The Cut

A construction business can be profitable on paper and still run out of cash. In this episode of The Cut, host Chris Bergin speaks with Victor Zhou, a fractional CFO specialising in the construction sector, about why cash flow problems develop, how builders and developers can identify them early, and why borrowing more money is rarely the real solution.

Their conversation ranges across the changing construction market, private credit, working capital, project forecasting and front-loaded claims — and the financial pressures facing Australian builders and developers today.

Victor also makes the case that construction businesses need to think beyond their next project and treat every project as an investment in the business itself. The key message is a simple one: understand your cash flow early, identify the source of the problem, and take action before you need the money yesterday.

Key Points

1. Cash flow problems need to be identified early. The answer isn't always another source of funding. A business first needs to understand how it arrived at its current position — and whether cash is still leaking out.
2. Every construction project creates a working capital requirement. Builders can spend on labour, subcontractors and materials 30 to 60 days before payment arrives, making working capital critical as projects grow in size and number.
3. Forecasting is an early warning system. A project budget doesn't need to be perfectly accurate. Its purpose is to surface problems early enough to act — rather than needing money immediately.

Links

• Victor Zhou on LinkedIn
• Your CFO Partner
• Chris Bergin on LinkedIn
• Simon Cathro on Linkedin
• Andrew Blundell on Linkedin

In this episode of The Cut, Chris Bergin, Cathro's Principal in Melbourne, sits down with Julian Heatherich, Director of Commercial Sales at Savills, to discuss the current state of Victoria's commercial property market.

Drawing on more than 25 years of experience in real estate, Julian shares his perspective on the challenges facing developers, investors and lenders, including rising construction costs, tighter funding conditions and reduced transaction volumes. He also explores why premium assets continue to perform, how developers are adapting through new strategies such as build-to-rent and modular construction, and where opportunities are beginning to emerge.

The conversation finishes on an optimistic note, with Julian explaining why he believes Victoria is nearing a turning point and why today's cautious market could be viewed as one of the best buying opportunities in hindsight.

Key Points

• Victoria is approaching a potential turning point. While uncertainty continues to slow transactions, Julian believes improving sentiment and future interest rate cuts could see the market rebound quickly.
• Developers are being forced to think differently. Rising construction costs, tighter lending and changing buyer demand are driving greater interest in strategies such as build-to-rent, modular construction and creative development partnerships.
• Long-term fundamentals remain strong. Population growth, limited housing supply and continued infrastructure investment are creating confidence that Melbourne and Victoria will remain attractive investment markets over the years ahead.

Links

• Julian Heatherich Linkedin
• Chris Bergin on LinkedIn
• Simon Cathro's Linkedin
• Andrew Blundell Linkedin
• Savills

Most small business owners invest their own money long before a bank ever backs them. But when financial hardship strikes, many discover that their personal investment isn't protected. In this episode of Season 5 of "The Cut", Simon Cathro sits down with former insolvency lawyer and Krodok founder Matthew Kelly to explain why thousands of Australian business owners unknowingly leave themselves exposed when lending money to their own companies.

They discuss director loans, PPSR registrations, business restructuring, insolvency, and why getting the legal foundations right early can make the difference between surviving financial distress and losing everything. Whether you're starting a business, growing one, or simply want to better protect what you've built, this episode offers practical advice every business owner and advisor should understand.

Key Points:

1. Why documenting director loans properly can dramatically improve restructuring options.
2. How secured loans give business owners greater control during insolvency.
3. Why prevention is significantly cheaper than trying to fix problems later.

Links

• Matthew Kelly's Linkedin
• Simon Cathro's Linkedin
• Krodok website

What does it actually take to build a professional services firm — and sustain its growth over time?

In this episode of The Cut, Andrew Blundell speaks with Danny Chiha about the realities of building and scaling a firm from the ground up.

From early beginnings working from a dining table to leading a 70-person team, Danny shares a practical perspective on growth — including the challenges of leadership, hiring and maintaining culture as a business expands.

The conversation also explores how technology is reshaping the accounting profession, and why human relationships remain central despite increasing adoption of AI.

More broadly, it highlights the role of mentorship, long-term thinking and consistency in building something sustainable.

• Building a professional services firm from first principles
• The challenges of scaling teams and maintaining culture
• Leadership development and capability building
• The role of AI in the future of accounting
• Why long-term thinking underpins sustainable growth

1. Growth takes time Building a sustainable business is typically the result of consistent effort over extended periods, rather than short-term acceleration.

2. Scaling is about people Business growth often depends on developing leadership capability and building teams that can operate effectively at scale.

3. Technology and relationships must align While AI and automation are reshaping the industry, client relationships and human judgement remain central to long-term success.

