Canva’s AI Crisis, Zoox Changes Everything, Xero’s Ad Disaster, Jetstar’s Bag War, and Atlassian’s Profit Pivot

27:12Now, I don't say that about Sekinder Singh-Cassidy, but I will say the other thing that I learned, which is this. Stuff that goes into the media gets there usually deliberately. Now, the things that aren't deliberate are scandals. No one's going to push scandals about themselves in the paper. And so there is journalism that goes on that finds exclusives and stories. But as you would know, most of what goes into the newspaper, especially business stuff, it goes in there because someone's pushed it in there. And that is obviously going to be true of an opinion piece. Someone's got, and then you say, well, why?

27:47Why is this opinion piece in there? Why has Sekinder Singh Cassidy decided that now is the time to wax lyrical about what sounds to me like her own CV and her big picture understanding of how great companies become greater or big companies become bigger. And I can only think of three possible reasons, and I'll leave the one I think most likely to last. Reason one is she's feeling emotionally bruised at the ego level because of what she's been through, and this is her kind of way of trying to remind people and mostly herself that she's actually fantastic. I actually don't think that's the motivation.

28:22The second reason could be she sees the writing on the wall and she's looking for a new job, and this is effectively a job application. Possible, very possible. Most likely, they're about to go through a process at zero to do something that we both think is irregular to say the least and inappropriate to say further things about it, which is a whole lot of repricing of stock-based compensation for someone who's just sold all of their shares in the company. and um and if you were going to go through that and were worried that a whole lot of people were going to vote against you wouldn't you love to make those people think to themselves hang on she's actually really accomplished and really capable and this is why we're paying these big dollars for an american ceo and let's not rock the boat we just got to give her time because she's done all these magical things and she'll be doing them for us and my guess is that this is a largely a message to try to smooth the way for this salary and compensation package to get through.

29:28What do you say to that? I think that's fair. It's hard to know. I think there's a level of narcissism here that is hitting all sorts of new highs. Most of these court-hired manager CEOs have a huge degree of that because you've got to be a great politician to hit this kind of level. But it's Becker's belief that she would write this asinine piece that is just – it was almost embarrassing reading it. Well, so yes, there's definitely ego involved with CEOs. I don't know her, so I can't comment about her ego. So my understanding is that she also has a whole chunk of Google shares from time at Google.

30:06Was she at Google? I think she was at Google. She was Google Maps, I think. So early days. So someone told me – That'll be a long time. which I cannot, I can't believe I'm spreading these rumors, but like this is what someone who I think really is in the know told me, that she has a whole chunk of Google shares, or at least she did. And so right now, if you had to choose between, you'll see some tax requirements and you have to choose between liquidating Alphabet shares or zero shares, I'd say it was a pretty easy choice of which one to sell down. And so - Well, Google has been on a bit of a run up and zero has been on a run down.

30:39So in that sense, it's not as simple as it sounds. You really think that? I think that, I mean, it's true what you've said, like mathematically what you've said is true, but Xero has been on a rundown and you think they should fall another 50%. And Alphabet's been on a run up and they're probably the best company in the world. I mean, I think they probably are. I think your point is Alphabet is less overvalued. Yes. That's your point. And so someone at the Fin Review or wherever should go and look at, does she hold a whole chunk of Google shares? And just ask her, you said you have a tax problem.

31:09and you're running zero, go sell some of your alphabet shares to fix your tax problem. Why are you selling zero shares? So I don't know if it's true. I just emphasize like it was shared with me. But I think that's relevant, right? If a CEO is selling shares, then you could ask for a tax reason. Then I think you would say, what else do you have that you could have sold and why didn't you sell that stuff? Don't you think that's a relevant question? Totally. Yeah, 100%. And it's obviously a lot easier to sell something you're not working, you're not running the company of as well. So it just makes a lot more sense to sell a few of those Google shares.

31:43Yeah, no one would even notice, right? No one would even notice. But the owner of the shares would notice because they would miss out on the gains that Google had after that. And probably they would wear the losses that I suspect that Xero might keep experiencing. I mean, you and I, I'm always a bit defensive about this. Like you and I, we generally want people to succeed. Maybe not all people, but most people. and we definitely want zero to succeed because that is a winner of a New Zealand slash Australian business, right? Like we love that business. Like we want that to succeed and it is a great business with great bones and maybe that's why we're a bit worked up about what's happening to the company at the moment.

32:20It was an incredible business. If you go back five years, this was, it's got so many powers, this business. This has been own goal after own goal. I also move on and the stench around the Andrews, Allen, now Carroll government in Victoria simply won't dissipate with the Victorian Anti-Corruption Commission finding that members of the Andrews government engaged in serious and concerning conduct with their dealings with union boss Peter Marshall, who came to exert extraordinary influence over firefighter paid negotiations and later the very controversial malclamation of the CFA and the MFB. It appears the only thing stopping the commission from deeming the conduct of disgraced former premier to be corrupt was because Andrews himself limited the scope of the commission to make a corrupt finding.

32:58So the commission was basically powerless to make that. So it's not as if they didn't think it was corrupt, because they couldn't find them corrupt. Well, they could only find that it was corruption if it fulfilled the requirements of criminality. And so that bar is too high, basically. With the evidence they presumably had. I'm not going into the full appalling conduct of Andrews and his ministers and key bureaucrats, but I was going to talk about one person who actually came out of this as a hero, and tragically she's no longer with us. The late Jane Garrett, who lost her job, her livelihood, and eventually her life to cancer following the horrendous treatment by Andrews and his cronies.

33:36Michelle Griffin, writing in The Age, I think said it really well. She said, countless ministers have swallowed their pride when their boss overrules them. Garrett would not. She believed the deal would cost them a insane amount of money and hand over far too much power to Peter Marshall and his troops at the expense of the volunteer-driven CFA. Garrett would later testify to IBAC that Marshall subjected her to a huge torrent of abuse, threatening to bring hellfire down on the government and Garrett would shortly after resign and then tragically lose her life to cancer in 2022. Very few people in the Labor Party ever stood up to the autocratic Andrews, who caused more damage to Victoria than anybody in the state's history.

34:11I think Jane Garrett is one person who can hold her head up high as doing that. So we talk about this government a lot because it is just so bad, but they weren't all bad. There was one hero in that, at least one hero in that party who lost her life. And where there was direct causation correlation, it's hard to say, but certainly was a tragic story of someone who deserved more. Agreed. I have nothing to add to that. I completely agree with you. Speaking of Victoria, the new premier down here, Ben Carroll, who promised on literally his first morning that he wasn't the horrific Dan Andrews of Sinta Allen, has decided to keep, and this is what's been reported, decided to keep Victoria's highly controversial work from home laws intact with just minor and largely irrelevant concessions to businesses saying basically the employees don't need to cover remote setup expenses, which itself was just ridiculous.

35:01Carol said to the AFR, the law signal importantly the priorities of our Labor government to support working people. Carol, the message I've been getting from the business community over the past week is that they have not felt their message on work from home has been heard or listened to. Under the bill that passed the lower house this week, an employer who receives a work from home notice must respond within 21 days if they do not consider it reasonable for the employee to work from home two days a week and they must propose alternative arrangements. So we thought there was a glimmer of hope last week that Ben Carroll was turning over a new leaf on the rotten Andrews, Allen governments, but this was his big test.

35:36It looks like he's flunked it. Well, there's a few questions. Well, there's an observation and a question. Let me start with the question. What happens next if someone says, submits that form to you they want to work from home and you provide what you think is a good reason that they can't work from home? Who adjudicates that? It goes to the Human Relations and Equal Opportunity Commission. Well, that's good night for the business. And then VCAT. Okay. Well, I think I've mentioned this to you before, but this, what's it called? What's that council you just said? Human Rights Equal Opportunity Commission.

36:15Human Rights. Okay. All right. So I've had to go not before the Human Rights Commission, but I actually can't remember if the CEO of a business that I was a shareholder in asked me to go before it or just provide information to him but whatever it is I got some exposure to this when an employee that we had was fired for reasons that had nothing to do with a human rights related issue let's say and made a claim to the human rights campaign which i don't even know it's a possible thing to do then when you were dismissed like because i think about human rights and i think about you know like people being kept in cages somewhere in africa or asia or like you know cute trafficking of people i don't think about you know we fired someone and they didn't like it because they claim we fired them for a personal issue and so So like – Well, I think the way you potentially could is if you fired them because they were black or Jewish or Muslim.

37:19Yeah, well, let me assure you that that was none of the claim pertained to any of those things. I'm not going to go into it because it's settled and whatever. But I know what the experience was going before that. And I don't really – I would love to hear from a business that had a good outcome from the Human Rights Commission. but my experience was that there was nothing that I could possibly do to fight this allegation because the way that my experience with the commission felt like the way they considered it was $10 ,000 would be a significant amount of money to the individual and inconsequential to the company, which by the way it was not and so you should just pay it because you're a company and make the problem go away.

38:03And so I have no confidence. Do you think I'm being unfair? I mean, I don't know if I'm going to like what I'm going to get in response for saying this, but like, I don't think the Human Rights Commission is in any way an appropriate place to be adjudicating conflict between individuals and businesses, unless it's for one of the reasons that you just flagged, which is these protected categories. So I'm just looking at the process is you can – an employee says, I want to work from home. The business can say, I disagree, that it's reasonable. For example, it could be a requirement of the role, could be significant operational impact.

