Category: Investment & Business Models

Economies of Scale — Fundamentals Through Graphics

The Experience Curve Revisiting fundamental business concepts is helpful.  Old concepts often have new meaning when viewed after new experiences.  Or, as we say at the school where I am a co-owner, “See it with today’s eyes and hear it with today’s ears.” One important,… Continue reading

Elusive Moats of Competitive Advantage — Definition by Morningstar

Moats of Competitive Advantage Investors look for “moats” or competitive advantages that create more certainty and more growth in revenue and margins.  In managing or investing in businesses, it is helpful to understand what moats other companies have been able to build and why.  This… Continue reading

Trend-spotting at Harvard Business School

One magnificent place to spot trends (and things that are too trendy) is the Harvard Business School.  There is a famous saying that someone should watch what newly minted Harvard MBA’s are doing and do the opposite — such as when all the MBA’s joined Internet… Continue reading

Investment Strategy – Sell Fixed Income

Pension Funds Buying Fixed Income As investors and business owners, it is problematic to make decisions for the future with too much of an emphasis on the past. In reading a recent issue of Grant’s Interest Rate Observer, they mentioned an eye-popping statistic from the… Continue reading

Thoughts on the Berkshire Hathaway Meeting 2012

The Berkshire Hathaway Annual Meeting Below are a few words of advice from Warren Buffett and Charlie Munger yesterday at the Berkshire Hathaway annual meeting.  Business owners and investors should make a point to attend a Berkshire annual meeting sometime.  There are not that many… Continue reading

Enlightenment about Investor Alignment

Obtaining alignment among the various parts of a company, particularly between company founders and investors, is a never-ending topic.  Two items have caught my eye this month that relate to this issue and may help spread some enlightened thinking about investor alignment. First, Fred Wilson, a… Continue reading

Company Founder Regrets Sale to Traditional Private Equity

Be careful to whom you sell your company, said the founder of Jimmy Choo footwear, Tamara Mellon.  In the Financial Times, Mellon was quoted, “What happens in private equity is they come in and they say we’re going to be a great partner.  We want… Continue reading

Construct a Perfect Business, Financially Speaking

Designing the financial model (in a real-world sense, not a spreadsheet sense) of your business is worth every minute that you can dedicate to it. We should craft the financial model of our business with as much care as a fine architect and craftsman would… Continue reading

To Sell Your Business or Not To Sell Your Business — That is the Question (a series)

Should you sell your business? This is one of the most difficult questions and there is no one right answer. I have been asked this question so many times and it is the most difficult to answer. To provide some assistance on the question, however,… Continue reading

C Corporation Business Owners are at Risk of Losing Millions

I lost huge money early in my career in not electing to switch my company from a Corporation to an S Corporation.  I don’t want you to make the same mistake.  Each year, the owners of C Corporations have an opportunity to switch their tax… Continue reading