• Kelly+Partners Accountants
• Simon Cathro's LinkedIn
• Andrew Blundell's LinkedIn

Cathro & Partners are experts in providing insolvency and restructuring services that help to create and preserve business value and enable individuals to make a fresh start. The firm specialises in restructuring, turnaround, personal and corporate insolvency, safe harbour, secured enforcement services, government advisory services and pre-lending services.

For a confidential discussion on any of the above, please reach out to one of our experts.

Most SME owners don't struggle due to a lack of knowledge — they struggle because they're too busy operating the business to step back and fix what actually drives performance.

In this episode of The Cut, Simon Cathro speaks with Mark Calleja, author of The Seven Figure Plateau, about the patterns that keep business owners stuck — and what it takes to move beyond them.

Drawing on practical experience with growing businesses, Mark unpacks the common blind spots that limit scale, constrain cashflow and create operational bottlenecks.

The discussion covers the shift from working in the business to working on it, the role of systems and discipline, and why many businesses fail despite appearing busy and active.

• Why working in the business limits growth and scalability
• The systems and structure required to create time and control
• Common cashflow mistakes that quietly undermine performance
• Building a team that supports, rather than constrains, growth
• The mindset shift required to move from survival to scale

1. Growth requires stepping back Sustainable growth typically comes from focusing on strategy, systems and decision-making — not just day-to-day operations.

2. Discipline over complexity Consistent processes, regular reviews and clear structure tend to outperform reactive or ad hoc management.

3. Cashflow drives outcomes Strong activity levels don't always translate to performance. Visibility over cashflow, billing and decision-making remains critical.

• Mark Calleja's LinkedIn
• Simon Cathro's LinkedIn
• Andrew Blundell's LinkedIn
• Mark Calleja Accounting
• The Seven Figure Plateau

Cathro & Partners are experts in providing insolvency and restructuring services that help to create and preserve business value and enable individuals to make a fresh start. The firm specialises in restructuring, turnaround, personal and corporate insolvency, safe harbour, secured enforcement services, government advisory services and pre-lending services.

For a confidential discussion on any of the above, please reach out to one of our experts.

John Melluish, CEO of ARITA, joins The Cut to unpack the current state of Australia's insolvency landscape.

From his early experience during the insolvency cycles of the 1980s to now leading the industry's peak body,

John shares perspectives on how the profession has evolved — and where it is heading. The discussion explores the post-COVID rebound in insolvency activity, the increasing role of the ATO and the potential for further pressure in the personal insolvency space.

John also reflects on the role of insolvency practitioners, including areas where their responsibilities are not always well understood, and how this intersects with stakeholder expectations. The conversation also covers insolvency reform, education pathways and the challenges of modern regulation, including AML obligations.

Key Points

• Why insolvency activity is rising again
• The role of liquidators and common areas of misunderstanding
• What's next for insolvency reform in Australia
• The ATO's influence on market dynamics

Timestamps:

• [00:00:00] The core AML problem: who is the "client"?
• [00:01:00] John Melluish's appointment as AITA CEO
• [00:02:00] Career beginnings and insolvency boom in the 80s
• [00:03:10] Borders collapse and the impact of online retail
• [00:04:45] AITA's role and industry coverage
• [00:05:30] Revenue model: membership, events, education
• [00:06:20] Shift to Registered Training Organisation (RTO)
• [00:09:00] Insolvency reform: challenges and opportunities
• [00:11:30] Post-COVID insolvency trends and ATO impact
• [00:16:00] Complaints, creditors, and public misunderstanding

Links:

• John Melluish Linkedin
• Simon Cathro's Linkedin
• Andrew Blundell Linkedin
• ARITA website

Construction insolvencies now represent one of the largest shares of corporate failures in Australia. While the triggers vary, the underlying pattern is often remarkably consistent: tight margins, poorly defined scope, delayed payments, disputed variations and contractors effectively funding projects from their own balance sheets.

In this episode of The Cut, Simon Cathro speaks with Paul Rojas, founder of RA Law Group, to explore why so many construction businesses find themselves in this position — and what operators can do earlier to avoid it.

With more than 22 years' experience in commercial litigation, construction disputes, insolvency and debt recovery, Paul has seen the same structural pressures play out across countless projects. The conversation examines the contractual and commercial issues that often sit behind construction insolvencies, and the steps builders, subcontractors and developers can take to better protect cashflow.

The discussion also highlights the importance of understanding payment rights under security of payment legislation, managing variations properly and ensuring contracts reflect the commercial realities of construction risk. For businesses operating in one of the most challenging sectors of the economy, proactive contract management and early legal advice can often determine whether a project remains viable or becomes another insolvency statistic.

