Four people are in a train compartment: a young woman and her mother, and a young soldier with his boss, Colonel.

The train enters a dark tunnel and the compartment goes completely black. Everyone hears the sound of a kiss, immediately followed by a loud slap. When the train comes out of the tunnel, the boss is rubbing his cheek, and all four quietly sit there, each thinking something different.

• The Colonel thinks: “That young soldier must have kissed the girl, and she slapped me by mistake.”
• The mother thinks: “That older man kissed my daughter, but I’m glad she slapped him.”
• The young woman thinks: “That older man kissed my mother, but I’m glad she slapped him.”
• The young man thinks: “This was perfect. I kissed the back of my own hand in the dark and got to slap the Colonel.”

“The Road Not Taken” is Robert Frost’s famous poem about a traveler facing a fork in the road, contemplating which path to choose. It explores the ambiguity of choices and the hindsight of regret.

The Road Not Taken by Robert Frost

Two roads diverged in a yellow wood,
And sorry I could not travel both
And be one traveler, long I stood
And looked down one as far as I could
To where it bent in the undergrowth;

Then took the other, as just as fair,
And having perhaps the better claim,
Because it was grassy and wanted wear;
Though as for that the passing there
Had worn them really about the same,

And both that morning equally lay
In leaves no step had trodden black.
Oh, I kept the first for another day!
Yet knowing how way leads on to way,
I doubted if I should ever come back.

I shall be telling this with a sigh
Somewhere ages and ages hence:
Two roads diverged in a wood, and I—
I took the one less traveled by,
And that has made all the difference.

The Rule of 40 balances revenue growth and profitability for SaaS companies by requiring their sum to reach or exceed 40%.

Definition

The Rule of 40 adds a company’s year-over-year revenue growth rate (in percentage) to its profit margin, typically EBITDA margin, though alternatives like operating or free cash flow margins apply. Popularized by Brad Feld, it assesses sustainability in high-growth tech firms where pure growth or profit alone misleads.

Calculation

Compute as: Rule of 40 = Revenue Growth Rate (%) + EBITDA Margin (%). For example, 30% growth plus 15% margin equals 45%, passing the rule; 20% growth plus 15% equals 35%, falling short. Use trailing periods like three to twelve months for stability, and weight growth higher (e.g., 1.33x) for early-stage firms.

Usage in Investing

Investors favor scores above 40% as it signals efficient scaling without excessive losses, guiding valuations and M&A.

Track trends over time: improving scores indicate health, while drops below 30-40% flag risks in competitive markets. Mature firms may prioritize margins, while startups lean on growth.

Source:  https://www.paylocity.com/resources/glossary/rule-of-40/

Owner earnings represent the true cash flow available to a business owner after accounting for essential reinvestments, popularized by Warren Buffett as a superior measure to reported net income for valuing companies.

Definition

Owner earnings adjust net income by adding back non-cash charges like depreciation and amortization, then subtracting maintenance capital expenditures and changes in working capital. The core formula is: Owner Earnings = Net Income + Depreciation/Amortization – Maintenance CapEx ± Working Capital Changes. This metric reveals cash that could fund dividends, growth, or debt reduction, ignoring accounting distortions.

Owner earnings and free cash flow both measure a company’s cash generation but differ in focus, adjustments, and application for investors.

Core Definitions

Owner earnings, from Warren Buffett, start with net income, add back depreciation/amortization, subtract maintenance capital expenditures (not total CapEx), and adjust for working capital changes to reflect cash truly available to owners.

Free cash flow (FCF) typically equals operating cash flow minus total capital expenditures, capturing cash after all CapEx but without distinguishing maintenance from growth spending.

Calculation Challenges

Precise computation requires estimating maintenance CapEx, as companies rarely disclose it separately from growth spending, leading to subjective judgments. Variations exist, such as starting from operating cash flow or excluding working capital, but all aim to approximate sustainable cash profits.

Pros for Long-Term Investment

Owner earnings excels for value investors by focusing on cash generation over accounting profits, enabling better intrinsic value assessments via comparisons to market cap. Consistent growth signals operational efficiency and sustainability, outperforming peers in cash conversion. It prioritizes businesses with durable competitive advantages, aligning with long-term holding strategies.

