a chance it gets away, but at the moment it feels pretty hard ASX-wise. I think people will be a bit shy about this now after the experiences of Firmus, and there’s a few others that have been a little bit reluctant to go on here.”

Five other stories worth following:

1. Cartoon Network suffered a massive leak exposing 200 gigabytes of material from over 30 classic shows, including unreleased storyboards, character rigs and production guides. The perpetrators and their motives remain unknown.

2. The NBA plans to introduce microchips into basketballs next year, helping referees track ball movement and improve decisions. The technology could also help everyday players analyse shooting mechanics and performance in detail.

3. Apple is preparing a major smart home product launch, reportedly including a new Apple TV and home hub display. Partnerships with LG could introduce smart locks, thermostats and other connected household devices soon.

4. Space technology startup Fortastra raised $30M to develop manoeuvrable spacecraft designed to protect US and allied satellites. Founded by a former SpaceX engineer, the company aims to intercept threats in orbit.

5. Nineteen-year-old entrepreneur Zach Yadegari raised $10M for Persona, a $180 privacy-focused wearable. His previous startup, calorie-tracking app Cal AI, generated over $30M annually before being acquired by MyFitnessPal earlier this year.

They dig into what went wrong with the $44 billion IPO, what it means for Oliver Curtis and MAAS Group, and where the data-centre story goes from here, before turning to Katrina Leslie’s remarkable Swipejobs story and its potential multi-billion-dollar listing.

01:34 - Melbourne Marathon Chaos

12:48 - Retail, Furniture and Property

15:40 - Is Australia Giving Up Alcohol?

19:52 - The Surcharge Ban and The ATO Backflip

25:40 - Australia’s Public Sector Productivity Problem

34:03 - John Stensholt On The Firmus IPO Collapse

59:30 - MAAS Group’s Firmus Fallout

1:05:24 - Swipejobs’ $2bn IPO Story

Join us on Substack for articles, news and more: https://www.thecontrarianspod.com/

They then revisit Cettire after Dean Mintz buys another $2.7 million of shares and debate whether taking the company private could make sense, before turning to Bending Spoons’ acquisition of Miro and whether its highly leveraged “cigar butt” strategy can really create lasting value.

Join us on Substack for articles, news and more: https://www.thecontrarianspod.com/

And watch on YouTube below:

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The Contrarians catchup

• Adam was on assignment in Queenstown, New Zealand. His observation: almost no one serving tourists was a native New Zealander. “New Zealand is relying on it. And they are obviously a tourist hotspot. So I’m not sure how we’re gonna go with migration levels dropping because I don’t think it’s gonna be great.”

• The Queenstown gondola and luge operation reportedly does around $300M in revenue and $86M in earnings, with a $15-per-ride luge that pumps someone through roughly every five seconds. Adir’s reaction: “If it’s anything close to that, how is that not been consolidated up by some global tourism operator?” Adam: “Unlike a ski resort where you’ve got to manage the resort, you’ve got no snow making, all this other stuff. This is just one gondola up a mountain. And then you’ve got the luge, which is non-motorised, so there’s a handful of staff.”

• Mike claimed last episode that GTA 6 would be digital-only, hurting JB Hi-Fi. He was wrong. There is a physical box in stores, but no disc inside it, just a download code. Adir: “Mike has mastered the art of AI, which is just say it confidently and make sure the facts don’t blur the confidence.”

• Adir upgraded to an NVIDIA 5080 Blackwell graphics card. “I can tell you what’s going on in my computer, and there has been a big increase in the power of that technology in the last three years. It’s actually unbelievable.”

• The Greens elected David Shoebridge as their new leader. Adir is delighted. “What I like is when extremists run extreme parties, because then you can see them for what they are. My dream for that party is it’s completely destroyed and replaced by a real environmental party, because there are lots of people that want to vote on climate change issues and other environmental issues.”

Jim Chalmers’ most self-defeating policy yet

The RBA’s ban on credit card surcharges went live October 1, and within days social media lit up with merchants raising prices by 10% or more to recoup the costs they can no longer pass on as a line item. Most damningly, the ATO itself announced it would stop accepting credit cards, saying it was “not appropriate for the cost of credit card merchant fees to be transferred to the community.”

