Expert Investor: Elise Kennedy on who is winning BNPL & Aussie Tech | Jarden

HOSTS Alec Renehan & Bryce Leske|4 August, 2021

Meet your hosts

  • Alec Renehan

    Alec developed an interest in investing after realising he was spending all that he was earning. Investing became his form of 'forced saving'. While his first investment, Slater and Gordon (SGH), was a resounding failure, he learnt a lot from that experience. He hopes to share those lessons amongst others through the podcast and help people realise that if he can make money investing, anyone can.
  • Bryce Leske

    Bryce has had an interest in the stock market since his parents encouraged him to save 50c a fortnight from the age of 5. Once he had saved $500 he bought his first stock - BKI - a Listed Investment Company (LIC), and since then hasn't stopped. He hopes that Equity Mates can help make investing understandable and accessible. He loves the Essendon Football Club, and lives in Sydney.

In this episode, Alec and Bryce are joined by Elise Kennedy. Elise is Vice President of Equity Research at Jarden and leads the Australian Research team covering technology and the internet. She has over 10 years experience in financial markets, including 7 years at Morgan Stanley covering Telecommunication, Media, Technology and Gaming. Elise summarises Australia’s listed tech sector, and they continue the overrated v underrated game with Australia’s answer to FAANG stocks – the WAAAX stocks. Then they have a look at some of the ‘older’ Australian tech companies – Webjet, REA, Seek, Carsales – and talk about whether she thinks there are still opportunities to be found.

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In the spirit of reconciliation, Equity Mates Media and the hosts of Equity Mates Investing Podcast acknowledge the Traditional Custodians of country throughout Australia and their connections to land, sea and community. We pay our respects to their elders past and present and extend that respect to all Aboriginal and Torres Strait Islander people today. 

Bryce: [00:00:15] Welcome to another episode of Equity Mates, a podcast that follows our journey of investing, whether you're an absolute beginner or approaching Warren Buffett status, our aim is to help break down your barriers from beginning to dividend. My name is Bryce and as always, I'm joined by my equity buddy Ren. How's it going? [00:00:31][15.2]

Alec: [00:00:31] I'm very good. Bryce very excited for this episode. We're still recording from home, but I'm concentrating rolls on. And today we're having a conversation about tech, arguably the most most exciting part of the market for the Equity Mates community. And it's a it's an important week to have this conversation. I think we're recording in a week where Apple, Microsoft and Alphabet combined reported sixty eight billion dollars in quarterly profit of Dollars. So tech in the US is just flying. We want to hear what's going on with tech closer to home in the Australian market. And we've got one of the best joining us to tell us all about it. [00:01:15][44.3]

Bryce: [00:01:16] That's right. Ren no doubt that it's an exciting space for many of the Equity Mates community and as well as the startup scene as well. And our guest today, Elise Kennedy, is charged with covering it all. So Elise welcome to the show. [00:01:31][15.0]

Elise: [00:01:32] Thanks for having me on the show. We decided to share what I can. [00:01:34][2.3]

Bryce: [00:01:36] So Elise is vice president of equity research at Jarden and leads the Australian research team covering technology and the Internet. She has over 10 years experience in financial markets, including seven years at Morgan Stanley covering telecommunication media, technology and gaming. And today we're going to be picking her brains about all of these things, particularly the buying up highlighter space. She's done a lot of work in that space, and we know how important it is for our Equity Mates community, as well as talk about the Wild West of start ups. And we'll get her thoughts on some of the Aussie tech darlings as well. So really looking forward to this one. But first thing's first over the Ren for a game. [00:02:20][43.8]

Alec: [00:02:20] That's right. We like to start with a bit of a game to get your thoughts on some topics we may not otherwise cover in this interview. So it's called overrated, underrated. And we'll start at home overrated or underrated. The ASX 200 index, [00:02:35][14.2]

Elise: [00:02:36] I've been told, is overrated the last 10 years. So I decided that I still see huge value in the market that is reaching its all time highs. So underrated, [00:02:47][10.7]

