Episode 140: AI Boom Keeps Booming, Deep Dive into Australia's Secret $6B Business, Pokemon Cards, Board Games and Founders Behaving Badly
The guys discuss the incredible AI boom and growing risks, deep dive into Codan Technology - Australia's lowest profile tech giant, the hidden world of Pokemon cards, board games, and silly founders.
The Contrarians catchup
If you’re wondering how to get guns like Dr Adir Shiffman, he reveals that he goes to a Kieser gym, with its “unique mix of physiotherapy and strength training”. Watch their valuation pop like Adir’s biceps now.
The guys discuss whether Donald Trump deserved the Nobel Peace Prize. Adam summarised his presidency so far as “foreign, massive tick; domestic, massive fail.”
Adir recommended a show he watched on a plane called ‘Syndicate’ about raising capital, but Google and ChatGPT say this doesn’t exist so reply to this email if you know the actual name of this show! He also recommended ‘The Hobby: Tales from the Tabletop’ (which does exist) about board games.
Adam went to the theatre last week to see ‘Rebecca’ (he got free tickets: “Do you think I go to the theatre? Obviously I’m not paying for it.”)
Adam has had “a few run-ins with various founders lately” where they are “completely unwilling to take any sort of criticism”. Listen in to hear what happened.
Gotta catch all ‘em returns
Pokémon cards have delivered a staggering 3,821 % cumulative return since 2004, vastly outperforming the S&P 500. Driven by nostalgia, rarity, and graded condition, ultra-rare cards command six-figure values. Admirers treat them as alternative assets, though critics warn of volatility and speculative risk.
Adir: “I feel the same way as I do about LVMH. You have this thing that’s special because it’s somewhat scarce and different and then they ramp up production to mega numbers and it’s good for profits in the short term but in the long term it damages the brand.”
AI boom keeps booming
AMD gave OpenAI 10% equity to secure massive future chip orders, aiming to challenge Nvidia’s dominance. The deal boosts AMD’s AI ecosystem and valuation, but investors question its sustainability amid dilution risks, OpenAI’s heavy cash burn, and an overheated AI market that may face painful corrections.
Adir: “I think we both agree that there will be a tech crash in the next 18 months. Businesses that have no obvious connection to AI or even more broadly to tech are trading on very low multiples, unless you’re a gold miner or a copper miner. I’m starting to think about what can I buy that’s really cheap because it’s being overlooked.”
Adir: “When you’re getting 10% of a company as part of a deal to use their chips, which I think are not being paid for, you’ve become a religion. OpenAI is a religion now.”
Adam: “I like the way Nvidia explains the AI stack. You’ve got power, you’ve got the chips, you’ve got data centres, you’ve got LLMs, and then you’ve got the application layer on top of the LLMs.”
Australia’s secret $6B business
Back by popular demand, the guys do a deep-dive into Codan Limited (ASX:CDA), a South Australian $6B company you may not have heard of who provide electronics solutions for government, corporate, NGO and consumer markets across the globe.
Adir: “It’s bizarre that there’s a tech company worth $6B that has grown 8x in the last two years and no one talks about it. Whatever number you want to use, this business is running at 40-45 on a rule of 40, split roughly between growth rate and profitability, which is pretty interesting.”
Adam: “If you recall when we talked about DroneShield, which is obviously a very different business but they’re both broadly military-type businesses. But the one thing I doubted about DroneShield was how could an Australian business be a market leader in military technology when we don’t fight many wars. DroneShield has proven me wrong and now Codan has too.”
Adir: “If you spend 10 years putting the market to sleep, it’s hard to wake them up again.”
Listen in for a deeeep dive into Australia’s secret $6B business that you probably missed your chance on.
Five other stories worth following:
Build-A-Bear’s revenue jumped 11% to $124.2M, and its stock surged 76% in a year—up nearly 2,000% over five. Adults and teens now make up 40% of its booming, nostalgia-fuelled business where heartbreak melts away.
Prince Harry and Meghan criticised social media’s impact on children at a gala honouring their Parents Network. They highlighted corporate responsibility, data misuse, and AI dangers, joining broader conversations about technology’s effect on young people’s mental health.
Boulder, Colorado’s basic income trial, giving $500 monthly to 200 residents, reduced stress but didn’t improve long-term issues like childcare or savings. Experts say deeper, systemic investment is needed to address lasting financial barriers.
A US tariff announcement triggered crypto’s biggest-ever liquidation, wiping out $US19B in 24 hours as Bitcoin plunged 12%. Over-leveraged traders faced massive losses before buyers pushed Bitcoin back above $US115,000.
Labor’s plan to tax super balances above $10M at 40% could push wealthy Australians toward property and trusts. About 8,000 will pay more tax, while 1.3M low-income earners receive top-ups under the reform.