Key Points:

• Recurring patterns behind construction insolvencies: Many failures follow the same trajectory: poorly managed contracts, unpaid variations, project delays and sustained cashflow pressure.
• Using security of payment laws effectively: These laws are designed to protect cashflow, but they only work when payment claims are issued correctly and enforced promptly.
• Early legal and contractual planning matters: Reviewing contracts carefully, understanding termination rights and diversifying client exposure can help prevent financial stress escalating into insolvency.

Links

• Paul Rojas' Linkedin
• Simon Cathro's Linkedin
• Andrew Blundell Linkedin
• RA Law Group

In this episode of The Cut, Simon Cathro sits down with Mitch Taylor, founder of ClaimCloud, to explore a concept still unfamiliar to many Australian creditors: selling creditor claims for immediate liquidity.

With over 25 years in credit markets, including time on Wall Street during the GFC, Mitch shares why time is often the most overlooked cost in insolvency. Together, Simon and Mitch unpack how claim trading works, why insolvencies can stretch on for years, and how emotion, uncertainty and litigation shape creditor decisions.

This conversation challenges traditional thinking about recoveries and asks whether maximising cents in the dollar should always come at the expense of time.

Key Points

• Time is as important as recovery value - Maximising cents in the dollar often comes at the cost of years of waiting.
• Creditors are not a single group - Every creditor has different priorities, emotions and financial pressures.
• Selling a claim should be an option, not a taboo - Claim trading gives creditors control over when they exit an insolvency.

Links

• Mitch Taylor's Linkedin
• Simon Cathro's Linkedin
• Andrew Blundell Linkedin
• ClaimCloud's website

In this episode of The Cut, the conversation dives deep into the hidden complexities of insolvency law and what every director, administrator, and shareholder needs to understand before making their next big decision.

From a chickpea trading company that triggered a pivotal case to the misunderstood power of subordinated creditors, this episode dissects real-world examples that show how "reasonable" actions can quickly become legally dangerous.

Guest Pavlos Stavropoulos, a senior disputes and insolvency solicitor at Addisons, breaks down three critical areas - unreasonable director-related transactions, subordinated creditor rights, and derivative leave applications, offering clarity on where risk meets responsibility. Whether you're a director seeking to protect your position or an insolvency practitioner managing complex stakeholder claims, this episode reveals how to approach each scenario with strategic insight and legal precision.

Key Points

• Understanding unreasonable director-related transactions is crucial — they can apply even when a company isn't insolvent.
• Subordinated creditors can have limited but important rights in external administrations — if the court allows it.
• Derivative leave applications reveal how legal power struggles inside companies can turn into court-sanctioned corporate warfare.

Links

• Pavlos Stavropoulos' LinkedIn
• Simon Cathro's Linkedin
• Andrew Blundell Linkedin
• Addisons website

In this episode of "The Cut", the conversation dives into how AI is being used inside law firms, what it's getting wrong, and the new rules emerging around its use in legal proceedings. Featuring "Jarrod Munro", Partner at "Cornwalls Lawyers", this discussion unpacks real examples—from court restrictions to hallucinated legal cases—to reveal the promise and peril of AI in professional industries.

Jarrod explores how AI's efficiency can help lawyers and accountants focus on higher-value work while warning of the ethical, accuracy, and confidentiality pitfalls that still plague the technology. Listeners will walk away with a sharper understanding of how to integrate AI responsibly, spot its blind spots, and future-proof their professional practice.

Key Points

• AI's speed doesn't mean accuracy—hallucinations and bias remain huge risks if you don't verify results.
• Confidentiality and compliance are still human responsibilities, even when AI handles the grunt work.
• The firms that learn how to train, audit, and ethically deploy AI will outpace those who ignore it.

Timestamps

• [00:00] Why trusting AI output is a dangerous assumption
• [02:27] What AI really is (and why it's not that new)
• [04:23] How AI impacts the legal and accounting industries
• [06:23] Why AI can't be trusted for legal research [08:00] Court rules on AI-generated affidavits
• [11:18] The hidden confidentiality risks in AI use [13:02] Efficiency vs. accuracy—real examples from practice
• [14:47] AI hallucinations and their legal fallout [20:00] Bias, black box problems, and real-world AI disasters
• [33:14] What the future of AI means for lawyers and accountants

Links

• Jarrod Munro's Linkedin - https://www.linkedin.com/in/jarrod-munro-5953ab58/
• Simon Cathro's Linkedin - https://www.linkedin.com/in/simon-cathro-b6a6b21/
• Andrew Blundell Linkedin - https://www.linkedin.com/in/andrew-blundell-2a54664/
• Cornwalls website - https://www.cornwalls.com.au/