Adam: “Jim Chalmers told everyone it’s not going to cost you any more. And the ATO are basically saying to Jim Chalmers, who the ATO reports to, ‘Jim, you’re a liar’. The ATO couldn’t be more clear in saying Jim Chalmers has lied to the Australian public.”

Adir: “Nobody had this problem. Literally nobody had this problem. The banks were happy raking in the money. They gave some of it back to consumers as frequent flyer points. No consumer was up in arms about the 1.5-2% credit card fee. And the merchant, they just got to say you know what, we’re happy to accept this form of payment, but there’s gonna be a you’re gonna have to recoup the cost. Nobody had any issues. Who had any issues?”

Adir: “I’ve seen situations in stores where cash now attracts a discount of 5%, but using a credit card attracts a penalty of 10%. So they’ve taken a 2% fee and turned it into a 10% fee. Who’s gonna stop it? Nobody is gonna hunt it down.”

Adam: “The problem is the banks maybe charge us 70 bips, but we have a 20-30 basis point Stripe charge, and then you’ve got a few other interchange fees in there as well. The problem is, whilst the banks reduced their amount, Stripe obviously can’t reduce their amount ‘cause that’s not part of this. And there’s a couple of phases going. So Chalmers is just too stupid, and the RBA is too stupid, to understand that the merchant fee being charged by businesses wasn’t just the bank merchant fee. There was a bunch of other merchants in there, and they didn’t reduce the fee at all.”

On AMEX specifically:

Adam: “What AMEX has said is we expect merchants to not charge a fee, but AMEX aren’t reducing that two to three percent cost to merchants. So if you’re using AMEX as a merchant, you’re getting completely squeezed here.”

Retail is dead, and a recession is coming

Adir spent the weekend walking Melbourne and Sydney retail strips. Every store except one was empty. The exception: Muji, packed almost entirely with Southeast Asian customers.

Adir: “Louis Vuitton, Chanel, Moncler, empty. Not a single customer in those stores. Then you go down into all the like RM Williams had a few customers, but like Peter Alexander, empty. The mall was dead. Dead. And every store was empty and every store on the side street was empty.”

Adir: “The firings are about to begin because retail is too distressed not to start firing people and trying to cut costs. I think there’ll be a wave of bankruptcies in February next year after people get through Black Friday and Christmas.”

Adir: “You’re about to see the $7 coffee in Melbourne. There is zero doubt in my mind whatsoever that this credit card fee change is going to drive another wave of inflation and we are going to end up with another interest rate rise. And they’re not going to be able to say it wasn’t me.”

Adir: “My very strong belief is the next federal election will occur during a recession. I think it’s going to be essentially impossible to avoid a recession from here.”

On Adir’s 17-year-old daughter, who sells secondhand goods on eBay and Depop:

Adir: “She said all the stuff that is $20, that has stopped selling. And all the stuff that’s $5, it’s selling, but people are sending her offers to try and haggle it down. She literally said the words to me, how am I supposed to price my product in this economy? Nobody’s got any money. Like, she’s 17. That’s a 17-year-old who sells on eBay-slash-vintage picking this up. How is the Treasurer of Australia not understanding what is going on in this country?”

Pleasers vs doers, and how Australia lost the plot

Adam framed the last 20 years of Australian government as the triumph of pleasers over doers. He nominated Hawke/Keating, Jeff Kennett, and Howard/Costello as the last governments to genuinely do things. Everything since has been an exercise in popularity management.

Adam: “The absolute worst situation is when you’re a pleaser and a doer. So when you’re effective at doing the wrong thing. And the classic example of that obviously is the Dan Andrews government; unfortunately Dan Andrews was an incredible politician and he was able to push through horrendous policy after horrendous policy.”

Adir: “We’ve never had a higher tax take. We’ve never had a higher deficit. We’ve never had a higher debt load. We’ve never had more public servants. And so this country is setting itself up really, I think, for, I don’t want to say catastrophe because it’s like we’re not going to sink into the ocean. But the days of this being a rich, growing, lucky country largely look like they’re going to end if this continues, notwithstanding a mining boom.”

