Two tech outsiders tried to sell a $44bn tech company. It didn’t work

Let’s get this straight. Australia should want big, bold technology companies, and it should want them listed here where ordinary investors can share in the upside.

But Firmus was always going to be a hard sell. Just after 9am on Friday, it stopped trying. The data centre start-up withdrew its $43.7 billion sharemarket float , which would have been the largest on the ASX since Telstra in 1997, after big investors refused to pay its price.

Firmus builds what it calls AI factories: data centres packed with Nvidia chips, whose computing power it rents to tech giants such as Meta and OpenAI to run their AI. Unlike most data centre operators, which rent out space and power, it owns the chips itself.

Most of those factories do not exist yet. Firmus runs two data centres, in Melbourne and Singapore, with seven more contracted and four in planning. Of the 912 megawatts of computing capacity it has signed customers up for, just 46 are running: about 5 per cent.

The company asked Australians to buy a skyscraper off the plan. For once, the market asked to see the foundations first.

Is this the AI bubble bursting? Not on this evidence. Spending on AI is still climbing, and chip giant Nvidia announced a $US150 billion share buyback late last month. But investors are getting pickier. Smart-ring maker Oura has delayed its US float, and shares in CoreWeave, Firmus’ closest listed rival, have halved in a year.

The ramifications are significant for its two chief architects – cousins who were set to be instant billionaires and had no real experience in the technology sector – and will sweep across Australia’s AI sector and the economy more broadly.

Had Firmus listed this month, millions of Australians would most likely have ended up owning a slice of it through their super, without ever being asked. They won’t now.

The float was supposed to complete one of the more remarkable comebacks in Australian business. Oliver Curtis, Firmus’ 40-year-old co-chief executive and the husband of public relations entrepreneur Roxy Jacenko, is a former investment banker who served a year in jail for insider trading a decade ago. He has since called his actions “incredibly, gravely stupid”.

He co-founded Firmus in 2019 as a bitcoin mining business with his cousin Tim Rosenfield, who ran a luxury lingerie brand, and Jonathan Levee, who handles the engineering. Neither co-chief executive came from the technology industry.

They signed up big names all the same. Nvidia, the world’s most valuable chipmaker, is a shareholder and James Packer and former treasurer Joe Hockey hold stakes. “As a father, I’m incredibly proud of what Oli’s done,” Curtis’ father Nick, a mining entrepreneur and major shareholder, told The Australian last week.

Firmus earned about $US50 million ($73 million) in revenue last financial year. It asked to be valued at about 600 times that.

“Investors just weren’t prepared to pay a sky-high price up-front for capacity that’s still largely on the drawing board,” Josh Gilbert, who analyses Asia-Pacific markets for investing platform eToro, told this masthead.

The price had climbed quickly.