Latest / What the Flux / Domain first big challenge to REA Group | AI-powered cow collars hit $2 billon | Cuttable builds $100 million biz with just 8 engineers

Transcript

Domain first big challenge to REA Group | AI-powered cow collars hit $2 billon | Cuttable builds $100 million biz with just 8 engineers · What the Flux

• 0:05
  Speaker 1: This is what the Flux. I'm brad and an't justin.
• 0:08
  Speaker 1: That's Wednesday, the twenty fifth of March. We have spent
• 0:10
  Speaker 1: months talking about inflation. Probably a sneaky cousin has just
• 0:14
  Speaker 1: walked back into the room. You can shrink inflation in particular.
• 0:17
  Speaker 1: Cadbury's out here playing a bit of chocolate hide and seek.
• 0:20
  Speaker 1: The Cadbury Biscoff has quietly slimmed down in size by
• 0:22
  Speaker 1: five point five percent, so the price has remained the same.
• 0:26
  Speaker 1: And as for old Easter eggs, well, they've gone from
• 0:28
  Speaker 1: a twenty four pack to a twenty pack while the
• 0:30
  Speaker 1: price has jumped more than forty percent.
• 0:32
  Speaker 2: Official chocolate is out of the budget. Yeah, as we
• 0:35
  Speaker 2: get to the end of the month, now is the
• 0:37
  Speaker 2: time where you want to be checking your credit score.
• 0:39
  Speaker 2: Has your credit score going up this month? Has it
• 0:40
  Speaker 2: gone down? Have you been making your repayments on time?
• 0:43
  Speaker 2: If you don't know your credit score, the Flux app
• 0:45
  Speaker 2: is the place to see your credit score and all
• 0:47
  Speaker 2: your payments in the one spots. Make sure to download
• 0:49
  Speaker 2: the app and check it out.
• 0:50
  Speaker 1: Three marvelous stories today, Dozy boy, let's do it for
• 0:52
  Speaker 1: our first and you look. Domain has promised to put
• 0:55
  Speaker 1: a cap on price hikes as part of its new
• 0:57
  Speaker 1: plan to take it to area.
• 0:59
  Speaker 2: Nothing like a bit of rice competition to shake up
• 1:01
  Speaker 2: the property market, b Man tell me more so.
• 1:03
  Speaker 1: Domain is the second biggest property listing platform in Australia
• 1:06
  Speaker 1: behind Aria groups at real estate dot com dot Au.
• 1:08
  Speaker 2: But b Man it's second. But there's daylight between Aria's
• 1:11
  Speaker 2: monthly users of around thirteen million monthly visits theirs Domain's
• 1:14
  Speaker 2: roughly nine mil in a very good month.
• 1:16
  Speaker 1: Quick reminded flex Fam. Last year, Domain was acquired by
• 1:19
  Speaker 1: US giant costar four two point eight billion bucks.
• 1:22
  Speaker 2: And be Man. Despite some aunis from co Stars investors,
• 1:25
  Speaker 2: the US property giant has now made some big moves
• 1:27
  Speaker 2: in Australia.
• 1:28
  Speaker 1: Domain announce it will cap its price increases at four
• 1:31
  Speaker 1: percent from July first.
• 1:32
  Speaker 2: Well analysts reckon Aria is going to lift prices between
• 1:34
  Speaker 2: eight to ten percent this year.
• 1:36
  Speaker 1: Domain is pitching itself as the genuine alternative to agents
• 1:39
  Speaker 1: after years where Aria has dominated the market with limited competition.
• 1:42
  Speaker 2: If you wanted eyeballs on your listing, you paid up
• 1:45
  Speaker 2: for Aria.
• 1:45
  Speaker 1: But now Domain is trying to reposition itself to win
• 1:48
  Speaker 1: back sellers and agents and.
• 1:49
  Speaker 2: Of course rebuild its market share.
• 1:52
  Speaker 1: So what's the key learning here?
• 1:53
  Speaker 2: Business has often faced trade off between maximizing profits today
• 1:56
  Speaker 2: and capturing market share for tomorrow.
• 1:58
  Speaker 1: Aria Group has largely the profit game.
• 2:00
  Speaker 2: Yeah, it's got a very dominant position, so it's been
• 2:02
  Speaker 2: able to focus on monetizing its platform.
• 2:05
  Speaker 1: That has been through higher prices, strong margins, consistent revenue growth.