38:40There's a few reasons. You then go to the Victorian Eco Opportunity and Human Rights Commission, VEO HRC, and if that doesn't – if that isn't resolved there, then you go to VCAT, which is the sort of main tribunal in Victoria. So I think VCAT is a better shot adjustment. Yeah, VCAT I find generally pretty good. Yeah, it's usually, they're pretty sensible. Yeah, but equal opportunity, it's not equal opportunity. Like each side does not have an equal opportunity in my view. If you're going to become an equal opportunity commissioner, what kind of person are you? You're not unlikely to be from business.

39:13You're more likely to be that way inclined that you're going to take the view. You're more likely to be the left of politics, I think is probably the broader. Well, you're more likely to, I think, your history and your personal beliefs, and I'm cautious about saying this because there are many people on the left, on the right, that can put their personal views to the side and just stick to the letter of the law. But we need to be honest and say your personal views on this are probably going to be for what you perceive as being the underdog, not the corporation. And so I just think it's wholly inappropriate that it goes there.

39:44And also, you know the number one argument, I mean, I'm going to be preaching to the choir here. But you know, the number one argument for why you can't work from home is I think that all of the benefits of working in an office, for example, being around other people, sharing ideas with them, serendipitous outcomes, etc., will lose all of that opportunity. And I think that it will be a disadvantage just relative to our overseas competitors who do have people in the same office. The chances of that succeeding as an argument are nil. But that is the most honest argument of all arguments. So let me say the second thing I think this shows, which is more dramatic.

40:21Well, just before you get to that, the bigger issue is on a practical sense, is if you've got 10 ,000 businesses all saying, actually, I disagree, neither Hiryok nor VCAT is going to ever have the capacity to hear these cases. So it's like, I don't know, who the hell knows? And it's a question where these laws are even valid because it's a state law trying to override a federal employment law, but there's so much wrong with this. And this was such an easy win for Ben Carroll to say, we're going to reassess the policy. We'll come back to you. We'll encourage work from home, but we don't think this is the way to do it.

40:53Instead, he's backed these disgraceful laws. And someone like, I couldn't see myself voting for this horrific Labor government, although I thought Ben was a big change from the previous two, but there's no way in a million years any business owner will consider voting for them now. And don't forget, this is not an anti-business rule. This is an anti-worker rule because what's going to happen? You're just going to hire people in different states. So Victorian workers don't have it bad enough as it is, highest unemployment rate in Australia by a mile, length of the Flemington Strait, as Richard Goida would say.

41:20This is going to make it even higher. So this is a job-killing, hope-killing law that absolutely penalizes employees and penalizes young Victorians. Well, I think what I'd mostly say about this is, and so you and I are not perfectly aligned, by the way, on this because I'm more tolerant of not five days a week in the office, but I know you're tolerant of flexible working, so it's not like you're intransigent. I mean, I know, just a flag for people. I'm tolerant of businesses and employees working out amongst themselves. If business wants to allow fully flexible, they can do it. Not my own issue.

41:51Just not my business, but other businesses can. So one thing we know about Ben Carroll, if we only know one thing about him, we know more than one, but if we only knew one thing about him, we could know this about him. He's good at politics because he's the premier and nobody else is. So he's got to be at least good at politics. And so this is my takeaway, because when you look at this, as you said, it looks like an easy win for Ben Carroll to just get rid of this work from home legislation. And he's not a dummy, that's for sure. And he's not bad at politics, that's for sure. And he didn't get rid of this.

42:24And so my only conclusion is that he decided the politics of getting rid of this is bad for him to get reelected. That has to be the motivation. And think about what that says. Ben Carroll, as you said last week, came up through this shop union or whatever it was called. Shoppies, that's what you called it. Shoppies. The shoppies. Shoppies, I worked out, it's people that work in shops. Probably should have taken me less time to work that out, but I got there, okay? So the Kmart worker, that's who he's talking about. The Kmart guy that is like schlepping boxes in the basement from here to there, that's what he was doing.

42:59Yeah. Can that person, that's where he came from, that means that that union was an integral part of the labour movement and the labour constituency. The members of that union were integral. And so what does it mean now? It means those people cannot work from home two days a week. The boxers, you know how they work from home, they can work from home five days a week when the robot moves the boxes. But until then, they need to move the boxes. So that means when Ben Carroll says we're not changing this, he's saying you, the shoppy, you are going to watch as other people get to work from home, which means that while the union itself may still be aligned to the labor movement and provide them with lots of cash and maybe get lots of benefits in return, the member of the union, which has been diminishing every day anyway, but the members, they don't seem like they're constituents of the labor party anymore.

43:56because they're being totally excluded with a law that gives other people benefits. I think they've just – the worker in the shop that Ben Carroll was when he was a kid is no longer the target voter of the ALP in Victoria. That's what it says to me. The target voter is – I mean, I don't want to be rude about it, but it's like the office worker at a desk, right? Public servant. Home marketing, whatever. Like, fine. But I'm not criticizing those people. I'm just saying those people are now the constituency Labor's going after. And so where does – then I thought about this. Where does the shoppy go?

44:33Who does he vote for? She votes for it the next election. And my answer is so I don't think that they're going to vote for the Liberal Party. I think that feels very unlikely to me, not impossible but unlikely. I think that the person that 20 years ago worked in the shop and would have voted for Labor today works in a shop and is going to vote for the Greens or One Nation. And increasingly, the Greens are totally unpalatable to anyone. And I think this is where One Nation votes are coming from in Victoria. Totally. It's astonishing. It's the Donald Trump voter. Trump did an incredible job of getting, and he arguably duped them, but getting the kind of uneducated, angry, middle-aged white male voter and young male voter.

45:16And this is the, obviously, Pauline's got exactly the same constituency. yeah it's remarkable can i just pick up on one small point you said ben carroll's good at politics because the premier well i can think of somebody else who was the premier just into allen who wasn't very good at politics she was the most unpopular leader in certainly australian history and possibly the world's history so uh like i think simply because someone is premier who doesn't win an election and i think ben carroll's much better than just in town don't get me wrong i think he's much more in the in the steve bracks uh even peter malinaskis chris minns mold from the the right the more sensible right of the Labor Party, but simply being Premier certainly doesn't qualify someone as being capable, and Sinterk Allen very much proved that.

45:55Well, I don't think, I think I would agree if you would have said she's bad at the politics of the electorate, but I think she was very astute at the internal machinations, the politics of internal machinations, because she positioned herself right beside Daniel Andrews, and as he slaughtered everyone else who was competent in the party and as a threat to him, she managed I mean, now we see why he didn't bother getting rid of her. And so, like, she positioned herself politically perfectly inside the party. She was just no good externally. Yeah. Well, I would say externally is a pretty big part of the job, but yeah.

46:28Yeah, she was good at a different politics. Now I'm going to segue back to a comment about the trip to Vegas, but actually about the trip itself rather than being in Vegas. This is the transport. So I flew here on Delta. Everybody – people love when we talk about airline stuff, so we'll talk about this. So maybe we'll disagree, but maybe I'm actually going to fold almost instantly.

46:52So basically, everyone said to me, Delta One, it's like first class. You should try Delta One. So Delta One, obviously, it's on Delta, an American-based airline. And it has a business class in a one-to-one configuration with sliding doors. We're going to talk about the doors. One of our great arguments is the door issue. All right. We might not have such a big idea. So let me tell you some things about Delta that are very perverse. So the best thing about Delta is the ground experience. And I don't say that because the air experience is terrible. It's got some problems. You mean the Delta Lounge?

47:29So the lounge in Australia is very bad. This is Sydney? Because I don't think they fly to Melbourne, do they? Yeah, it flies out of Sydney. And it uses like, you know, what's that card called that you get for free with American Express, Priority Pass. Priority Pass, yeah. It uses one of the Priority Pass lounges. To be honest, I just went into the American Express lounge, which was better. Delta is part of Sky Team, right? Sky Team. Which is Garuda. It's that sort of third airline. Plus the Taiwanese airline. It's got China Airlines in there as well. Yeah. So, yeah, it's not. Why did you fly Delta, not like United, who fly to Melbourne now?

48:06Because I wanted to try out this Delta One suite. Oh, okay. I don't want to say suite. And I presume your private plane's in for maintenance. They call it. Well, you know, the A380 I own has got some problems and like the – The 7-foot – the Qatari don't have a 7.7. I don't even know the names of these things. The G, are they up to 6 maybe or something? The G650, 650 I think. Yeah, 650. Yeah, that's got a flat tire. So anyway. Now, I thought I'd give this a go. Anyway, so the land experience here is no good, but it's very – the service is the friendliest check-in staff and like onboarding staff.

48:38The in-flight crew are very friendly for American flight crew. Yeah. So that's a low bar, okay? But they're more friendly than like United. You know United's theme used to be come fly the friendliest guys? So I think that was – it's generous, that theme, right? But that was quite friendly. Ironic almost. But then I get to Los Angeles and I have to swap planes and I've got hours between them. So firstly, I go and get – I think I can talk about this. I go and get global entry. so I'm now authenticated for global entry, which is cool. Yeah, great. And that's via – do you get like a discount through Amex and stuff to get that?

49:13No, maybe, but I didn't use it. But what I like most is it gives you TSA pre-check so you can go through the domestic lines much faster. Yeah. So that's good. What's the only reason to get it really? It's better to go into the – faster to go into the country. Yeah. Yes, exactly. The main reason is because there is no priority queue skipping in the US for domestic security. Like only TSA PreCheck helps you. I didn't have that for this flight as it happens. But so Delta has this lounge in Los Angeles and this is what's incredible. LAX is a lot better than it used to be. Like it's got, its reputation now is - I don't mind LAX.