Bryce: [00:02:48] overrated or underrated looking overseas, the Nasdaq 100 [00:02:52][3.5]

Elise: [00:02:54] similar cases, I would say, but probably, if anything, I would say perhaps more overrated context that some of those larger companies have less growth in that future because they are those incumbents that I believe, more towards that spectacular growth. [00:03:11][17.3]

Alec: [00:03:14] So at least this is a common question that we, I guess, get asked in the Equity Mates community, a community full of retail investors, overrated or underrated FULL-SERVICE brokers for retail investors. [00:03:28][14.3]

Elise: [00:03:29] You know what? I'm probably not experienced enough to be able to actually answer that question because I don't necessarily do it myself. So can I say a neutral, [00:03:40][10.9]

Bryce: [00:03:49] at least overrated or underrated an asset class that is always controversial and that is Bitcoin? [00:03:55][6.4]

Elise: [00:03:56] Again, I think I will go with Underwriter's just because you can see the usage of cryptocurrency and how much that's happening in the lab that you can see whether or not it's fundamental growth rates, momentum, the way everybody, including my driver, is talking about it. So there's a bit more to go. I think it will Bryce. [00:04:17][20.8]

Alec: [00:04:18] We love hearing that. Hey, Bitcoin has crossed forty thousand US dollars overnight and Bryce has fired up the crypto group shot again this morning. So you can say I'm smiling there on camera. But a final question for this game. Overrated or underrated Australian residential property? [00:04:37][19.3]

Elise: [00:04:38] Well, we've got another ten to 15 percent property prices over the next 12 months on top of the 15 percent we've already seen. So unfortunately, it's a lot less surprising to buy those properties. [00:04:48][10.2]

Bryce: [00:04:49] It wow, not what I want to hear. That's why we're doing a show on equities and not property. But anyway, at least before we get into the Australian listed tech and buy now piled up, we'll love to start at the top. And that is with the story of your first investment, if you're able to share that and perhaps some of the major lessons that you took from it. [00:05:14][24.1]

Elise: [00:05:14] Absolutely. So my first investment was in 3D printing in the US back during university. And for me, that was a great eye opener to stop thinking. It's more than just knowing what to buy and when to buy it. It's also about when to sell it. So I bought 3D systems when it was under twenty dollars a share in price, about seventy five dollars. But then before I knew it, I would look at that. Tradeoffs to be studying. It was back twenty dollar. That's where it sank the last year until that last year. So again, that taught me that timing in the market is everything interesting. [00:05:50][36.0]

Alec: [00:05:51] And at least from that first investment to now, have you developed a personal investing philosophy? [00:05:56][5.5]

Elise: [00:05:57] Well, I'm actually quite risky for us with a tech analyst. Investing and recommending stocks without owning seems counterintuitive, but me, I think that's part of my investment philosophy going forward and taking that first experience. I really like those stocks that I feel confident about the market opportunity, ability to grow in a sustainable manner, and some of those unit economics that do stop in some of my best investments. You don't always have to believe the hype, but you do need to get high when the market gets over that high. What are those fundamentals that I do now? [00:06:32][35.1]

Bryce: [00:06:33] So you've mentioned, obviously, that you're the tech analyst. So let's turn to Ozon Tech. No doubt that you can't miss the tech scene over in the States. As we said at the top, it's got the world's biggest tech companies. But if you were to try and explain to a U.S. investor how the tech scene looks here in Australia, how would you sort of summarize the listed tech companies in the same year? [00:06:56][23.2]

Elise: [00:06:57] We had a lot of high quality global businesses that are based on the ASX Australia. But the challenge here is the US is that fewer than they are. And as a result, compared to the US, sometimes we get what we call a scarcity premium. So these good stocks tend to trade higher than what they might on the Nasdaq, because in the Nasdaq they'll get lost in the number and humorous side. So I be saying that you're going to get some quality businesses in Australia with the flow of funds that we have here. You might be paying a little bit higher than you would in the US. [00:07:31][33.4]

