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Category Archives: Finance

Revenue and Runway – Why every cent matters

Tuesday, November 10, 2009

A month ago on Techcrunch, Michael Arrington wrote about “Twitter’s Revenue Dilemma”: “Your valuation can actually go down once you turn on revenue.”.
“Turning on revenue” frames it as a binary thing. You’re either making money or you’re not. It completely disregards the most important variable in finance: Time.
With the tiniest trickle of revenue you can [...]

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Costs and Startups – Advice for your CFO

Sunday, November 1, 2009

In any company if you save $1 it goes straight to your bottom line. Meaning it’s as if you just earned another $1. The company that my wife and I have been running for about 2 years now serves over 30 Million page requests per day. We’ve invested a lot of time in getting more [...]

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The DOW 10K priced as opportunity cost

Saturday, October 17, 2009

Economists love the concept of opportunity cost because it gives you a the real long-term value of an investment or purchase in relative terms – which is really the only way to calculate value. On Wednesday the DOW hit 10,000 again. The US financial press did their part to ring the bell while the banking [...]

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Great interview with Columbia’s Bruce Greenwald on value investing

Sunday, October 11, 2009

There’s a spectacular interview on ft.com today with my favorite FT journalist John Authers with Bruce Greenwald who teaches Ben Graham’s value investing course at Columbia.
Bruce talks about behavioural finance and the irrationality of investors, the often ignored mathematical realities of the market, the brutality and danger of short selling (all short sales are treated [...]

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