49:50Yeah, yeah. I was picking my CFO about this. I thought - Because it was terrible 20 years ago. A couple of weeks ago, it was fine. No, 20 years ago it was a disaster and now it's actually pretty good. I find it fine. You can walk between terminals. Like it's fine. But the security lines are long to fly domestically at LAX. That's every US airport, I reckon. So Delta has this Delta One lounge. The first thing is you can go into it from – I could access it because I had a Delta One flight over there and had another Delta flight on the same day. And so you enter it from like curbside and then you go and have this like little check-in process, which I didn't need because my bag was being sent through.

50:30How did you get your bag sent through? Because I collected it and then put it back on. But by the way, if you go through San Fran, for reasons that I don't possibly understand, your bag checks all the way to your final destination. It's just LA. I don't understand it at all. Anyway, so I didn't need it. And then I go, you keep walking through this little private thing and you get at the back to this security scanner and it's private just for the people that go through this Delta 1 entry. And you get private security scanning. There was no one in the line. I just went through a private security scan.

51:00And then where do you come out? In this Delta One lounge. It's like the old Ansett Virgin. Remember these days they have that? They have their own separate security thing at Melbourne Airport? Yes. Virgin at Sydney used to go straight in. But let me tell you – oh, yeah. But let me talk about this Delta One lounge at LAX. This is the best lounge I've ever been to of any airline in any class in my entire life. And this is a domestic lounge as well. Yep. So there are some flights that fly out of this Terminal 3 that fly also So it's a lot of places like that. So it's a bit of a mixed terminal. But yeah, you can use it for domestic.

51:36And the Qantas lounge, the Qantas first lounge, it's very nice. But this is a step above that. Because Qantas is pretty good. So they're going to do a good job with lounges. Unbelievable. What's so good about it? The design of it is amazing. The vibe of it is amazing. Delta has really upped their lounges. American lounges are pretty bad. Even the Delta. I had to have a shower. and so actually they don't have showers, it's connected to the Delta Sky Lounge or whatever the other lounge is called, the regular lounge, yeah, domestic lounge. Like their showers, I was expecting, oh, this is going to be a step down because like the bathrooms in this Delta One is the same as like Qantas First.

52:13The Delta regular lounge has also become beautiful. They've really pivoted to premium cabins now and they've become effectively a financial services business. You can barely get into the other lounge unless you're an Amex customer because it's become basically an Amex lounge, So I was flying Delta domestically in business or whatever they call it. I didn't call it first. And I couldn't get into the lounge because like I'd get one person on home X and I couldn't get in on the basis of it, which is completely opposite to pretty much every other lounge experience globally which prioritized business class over cardholders.

52:45I mean, Delta has poured money into there. There's a sushi bag at this lounge. Like it's all a la carte service. But it's just beautiful. It's just absolutely beautiful. But then I'll tell you the flip side. that's this incredible ground experience okay the flight i didn't love the that delta one cabin i thought you know you know the way it's structured is that every second seat has is like closer to the window and like yeah yeah it's the same right so i always i always go for the one that's closer to the window but i should thought maybe that was a mistake because it felt very cramped to get in because there's a door now right that takes up some space and so basically that wasn't but i can't really complain it was perfectly comfortable i've got no complaints about it i was able to sleep etc my biggest issue was this there were 15 movies on the plane one five so that's what no it's 1998 i think would you watch movies on a plane usually uh yeah i'll watch a movie or two on a plane yeah because long for 14 hours don't roar dog what was the do they have starlink yet no that's they're not starlink right okay let's get to wi-fi So the 15 movies, that was the best part of the entire option I had.

53:58And the thing is I've got problems watching movies. Basically, they're all too emotional for me. So if you have 150 movies, I can find one or two that are okay for me to watch. And so I started watching this animated movie. I forgot what it was. It was with bears or something. And then at the beginning I started watching it. I'm like, I see what happens now. This grandmother is going to die. Turn it off. I can't watch that. And so it's not easy for me to find a movie to watch. You weren't watching Bambi, I'm guessing. 15, I watched the Michael Jackson movie in the end. That was actually not bad.

54:24That was good. And so basically I thought I'll go to Wi-Fi. I'll do that. They've got Wi-Fi. Not Skylink, Starlink. Yeah. Guess what? Guess what the Wi-Fi message says? Doesn't work. Our Wi-Fi only works over continental America. God. And so it doesn't really. It actually stretches to Europe and it stretches to like three hours out of LAX. Okay. For 11 hours of the flight. Yeah, that's annoying. No internet available. What is that? What is that? I'm going to US later in the year. And one of the reasons, well, partly it was due to flight timing. But the other reason is United has Starlink and no one else does.

55:06So I made the choice. It's a 15-hour flight. Yeah. I think American Airlines is getting it. American Airlines, I'm coming back actually to Sydney. I'm going to that 17-hour American Airlines flight from Houston to Sydney, which is a monster flight. Yeah. Yeah, what plane would they fly for that? 787 they fly. Okay, all right. I think United is flying 787s as well with their Polaris business class suite. I'm flying over on Polaris. Oh, maybe I'm going United both ways. Here's another question for you. Do you think the business class service is better when there is no first class on the plane? Oh, for sure.

55:40You agree? Yes, it is. Yeah, absolutely. Yeah. So if you had to choose between flying on a Qantas international plane that had a first class and one that didn't. Yeah, 380 versus whatever the L7. 787 or 777. You would take the one that didn't have a first class. That said, I was on the 380, the Qantas 380, back from Johannesburg a couple of weeks ago, and that was a really good experience. It'd be a real shame if Qantas actually do decommission those planes because it was a world class, apart for the Wi-Fi, which was a disaster. Is there still no Wi-Fi on them? No. That's one of the last. I think the A380 is the last one.

56:19I think 777s have been done or 350s have been done, but A380 is the last. But for the no Wi-Fi, it was a great experience, like a really great – the crew were great, the food's great, the entertainment's the best in the world, lounges are great. So Qantas actually, for all – and we're going to talk about Jetstar soon, but for all the sort of animosity it gets from Australians, they're back to a world-class product. It's up there with Singapore and Emirates, not Qatar, but it's definitely top five. I thought Delta One was going to be Qatar, but I'm going to give you a tip of the business class.

56:49Well, no Starlink, so it can't be. Well, I'll tell you which business class cabin I still want to try. I want to see. I'm telling you one of these is going to be amazing eventually. There's an ANA one called The Room. Okay, yeah. I was going to try that on the way back. I'm not, but like I was going to go through Japan, but that's the one I want to try. But now it is. Cathay's Aria product is also well-closed. That's probably almost my favorite. In terms of sleeping, it's probably got the best sleeping because a lot of these business class captains, you can barely move your toes because it's got tidal encased.

57:23The Cathay one is almost first class in the sense that you've got a full footwell. Someone really tall could still be fine in that. Well, I used to fly Cathay almost exclusively before COVID because I got Qantas Platinum status from flying Cathay and could access all of the first-class lounges in Hong Kong. It was amazing. It was amazing. So tell me this, before we finish, you're going to segue to Jetstar, which is the opposite extreme of this conversation. But just tell me, you don't like doors on cabins, right? I think they're overrated. Especially with kids, I don't like kids having doors because they might not be able to open them if they need to get out.

58:02So I find that just a bit weird. And the Delta door is completely mechanical. You pull this handle and it slides closed. and then you have to yank it open with your hand as well. People go gaga over these doors. I've got a door. I've got a door. How good is this door? I fail to see the benefit of a door. So I really disagreed strongly with you because I didn't understand why you thought they were overrated. And then I flew on Delta One, which is the first business class seat that I flew with a door, okay? And this is what I've come to understand. Tell me if I can get you on this, okay? This is my pitch to you.

58:40if the height of the side of the suite, let's call it a suite, if the height of the side of the suite is less than, let's say, six foot tall, it means that people can see over the top of it. And then a door is pointless because people just look over the top anyway. But if the height of it is six foot or to the ceiling, then a door gives you a private cabin. You agree with that or not? I think when we had this argument in depth on that WhatsApp that you referred to earlier, I said like I think Singapore Switch, which is basically like a room, that's different. Or Emirates? I've never been in Emirates first.

59:19Okay. Because there's too many points. But I think Emirates, you're up for like – it's like 30 grand worth of points. This is pointless. No, but it just rose. You know, they increased their points. Oh, Emirates points is just outrageous. To the point where I don't understand who can afford to ever use points on Emirates. Well, I tell you what I do. The only time I use Emirates points is when I have flown with Emirates and achieved points from flying with Emirates. Then I use their points. Yeah, fair enough because it's four to one off Amex and it's a huge amount of points and there's a massive cash cost as well.

59:50Yeah, it's crazy fees. But they can get it. By the way, the cost of an Emirates – I don't know if you've noticed this discussion for another day. We're talking about rarefied air, but I happen to go and look at what the cost is of first-class flights here. like you know everything has gone up like 30 percent like basically what the world has decided is that there are premium airlines well not the world what the airline world has decided is there's like six premium airlines in the world and their first class product is what rich people think is the richest of all things which it's not it's it's private which i hasten to add i've never flown in my entire life and possibly never will but like private is the pinnacle but the step below there, these first class services have said, we don't have many seats.

1:00:34And so we're just going to go and test full price elasticity on these. And they just keep rising at 30 % every year. This is the classic case of the richer becomes, we talked about hotel rooms and this is the sort of corollary of, if you eat some of these, most of these first class cabins have between what, six and maybe 12 seats max in them. And 12 is pretty rare. And there's now an increase, So you've got obviously Emirates. Qatar actually don't have that much first class. It's only on I think the 380. They don't have a 777. And the business is so good that you barely need it. So you've got Emirates has got a great first class.

