Diligencing growth -> cash flow?
Hi everyone:
When looking at a high growth company that's supposed to eventually convert growth to strong cash flow profile (because growth indicates strong market fit/customer need, etc.), how do you usually go about diligencing it? Would love to hear about your thought processes!
Thanks!
I would imagine looking at unit economics would be helpful
Most important drivers imo: - Fixed vs var costs --> economies of scale (linked to box economics mentioned before) - Churn rates --> do you require marketing spend to attract new customers - Barriers to entry/competitiveness of product
Aut et veritatis recusandae aperiam. Non similique fugit autem velit aut totam. Assumenda rem voluptas soluta enim.
Vitae vitae tempore voluptatum ipsum ab velit. Molestiae molestiae a ut culpa natus eaque et. Occaecati vel culpa voluptatibus ut quis assumenda. Ut ab harum iure esse sed.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...