Episode 102: Labubu Mania, Webjet Takeover, Rich List Deep Dive, Eucalyptus Face Off, Waymo and Warby Parker
The guys chat about the great Labubu craze, discuss whether Eucalyptus is a valuable business, Webjet's takeover, Australia's richest people, and Google's surprise investment in Warby Parker.
The Contrarians catchup
Adir is in Tel Aviv and said if you surveyed everyone in the city, you wouldn’t find more than 0.1% of people who would say they don’t feel safe.
With the AFR Rich List coming out last week, Adam quizzed Adir on who was first on the list in 1984. Listen in to see how many of the top 10 you’ll know. Gina Rinehart topped this year’s list at $38.11B, down 6% on last year.
Adir recommends the movie Midas Man about Brian Epstein, the music entrepreneur who discovered The Beatles - “I would highly recommend that movie. There are so many weird ways to make money in this world, and that has got to be one of the weirdest.”
Labubu Mania
Labubu is a character and brand of collectible plush toy monster elves created by Hong Kong artist Kasing Lung, and marketed and sold exclusively by Pop Mart.
Labubu is also the name of the main character in the series, "The Monsters," which was inspired by Nordic mythology. Labubu is a small, mischievous monster with pointed ears and serrated teeth. She is known for being kind-hearted but accidentally doing bad things.
Wang Ning, the founder of Pop Mart, is now worth $18.3B.
Adir: “I think that this craze, which is kind of internet-led, influencer-driven, short form content etc. - this is definitely a very 2025 thing.”
Adam: “The magic is in the gross margin. These things couldn’t cost more than a dollar to make, so we're talking about a 95% gross margin and they sell all their own stuff. To somehow create this alchemy from the impact of celebrity impact to social media, it’s an unbelievable combination of forces.”
Eucalyptus targets unicorn status
Healthcare technology company, Eucalyptus, connects telehealth consultations with doctors, pharmacy delivery, and ongoing patient care through its five healthcare brands: Pilot, Kin, Software, Normal, and Juniper.
Eucalyptus is now targeting unicorn status with a new $150M funding round. Roughly 60% of their revenue comes from Europe and the company is planning on launching brands in two new markets this year.
Adir quotes Shakespeare (“There is a tide in the affairs of men, Which taken at the flood, leads on to fortune; Omitted, all the voyage of their life, Is bound in shallows and in miseries”). Listen in to find out how (and why).
Adir: “What they've become is a health business predominantly focusing on GLP-1, which is injectables for weight loss, but that's not where they started. Because Tim was the head of marketing and the brains behind the Koala positioning, he was going to build out a whole range of direct to consumer physical products, and that's the business he was planning to build.”
Adir: “If you said to me, do I think Tim has the potential to build a huge, great business here, making lots of money, my answer would definitely be yes, but I do think he's going to have to use the the loyal customer base and brand he's built at some point to sell something other than just these GLP-1 drugs.”
Adam: “There is no way this is $1B. This is a retailer selling a commoditised product. We talk about competitive advantages, I can't think of any competitive advantages they have.”
Adam: “There's nothing about this I like other than the fact that Tim's a generational marketer and you're buying into him, but it ain't worth $1B. Any VC who pays $1B for this shouldn't be taking people's money. They're unfit to take people's money. This is maybe a $200M business in my mind. I hate this business. As an investor, I hate it.”
Webjet takeover
One of Australia’s largest online travel agents, Webjet, has found itself in a bidding war on their path to doubling TTV by 2030.
In less than a year since starting the role, Katrina Barry (former CEO of me&u, another brand known for its marketing prowess) has rung the bell for Webjet Group following its demerger from Web Travel Group, navigated its fluctuating share price from $1 to 40c and back to 80c, faced a $9M penalty from the ACCC and, more recently, had Helloworld increase its stake in the business to 15%.
Adam: “I think Webjet is a good business, albeit not a fast growing business, but a good business. Helloworld, I don't think is a good business. I don't think anybody thinks Helloworld is a good business. Webjet shareholders don't want to sell to Helloworld, that'd be a disaster for them.”
Adam: “It just makes no sense to me. Flight Centre would make sense. Helloworld throwing their weight around doesn't make much sense to me. This is a business worth $260M and struggling. Helloworld is a shrinking business. It's a bricks and mortar business that effectively makes money selling to franchisees. It’s not a business I would want to invest in.”
Google x Warby Parker
Google says it will commit up to $150M to the consumer eyewear company Warby Parker to jointly develop AI-powered smart glasses based on Android XR.
Google has already committed $75M to Warby Parker’s product development and commercialisation costs, and will take an equity stake in Warby Parker, should the eyewear manufacturer meet certain milestones.
In other Google-related news, Waymo announced that the number of trips booked in their autonomous vehicles has gone up 25x in only two years, now averaging 250K rides a week.
Adam: “Think about how big this market is. This is a taking-over-people-driving-cars market.”
Adam: “We don't know where the value in autonomous vehicles is going to be. I feel Google has got a worse future than its past, because even if it wins with Waymo, it will lose the magical monopoly it has with search.”
Five other stories worth following:
French startup Veesion raised $43M to expand its AI theft detection tech in the US. The software analyses surveillance footage in real time to flag suspicious behaviour. While designed to prevent shoplifting, the tech could also help stores with safety issues like identifying spills or other in-store hazards.
Researchers in China have developed contact lenses that convert infrared light into visible light, allowing users to see in the dark. The non-invasive tech could also assist those with colour blindness and may disrupt the $200B global eyewear market. Human trials are yet to be conducted.
Bandai will open a museum at its new Shizuoka factory this September to show how Gunpla kits are made. Visitors can design their own. First released in the 1980s, the Gundam models have seen renewed demand, with 50% of sales now coming from international markets.
JPMorgan CEO Jamie Dimon warned the US bond market could collapse, citing post-COVID spending, tax reform and banking rules. He made the comments at the Reagan Economic Forum. Treasury officials pushed back, saying Dimon has made similar predictions throughout his career, none of which have come true. The upside is a potential sequel to ‘The Big Short’.
Jared Isaacman’s nomination to lead NASA was withdrawn by the Trump administration after he donated to Democrats. The private astronaut, known for working with SpaceX, had been expected to be confirmed. A new nominee will be announced soon as the administration looks to align the role with its agenda.