Alec: [00:07:32] So at least over in the US, they have FANG or fan mag these days. The I guess the list of the top US tech stocks over here, we have works with three eyes. Let's bring back this overrated, underrated game and maybe get your thoughts on them. So let's start with the W was tech overrated, underrated? And what are your thoughts on it? [00:07:58][25.6]

Elise: [00:07:58] It's underway in our view and leading on into results. It's actually one of our top picks. So a bit of context, background wise tech, logistics, software company, global business. It's had a few short summary points, which has meant that it's never going back to its full time highs. And some of the reasons around that was around doing 40 acquisitions over two to three years, you know, sometimes a red flag. So the thing is, though, this year they've stopped doing any acquisitions. Frank Williams, which is where they take a look at the ticket each time you move, the volumes are over 20 percent globally. So you think that should bode well for your organic growth. And it's still trading around thirty thirty one point thirty eight dollars. So it hasn't really ever got rid of that that. So for us, that's a few of the reasons why it's one of our options. But it has to be 10 catalysts to drive that share price. [00:08:55][56.6]

Bryce: [00:08:56] Moving to the eyes. Altium overrated or underrated? And what's the thesis the [00:09:01][4.9]

Elise: [00:09:01] so underrated on that name? Just because it has a smaller market opportunity, one point two billion and so ignorant of it now sounds massive, but they haven't really got the dominance that the only candidate to that they have had some interest from overseas more recently to get any stuff that you say that has. And they usually take that and people think there might be another beat up. So even though it's not one of those peaks on fundamentals, that might be a bit annoying to Ren that still need to [00:09:31][29.5]

Alec: [00:09:32] go on logistics software. We've gone printed circuit boards. Now let's go buy Elpida and let's just do this one briefly because we'll go into detail and buy Elpida in a little bit. But overrated or underrated? [00:09:45][13.6]

Elise: [00:09:46] Afterpay underrated. It's a few reasons, but you can delve into and I know it's a well-loved stock among everyone, really high valuations, but in short, they're only at the edge of a journey. And that rotating out beyond the just the payments of the marketplace of Westpac. So for us, yes, I'm delighted. [00:10:07][21.1]

Bryce: [00:10:08] It's looking forward to some further conversation around that. Closing out the eyes we have apon overrated on. To write it and why [00:10:15][7.4]

Elise: [00:10:17] so we haven't really fond of you on that subject at this point in time, I think that is a really important part and it's so different from the on [00:10:27][9.7]

Alec: [00:10:28] the market certainly isn't sitting on the fence. I think it's down about over 50 percent from what started the year. So, yeah, the market's got a clear view. But let's move on to zero accounting software, probably the least sexy of those five, but potentially the best business are overrated or underrated. [00:10:46][17.5]

Elise: [00:10:46] Zero underrated. Much better. Don't worry, we do have some space, but this is one of the stuff. They have a Covid back what it is around thirty Dollars. And I've found that, you know, some of those less sexy stocks, as you say, some of the best because they're fundamentally mckennitt sticky, this regulation havingness digitizing tax stuff. You can see all the drivers and then voting in the beyond accounting software, which is small business. Software business is not enough. Just throw around just [00:11:23][36.4]

Alec: [00:11:23] just to give give everyone a bit of balance. We've said for underrated one of you maybe tell us one Australian listed tech stock that is overrated. [00:11:32][8.9]

Elise: [00:11:34] Oh no, I'm sorry. I didn't say yes. That's all right to be clear. So there is one in the balance. There are a few others in there. It's just happened to be the last stop. That's a challenge I had you had to go on and show that that valuation and. Yes, yes. So I think that's some of the things is fundamentally the stock that got that little recognition that. [00:12:04][29.6]

Bryce: [00:12:07] Just before we move on as well, a question in your eyes, Domino's, is it a tech stock or pizza company? [00:12:12][5.6]

