New Regime for hyper growth investment
As serial entrepreneur organization, TANAAKK found these truth in hyper growth investment
The power of free cash flow
There is only 60 companies in the world, that have >100Billion USD Net Income with >100 Billion Free Cash Flow ,>10% ROE. (chart:FINBOX)
The top 10 companies free cash flow is around 1 Trillion USD per year. Oil&Gas, Banking, Manufucturing, Retail, Media, Shipping, Energy, etc. Relative revenue growth percentage is not so high but these are the fundamental free cash growth organizations. The real hyper growth organization have nearly 3 billion USD new cash per day. Comparing 2022 global venture capital investment amount($209.4 billion by EY Report), These architype high cash organization have 5 times more cash and new market as compared to venture capital.
How should we behave in modern growth environment?
It is very sensitive to touch which investment for each company is good or bad though, I can only say keep eye to 10 Billion free cash flow market and there is some in 5 years. The point is ESG with cash burning not accepted, ESG with high ROE and rich free cash flow is only accepted. Same rule will be applied in any industry.