Episode 74: Our 2025 Predictions, Culture Amp, NDIS Rorting, Adir's Travels, and Adam's Movie of the Week
The guys reflect on their 2024 predictions and try to forecast what will happen in 2025, discuss the future for unicorn Culture Amp, the NDIS Rortfest, and Adir's globetrotting.
The Contrarians catchup
Adam joined from the slopes of Whistler in Canada, while Adir is in the Multiply Me office in Tel Aviv. One thing both places have in common is that the sun sets around 4.30pm. The weather is “really beautiful” but “there definitely feels like there’s a war going on”.
Amazon patented, and popularised, 1-click online purchasing in 1999, but Adam tested out Amazon in the UK and found that he had to do “about 14 clicks”.
Adir: “This is the tension of Google, in my view. If you're really customer centric, you just want to create the best possible results for search that you can. But if you create the best organic results, then people are not going to click on your paid results. And so you have to find this balance between really good results but not great.”
Adir keeps getting fed LinkedIn ads for Startup Pakistan and has been impressed with the thriving startup ecosystem over there.
Did you know the NDIS in Victoria pays half the cost of each taxi trip taken by its users, up to $60? The guys discuss all the issues with the NDIS and how it can be salvaged.
When Adam goes overseas, he takes his podcast microphone and heated ski gloves. Adir takes his pillow from home.
Adam recommends the movie ‘The Wizard of Lies’, which documents the fall of Bernie Madoff, whose Ponzi scheme robbed $65B from unsuspecting victims - the largest fraud in U.S. history (although Adam says the real number is around $19B).
Culture Amp ‘24 results
Adam and Adir are both fans of Culture Amp and were a little surprised by their ‘24 results, as reported in the AFR by Tess Bennett.
Culture Amp, one of the country’s biggest private software companies with the backing of major venture firms, lost more than $US96.5 million ($155 million) over the past two years as it funded rapid growth.
But accounts filed with the corporate regulator also show revenue growth is slowing at the start-up, from 32 per cent in 2023 to 19 per cent in the 12 months to June 30, 2024, when it had $US159.8 million in sales.
Founded in 2009, Culture Amp has more than 6500 customers including McDonald’s, Canva and Coles, which use the company’s software to manage employee performance, engagement and workplace culture.
Adir: “As I say over and over and over again. And at least I can say I'm not a hypocrite because I eat my own dog food on this, but if you've got 160 million USD of revenue, unless you are growing like a rocket, maybe I'm talking 35% plus, you should be making cash.”
Adam: “Frankly, we criticise Atlassian, but at least Atlassian makes cash. We both see how Atlassian could be a great profit machine. But this is a different issue. This is a business where the question is, what do they need to do to make a profit? They’ve got to get rid of half their staff, presumably. What happens to growth then?”
Adam: “You had Canva, which is the Michael Jordan of businesses in Australia. And you had Safety Culture and Culture Amp, and they all got lumped together. It’s like the AFL versus Diamond Valley.”
Our 2025 Predictions
But first, a look back at Adam and Adir’s 2024 predictions.
Interest rates didn’t move in 2024, which both of the guys largely predicted (Adam said they’d go up and come back down, Adir predicted a range of half below and half above).
Adir: “Although these rates are hurting individuals, without doubt, I think the economy is actually going to strengthen. And so the problem is, how can you reduce rates into a low unemployment environment with a strengthening economy? I don't think you can. And so I think I'm just going to stick with my pick from last year.”
Adam: “I think the RBA will drop 25 to 50. It's I don't think it should, absolutely I think they should be increasing it. But I think because of property prices lately, there could be one drop.”
Adir predicted the index would end up flat, which Adam said he nailed.
Adam: “It feels like the market is way overcooked. It feels like price earnings elevated earnings multiples like elevated more risk on downside. So I clearly got the timing wrong. I still stand by that that view. And I think we'll get become right eventually.”
The guys predicted Sydney real estate would continue to grow and the rest of the capital cities would largely be flat. Sydney ended up with 3.3% growth, Melbourne went down 2.3%, Brisbane was up 12%, Adelaide 14%, and Perth 21%.
More predictions coming next week!
Five other stories worth following:
President Biden blocked Nippon Steel’s nearly $15B proposed purchase of US Steel. Biden called out national-security concerns, arguing that one of the US’s largest steel manufacturers shouldn’t be under foreign control.
Nvidia reportedly invested $1B in artificial-intelligence deals in 2024. The AI chipmaker had a banner year — hitting a $3T+ valuation — as the genAI frenzy drove customers to stockpile its GPUs.
The US Department of Transportation fined JetBlue Airways $2M for “chronic delays” and “other unrealistic scheduling practices.” It’s the first time the department has charged an airline for delayed flights, and the DOT said $1M of the fine will be paid out within the year to affected JetBlue customers.
Meta took its AI-generated profiles offline. The various characters were labeled as “AI managed by Meta,” and users mocked them incessantly. Meta clarified that these bots were part of an “early experiment” before removing them to fix a bug.
DraftKings is trialing a $20 subscription service called Sportsbook+ that boosts members’ odds on sports parlays. The subscription, which recently rolled out to some participants in New York, may be the company’s attempt to offset the state’s gaming taxes.