Elise: [00:12:14] I remember a solid day and asked for a multiple that was a tech company. I think it's got some elements where definitely if you look at what the drivers of differentiation for them, it's around that we can claim the ability to give you a unique topic that are customized to you and using all that data. So you know that a premium of the tech at the end of the day, there are inventoried overheads that make it what's not a tax, not for those those reasons, not utilizing the technology to be able to have a premium it. [00:12:51][36.5]

Alec: [00:12:51] Yeah, Bryce. And I look out for the trip around every earnings season where companies completely unrelated to tech, you know, retail to, you know, like whatever, we'll talk about AI and machine learning in the earnings. Not that is the biggest trope these days when it comes to earnings is twenty times. [00:13:12][21.0]

Elise: [00:13:14] Yeah. [00:13:14][0.0]

Bryce: [00:13:15] It's like if you throw in AI or crypto somewhere in your in your reporting, you're looking for a share price. [00:13:22][6.9]

Alec: [00:13:24] And that's why Equity Mates is an AI driven tech stock [00:13:27][2.7]

Bryce: [00:13:29] with a crypto offering. [00:13:30][0.6]

Alec: [00:13:33] So at least WACs gets a lot of it has got a lot of the attention the last few years, but there's a lot of old and I guess I put older in inverted commas because most of them are still in this second decade. But the old Australian tech companies, the Webjet, the Arias sake's, car sales, do you cover these stocks as well? Jodha And how do you think about, I guess, that older cohort of tech stocks? [00:13:58][25.2]

Elise: [00:13:59] Yeah, we do have a number of those names in that job. And then we think about them is they've got great businesses and they actually make money, which gives you more certainty versus some of those it do perhaps in their early formation stages. So let's just take, for example, the likes of REIT or even domain in the housing market, as you said we discussed earlier, is around house prices. And I hope that was not the average for that house. The stocks that I'll live it to the housing crisis because more housing prices, for example, seller's results in more listings. And that's a key driver for some of these stocks. So the thing is that they are proven models. We know that customers continue always have onto these platforms and through Covid. If anything, even when auctions went to next to zero, I'm still eager to make money and take out. So we definitely look at them definitely following in what we would say is more established online tech. [00:14:57][57.8]

Alec: [00:14:57] That's one thing about a lot of those companies that I often think about is that they've got extreme local dominance, like Seek owns the job listings area and domain own home own home listings. Webjet owns online domestic travel bookings. Then even car sales, you know, like incredible domestic presence, but then it's the question about like, can they be truly international businesses? And they all seem to have like differing levels of success and different strategies. You know, Webjet completely switch their business offering. And waterbeds is like the big international play when you're looking at some of these Australian based tech companies with dominant domestic footprint. How do you start to think about can they be truly global companies or just great Australian companies? [00:15:46][49.1]

Elise: [00:15:48] It's a really great question. And especially for these companies. When you do reach more mature state, that's when you start to see them move offshore. But a cool business still is what you pay for today. So when we think about offshore, initially, it is option. So do you pay for that today? Not necessarily, because you haven't necessarily proven your capability. And as you recognized, it can be fixed when you start to see that taking market share a few different ways that we can analyze that we can spot trends, Google Trends downloads, you start to see them get traction. They actually know they are beating some of the incumbent and or you're seeing some things like regulation having to change. That is shifting structural change to unlock some of the markets overseas are in that adoption phase. That's when you start to think, oh, no, I can press that into my model this outside that maybe isn't recognized by the market. But as you say tonight, it's still a bit mixed even. But if they can show their ability and that's going to be the key value in 05. [00:16:56][68.0]

Bryce: [00:16:57] So at least another, I guess, part of the Equity Mates community that is generating a lot of excitement or part of the market sorry, is EA Sports, no doubt that particularly internationally, it's a growing industry, a lot of money starting to come in and some pretty cool investment opportunities. So where are you seeing some interesting opportunities in this space? [00:17:16][18.3]