Cons for Long-Term Investment

Estimates introduce imprecision, especially for capital-intensive or cyclical firms where CapEx fluctuates. It overlooks growth CapEx benefits, potentially undervaluing expanding companies, and demands deep financial analysis not suited for all investors. Volatile earnings or seasonal patterns further undermine reliability compared to standardized metrics like free cash flow.

Companies with high owner earnings (often proxied by free cash flow or earnings growth tied to cash generation) and high ROIC (Return on Invested Capital, typically above 20-30%) indicate efficient capital allocation and strong economic moats.

These metrics appeal to value investors seeking sustainable profitability. Recent screens highlight US-listed firms excelling in both areas.

Source:  https://strawman.com/member/uploads/objects/de/d778df06286d71562539ae921cd296c6827ef3.pdf

A man asked his gardener, “How do you make your plants grow so beautifully?”

The gardener replied, “I don’t force them to grow. I simply remove what stops them.”

Michelangelo said something similar…

When asked how he carved the statue of David, he said: “It’s simple. I just remove everything that is NOT David.”

This is called: Addition through Subtraction.

Often, on your quest to unlock inner-greatness, you begin by looking in all the wrong places.

You look to introduce fancy new habits like cold plunges, red light therapy, or gratitude journals because you believe the reason you are not where you want to be is because there’s something you’re not doing.

And ya know what? Sometimes you do need to introduce new habits.

But…

The thing really holding you back are the things you need to STOP doing.

Imagine you’re a car.

Great habits are the accelerator.
Bad habits are the emergency break.

You could press harder on the accelerator, and sure, you’ll go quicker…

But do you smell that?

Yeah, that’s the smell of burn out.

So, before pressing the pedal all the way to the metal, let’s first make sure we’ve disengaged the emergency break.

That is, let’s eliminate those habits holding you back before worrying about the ones that’ll propel you forward.

Here are 3 of the most common bad habits that can hold you back:

1. The Scarcity Mindset

Many are haunted by the specter of scarcity, fearing there’s never enough of whatever we seek (money, love, attention, security, joy, time, etc…)

The paradox here is that when you worry about not having enough, you close ourselves off to the opportunities around you.

And therefore your reality mirrors your beliefs.

Here’s the thing…

Any belief held strongly enough will inevitably become true.

So be careful what you choose to believe…

Because in a very real way, it’ll become your reality.

2. Prioritizing Urgency Over Impact

We live in a noisy world filled with “loud” tasks vying for our attention.

And unfortunately, the loudest tasks tend to be the most urgent (and rarely the most important).

When you’re trapped in the cycle of urgency, it’s easy to confuse being busy with being productive.

But not everything that demands your attention deserves your attention.

3. Collecting Dots Instead of Connecting Dots

This third habit is subtle (and often mistaken for a virtue)…

It’s the excessive collection of dots, or in layman’s terms, the relentless pursuit of knowledge.

The problem?

It’s very hard to get paid for collecting dots.

Surprisingly easy, however, to get paid for connecting them.

**Dots = Information

Remember, the acquisition of knowlege is valuable, but it’s the APPLICATIONS of knowledge that creates real impact in the world.

Truly, life gets good when you stop collecitng more dots…

…and just start connecting the ones you already have.

Or, put another way:

Consume Less. Create More.

Source: Anthony Vicino, on “X”,  https://x.com/anthonyvicino/status/1999856841254130125

“Irrational exuberance is the psychological basis of a speculative bubble. I define a speculative bubble as a situation in which news of price increases spurs investor enthusiasm” – Robert J. Shiller

A financial bubble is a market phenomenon where an asset or group of assets rapidly inflates in price far beyond their intrinsic value, often driven by excessive speculation, investor psychology of greed, and easy access to capital. This price surge or melt-up becomes unsustainable, leading to a sudden and sharp decline in price or bursting of the bubble, which causes significant financial losses and widespread economic repercussions.

Key characteristics of a financial bubble include rapid price increases not supported by fundamentals, herd behavior fueled by optimism and fear of missing out (FOMO), and eventual panic selling when confidence and asset price collapses.