1:01:09Singapore's got an incredible first class. I'm not sure about Cathay have a little bit of first class. Lufthansa has a good first class now. Air France has apparently the best first class. And I think Air Japan and now Qantas with its Sunrise flights will have an incredible jet. Well, Japan put a new first class on and they are boasting that their first class is nine economy seats in size. Yeah, well, a Singapore suite would be that, I reckon, or at least five. So there's six or seven. There's six or seven. And you've obviously got Eddie Had with the residents. So you've got six or seven airlines.

1:01:42That still exists, the residents or not? I think it does, but it's only between like Abu Dhabi and Europe. So like - Right. Which is what, a seven-hour flight. So to me, it's always been a bit of a - Who's that for? The Sheik who's jet has got a problem. It's the private jet competitor, essentially. Yeah. Because you've actually got three rooms. Yeah, your own bathroom. Obviously, we're very rare afraid. Let's go to a super quick break, though, on that gluttonous note. We're back with some really great business stories just in a moment. Don't turn off.

1:02:23And we're back. We're going from one extreme to the other. So we talked about the world's best first-class experiences. And now we're going to go to Jetstar with the traveling and public mainstream media reacting with absolute horror to the news that Qantas' low-cost Jetstar will give priority only to customers to take one single carry-on bag, which needs to be placed under their seat for free. If you want to have a second bag or like a normal carry-on bag in the overhead lockers, you need to pay what's called a priority fee, which ranges from$25 for a short flight, I think up to$52 for a big international flight, effectively for one bag.

1:02:56The model of charging for carry-on storage is, of course, adopted from European no-frills carriers such as EasyJet Ryanair and Whiz Air. Of course, there's a cash spinner for these airlines. Ryanair generates$25 billion Australian from ancillary fees for baggage and seat selection, which is pretty incredible. $25 billion? Yeah. What? It's unbelievable. You sure that the vehicle is in the right place on that one? It's a third of their – well, they obviously – And I'll talk about my views on this soon, but they obviously have very low fares. And if you want to add stuff, you choose what you want to add.

1:03:27So they've really deconstructed the complete experience from everything. So I don't even know that Ryanair's revenue was$25 billion. Ryanair's, I think, if not the world's most, one of the world's most valuable airlines. I think, right, Ryanair's got a market cap of$31 billion. I presume that's euros, which is certainly up there with the big American airlines. So it's one of the, if not the most valuable, one of the most valuable airlines in the world. It's also trading near its all-time – it's just off its record highs. So it's been an incredible story. This is over – since – like I think since – if you look at share price, it's gone from – in 1997, it was$2 a share.

1:04:05It's now$60 a share. So 30 bagger in sort of 35 years or whatever it is. So 30 years. So it's been an incredible story. That's sort of how they operate. Of course, the so-called consumer crusaders very quickly criticized Jetstar. with campaign director at Choice, Andy Kelly, claiming Jetstar's policy is just an easy cash grab. Customers, understandably, ventured their frustration online. Some expressed concern of losing legroom for that free underseat bag, while others said it was a ridiculous change that would stop them from flying with the airline entirely. One customer said that Jetstar has just gifted Virgin tens of thousands of passengers.

1:04:40Our well-regarded Jetstar boss, Steph Tully, said that by giving customers an underseat bag with the option of a priority carry-on. We can make better use of overhead locker space, streamline boarding, and help more flights depart on time. Now, Adi, I know you don't fly discount carriers. Well, you probably haven't flown to them since the 80s, but do you have a view on, I've certainly got a view on this. Do you have a view on good or bad Jetstar charging, deconstructing the fare, essentially? Well, I don't really fly Jetstar at all because I've had universally bad experiences with that airline.

1:05:15but I would fly discount airlines, like in the US, if that was the only, like, you know, Frontier that just went broke. Like I'd flown Frontier before or whatever. So I have flown them. I don't find them, I mean, I wouldn't fly long haul on them, but I don't find them terrible at all. Like if you have to get point A, point B, fine. I've got no issue with this. Essentially, this is my view. What you're saying, if you're Jetstar, is we want to make this as our business model for it to work means we try to make flying as accessible as humanly possible for people. And we will take, we've got a minimum amount of money we need to make on each flight or each block of flights or each route, let's call it.

1:05:55And we will take as much money from you as you've got to give us. So let's figure out all of it, which is, I've got no issue with that. Let's figure out all of the different ways where not all of, so I feel, I'm more benign than you in thinking about this. Maybe I think about it as not let's think of all the ways we can take money off you. I think about it as let's think all of the things that we could strip out in order to let the poorest person who could possibly fly be able to get on our plane. Now, probably the truth is somewhere between those, but there are people that do not have luggage that goes in the overhead.

1:06:33And I don't, you know, people might say this is their way of like, I don't know, I think their sales pitch was there's too much luggage in the overhead so we have to limit it i don't care about that like if there was unlimited storage in the overhead i would still say this is an airline that says it's um this is not an unlimited buffet it's a la carte and if one of the things you want to buy is putting a carry-on suitcase in the overhead then you buy that and if you don't want to buy it then you don't buy it and by the way it does cost weight and room it does it costs those two things so i've got no issue with this whatsoever and i think it makes a lot of sense is my personal view.

1:07:06That's absolutely a great point and it's a really fair point. And I actually don't have an issue if Jetstar or any of these discount airlines want to maximize their profitability. That's their job as a company. This is not a charity. This is a company. But I think there's actually a bigger, I'd argue a bigger point that you've slightly missed here. And this is all these selfish people with massive bags. This is the classic free rider problem or the free rider effect in that you've got people carrying these, they haven't paid a cent more for them. They've paid the same price everybody else. They've got these huge bags.

1:07:39And what do these bags do? They mean it takes 5, 10, 15 minutes longer to board a plane because everybody wants to shove their bag up the top and nobody wants to pay for it. And these are people who complain the loudest are the biggest free riders who have the most to lose because they're the ones costing other people. So this is a classic externality. So you've got all these people. Someone does the right thing, brings a small bag, puts them under the seat, takes no time boarding. They get held up 15, 20, 30 minutes from some selfish person with a massive bag that doesn't fit and has to go up and down trying to find a spot because they also boarded last because never let these people board last.

1:08:10So you've got a huge problem for people who have done the right thing on the plane. And then this delays that plane. So the next plane runs late. So you've just delayed another 300 people who have done nothing wrong either. And this continues this cycle of externality of a cost being borne by innocent people because selfish people with massive bags want a free ride. So what JetSales is really smartly doing is saying, you can have a bag, but you have to pay for it. You're going to pay for the cost of your externality. And what this will happen is less people will bring bags on, the more likely to check the bag in.

1:08:37It's going to speed it up for everyone. You're going to have more revenue for Jetstar and potentially lower costs for people as well. So letting someone who's never been able to fly to Bali can now fly to Bali because it's 50 bucks less. So this is a classic win-win. We're removing an externality and you've always got these rent seekers, these selfish people who want everything for themselves and this is just symptomatic of what society has become. I want free healthcare, I want free pensions, I want free travel, I want free public transit, I want free everything and I don't want to have to pay for anything.

1:09:06And hence we've got infinite government debt because everybody thinks everything's for free. And this is just such a symptomatic case of where society's become. I congratulate Steph Tully and Jetstar. This is a brave call. This is absolutely the right call for Jetstar's travellers. There's another point. Not only is it an externality, but there is an incentive to do this because if you want to send a bag under the plane, that does cost you money. And so you're basically saying you can pay to put a bag under the plane or you can stuff 13 kilos into your carry-on and unzip it. That's a good point.

1:09:42You know, people unzip it, barely gets into the overhead. Yeah. And so I think that there is a bit of a perverse incentive there, in fact, that has occurred. Well, it's the reverse incentive. It's actually – they're almost forcing people to check it in – to not check it in because it's saving the money. Now they're basically equalizing. Yeah, exactly. The Delta flight that I took to Vegas was the first plane I'd been on where they specifically had the overhead compartment where you put your bag sideways in order to get it in on its side. It's actually much better, by the way. Like you fit so much more into that compartment.

1:10:18I want to ask you a question. I want you to choose option A or B to do with this Jetstar. So do you know what, this is not the A or B question, do you know what Jetstar did the day after they announced this? Do you know what they announced? No, what they announced. They announced a big sale where like the entry level fare was like next to nothing. So this is my question. Option A, they made this announcement. They got a ton of negative publicity. They thought, okay, we got to change the narrative and they quickly pumped out a sale the next day. Option two, they thought, how do we deliver this messaging as part of a coherent communications plan?

1:10:55We're going to have to punch someone in the face. What should we do? Let's give them a big box of candy the next day and then everyone will be focusing on talking about the candy and like the blood nose and stuff will just be dripping away quietly in the corner. You think it's A or B? You think it was reactive or proactive? There's also option three, which is it was always planned anyway. As in the sale was always planned and had nothing to do with it. unrelated yeah i guess i never i'm much more cynical than that so yeah i guess you could have that as your option c if you i think i think it's option c to be honest do you um yeah i think you think it's option i think that i think these sales are planned their schedule i think they have an annual schedule of sales and i think they just stuck to it and i then i've slipped in this announcement before i knew a sale was coming i don't think it was that reaction i don't think an airline can move up a sale in 24 hours so you might you know better than me about that so i don't know that but i have it i don't i've never worked an airline we we're different airlines but if you knew well let me just tell you why i think option three is the least likely okay because if you knew that a sale was coming down the pipe in four months time let's say and you're always running sales everyone sounds like every month all right if you knew the sale was coming down the pipe every month okay and you know you come and have some meeting and in the meeting it's like you know we finally got to pull the trigger on this uh charging people for overhead stuff wouldn't it be logical that you say when should we announce this just announce it the day before the sale.

