π§΅π² Do you want to outperform the market?
Invest in companies with skin in the game. These companies outperform the market by 4% (!) per year on average.
Start to learn here β¬οΈβ¬οΈβ¬οΈβ¬οΈβ¬οΈ
Invest in companies with skin in the game. These companies outperform the market by 4% (!) per year on average.
Start to learn here β¬οΈβ¬οΈβ¬οΈβ¬οΈβ¬οΈ
Lesson 1: Skin in the game is essential.
Invest in companies where interests of management are aligned with the one of you as a shareholder. Family companies put the interests of the company first.
Buy companies where the founder or his family owns at least 20%.
Invest in companies where interests of management are aligned with the one of you as a shareholder. Family companies put the interests of the company first.
Buy companies where the founder or his family owns at least 20%.
Lesson 2: A long-term mindset creates value.
Family-run companies think on the long-term.
Companies with skin in the game dare to take decisions which might hurt results in the ST, but are very good for LT value creation. This is a BIG advantage compared to other companies.
Family-run companies think on the long-term.
Companies with skin in the game dare to take decisions which might hurt results in the ST, but are very good for LT value creation. This is a BIG advantage compared to other companies.
Lesson 3: Healthier balance sheet.
In general, companies run by people with skin in the game use less debt. This is very beneficial as cash is just like air for humans. If you donβt have air, you canβt breathe. Cash gives companies a lot of flexibility.
In general, companies run by people with skin in the game use less debt. This is very beneficial as cash is just like air for humans. If you donβt have air, you canβt breathe. Cash gives companies a lot of flexibility.
Lesson 4: More revenue growth.
Family-owned companies generate superior top-line growth.
Since 2006, revenue growth for family companies averaged 11.3% compared to βonlyβ 6.8% for non-family companies.
Family-owned companies generate superior top-line growth.
Since 2006, revenue growth for family companies averaged 11.3% compared to βonlyβ 6.8% for non-family companies.
Lesson 5: Higher profitability.
Besides generating stronger revenue growth, companies with skin in the game are more profitable too.
Since 2006, family companies generated higher EBITDA margins every single year compared to non-family companies.
Besides generating stronger revenue growth, companies with skin in the game are more profitable too.
Since 2006, family companies generated higher EBITDA margins every single year compared to non-family companies.
Lesson 6: Better capital allocation.
The cash flow returns on investment (CFROI) is a great metric to measure the capital allocation of a company. This metric shows a clear and consistent degree of outperformance by family companies.
This is essential for LT value creation.
The cash flow returns on investment (CFROI) is a great metric to measure the capital allocation of a company. This metric shows a clear and consistent degree of outperformance by family companies.
This is essential for LT value creation.
Lesson 7: More robust against disruption.
Disruption is the biggest enemy of Quality stocks.
In general, family companies invest more in R&D compared to other businesses. Investing in R&D goes hand in hand with a long-term mindset and is a good protection against disruption.
Disruption is the biggest enemy of Quality stocks.
In general, family companies invest more in R&D compared to other businesses. Investing in R&D goes hand in hand with a long-term mindset and is a good protection against disruption.
Lesson 8: Clear outperformance on the stock market.
Family-owned companies outperformed non-family-owned peers by 3.7% (!) per year since 2006.
Small cap companies with skin in the game outperform with even 6.5% (!) per year.
Family-owned companies outperformed non-family-owned peers by 3.7% (!) per year since 2006.
Small cap companies with skin in the game outperform with even 6.5% (!) per year.
Lesson 9: Some examples of family companies.
In the picture below you can find some examples of companies with skin in the game.
In the picture below you can find some examples of companies with skin in the game.
Loading suggestions...