Financial asset bubbles are like roller coasters – prices soar rapidly and then plunge suddenly, leaving investors feeling disoriented. They occur when the price of assets, like stocks, real estate, or even tulips, shoots up quickly and deviates from its intrinsic value. A trigger, like rapidly increasing earnings or new technology, ignites investor excitement.

FOMO (fear of missing out) kicks in, leading to speculation and further price increases. However, like all roller coasters, the ride eventually ends, sending prices crashing down and leaving those who didn’t get off in time with significant financial losses.

Another unique feature of financial bubbles is its most frustrating: at a bubble’s height, most participants are completely unaware of being caught up in one. It is only in hindsight – after the damage has occurred – that a bubble becomes most clear.

Like bear markets and market corrections, stock market bubbles happen with some frequency, and investors are well served to prepare ahead of time.

The key to surviving a bubble is to not focus on identifying the bubble, but to maintain a diversified portfolio and a disciplined investment approach, which can serve as a steady anchor during a turbulent market.

Unfortunately, bubbles do happen with surprising frequency. As an investor, the important approach is not to avoid them altogether but to learn how to manage through them. In many of past bubbles, it was easy to think that sitting out would equal missing out.

During the Japanese property boom, one may have felt that everyone around them – friends, relatives, neighbors – was getting rich. It can be hard to second-guess the opinions of people we know, but no one is impervious to getting swept up in the excitement – even someone as brilliant as Isaac Newton.

However, it is precisely in these volatile markets that maintaining a diversified and disciplined investment approach becomes crucial.

Source:  https://www.elevatedpwa.com/blog/fundamentals-of-investing-how-to-survive-and-thrive-during-financial-bubbl

Success doesn’t belong to the smartest or the luckiest or the most talented—it belongs to those who refuse to quit when things get difficult.

Every journey has its challenging moments, yet those moments are what separate winners from quitters.

When life tests and challenges you, it’s not to stop you—it’s to strengthen and grow you. The people you admire today didn’t have it easy. They kept going when others quit and walked away. They faced repeated rejection, failure, and doubt, yet they pushed through. That’s how real success is built—through habits, persistence, and determination…when it hurts the most.

Quitting might give short-term comfort, but it k!!lls long-term learning and growth. Every time you keep moving through the storm, you’re earning the right to win.

This too shall past!

This adage reflects the temporary nature of the human condition, meaning that neither negative nor positive moments last forever. It captures the idea of impermanence and is often used to offer comfort during difficult times, reminding you that challenges and hardships do occur, but are transient.

In other words, tough times don’t last, but determined and persistent people do. So, keep going until the hard days turn into your success story.

As elite Navy SEALS say, “The only easy day was yesterday!”

President Calvin Coolidge famously said:

“Nothing in this world can take the place of persistence. Talent will not; nothing is more common than unsuccessful men with talent. Genius will not; unrewarded genius is almost a proverb. Education will not; the world is full of educated derelicts. Persistence and determination alone are omnipotent. The slogan ‘Press On!’ has solved and always will solve the problems of the human race.”

While talent, genius, and education are valuable, they alone do not guarantee success. It is habits, persistence, and determination—steadfast effort and willpower—that ultimately lead to achievement and success.

Habits automate the necessary actions toward goals making efforts more efficient and less reliant on constant conscious exertion.

Persistence is the quality that drives continued effort despite setbacks, allowing for resilience against obstacles and failures.

Determination fuels the desire and mindset to keep focused on the goal, enabling sustained persistence.

Together, these qualities form a powerful synergy: habits provide the structure, persistence provides the endurance, and determination provides the motivation to achieve success.

A job gives you income and can buy you comfort, but it rarely gives you financial independence and freedom.

No matter how high your salary is, if you stop working (trading time for money), the income stops too. That’s why job income alone will never make you wealthy—it keeps you comfortable, not free.

The truth is wealth comes from ownership, not employment. It’s built through owning assets, investments, and systems that earn even when you’re not on the clock.

A job can fund your dreams and aspirations, but it should never be the dream or destination itself.

The wealthy use their jobs and earned income as stepping stones to building wealth. They save, invest, and create multiple streams of income until their money starts working for them. That’s how financial freedom is created—not by working harder, but by working smarter.

Your paycheck can help you survive, but your investments will help you live and achieve freedom.

Believe. Have Faith. Always Be Grateful.