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How Are You Investing In Your Business This Year?

Name: How Are You Investing In Your Business This Year?
Uploaded: 2022-06-03T15:15:04+00:00
Duration: 41 s
Channel: Shanli Liu, CPA, CTP
Description: In this concise talk, the speaker frames a business as a cash‑flow‑generating asset and argues that the most effective use of that cash flow is to…

3 Jun 2022 · 1 min

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In this concise talk, the speaker frames a business as a cash‑flow‑generating asset and argues that the most effective use of that cash flow is to reinvest it back into the business. By doing so, owners can expand the asset’s capacity to generate even more cash. The speaker outlines concrete ways to invest: hiring talented personnel, adopting new technology, broadening customer‑acquisition pathways, and increasing media presence. Each of these actions raises enterprise value, which in turn produces higher future cash flows, creating a self‑reinforcing cycle of growth.

Chapters

Here's what it means when someone says you should invest into your business. Your business is a cash flow asset. It produces cash flow. What is the best thing to do with cash flow when you have it? When people have money, they want to put it in something that actually produces cash flow. And so that is why for most business owners, it makes sense to take that money and put it back into their business to then create a bigger cash flow asset that creates more cash flow that comes out of it. And the way that you do this, investing into the business, is by hiring talented people that can add to the enterprise value, by increasing enterprise value by maybe adding technology or expanding pathways in which you acquire customers, or by literally reinvesting in media. So expanding your reach by expanding how much media that your business has. And so as you do that, you literally are producing more cash flow. And so it's a recycling of your cash essentially.