1:12:18Don't announce it the day of the sale because it will overshadow the sale. But like, we've got a sale coming up on this date anyway. Let's make this announcement the day before. Wouldn't you be mad not to do that? Of course you would do that. Possibly. I just want to go back to the substantial point. I took a couple of EasyJet flights a couple of weeks ago and I couldn't believe how smooth they ran. I've never had, so I've only had one ever bad experience with Jetstar that was a mechanical issue. But I find EasyJet and Ryanair to be so much more efficient because they do this policy. So there's no question that this is a great policy they should be charging more the question whether they allow one carry-on bag for free it should be it should be user pays pay for what you use and if i've always thought they should you should stand on the scale with your bag and that's how like bigger people should be getting discounts on the expense of smaller people oh god you know we have this whole conversation where i think this is a surprisingly reasonable conversation This whole podcast episode, we're more than an hour in.

1:13:16I haven't said anything here that I think to myself, well, that will get the bag of hate mail on the door again this week. But there you go. You nailed it. You nailed it. Put the person on the scale with their bag. There you go. You think people are going to get hate mail? I think there's a huge number of people who, let's say, I hear stories of someone who's 55 kilo female with a bag that weighs 11 kilos, so that's 66 kilos having to pay 50 bucks and some 120 kilo person with a eight kilo bag pays nothing like how is that fair like people say oh you're being fattest or like i'm not whether someone's tall or wide or whatever that's that's by the point we should be paid based on weight how is anything fair how is it fair that someone that happens to do a job that gets paid lots of money but inherently has less value in society than being a teacher how is it a teacher can't afford to go on a holiday, but that second person flies first class four times a year.

1:14:13Nothing's fair. What were we having that argument for? That sounds very Donald Trumpian in terms of that response. But that's unfixable. But this weight thing is highly fixable. Like we say, we're going to charge you based on weight. If you weigh 50 kilos and you want to be a 50 kilo bag, we're going to charge you based on that. And if you weigh 120, well, you have to pay a bit more because it costs us more to travel you, to fly you. I don't see how that's unfair. So hang on, but are you saying you would do it? This is also heightest, by the way. If someone's six foot four, you're going to nationally weigh more.

1:14:43So it's not just against fat people, it's against tall people as well. You know what else is heightest? The Olympic Games. You're going to change those as well? I can't go in the high jump. I want to be in the high jump. Unfortunately, there are not too many Jews jumping over the high jump, as far as I'm aware. So you want to fix the world's unfairness problem. Okay, great, I'm on board. But like what? You want to start with how much people weigh on a plane. That's where you want to fix the world's problems. The Ryanair guy, I forget his name, he's the man to do this. No one else would have the gumption to do this, but I think he's the only guy in the world who could possibly do it.

1:15:15Is he the guy that Elon fought with? Michael O 'Leary is the guy, so CEO of Ryanair. He's actually led it since 1994, so he must have been pretty young when he started. He joined Ryanair in 1988. What is he, Irish or something? Yeah, he's Irish because it was an Irish airline. So he's pugilistic. Yeah. I love him. He's been one of the greatest, probably the greatest aviation CEO ever. So I read a little thread about what happens with airlines when it's very obese people. It was an American thread you'd be unsurprised to hear. And a lot of people that are very obese, morbidly obese, they were posting on this Reddit thread.

1:15:49And essentially what they said is that if they ring the call center and tell the airline that they're, I'm just going to be blunt, like they're too fat to sit in a regular size seat and it's going to be a problem for the person next to them. Most airlines will generally try to accommodate them. Some airlines will make them pay for a second seat at a discount. Yeah, well, it's completely fair. They give them a discount on the second seat. Yeah, that's fair as well. And some airlines say we've got no mechanism for doing this. It just depends what happens on the day, which I actually think - Or buy a business class seat is the other option.

1:16:22Yeah, buy a business class. So business class is very expensive. Two economies much cheaper than business class. Yeah, sure. But also I think the problem is that it's unfair to the person next to them. Oh, totally. In fact, so I tell you a bit of a light relief at the end of this discussion that is going to get us, you know, yet another attempt to cancel the podcast. So I try to make a bit of light relief. So I was on an Israeli flight, it was an LL flight, like maybe 10 years ago. And like, you know, on these LL flights, the way I'd say it is the seat number that you get on your boarding pass is more of a – considered to be more of a recommendation than a firm seat number that you have to abide by.

1:17:01And so there's like a huge, it turns into like a haggling market when you get on the planes and people want to move around and all sorts of stuff. And so one example I'll remember forever is this guy's yelling at the, but yelling in an Israeli way, so not offensive, yelling at the flight attendant. Not intentionally offensive. No, it's not offensive at the female flight attendant. And so I listened to the conversation and he's basically yelling at her, saying, in Hebrew, he's basically yelling, I can't sit in this seat, and she's like, I don't have any other seat for you. No, you have to move me to a seat with no one next to me, and she's like, there's no way for you to go, and he's like, you have to do it.

1:17:38Look at me. I'm too fat to sit in this seat. I can't sit in this seat. I'm all over the guy next to me, and she's arguing, and then he turns to the guy who's in the seat next to him and says to this guy, no, tell her I'm too fat to sit next to you, and then the guy says to the, the neighbor says, No, it's true. He is too fat. You can't sit him next to me. He's much too fat to sit next to me. In the end, she found a place for him to move to. I mean – There you go. Happy ending. It was a crazy, crazy experience. I want to move on. And we talked about it last week. We only had, unfortunately, half the story.

1:18:12So market – former private markets, darling Canva, we talked about it on last Saturday's episode, how their street talk revealed how their growth was going to drop to 30%. But in fact, it's actually way, way worse than this. So the tech section of the financial review has actually gazumped the street talk of the section of the financial review. Ironically, it was Emma Rappaport who moved from one to the other, run with your mate Paul Smith, who reported that Canva told investors that FY 2027 growth would drop to a calamitous 20 % next year. And this is for the barely profitable 60 billion giant.

1:18:49This is basically like telling someone you've got a terminal illness. This is horrific news. As I wrote in the contrarian substack, Canva blamed AI for the horrendous result. Co-founder Mel Perkins said that rather than broadly rolling out a product before the underlying economics were ready, we decided to slow the rollout while we rebuilt the architecture, reduced unit costs and strengthened the business model. Mel's husband and co-founder Cliff Obrecht said, we anticipated we'd be able to bring these inference costs down quicker than we were able to. And so ultimately, we were too ambitious in our assumptions, which meant we couldn't roll out a competitive free AI product as quickly as we'd hoped.

1:19:22But while the founders claim this was a merely AI-induced short-term issue caused by high inference costs, in reality, when I go back and look at Canva's numbers over the last five years, it does not look pretty. In 2023, Canva grew by an amazing 49%. In 2024, it grew by 45%. This is all from the ASIC filings. That's actually still some very good numbers. Obviously, growth was down to 38 % last year, and it's now predicted to grow by only 20 % next year, which is an absolute catastrophe. Not only for Canva, but also its employees who are seeing multi-million dollar paydays evaporate before their very eyes.

1:19:56It's also catastrophic for a swathe of the Australian VC industry, which is really dependent on Canva's$60 billion valuation to pay huge multiples on their funds. This is a dark day for Australian VC. How bad is it? So I will say, firstly, that 38 % growth. Was that last year? That was, I think, FY26. It's not official, but that was what was speculated. All right. So I feel, I think I said this previously, I feel perfectly fine about that. Like it's not 50%, but that to me would still be a very, very rapid rate of growth. I'll be totally fine with that. They're not a rule of 40 business, I suspect.

1:20:36You think if they're 38, they're not a rule of 40 business? It depends what they decide their other metric is going to be, doesn't it? It's going to be ARR growth is one that they would choose? We're talking profit, right? So if their growth's 38 and they're not making any money, they're not a rule of 40 business because they've got no other side, they've got no profit side. The rule of 40 is traditionally free cash flow, actually. I mean, they can't count the cheating free cash flow. It doesn't include share-based payments, though. Historically, it has been, and then it's moved around to all sorts.

1:21:03So I think people will get to pick a metric for rule of 40 now that mostly represents the truth of their business would be how I would describe it. The Shrub rule of 40 does not include, like factors in share. Otherwise, I'm going to pay everybody in shares and something like a rule of 40 is 100. It's just a cheating way to get there. I think, look, rule of 40 I think is more a guide anyway. We take it very seriously, a catapult, and we push towards it. But we don't even have to talk about 38 though and speculate on that because if it's down to 20%, that is deeply problematic. And I think that what that demonstrates is that we had these different hypotheses on where how canva might be affected by ai and i felt very bearish about it i thought they had real risks because you know canva exists because they made it easier to do nice things and beautiful things than the previous uh technology which was like um photoshop basically and if you're a workflow enhancement that business that's what their whole business effectively was then there is no more simple workflow than prompts in an AI.

