Ryan Deiss argues that revenue and growth metrics lie. The real measure of a business is whether it can distribute cash to owners. He recommends taking money out regularly and reinvesting only when returns justify it, which forces discipline and proves the business actually creates value.
Revenue is vanity. Profit is sanity. Cash is reality. Distributions are freedom. I think that the end goal of a company and the ultimate way to know if a business is successful is not profit. It's not growth. It's not sales. It's not, are customers happy. It's can this business distribute large chunks of cash? That is the sign that it is delivering excess value. And if that's not happening, there is a problem. I'm all for reinvesting in businesses, but here's a tip. Take the money out, and if it's worth reinvesting in, put it back in. If you do that, I promise you will make better investments in your business.