Adir: “You can be an ideological warrior of the left. But also you’re the treasurer of the country. What’s he doing? Like this country is in dire straits economically. You need to be fixing it and taking it very seriously. And the ideology all has to go out the window.”

On the CGT changes and the ASX:

Adir: “Once this law comes in, I think there is a very big risk that there’s going to be a consequential shift away from growth tech on the ASX, and we are just going to see a wave of PE, private equity acquisitions of these tech businesses at lower prices. The ASX should be coming out and attacking this policy as terrible for its business. The number of companies listed on the ASX is going backwards.”

The $12B sleeper from South Australia

Codan (not to be confused with Boden), a 68-year-old South Australian electronics company originally known for its gold detection and high-frequency radio businesses, has become Australia’s third-largest listed tech company at $12B, after releasing extraordinary results. Its communications segment, which sells radio frequency components to drone manufacturers in the US, is set to deliver $400M in first-half FY27 revenue, up from $221M the prior year. EBIT margin has expanded from 26% to 40%. Group net profit after tax for the half is expected to be not less than $160M, versus $71M last year. Three years ago the shares were $3.50. They are now $63.

Adam: “This is unbelievable. This is a business that’s over a hundred on Rule of 40, I think. Doubling revenue and growing margin at the same time.”

Adam: “Run out of South Australia, low profile. I think the founder’s widow is well and truly ensconced on the rich list, like well in the billions now. But it’s the classic tortoise and the hare. These guys are the absolute tortoise. Founded in 1959 by three students from the University of Adelaide and it just keeps growing.”

On the valuation risk:

Adir: “On a financial metrics basis it might be too late to buy this. Paying 70 or 80 times earnings. I mean I know. But your bet is in order to justify the multiple it has to double, and so where’s your upside? There’s a lot of downside risk.”

Koala IPO: the call keeps paying off

Koala, which floated at $3.80 and which both hosts backed at IPO and again when it fell to $3.20, is now trading at $5.05, giving it a market cap of $458M on a 16x PE. Adam and Adir noted this as the third consecutive stock call (alongside CSL and Codan) that has played out faster than either expected.

Adir: “Of the three, actually as it happens, I felt most confident that Koala was going to get the re-rating first. Koala, I know this business. And so this is doing pretty much exactly what we said it would do. It’s just everything happens faster right now.”

Adam: “Koala we knew is really well managed. We think Danny and Mitch are great. I still think it’s one of the more reasonable buys out there.”

Five other stories worth following:

1. British startup Omni has launched plant-based functional dog foods promising joint, skin and even calming benefits, while claiming 73% lower emissions. It is also developing LeanPaws, an Ozempic-inspired weight-loss supplement specifically for overweight dogs.

2. Humanoid robot maker Figure destroyed robots in a Finnish steel foundry to protect its intellectual property, filming them jumping into molten steel. It is now selling metal bars from the remains for as much as $1,900.

3. Grindr is expanding beyond dating with a $250M acquisition of HIV-prevention startup Freddie. The company will fold Freddie into Grindr Health alongside its Woodwork telehealth and pharmacy business, while revenue growth continues strongly.

4. Debris believed to belong to a Canadian Gulfstream G100 air ambulance was found near Nantucket after the aircraft, carrying six people from Bermuda to Boston, reported electrical problems during stormy conditions and then disappeared.

5. President Trump announced a Super Intelligence Force led by National Intelligence Director Jay Clayton, with senior FTC and Defense officials included. Elon Musk endorsed replacing “AI” with “SI” and proposed renaming SpaceXAI to SpaceXSI.

00:00 - Queenstown, Tourism and GTA 6

20:45 - Credit Card Surcharges and Retail

54:02 - Iran, Energy and Geopolitics

1:04:21 - Australia’s Biggest Tech Businesses

1:09:35 - Codan’s Incredible Run

1:17:43 - Joby, Flying Taxis and The Future Of Flight

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