Elise: [00:17:17] So it's still relatively early in Australia. There's a few small cap stocks that you can find that specialize in it. We don't yet cover it as an investment house. But in the March headspace, you may be content that what you find is a sports. But even in the digital gaming space, aristocrat, which is traditional poker machine, make up and has 30 percent of its earnings coming now from digital online gaming. And it does have some of those, what we call APJ, which are more you can get in like guys. So that's another way to to play it in the LogCAP cap stuff that has more sustainable earnings, because a lot of those smaller cap stocks that haven't been proven, but it's growing meaningful support for our next generation of cohort. And see if you could have invested in our real life, not a cash spot. Would you have invested in that? Probably because you know how sustainable this is a trend that's coming that's going to be on the table in the future. So it's definitely an interesting space that's getting more traction globally and now coming into the strategies. [00:18:24][67.1]

Alec: [00:18:25] Yeah, it is fascinating. You know, we read about reports of what's going on overseas and the amount of money being thrown into it. I went to South Korea and went into one of those soccer stadiums and they are literally stadiums. [00:18:38][12.5]

Elise: [00:18:40] It's like, yeah, Brooklyn Stadium. And it was one of the events, which is one that's over there. Remember what it was. But it was the second biggest sport all the commentators had. All the fans is a packed stadium. It's absolutely crazy. [00:18:58][17.8]

Alec: [00:18:59] Well, we may not be able to invest in the sports industry on the Australian market, but one sector that seems to dominate the conversation here is by now later. So we'll move to that in a second and pick your brains on it. But before we do, we'll just take a quick break to hear from our sponsors. So at least before the break, I mentioned that we're going to move to the Boyanup highlighter sector and I can say Bryce chomping at the bit to get the hey, I don't know. I don't know if bitcoins is true love Afterpay would be second. So let's start generally because there's I guess there's a lot of directions we can take this conversation. But at a high level, when you think about Binzel, where do you start thinking about it and analyzing it? [00:19:49][49.6]

Elise: [00:19:49] So as you say, it's definitely the most topical investor conversations that we have when we came and approached a stocks, whereas we approached the same way we do most stocks. One, what is the market opportunity? So what we call total addressable market or and that was how many individuals do you think might take up on that or what a positive retail sales do you think? So that's that's step one. But then from there, we also start to think, all right, what is the unique value proposition? Because it sounds like everything, the way you find out it comes to market. And then you also you've seen Apple come into this as well. So Frenchwomen, is there a competitive market, other barriers to entry? And so that's the other thing that we started to look at after you identified tends to take this for us. And we find that if you think about the value proposition that these guys offer, it's not just a for civil rights. It's also a unique office for the merchant ivory customers. And the bigger you are, the more unique customers you bring and the vigor that you get. You can also then offer payment terms for your customers. So let's just use Afterpay the two years. You're going to be able to borrow a lot more if you consistently and somebody is just starting to offer it. So with that in mind, that's probably how we start to think about it. And that's been a preference as to our cause on the stuff. [00:21:23][93.4]

Bryce: [00:21:24] So a bit to unpack the let's let's start with Afterpay and Zipp, two of the biggest names here in Australia, both of which are now starting to significantly play overseas as well. So let's I guess more broadly, what are your thoughts on each of them? And then you mentioned Moat's that I'd be interested to get your view on what you see as their Moat's if they have any. Just your thoughts on that. [00:21:48][24.1]

Elise: [00:21:48] Yeah. So I'll just Afterpay and the context there is our overall view is that you are a first mover advantage. That's how you start to create economic not because let's just think about it in a scenario. If you started two years ago and you've reached as many customers, you have an Australia is becoming relatively new to it in other markets and say to us, you'll find that if you've got to imagine, you've probably already got all that much easier to go the active customers that you would have had if you just start to that. So that's where we find those logic guys. Most Afterpay and both well on that front. This is a new entrant and a smaller player that's just coming to market. That's the first point ever of creating an economic meltdown. The other component that creates and drives that as well is some of those offerings. As mentioned, the longer you go with that platform, the more that you can because you show your tenacity to spend. So you think the Afterpay, about eighty five percent of the sales comes from repeat customers and that's bringing down the price overall bodes well for the company standpoint. It's also enabling you to be able to borrow five hundred dollars. You can never agreed to that. And again, the average order value is about one hundred and fifty dollars. You get to spend a lot more and a lot more frequently and then they can start to drive. Now, that marketplace is another area that they're trying to drive. So instead of you just jumping in that general store or whatever it is and spending at the checkout and companies Titanfall, instead you jump on the Afterpay, you get 10 percent off and you can see some things that actually let not so much each month. So there's a few things that they're doing that actually building out that first mover advantage and creating a multiverses initially used to pay for that. Is it unique proprietary technology to keep it simple? But what is unique is what they're building out now. [00:23:47][118.7]

