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I couldn't agree more. We need to build companies that are sustainable and stable, it's almost as if its a lost concept - What's wrong with a profitable company

I couldn't agree more. We need to build companies that are sustainable and stable, it's almost as if its a lost concept - What's wrong with a profitable company with no growth? Most companies shoot themselves in the foot and die while growing. Hey, I guess its like a forest - a tree falls down and small seedlings take up the space. Ah, the endless cycle of human struggle.

tjs8rj 6y ago
I just watched a video on Apple’s “cash problem”, with one of the video creators core point that “people expect the stock price to go up, and that can’t happen unless Apple does something with that cash and makes more with it!”. Got me thinking: isn’t one of the core premises of investing that you’re purchasing ownership of cash flow? Is the ideal company one that it’s never profitable because it so perfectly allocated its money to never return a dime, but always to reinvest in itself? There’s a time and a place for re investment, but returning profit to investors is marginalized these days. Apple probably doesn’t have a money problem, the culture does. Startups don’t sell growth except secondarily, they sell profit.
- systemvoltage 6y ago
  No, classic companies like Coca-Cola pay dividends to their shareholders. A company can also buyback their shares.
- wtf_is_up 6y ago
  AAPL pays a dividend and has a substantial buyback program. Their cash problem, if you want to call it that, is that they bring in so much revenue with nice margins that it is impossible to allocate it all. So they return some value back to shareholders through divvies and buybacks, spend what is reasonable on R&D, and keep cash on hand for flexibility. They don't seem that big on M&A, but that is probably a good thing (looking at Cisco for example)
  - lexs 6y ago
    It's a shame that the third way to spend the money is totally forgotten now apparently. Yes you can re-invest, give back to shareholders, but why not increase wages?
    - kgwgk 6y ago
      Why not the fourth way: lower prices? Or the fifth way: give it to me...
      - systemvoltage 6y ago
        Build manufacturing plants in western countries.
raybb 6y ago
I joined clubhouse (the audio-only app) recently and while there is a lot of VCs and marketing nonsense there taking up the app I've also found quite a few rooms full of people who are working on sustainable organizations. start.coop is one example and others just generally talking about social enterprises or how to use tech to keep businesses on a slow and steady growth.
Breza 6y ago
I totally agree with you. A company with consistent profits shouldn't be seen as a bad thing.

tjs8rj 6y ago

I just watched a video on Apple’s “cash problem”, with one of the video creators core point that “people expect the stock price to go up, and that can’t happen unless Apple does something with that cash and makes more with it!”. Got me thinking: isn’t one of the core premises of investing that you’re purchasing ownership of cash flow? Is the ideal company one that it’s never profitable because it so perfectly allocated its money to never return a dime, but always to reinvest in itself? There’s a time and a place for re investment, but returning profit to investors is marginalized these days. Apple probably doesn’t have a money problem, the culture does. Startups don’t sell growth except secondarily, they sell profit.

systemvoltage 6y ago
No, classic companies like Coca-Cola pay dividends to their shareholders. A company can also buyback their shares.
wtf_is_up 6y ago
AAPL pays a dividend and has a substantial buyback program. Their cash problem, if you want to call it that, is that they bring in so much revenue with nice margins that it is impossible to allocate it all. So they return some value back to shareholders through divvies and buybacks, spend what is reasonable on R&D, and keep cash on hand for flexibility. They don't seem that big on M&A, but that is probably a good thing (looking at Cisco for example)
- lexs 6y ago
  It's a shame that the third way to spend the money is totally forgotten now apparently. Yes you can re-invest, give back to shareholders, but why not increase wages?
  - kgwgk 6y ago
    Why not the fourth way: lower prices? Or the fifth way: give it to me...
    - systemvoltage 6y ago
      Build manufacturing plants in western countries.

raybb 6y ago

I joined clubhouse (the audio-only app) recently and while there is a lot of VCs and marketing nonsense there taking up the app I've also found quite a few rooms full of people who are working on sustainable organizations. start.coop is one example and others just generally talking about social enterprises or how to use tech to keep businesses on a slow and steady growth.

Breza 6y ago

I totally agree with you. A company with consistent profits shouldn't be seen as a bad thing.