1:22:15And as we've seen with Claude Design, like it's amazingly good. Now that does not directly target most of Canva's business now, but we can see the direction that's heading in. And I felt like Canva, like they didn't have much choice but to try to fight the AI war, but it always felt to me it was going to be difficult because not only are they fighting much bigger companies with better resources, but they're fighting companies that are on this huge growth trajectory selling applications that are vastly beyond what Canva does with no pressure to make money and an unending access to capital. Like, that feels like a terrible fight to have to fight.

1:22:57And also, we've seen that the cost of actually like providing this AI, it's hurting companies badly, these token costs. And so it feels to me that Canva's the worst of all worlds in the war it has to fight. I don't mean it's the worst of all worlds as a business, but in terms of the war it has to fight. It has to fight against these frontier models with unlimited money whilst effectively paying the AI costs to fight that war. Like that is a horrible place to be. And so I'm not shocked by this at all. And they should have sold, they should be selling, I haven't changed my view. And if they return to 50 % growth, then I'm happy to say I was totally wrong about this.

1:23:38But this has reinforced the hypothesis that I had about the difficulties this business is facing. And you definitely got this more right than me. I was more confident that Melon Cliff would be able to navigate that way through this challenge. And it's not just broad design and Nano Banana they're competing against, they're also competing against, well, I guess you've got Adobe and Figma on the side, that means Microsoft's got a free product as well, I think Microsoft Design. So there's definitely some bad luck in here as well, but there's also some just terrible management. They just, they had their chance.

1:24:08They had their golden window, like you said. They could have sold for$30 billion, no problem to Adobe, but they didn't. I wouldn't call it terrible management. I don't think you mean terrible management. I think you mean - From a corporate side. They had the ability to sell. You don't mean terrible management. They said they, when I say management, choosing when to sell is part of managing a business. and they had the chance to sell. They had a great business. It was – people loved – I wrote an article and check out our Substack if you haven't read it yet, listeners. It's called – Well, your article is very popular on Substack.

1:24:38People – like even if people only listen to this two weeks after it comes out because, you know, there's a bit of a tale on this podcast, people should still read it. Like it's relevant. It's a very, very good article. I highly recommend it. And usually like most things I write, especially when I'm sort of questioning the value – I remember when I used to question Lassian's valuation and people come to me like I just shot Barbie. People come to me like I just shot Bambi. Whereas this one, it was basically universal. There may be one or two people, but almost everybody was saying, I don't use Canberra anymore.

1:25:06It's no good. I use AI. And people commenting are pretty smart, sort of sophisticated people, but they're the mavens. They're the brokers, the most important sort of constituency for a consumer business. Universally, people said, yeah, I agree. I think Canberra's finished. And this is like, when I finish, it's still$6 to$10 billion, I suspect. We can talk about valuation in a second. It's still a very valuable business, but just nowhere near what it was a year ago is the likelihood. Still one of the great Australian success stories, don't get me wrong. But because we've been anchored to the$60 billion Australian valuation, maybe unfairly, it's like, I can't see it ever getting near.

1:25:42This is a business that's turning over, we're talking US dollars. So it's$42 billion US as the last valuation. It's revenue, my calculation is around 3.7 US revenue. We don't know yet because they're so late releasing, even their 2025 numbers. But let's just say the 3.7 US number's right. On 20 % growth and almost certainly loss-making, given the inference cost, how can this business be valued at even 10 billion? Yeah, it's tricky. I mean, look, I will say, the reason I say I don't think it's bad management, I know you didn't mean management, but I actually think it's good management. and is because I don't really, I don't hold the founders responsible for not being able to compete right now in this space.

1:26:28If this AI revolution had not come along, I think they would have been fine competing with Microsoft. I think over time, it might've been tricky for them, but I think they would still be growing rapidly. I think AI has completely changed the game for them. And I just think they're being pummeled by organizations that have far, far greater resources and are able to capture much more of the high quality talent pool, like better people and way more of them. And they're also competing with brands that everybody knows. So Canvary is a well-known consumer brand, but ChatGPT is a better known consumer brand and like Claudia is becoming a better known, probably is a better known consumer brand.

1:27:11It is for sure. And so, yeah, I think, you know, what do I think it's worth? Well, what's your – so I should say this. I've never paid for Canva because it's not really my thing, right? I have. I've paid for it. Yeah, I know you've paid for it. And so you're better placed to say this. But also there's like what, 4 million people or something that are paying for it or some big number, yeah? 31 million paid for it. 31 million. Okay. This is 10 times what I thought it was. And so like all of those people are still paying and I'm none of those people. So I can't, anything that I say about this is going to be hypothesizing.

1:27:45I cannot, I've not talked to any of those 31 million people that are paying. You're talking to one, me. Well, you're not paying anymore. So you can basically say, this is why I've stopped paying, but 31 million people are still paying. So I'm saying that as like kind of the caveat of what I'm about to say next. What I'm about to say next is this. how do they not end up with negative growth in two years time like isn't that the trajectory of this business I think you're right I think that I didn't realize just how important that free tier is for converting to paid so I went I think I went straight to paid so my my views a bit jaundiced my own experience but they've got 210 there's different numbers float around one was 265, one was 210, but they've got more than 200 million free subs, 210 million subscribers, and they've got 30 million paid.

1:28:40And obviously what Canva does is use these new people. So there's obviously a bunch of this free tier, just remain free and freeload forever and never pay anything, fine. Then there's obviously a small portion of people who sign up to the free tier who then become paid. And Canva obviously needs 10 or 20 or 30 million people every year to sign up to this free tier, knowing that 10 % of people come paid, and that's their growth. And maybe there's a bit of expansion revenue as well, but I don't think there's much. So I think most of their growth comes from free to paid. What's clearly happening now is the number of free subscribers is not growing at all.

1:29:14I think it sounds like it's basically static. So all these freeloaders are now freeloading on GPT and Anthropic and whatever, Microsoft or Nano, Banana. And some of those freeloaders aren't freeloaders at all. They're actually paid loaders. and they've lost the good and the bad. The reason why they can't have the top of the funnel straight up is because it was costing them. So you think Canva two years ago had this great free channel. I'm going to give this product away, give away the razor, and you're going to use the razor, and maybe 10 % of people will give me the blade. I can give razors to everyone because the razors are so cheap they're basically free.

1:29:50Now what they're finding is the razors actually are made with gold, i.e. AI tokens, and I can't give razors to everyone because it's costing me too much. I have to pull back on the razors. At the same time, my profit's probably getting smashed because there's some cost there. So my gold-plated razors are a non-starter and I'm competing against people giving away other gold-plated razors like OpenAI for free. So when we talk about them having bad luck, like to cop these frontier models with basically limitless money at the moment who are competing with them and Microsoft is just a really unlucky place to be.

1:30:20But they probably should have, when I say bad management, they should have seen this a year ago and sold when they could. Maybe they couldn't have sold a year ago. We don't know, but you talk about golden windows. Is this the biggest miss of golden window you've ever seen? I think it might be one of the most expensive misses. Yeah, I think so. Your razor example is really good, but you could even take it a step further and say not only is their razor now costing it as if it's made of solid gold, not only is ChatGPT giving out solid gold razors as well, not only are like 10 other companies giving out solid gold raises for free but all of these other companies i.e the ai companies it turns out their things are not raises at all they're a magic wand that can do 150 million other things as well as like shaving your face and so that's the real problem like the real problem is if you were going to pay for something that did design and i'm taking that small business from this although small business is very much the domain of um anthropic very much the domain.

1:31:19If you had a, I don't know, like if you had$50 a month to pay for something, why would you pay for Canva and not for Anthropic or ChatGPT or something? I mean, it feels like a very hard sell to me. I think Canva, no, Canva's a lot cheaper than that, in fairness. Canva's more like, is it$12 a month? All right, whatever. If you had$12 a month, why, if you had to choose where am I going to spend my$12 or$20 a month, you know, it's easy to forget this. Three years ago, irrespective of whatever competitors were doing canva was considered to be like in a usability class of its own and and it it was not quite a religion but it had like people loved acolytes loved acolytes loved it now what do people love people love ai heavy they hate it as well by the way but like the way they speak about it is like in these glowing terms and if i say to someone anyone probably the 31 million paying customers like do you like canva yeah i love it oh do you love it the way you love like claude oh my god claude is incredible like it's not the same love right it makes them yeah like it's you can't have that level of love anymore i don't think for something that's not one of these ai frontier models they're just too amazing so well i also use i use canva um i just tried to use canva's ai i hadn't used canva for ages for the reason i talked about i tried to just i was started a simple sort of image thing and i thought i'll try and use cams ai product and it just it didn't work no it's not it's not uh anthropic it's not like anthropic i agree with you it's nothing like it was useless it was i'm bad at design and i use it i want to design stuff for personal stuff and i want to design lots of stuff for business and i like did some stuff in canva and then when i would put it inside a deck or something people would make fun of me and then And I would say, obviously, you're going to redesign this stuff, but at least it let me communicate my message, right?

1:33:11So it was good. I liked it. I didn't pay, but I didn't have to. I didn't use it much. What I find now when I use Anthropic is, look, everyone knows it's created by AI, but nobody says that looks bad. They say that looks like it was created by AI, right? But the quality of it is really high, and the ease of it is incredible. So that's my concern. The reason I'm dodging your valuation question with a million words is because I think you might be asking me whether I'm prepared to catch a falling knife. That's my concern. I mean, I can't believe I'm saying that about cans. Let's pretend it's not cans.