• 2:08
  Speaker 2: Man Domain under Costar is now leaning into the opposite strategy,
• 2:12
  Speaker 2: i e. Growing market share.
• 2:14
  Speaker 1: So Jasi Boy by capping price increases and offering added features,
• 2:17
  Speaker 1: Domain is effectively sacrificing some short term revenue to attract
• 2:21
  Speaker 1: more agents and listenings.
• 2:22
  Speaker 2: The classic challenge of playbook isn't it.
• 2:24
  Speaker 1: Yeah, you come in cheaper, add more value, try to
• 2:26
  Speaker 1: win customers from the incumbent.
• 2:27
  Speaker 2: If it works, the reward is scale.
• 2:29
  Speaker 1: And once you reach scale you can start to improve
• 2:31
  Speaker 1: margins a little bit later.
• 2:33
  Speaker 2: Remember when Zero the accounting software first entered the accounting
• 2:35
  Speaker 2: market against incumbents like mayobm hmm.
• 2:38
  Speaker 1: It originally charged significantly less as it worked to grow
• 2:41
  Speaker 1: its market share, but over the next decade, as Zero
• 2:43
  Speaker 1: has grown its market share to over sixty seven percent
• 2:45
  Speaker 1: in Australia, it's been able to jack up its prices
• 2:48
  Speaker 1: big time. Yeah, its startuplan went from around twenty seven
• 2:50
  Speaker 1: bucks per month to now a minimum of seventy bucks
• 2:53
  Speaker 1: per month.
• 2:53
  Speaker 2: So Domain will be hoping to grow market share and
• 2:56
  Speaker 2: then work on its margins.
• 2:57
  Speaker 1: For our second story. Halter, and New Zealand based ag
• 3:01
  Speaker 1: tech company, has been valued at two billion dollars as
• 3:03
  Speaker 1: it builds aipowered smart collars for cows.
• 3:06
  Speaker 2: We love to see a calgorithm taking off BMN, so
• 3:09
  Speaker 2: what's going on here?
• 3:10
  Speaker 1: Halter is a New Zealand based ag tech that was
• 3:12
  Speaker 1: found at e in twenty sixteen.
• 3:14
  Speaker 2: The idea was to create a GPS enable, solar powered
• 3:17
  Speaker 2: color for cattle like cows.
• 3:19
  Speaker 1: Yeah. The goal was to reduce the need for physical
• 3:21
  Speaker 1: fencing by using sound and vibration to guide cattle to
• 3:24
  Speaker 1: stay within boundaries.
• 3:26
  Speaker 2: And to move to other spots of a farm.
• 3:28
  Speaker 1: And now Halter is reportedly raising a new funding round
• 3:31
  Speaker 1: being led by none other than Peter Thiel.
• 3:33
  Speaker 2: Aka the investor behind Facebook, Stripe, LinkedIn, Airbnb, and a
• 3:36
  Speaker 2: whole lot more.
• 3:37
  Speaker 1: And jazup boit. This caveres could value Halter at over
• 3:40
  Speaker 1: two billion US dollars And why is it not finalized?
• 3:42
  Speaker 1: Yet b Man well because the round is so oversubscribed
• 3:44
  Speaker 1: apparently that they haven't even locked in the final size yet.
• 3:47
  Speaker 1: So Halter has managed to turn livestock into a subscription
• 3:50
  Speaker 1: based revenue model.
• 3:51
  Speaker 2: And the reason why this company is so popular because
• 3:53
  Speaker 2: it's part of a new wave of precision agriculture.
• 3:56
  Speaker 1: So what's the key learning here?
• 3:57
  Speaker 2: Precision agriculture is all about using technology to make farming
• 4:01
  Speaker 2: more efficient and sustainable.
• 4:02
  Speaker 1: Traditionally, farming has relied on pretty manual processes out on
• 4:05
  Speaker 1: the field.
• 4:06
  Speaker 2: Yep, the greatest piece of technology was a dog herding
• 4:08
  Speaker 2: the cattle.
• 4:10
  Speaker 1: But it was also about watering entire fields, or counting
• 4:13
  Speaker 1: livestock by hands, or building physical fences to manage animals.
• 4:16
  Speaker 1: But precision agriculture flips that by using data and sensors
• 4:20
  Speaker 1: to make much more targeted decisions. And the benefit is twofold. First,
• 4:23
  Speaker 1: it reduces labor costs for farmers.
• 4:25
  Speaker 2: And second it can actually improve how farmland and animals
• 4:28
  Speaker 2: are managed from your.
