Episode 148: RBA Blows It (Again), Pet Circle Horror Show, Navan IPO Deep Dive, Richo Gone, Mamdani Takes NYC, Luxury Escapes Goes to the Beach and Adir Turns Quizmaster

The guys discuss Australia's inflation disaster, Pet Circle's calamity, Navan goes public, Graham Richardson dies, Mamdani becomes mayor of the heart of capitalism, and LE opens in Sydney.

The Contrarians catchup

• The guys discuss whether the average person understands the connection between interest rates and inflation going into the holiday season (Adam: “I don’t think most people are idiots.”)

• Adir: “The ultimate cynical government ploy would be getting a chunk of money and pouring it into subsidising reduced bills on a utility. And what that would do is it would push down inflation because the cost of that electricity bill would be lower for the customer and it would drive GDP because it would pull government spending into the economy.”

• Adir: “The word economics makes most people vomit, right? But the better way to describe it is the rules to the game that you’re playing in society, and that is capitalism. And no one sits down and plays a game and says, ‘I’m just going to start playing, we’ll work out the rules as I go along’, especially when everybody else around the board knows the rules.”

• There are a lot of great Adir quotes in the first 20 minutes - just listen to the podcast, I’m not typing them all out.

• After Adir knocked formal education and the importance of the periodic table of elements, Adam said “But the bigger problem here is who’s going to teach it? The commies who work in schools?”

• Adir shares his opinion on Zohran Mamdani becoming mayor-elect of New York City and asks Adam a pop quiz about socialism, democracy, and genocide.

• Adam shares a quiz on the top 40 jobs most exposed to AI. The top five:

  • Interpreters and Translators

  • Historians

  • Passenger Attendants

  • Sales Representatives of Services

  • Writers and Authors

Pet Circle horror show

Pet Circle’s revenue fell 2.9% to $373M while losses widened to $36.9M as expansion and tech investments drove costs up. Operating expenses rose $18M, halving cash reserves. New CEO Alistair Venn says infrastructure upgrades position the $1B-valued retailer for scalable growth and faster deliveries nationwide.

Adir: “Two words: golden window. There was a golden window for this business to exit and for the founders to take their money. It got into this world pretty early and grew pretty big, and now there are competitors. You can’t get into something early and nail it and then just keep doing that thing and nothing new while other people come and do the same thing.”

Adam: “This is a business that needs to be put down, I think.”

Luxury Escapes’ goes to the beach

Luxury Escapes will open its second store in Westfield Bondi Junction, Sydney. The high-foot-traffic location will offer in-store travel experience, bookings and a personalised service, as the luxury travel brand expands its brick-and-mortar presence.

Grab your friend and head down to the store from 9.30am on Wednesday, November 12th, where the LE team will be giving away lots of stuff!

Adam: “The retail event of the decade.”

Navan IPO deep dive

Navan, a corporate travel and expense-management platform, saw its shares plunge around 20% on its debut after pricing at US$25, pinning its market value at about $4.7B.

The company went public using a novel “shutdown workaround” rule amid a government shutdown, allowing automatic approval of its IPO paperwork, but this regulatory uncertainty appeared to weigh on investor sentiment.

Adam: “It’s very rare you see a business with sales and marketing go down a couple million and still grow revenue by 35%. That is almost unheard of.”

Adir: “If they could drive $200M in additional gross profit in a year’s time, it’s possible they could keep $100M of that flowing down to the EBITDA line. And then all of a sudden your $4B is 40x EBITDA. And the year after, it might be 15 times EBITDA. My favourite way to measure businesses is to say what percentage of incremental revenue, or gross profit in this case, is actually flowing down to whatever profit number you want to use.”

Five other stories worth following:

1. Pfizer secured a $10B acquisition of biotech firm Metsera after outbidding Novo Nordisk in a fierce contest. The move strengthens Pfizer’s position in the booming weight-loss drug market, expected to reach $150B by 2030, amid upcoming US plans to lower drug prices.

2. MLB’s Cleveland Guardians pitchers Emmanuel Clase and Luis Ortiz were indicted for allegedly fixing specific pitches to help a gambler win prop bets worth $450,000. Prosecutors said they defrauded MLB and betting platforms; Ortiz denied the charges, and Clase’s lawyer has not responded.

3. Visa and Mastercard are close to settling a two-decade lawsuit with merchants, allowing stores to reject certain high-fee credit cards and lowering interchange fees by an average of 0.1 percentage point. The deal could reshape credit card acceptance and transaction costs for businesses.

4. The UN’s COP30 climate summit begins today without US participation, as President Trump’s policy reversals threaten recent progress on emissions reductions. Global leaders and scientists will meet to assess the planet’s accelerating warming and the future of the Paris Agreement’s climate goals.

5. Warren Buffett, 95, is expected to release his farewell letter before stepping down as Berkshire Hathaway’s head by year-end. The message will address philanthropy, Berkshire’s future, and his reflections after six decades leading one of America’s most influential companies.