1:33:44Let's pretend I'm going to call this business SPC. It's a fruit canning business and it grew 20 % having growth dropped five years in a row and it lost$100 million having made$25 million previously. What would you value this business as? Well, you have to tell me the rest of the story. The rest of the story is, and there's another company that makes much more delicious fruit and they're giving it away for free. Well, that's reflected in the fact that the growth has dropped off. I know, but like, if you tell me that fact, then I say to you, well, for as long as there's another company making much more delicious fruit and giving away for free, I don't have any confidence that the growth will return and I think it's going to keep falling.

1:34:24So do I believe there's any chance that either the other company's fruit is going to be worse or they're going to start charging a lot of money for it? That would be my number one question in that situation. And in this situation, yeah, I think eventually they're going to have to start charging more for it. That's going to help Canva. I don't think it's going to get worse. I think it's going to keep getting better. But I don't think I would go near that company. Like this company has no assets. Like there's no – you can't value purchase this company for its assets. So I think of all of the things I could possibly buy, I wouldn't be thinking about buying that company.

1:34:55And then you say, well, surely there's a price you'd buy it for. and I'd say, yeah, what I'd work out is how long do I think it's going to be until I can't make any money from this and now I'll buy it and cut as many costs as I possibly can to take as much cash out before I feel like I'm going to run out of the ability to make money out of it. And that is not the way I want to value Canva because that's ridiculous and probably overly pessimistic and that's why it's so hard to value. So I don't think your number's not dumb. The challenge with that is they've always been pretty efficient business.

1:35:27They never hide that. They've got, I think, 60 ,000 employees, which is not too bad for a business of that scale. Well, they're spending$4 billion a year on something. Yeah. Who knows what it's exactly like. There's obviously a degree of sales team. They've got Enterprise now. So there's probably all sorts of people. Well, it's people. There's nothing else they buy. I mean, now they buy tokens. Well, they obviously spend on marketing. But they're not spending a billion dollars on marketing. So it's still billions of dollars a year on people. The most recent financials we got, which was March this year, which is the FY24 number.

1:36:00So we're talking like more than two years ago. So they're old, but that's all we got. And if you look at expense, so they had, this is back in 2024, they had 2.1, this is US dollars, 2.1 billion revenue. They had print, because they had the print business as well. That's 175 million expenses. Payment processing, 180 million. Hosting, 213 million. Royalty expenses because they obviously use some licensed images,$196 million $200 million, employees $850 million sales and marketing$270 million related party services, I'm not sure what it is $260 million, then admin and depreciation stuff. So they got a whole range of expenses there that was, they were lost making that so 2023, they lost about$200 million in 22, 23, 24 25, I think they pivoted to profit.

1:36:52I think they made$25 million, something last year, they were saying. So I suspect given the inference costs were so high this year, I suspect they made a big loss in FY26 is my gut feel based on what they've said. Obviously, the finance haven't been released yet. But this feels like a loss-making business. Its growth is almost ground to a halt. Like 20 % is horrific for a business that's meant to be a super-scaling, fast-growing global TAM. Well, you don't mean it's almost ground to a halt. you mean 20 % is a number where you'd say this could be a very good business, but probably not one of the world's best 100 businesses.

1:37:25Oh, forget best 100, more like best 10th out. Like Airtable, which is a database relationship product that I'm sure you saw the news, agreed to sell to our friend of the pod, Bending Spoons, for$1.2 billion. That was growing at 20%. So I think on a two points. They had some other problems. Well, they had AI issues like Canva does. So they've got very similar issues to Canva. I think it was 2.7 times revenue multiple. So if you give Canva 2.7 revenue, you get to that 10 billion number, give or take. That would be the air value, the air table valuation. But I think actually Canva's got more problems than air table had.

1:38:04Well, I will say this that I think is kind of interesting. Maybe these two things. One is this is why it's so important to understand what a company's powers are. Absolutely. because like Canva was quite a susceptible business for all of its beautiful software and like rapid growth and smarts inside the company. And I think quite visionary planning for the future. Predominantly it's key advantage was brand. And then maybe you could maybe give them, is there a network effect? Like if more, if like if everyone has Canva, I think you have to have Canva to open Canva. So there is no network. There's no network.

1:38:40There's zero networking. If I use Canva, it doesn't make it more valuable to you. No, but I think that for me to see what you've built for me, I have to download Canvas. No, you can put download as a PDF. Oh, that's true, but it kind of sucks a bit. Okay, but yes. There's zero network. Okay. I guess you can collaborate together on it. All right, a bit of network maybe, but that's not really. Yeah, maybe we say it's really just brand, right? That's what Canvas got going for them. Oh, maybe some scale. It's not scale against their competitors. Will you give them scale against Microsoft and Adobe?

1:39:11Well, in this consumer graphic design, yes, because they're still the biggest consumer. What scale advantage do they get for being the biggest in this space against Microsoft and Adobe? Well, they can out-market them. I mean, they've got no advantage. If you improve your product, that amortizes over more people. There is a bit of a scale benefit with software. Microsoft and Adobe have got much bigger businesses to spread costs over and much more money. Yeah, but not just in this. depends how you define the market. I think it's a very weak scale. I'll give you that. Microsoft's biggest problem in competing with people like Canva is that they can't go and do antitrust stuff.

1:39:52That's their biggest problem. Yeah. If they could, they would go and crush all of these companies instantly. Yeah. But like they are cautious in the way they behave because they're a hyperscaler. So I think that Canvas problem ultimately is they didn't really have a lot of powers. They didn't own data. They didn't like they weren't. So like I think fundamentally that's been. They originally had that great counter positioning against Adobe, obviously. That was a huge power. But now they've got everybody counter positioning against them. That's right. They've lost that. The counter positioning works when you're not the incumbent, basically.

1:40:25Yeah. And so the other thing I'd say about Canva, though. No corner resource, no process power. Yeah, you're right. Just brand. The flip side, though, is something positive I want to say, which is this. So if we juxtapose them against Firmus, and hear me out on this, what you find with firmus is even though it's the hottest stock in australia right now the hottest company in australia the both the hottest and maybe the coldest in australia but like the hottest company in australia whenever you want to go and like buy shares there's no shortage of sellers including the bloke's dad okay yeah who just bought a hundred million dollar apartment or 50 million dollar apartment in sydney so it's the smartest bloke in smartest bloke in the room that guy yeah i think yeah i don't reckon that's the greatest time to buy property but anyway so So - No, no, I'm not talking about that.

1:41:09I think in terms of selling out of Firmus when he did. I think - Yes, very smart. Premium property, I think eventually is probably fine. Yeah, very smart. And so what I'm saying is Firmus, you can always find someone prepared to sell their shares. But Canva historically has been quite hard to find someone that is selling secondary. And it's predominantly been VCs that have got to return capital to their investors and take some money off the table to do that. And so I think the interesting thing about Canva is still now, I haven't heard a single word behind the scenes of any shareholder in Canva talking about clamoring for the exits or trying to dump stock or whatever.

1:41:48Now, it might be because they're still trying to hang on to this$60 billion valuation. But it is still, for all of these problems, the investor base does not feel like they've turned against the company at this point in time. You know what that feels like to me? You know when you jump out of a building and you jump falling down, falling down, level 30th floor, 25th floor, 20th floor, 15th floor, oh, I'm fine. Boom. They haven't quite hit the floor yet but that person jumped off out the window and they're heading right to the ground. The growth rate is like floor by floor and I think everybody's just willful blindness they're about to hit the ground because clearly they are.

1:42:23Yeah. I still maintain. This has not changed my view which is that Canva is a premium brand and I think that someone will pay some tens of billions of dollars for it. The problem is they might not pay it in cash now. That's the challenge they've got. But who can possibly buy it? Well, we had that argument and you disagreed with me. I told you files OpenAI would buy them for sure. No, but who can buy it and get away with buying it? Like would OpenAI be out? OpenAI's got its own issues now. I'm sure they're not spending$20 billion on a fast, slowing company. Why do you think that? Because they've got bigger issues.

1:43:03They're struggling to pay their own bills. They've got to pay their data center costs. They can't be paying$20 billion for this. Well, it might be a good change of narrative. I hear what you're saying. Listen, you say Canva has got a missed golden window problem, which is irrefutably true at this point in time. I mean, that's why I say the world's unpredictable. They could end up being worth$200 billion in the future. It just feels very unlikely. But not only do they have the problem of their own decision not to sell, Now I think the logical buyers, they've kind of maybe passed their own high point as well.

1:43:36Yeah, totally. And so their ability to pay this money diminishes every day. Yeah, there's cameras, internal issues, and then there's the potential buyers, like their own, their issues. So that's why I think it's just such a tragedy for Australia that we've missed, the country's missed this golden window because this could have been a$50 billion exit. You know, Elon has ruined it for everyone. We should say that. Like, this SpaceX IPO has the double, like, whammy of sucking everybody's capital out of their pockets to not be able to invest in other stuff and then delivering losses to them. As we said at all.

1:44:16I think, yeah, we should not underestimate the impact that the SpaceX IPO had on every other transaction in the entire world. That's my view. I don't think that's impacting Canva though. Like not directly and not significantly. Canva's wounds are self-inflicted here. I don't think, yeah, there's been a bad luck with the rise of AI, but that's been happening for three years. It's like it's cheaper. Yeah, but it affects the Canva buyers because OpenAI's ability to raise additional capital, all of this money comes from the same people. There's one pool of capital with maybe, what, 50 people, 50 companies in it that can fund all of the capital raisings that all of these companies are doing.