• 4:29
  Speaker 1: Couch and Joe Boyd. Globally, this is becoming a massive market.
• 4:32
  Speaker 2: Ye It's expected to grow from around nine and a
• 4:34
  Speaker 2: half billion dollars in twenty twenty five over seventeen bill
• 4:37
  Speaker 2: by twenty thirty one.
• 4:38
  Speaker 1: So it's no surprise that famed investors like Peter Till
• 4:41
  Speaker 1: the one slice of this market. For our third and
• 4:43
  Speaker 1: final story, Cudable and Ossie AI ad business has just
• 4:47
  Speaker 1: cracked one hundred million dollar.
• 4:48
  Speaker 2: Valuation with just eight software engineers.
• 4:51
  Speaker 1: Very interesting news, Josie Boy, tell me more about this one, Okay.
• 4:53
  Speaker 2: So, Cudable is an Ossie ad tech startup that was
• 4:55
  Speaker 2: founded in just twenty twenty three.
• 4:57
  Speaker 1: With one of the founders being Sam Kunnenberg, who was
• 5:00
  Speaker 1: previously the founder of a cloud Guru acquired for two
• 5:02
  Speaker 1: billion bucks a few years ago.
• 5:04
  Speaker 2: So what does cudible actually do be man?
• 5:05
  Speaker 1: Essentially, it's built for companies that want to test a
• 5:08
  Speaker 1: range of creative across social media platforms.
• 5:10
  Speaker 2: Instead of having a whole swat team of creatives test
• 5:12
  Speaker 2: different ideas and variations, they've built an AI tool that
• 5:15
  Speaker 2: can do it instead.
• 5:16
  Speaker 1: So early last year, Cuttable raised ten million bucks at
• 5:18
  Speaker 1: a valuation of just under forty five million dollars.
• 5:21
  Speaker 2: And now they're back at the cap raise table.
• 5:23
  Speaker 1: So as part of this round, they've raised capital at
• 5:25
  Speaker 1: a one hundred million dollar valuation.
• 5:26
  Speaker 2: But they meant what's probably the most interesting part is
• 5:28
  Speaker 2: it cutdable, So they're shipping more products with an engineering
• 5:31
  Speaker 2: team of eight compared to Crounenberg's one hundred person team
• 5:34
  Speaker 2: at a cloud Guru.
• 5:35
  Speaker 1: So they've effectively used AI to build their new AI tool.
• 5:39
  Speaker 2: So what is the key learning here?
• 5:40
  Speaker 1: AI isn't just changing products, it's changing how companies are built.
• 5:43
  Speaker 2: Scaling used to mean more people, bigger teams, more hierarchy,
• 5:47
  Speaker 2: but AI's flipped that on a teed.
• 5:48
  Speaker 1: For startups, it means you can move faster from day
• 5:50
  Speaker 1: one building and scaling without needing a huge team, and
• 5:53
  Speaker 1: then numbers back it up. In fact, a man McKinsey
• 5:55
  Speaker 1: estimates generative AI could add up to four point four
• 5:58
  Speaker 1: trillion dollars in productivity means globally or thirty to forty
• 6:01
  Speaker 1: percent increases in productivity for software engineers. But for established
• 6:05
  Speaker 1: companies it's forcing a rethink on their headcount like Wistech
• 6:08
  Speaker 1: who just got rid of around twenty nine percent of
• 6:11
  Speaker 1: their team.
• 6:11
  Speaker 2: Or Block who just cut fifty percent of their team.
• 6:13
  Speaker 1: Because when a smaller team can do more, the old
• 6:15
  Speaker 1: model starts to break.
• 6:16
  Speaker 2: So me man, the next billion dollar company might not
• 6:19
  Speaker 2: look like a five hundred percent organization, it.
• 6:22
  Speaker 1: Might look like a tight team running on AI Flux am.
• 6:24
  Speaker 1: Did you know your credit score can be as low
• 6:26
  Speaker 1: as the low hundreds and up to twelve hundred based
• 6:29
  Speaker 1: on the Flux Credit Score tool, And it all depends
• 6:31
  Speaker 1: on it how much credit you have, how you're repaying it,
• 6:34
  Speaker 1: and a whole lot of other factors where you break
• 6:35
  Speaker 1: it down in the Flux app. And if you want
• 6:37
  Speaker 1: to see what your credit score is this month, make
• 6:39
  Speaker 1: sure to download the app and check it out. Thanks
• 6:41
  Speaker 1: for listening and we'll see you on Friday.