Alec: [00:23:48] Now, at least one model that we think about when we think of a company like Nike is Brand Zipp have just rebranded. And we couldn't miss the chance to ask what your thoughts are about the the new brand and the big purple box. [00:24:04][15.9]

Elise: [00:24:05] Yeah, look, I'm not a marketing expert, so I actually dropped out. Isn't really about it. It asks me what color is that blue or red, which wants to make the finances. So I am not sure how it's going to go down in terms of being Brian is an important element in all of this. So we did a comparison because, as we mentioned, the tech might not be a surprise. Great. But you think about Coca-Cola and you think, hey, that was really different. So I hope that it bodes well for them. But again, it is a very important element of creating that consumer awareness. [00:24:44][38.9]

Alec: [00:24:44] And you're very, very diplomatic at all. I don't get it. I'm going to be honest. I'm sure there's reasons behind it, but it is not clear to me. [00:25:00][15.4]

Bryce: [00:25:00] We're obviously going to touch on the announcements from PayPal and Apple in a second. But let's just remain focused on Afterpay and see it, both of which are pushing hard into America. How would you assess the efforts in that space so far and would you say that one has been more successful than the other? [00:25:18][17.6]

Elise: [00:25:18] Well, in the US it is, as you mentioned, the Delta four, they started about five times the size of what I said. It will be a key driver of the future on statistic. Depay is in latest numbers much and so on and so forth and deepwater business to get the growth that they did do, though, in the last three result, which came out last week for yet they did do actually better than what we expected in the US. But again, it wasn't necessarily enough for the retail investor was looking for. So overall, Afterpay is taking the lead that we think the expectations that are relatively low, at least from outside of the market, and you're going to look at the multiples of their significantly different. So if they were on the same último, that you'd have to be leaning towards Afterpay, but that's one of over 20 times 80 sales, or is this other stuff below 10 times? So again, that is a different story. [00:26:18][60.0]

Alec: [00:26:19] That is Zipp is a really interesting one on that point around expectations because it feels so. The stock's down about 50 percent from its February highs and retail investors are making a lot of noise. And, you know, I think it's one of the most shorted stocks on the ASX. But at the same time, a lot of the brokers that are releasing reports on Zipp have price targets in the eight dollar range. I saw one in the 10 Dollars range. It just feels like there's a real mismatch of expectations going on with Zipp. How do you think about that? [00:26:52][33.3]

Elise: [00:26:53] Yeah, that's absolutely what we've recognized as well and started to say. And you do come across those stocks that we know that the institutional investment environment, they came out on the retail side. Why that occurs is it's more challenging to recognize. But I think from our standpoint, why we're optimistic in having this price target stems from our expectations around growth and overall the market. You think instead of just thinking high, it's not that great of a product. All right. They're not as bright, but we're forecasting still reasonable growth given the size of the market. And they are a significant player and they've got the balance sheet and have continued to grow. So I think that's where perhaps the disconnect with how we do it, too much work at the number and step back. Yeah, we'll see how it pans out. [00:27:42][48.9]

Bryce: [00:27:43] So, as you mentioned, scale was one of the important factors for these companies when it comes to creating a moat. And two of the biggest players in payments and tech, PayPal and Apple, have both recently announced that they're going to be entering this space with some form of a final Piloto offer, both of which have enormous scale immediately. So where does that leave your thinking when it comes to the success of Afterpay and Zipp? [00:28:12][29.5]