1:45:02And SpaceX sucked a lot of that cash down. And also, like, do you remember, like, the euphoria leading up to the SpaceX IPO? Yeah, of course. There was so much FOMO and it bled across the entire capital market structure. And now that this has flipped, like it's put a real dampener on people's enthusiasm for capital markets. I'm not saying the thesis is completely wrong, but I'm not sure you can blame SpaceX for this. I think this would have happened anyway. The whole AI Ponzi bubble thing was going to burst one way or the other. And there's also a question of did SpaceX drop because the bubble was deflating, because of the whole situational awareness issue.

1:45:38because I remember a lot of these insane valuations were being caused by people like Leo Ash and Brenner using leverage to overpay for stuff. So we just don't know what's real in these bubbles because everything comes to such a fraud. So I'm not saying campers are not fraud at all. I'm saying their valuation benefited from this inherent froth in the market. The froth's gone. I'm not sure there was one cause of that froth, defrothing though. Yes, I agree with you. Speaking of which, I just want to pivot to just our last chat about, We're filming this on Friday, so a couple of days before we launch it.

1:46:12And Atlassian, obviously, great friend of the pod, has announced a blowout quarter in some ways anyway. And shareholders appear to love it. So in overnight trading, Atlassian share price boomed basically 30 % or just under 30%, which is pretty incredible. It's still well down for the year. But this is a massive jump on the back of 31 % growth and a pivot. But as you said, they should really be paying both of us, but especially you for corporate advice because they've pivoted to profitability. I think they made$220 million for the quarter, which is a far cry from the massive losses they've been generating every other quarter.

1:46:48So this is a huge turnaround. Shareholders seem to love it. There was one big – what's the opposite of silver lining, black lining? Yeah, I guess. I mean, I think that's probably not the greatest term to use. Humongous black lining. So whatever we want to call it, the non-silver lining is their forecast growth for next year. What do you reckon they forecast next year's growth would be? I'd be totally guessing here. 15%. 13%. So they've gone, forget about growth. We're going to try and make money. They've done exactly what you told them to do two years ago. We're going to try and make money. And the share market seems to love it.

1:47:25It's up 25%. Well, I just want to point out before you get too enthusiastic about me that I didn't come up with the idea that big companies should make profits. Like, that was not me that thought of that. I mean, I thought it seemed pretty obvious to me. And so, yeah, I think they're doing the right thing now. You know, I've always been less bearish, I think, on them as a risk from AI and as a general business risk relative to you. I might still end up being wrong, by the way. But I think they're doing the right thing. And the most impressive part about this, maybe even you would have to concede this, is that I wasn't sure that Mike Cannon-Brooks, as a guy that double, triple, quadruple, and quintuple down on, you know, mega growth and no profits, I wasn't sure he was going to be able to be the CEO to flip this, but I think maybe he is.

1:48:14Well, you were clearly right in terms of their ability to get to profitability and the ability to stop the growth and have investors still, and let's not get too carried away. This business is still down 70 % in the last eight, eight months. So it's still catastrophic for shareholders, for employees. But as we said, we said that in order for them to pivot to profitability and not destroy the valuation built on hope, the valuation would have to be destroyed. This is now a$27 billion US business. So still like significantly lower than Canva's last valuation, let alone the fact that this business was worth like 4Xs at one point.

1:48:51But the market seems to have embraced this pivot to profitability when it felt like, oh, they were just rewarding growth. It's a huge turnaround. Interestingly, I'm up in Sydney today, listeners who are listening to this on Tuesday, I'm up today to launch Friends of the Pod, John Stensholt and Perry Williams' book on Atlassian called Tech Bros. So we'll have John on the show in the next week or two. It was a great read. I'd love to read it because I'm helping out with John's launch. But it was a fantastic read. And it certainly wasn't a hit job at all at Atlassian. And it was really just a really honest history of the business, of Scott and Mike, the early days.

1:49:26What I found super fascinating is literally three or four years in, they were generating like$70 million in sales and making like 25, 30. It was just incredible the profitability of these guys were spinning off in their, maybe this was six years in. But it was an amazingly profitable business in the early days. Yeah. Well, that was the Seth's dream. That was the promise. Yeah. So they were making significant money. I think when they started making losses when they listed, and since listing, they've lost$6 billion US, and$2 billion of which happened in the last 12 months. So it's taken Mike a while to get there.

1:49:59He's burned, I don't know,$4 billion in the last few years, hitting profitability. It looks like that finally, this is what, a billion dollar run rate, earnings run rate, which is not bad. So it's what, 28 times multiple. Again, probably reasonable. Well, I would say that's still a bit high, but like - Not bad. In the scheme of things. We're not saying it's crazy, that's for sure. Yeah. I think, as we said, this business is a profitable business making$1 to$2 billion a year growing at 10%. It's not a bad business. Yeah. And the only reason that's worth less than Canva is because you can trade this business in real time.

1:50:36I think if Canva was listed, what do you think it would be valued at today? Well, that's a much easier question for you to ask than what do I think it's worth. I think it would be valued about the same as Atlassian. You think it'd be worth$28 billion? Yeah, I tell you why. Because the brand is better known by, like people, it's a more well-known brand and you do get a bit of a premium for that, even though - That makes no sense because Atlassian's two and a half times bigger though and profitable. Yeah, I get it. But Canva's still growing fast. A little bit fast. Well, Alessian grew 31 % last year.

1:51:12So faster than next year but not faster than last year. Well, they're growing 20%. If you say they're growing 20%, is that what you said? Canva predicted 20 % growth next year. But I presume that's loss-making growth though. We don't know because they haven't announced the profitability. Possible. But like that's still not quite double but still 70 % more growth than Alessian. But Alessian will be making potentially 1.5 billion at that level. I know. So you said to me, what do I think it's worth? I think that you've got the anchoring of the$42,$43 billion, and so that would roughly halve that valuation from the last round.

1:51:50And that halving is like what a lot of these big names have done and Canva hasn't had that. If it halved it would be$21 billion and Alessian is$28 billion. Actually, Alessian now will be$40 billion actually post this sort of jump since the financials were released. So, yeah. Well, then I'll tell you this. If Atlassian's 40 and Calving is 20 at one, then I'll say, let's say put Canva at 20 and Atlassian at 40, if that's what the situation is. Let me throw you another curveball then. So you've got Figma, which is in the – it's enterprise and Canva's not as enterprise as Figma is. But Figma grew 46 % last year.

1:52:22It's small. It's like 1.4 billion. So it's like under half the size of Canva, but it's growing much faster. Almost a third of the size. Growing much faster, though. I think it's worth$14 billion and it's sort of losing similar amounts of money, I suspect. So much faster growth though. Yeah, I think that reinforces my view that Canva would be circa 20. So you'd pay - No, you're not asking me what I'd pay. You'd say, what do I think the market would pay? The market would pay a higher multiple of Canva than it's paying for Figma, notwithstanding Figma's growing faster. I think so. A lot faster. And Figma's growth is accelerating.

1:52:56Went from 40 to 46. Canva's been dropping year on year on year on year. Yeah, I think the market still perceives Figma as being very exposed to like Claude design, et cetera, because they're like an enterprise slash B2B focused business. And so I think the market is less pessimistic about Canva in general, notwithstanding that these numbers, it would give them a hell of a lot more to be pessimistic about. But look, Canva's liable. Canva's got not only Claude, it's got GPT, it's got Microsoft. I think Canva's got more threats than – There's more people hiding in the bushes trying to shoot Canva than trying to shoot Figma.

1:53:30Well, I'll tell you, Canva's bigger threat to me is simply this. It's harder for – the probability of a company throwing software out of their workflow is a lower probability than an individual throwing software out of their workflow. That's why Figma is stickier as a business in my view. So it's a better business. You get a higher multiple and a lower multiple. Why are you giving Figma a lower multiple than Canva? because I think that people's view of Canva is the last valuation was 42, 43, whatever it is, billion USD. That's where people are anchored. It was a sexy business for a very, very long time.

1:54:11It would be perceived as having had a year or a year and a half of tough times. I just don't think people are willing yet to write it down to like a quarter of its value of the last valuation. That's why I think so. You asked me what I think the market would pay. I'm telling you what I think the market would pay. Well, no one wants to write stuff down. I don't think the market - It's new investors that might - I'm not saying this was listed. I think new investors would say halving the valuation of Canva after a bad year and things looking choppy, that feels like adequate compensation for the risk I'm taking.

1:54:42I think they would perceive 75 % on the sell side as being like too much of a haircut for a bad year. That's my view of it. Like that's how I think the market would view it. Yeah. Well, time will tell. We'll obviously see. Well, time won't tell because they won't be IPO-ing. Yeah, but you can tell there is some private marks out there. We saw Canberra drop from$42 billion to$22 billion in 2023. So it's not like it's never been down this road before and obviously recovered from that. But if you look at Blackbird came into Canberra's, I think Blackbird was Canberra's first institutional investor, invested at an$8 million US valuation.

1:55:17So either way, sort of Blackbird's 100-plus bagged this. But they do really well either way, just less well than it would have been. Well, that's one way to think about it. The other way to think about it is this. I don't know what they've done. Let's call it they've made 200 times their money on it or something, whatever number you just said. Yeah. So one way you can say it is, well, if it halves, they've still made 100 times their money. Another way to say it is that halving just cost them a 100 bagger. Yeah, yeah. So I think it's actually more painful for them. Well, but they've also had – it's an incredible investment either way because they came in so – if you bought in at$20 billion, that's not great.

1:56:05Yeah, I agree with you about that. On that note, we better wrap it up. You've got to get back to partying and whatever the hell you're doing in Vegas. I've got to get back to work. Thank you, listeners, again for sticking with us. We'll, of course, see everybody on Saturday for a very special episode. Thanks for listening in. Thank you.