Episode 106: Virgin IPO, Immutable Questions, YouTube Goes Too Premium, Adir's US Adventures, Israel's Masterstroke and Adam's Cettire Victory Lap
The guys discuss the winners from the Virgin IPO, questions being raised about crypto unicorn Immutable, YouTube gets too rich for Adir, Israel's intelligence win in Iran, and Cettire's collapse.
The Contrarians catchup
Adir and his son left Tel Aviv safely and are now in New York, for those at home worried about his whereabouts.
Adir took issue with a LinkedIn post from a venture capitalist who said don’t invest in defense tech because no matter which side it’s used on, it’s ultimately designed to kill people. “We don't give much thought to the fact the reason we're sitting here is because there are other Australians making sure that we stay safe.”
Adir: “I would really encourage people to invest in defense tech. The world is going through a substantial defense transition. Everyone talks about AI, but drone technology and missile defense shields are the emerging technologies of the 21st century.”
Adir was blown away with the service provided at Chick-fil-A, where they take your order while you’re in the line and the food is ready when you get to the front.
Adam said it’s rare for someone of Adir’s “vintage” to not wear glasses after he shared his positive customer experience at Specsavers. Adam was tested, got new frames, and was in and out in 30 minutes, and only out of pocket $49.
Adam had another poor experience with Apple, saying “Steve Jobs would be literally throwing himself around his coffin if he wasn’t cremated.”
The guys were impressed that Mark Zuckerberg is now the second-richest person in the world. Adam thinks he’ll be number one in the next two years once “Tesla’s price asymptotes down to zero”.
Google gives YouTube premium price tag
In light of Google’s existential threat surrounding their search monopoly in the age of AI, Adir poses the question of how Google can increase their revenue amidst search decline.
As a YouTube Premium subscriber, Adir was surprised at a recent price increase from $33/month to $40 (21% increase), forcing him to reflect on how much he’s willing to pay for this service.
Adir: “This smells like desperation to me. Why are they increasing their price that much? This feels like the actions of a company that is used to just printing money and growing every quarter without trying, and all of a sudden it's seeing some problems down the road, and it is scrambling to figure out how its next results are going to have enough growth in it.”
Virgin ready for takeoff in ASX landing
Virgin Australia is set to return to the ASX with a $685M capital raising, cutting Bain Capital’s stake to 40%. The long-delayed float gained momentum after Bain sold a stake to Qatar Airways and appointed former Bain consultant Dave Emerson as CEO.
The airline will list with a $2.3B market cap and $3.6B enterprise value, pricing shares at $2.90 - about seven times its forecast earnings. This represents a 30% discount to Qantas, which trades at 10 times earnings with a $16.45B valuation. Virgin is forecasting $1B in underlying earnings for FY24, with bids due Thursday.
Adam: “They’ve put an incredible team together. They’ve timed that beautifully. They had this beautiful tailwind of Qantas performing really well. Their loyalty programs have done well. They did that masterstroke with Qatar in getting that international network. They’ve played as well a game here as almost I've seen any business playing in easily 10 years, possibly 20 years.”
Immutable plays the long game in Web3 quest
Backed by major VCs like Temasek and Tencent, Immutable, “a global leader in gaming on a mission to bring digital ownership to every player by making it safe and easy to build great web3 games”, has raised over $800M and is valued at $3.8B, making it Australia’s fourth-biggest private tech firm.
Founded in 2018, Immutable builds blockchain-based games where players earn tradable NFTs. But while Bitcoin has surged, alternative coins like Ethereum - which underpins Immutable - have lagged, leaving some investors frustrated by stagnant platform revenue and uncertain growth prospects as attention shifts to AI.
Adam: “I’ve always thought this business just didn’t make sense. This whole thing felt like a pyramid scheme.”
Adir: “I feel like I'm always defending VCs, which is not my natural place in life. The thing is they've got a model and they just want to find the huge winners. So the valuation matters, but it doesn't matter in the same way as common stock valuations matter because we're protected. So I think all of these valuations are complicated.”
Cettire’s luxury crash sparks fresh insider questions
Cettire founder Dean Mintz delivered a second profit downgrade in three months, blaming volatility in luxury goods. Shares plunged 30% Thursday, then another 20% Friday, closing at 25¢.
Analyst views are split: RBC’s upside scenario sees a 525% rebound; downside, a collapse to 5¢. Major backer Cat Rock Capital sold 20M shares days before the downgrade, prompting market questions about potential insider information, though Cettire denies any contact. Concerns also resurfaced around Barrenjoey's past Cettire trades, including a $127M Mintz sell-down in 2023 just before negative media reports triggered a 25% price drop.
Adam is doing a victory lap after many episodes predicting Cettire’s downfall.
Adam: “Do you remember when Usain Bolt won I think his third gold medal and he did a great victory lap? Well, that’s nothing compared with what I’m about to do.”
Five other stories worth following:
Over 6,000 soldiers marched in Washington, DC, for the US Army’s 250th birthday, coinciding with Trump’s 79th. Meanwhile, 200+ groups organised “No Kings” protests in all 50 states, drawing 5 million people to oppose strongman politics. The Secret Service had projected 200,000 attendees for the parade.
President Trump and world leaders gathered in Alberta for the G7 summit. The Israel–Iran conflict tops the agenda, alongside trade and economic issues. NATO’s Mark Rutte and Ukraine’s Volodymyr Zelensky will join talks as Trump’s July 9 trade deadline looms.
Brazilian meat giant JBS listed directly on the NYSE, valuing it at ~$30B. Previously listed in São Paulo, JBS faced years of delays due to corruption allegations. The move gives it long-sought access to US investors.
Amazon, Walmart, and others may launch stablecoins to cut credit card fees, potentially saving billions. Merchants paid $172B in US swipe fees last year. Congress may soon vote on the GENIUS Act, paving the way for company-issued stablecoins. Visa, Mastercard, and others saw stock declines on the news.
Anne Wojcicki’s nonprofit outbid Regeneron, offering $305M for 23andMe in a bankruptcy auction. The surprise win gives her control over the company and its genetic data, after the bidding reopened following her unsolicited offer.