Elise: [00:28:14] It's funny, as soon as those announcements came out and what happened last year and this year, more recently, Apple stock fell five to 10 percent. And it's just you. That's it. As soon as that happens, you think that's in the Bryce today? You can get glove's for us, which is not anything that would be positive about this company. Right. And it's a hypothetical, but you see the Apple and people are coming in now. I want you to submit Apple actual specs. There's something going on in there that's meaningful enough for us to want to come in the same city, I think, as financial institutions. Whether or not you have a lot to display or any of this other guys, it's probably going to happen because this is a reasonable growing area. So that's one thing that we thought, hey, this is not that to try to open a pod. So if you go back to try to think about how do we see the opportunity and how do we value these stocks when that total addressable market and again, kind even if you take. So this year it's growing that upon that it's going to be in line to even be better than expected because more people are aware of it, when you actually what are the other options out there? And you see guys got any other offerings? I can only go to Afterpay to jump on the market twice a month. Can I jump on that at the Marketplace Web site and find discounts and why much? It's my one stop shop. So I think that's where they're involving themselves, that this all seems negative and everybody can talk about that. And competition is always a challenge. And you are watching closely to see, you know, outside of the box thinking, I think that perhaps it might not be as bad as I see it. We had this morning PayPal's quarterly results as well, and that showed that even though you're seeing strong growth, for example, you had active customers. The increase was around point nine million from quarter on quarter, whereas you look at what, Afterpay? So you're expecting Ranchi full for the next quarter. And so you can see if you keep accelerating that growth, no matter what happens, you're not going to necessarily catch up if Afterpay can continue all that worries. [00:30:31][136.2]

Alec: [00:30:33] Yeah, it's a it's a fascinating battle that we're going to watch play out in this battle. There's Afterpay the zip. Those people, those apple, they capture the headlines. But there is a raft of smaller players that are all trying to fight for their piece of the pie. Sizzle, hum, split open pie. The list goes on. How do you think about the smaller players in this competition? Do you think any have bright prospects, any that may fall out of the competition at some point? Yeah. How are you thinking about that long tail of being up [00:31:10][36.8]

Elise: [00:31:11] so fundamentally fundamental? Twelve three. Our faces is all around. That first mover advantage in the largest is gaining global share. So that makes it challenging for some of the smaller players. However, in the near term, there is some opportunities of that land grab. So we think there's some short term fundamentals. We do have a on that stock as we don't see those economics and I have to raise stock coming out of escrow. Again, that doesn't bode well the share price. But if you think about getting in, those contract means you might see a few more small hits to that share price. I guess what I'm going to do is, [00:31:53][41.9]

Bryce: [00:31:53] yeah, interesting to see how this all plays out. I'm sure we're going to have a divided community listening to this. But let's turn to the Australian startup scene, probably for for us in the Equity Mates community, a scene that's not necessarily Covid as much, or at least we're not getting information flow as much as we sort of would like. So how would you describe the current state of the Australian startup scene? Let's start at the top. [00:32:26][32.8]

Elise: [00:32:27] So I think as you recognize it, it's really fun to actually hear about these stocks before they come to market, because it's it gives the guys to who are your next disruptors to the listing large cap stocks or maybe small cap that we have in the market. And it's also a matter of who is going to be the next IPO. You've not had the journey from the stop before they come to market? No, they can't get it out. So what we're seeing at the moment is similar really to what we're seeing in the listed space, which is high valuations. It's is that a lot of that institutional money, which is the Dollars and some of these stocks, has now seen the return that was being received that makes and now they've started to move it to the IPO space. But when we think about the semantics, again, thinking about what might be asking you to stop that, you've got to look at one aspect of currency. We see a lot of that coming for a fee tax and then ESG investing. That's another thing that I've seen a lot in that space. [00:33:27][60.6]

Alec: [00:33:28] So I guess the the startup scene is critical to create the next, you know, saken area in Australia. But we want to aim for the next Google and Apple and all of those that were all started in garages over in Silicon Valley. I guess looking at the tech landscape and looking at those potential companies that may be opening soon and showing great growth, growth prospects, are there any particular names that that have you quite excited at the moment? [00:34:00][31.4]

Elise: [00:34:00] Well, we start out by talking tech focus, but we hope these entrepreneurs start up funds and there's a few potential IPOs in there that I'm not going to see. And what they are, they are an and Spotify. I do want to listen. I talk in tech with the least, but a few that are just. Lieto is around historically, this space of music, there's a lot of needle in open and kind of work within that where this now always online where you can remove that man so that both the artist gets the full amount of space and then you can also contact artists. That's one thing is also some of those ESG orientated stocks is mentioned once that contract companies, companies, including the likes of yourself, if you it to track record and recognition, and then another one, which is you can shop as a woman, is trying to divide the superannuation every time you shop, even if you think you're working from home, although you'll be the one that's going to be looking all the things for the kids, buying all the nappies or whatever it is. What if you could get paid to superannuation for that? And so that's what this does. Access website. So that's a few of those. But as I mentioned, I won't say which ones. [00:35:20][80.4]

Alec: [00:35:26] Well Elise. We appreciate you taking the time today. We have almost come to the end of our time. But before we do, if people want to find out more about you, you've mentioned the Talking Tech podcast. But outside of that, if people want to find out more about you or your work at Jarden, where should they go? [00:35:45][19.3]

Elise: [00:35:46] If you just Google the website and Kennedy on Jota and you'll be able to find myself on LinkedIn, that's probably one of the best ways to reach out to me personally. But you'll also see I'll ask myself and some of the other analysts that are in the market that's covering how this is outside of Tik-tok. [00:36:02][16.3]

Alec: [00:36:03] This one will jump into these final three questions. The first one is, do you have any books that you consider must read? [00:36:11][7.8]

Elise: [00:36:12] I've got an extensive list, so I will narrow it down to a few quick ones. So she Dollars one. Benjamin Graham, intelligent investor, just about. And then my lucky last one, How to win friends and Influence People. [00:36:28][15.5]

Alec: [00:36:28] Know some great books there. How to win friends and influence people is one that Warren Buffett often talks about. So you're in good company then? [00:36:37][8.5]

Elise: [00:36:39] I think he also likes Benjamin Graham, to say the least. [00:36:44][4.9]

Alec: [00:36:46] So the next one is what is the best company you've ever come across? [00:36:51][4.6]

Elise: [00:36:53] That's a really stupid thing to do to find ones that I hate. Well, that is just some really impressive drive because it's so many in the US as to what I want, I find is that a company is about being able to grow beyond what you can do to that. So Xeros right and you start taking that business globally. Strong unit economics such as mulcher from unvalued provability to look at Cash-Flow. So that's just one company I can give an example of looking at the is more of that kind of list, those drivers and so on. [00:37:32][38.7]

Alec: [00:37:32] And then final question, if you think back to your early days starting out, investing, buying those first shares in 3D systems, what advice would you give to your younger self? [00:37:43][10.3]

Elise: [00:37:44] Don't stress if you raise twenty five and you haven't invested. Right. And if you think that that success is about the journey, it's about learning and overcoming those stumbling blocks and thinking about those is just stepping stones for you, getting creative about your solutions or thinking about differently each time. So instead of kicking yourself, what did I do investing in stocks? I actually go back to my original example. You have to all of a sudden Tom Deep Dive says, [00:38:14][30.2]

Bryce: [00:38:15] Well, Elise, thank you so much for your time today. No doubt that our community would have taken a lot from from this interview, a very topical space and one that's daily getting questions and and conversation going in our in our Facebook group. And so we appreciate hearing your thoughts on it. And I would encourage anyone who's listening to try and follow the work that you're doing because you are covering this space very closely. And to your point, got to keep the eye on the prize. So appreciate your time [00:38:44][29.7]

Elise: [00:38:46] and thank you both again for having me on the show. [00:38:46][0.0]

[2206.9]

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