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Topic Cluster

Capital

‘Capital’ is a shorthand for ‘factors driving business finance and economic climates’, which is one of the three legs of triad mental model of business expertise. If you don’t know what that is, read this page first.

Broadly speaking, the Capital leg of the business expertise triad covers things like: P&L style thinking, capital allocation, capital structure and the relationship businesses have with capital markets. It also has to do with the ‘capital cycle’ (more broadly known as the market cycle).

It is this Capital aspect of expertise in business that Warren Buffett was referring to when he said “I am a better investor because I am a businessman, and a better businessman because I am an investor.”

Series and Guides

There is really one big series here:

Historically, Commoncog has alluded to but not focused on capital as a topic. That should change in the coming months.

‘Capital’ is a shorthand for ‘factors driving business finance and economic climates’, which is one of the three legs of triad mental model of business expertise. If you don’t know what that is, read this page first.

Broadly speaking, the Capital leg of the business expertise triad covers things like: P&L style thinking, capital allocation, capital structure and the relationship businesses have with capital markets. It also has to do with the ‘capital cycle’ (more broadly known as the market cycle).

It is this Capital aspect of expertise in business that Warren Buffett was referring to when he said “I am a better investor because I am a businessman, and a better businessman because I am an investor.”

Series and Guides

There is really one big series here:

Historically, Commoncog has alluded to but not focused on capital as a topic. That should change in the coming months.

This topic overview was last updated .

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Articles //  Page 1

Feature image for Businesses as Ecosystem Organisms

Businesses as Ecosystem Organisms

What we can learn from seeing businesses as organisms in an ecosystem ... using the particularly odd example of HEICO as the barnacle to TransDigm’s whale.

 Members only
Feature image for Getting Burnt by Business Expansion

Getting Burnt by Business Expansion

A recurring pattern that seems to show up again and again in business: expansion is dangerous, and everyone really only learns this through pain.

 Members only
Feature image for Running a Fine Dining Restaurant in a Recession

Running a Fine Dining Restaurant in a Recession

How Eleven Madison Park survived the 2008 Global Recession ... and what this tells us about operating through the capital cycle.

Feature image for Learning About Moats the Hard Way

Learning About Moats the Hard Way

How even legendary conglomerator Henry Singleton got caught out by competitive arbitrage at the end of his career.

 Members only
Feature image for The Limits of Operational Excellence

The Limits of Operational Excellence

An answer to a puzzle: why is that some businesses go down the Deming path, become data driven, achieve operational excellence, and die, and others acquire Process Power and win?

 Members only
Feature image for One Definition of Wisdom

One Definition of Wisdom

Charlie Munger’s biggest business mistake, and what it tells us about wisdom.

 Members only
Feature image for A Most Unlikely Master of Capital Allocation

A Most Unlikely Master of Capital Allocation

If the most unlikely, most un-businesslike person could become a masterful capital allocator late in her life, then perhaps you could, too.

 Members only
Feature image for Data and the Capital Cycle: How Koch Became an Empire

Data and the Capital Cycle: How Koch Became an Empire

How Koch Industries became an empire. We draw on ideas from both the Becoming Data Driven series and the Capital Expertise series.

 Members only
Feature image for Marvel Studios’s Origin Story

Marvel Studios’s Origin Story

The creation of Marvel Studios was contingent on some very creative financial dealmaking. A story of superb capital expertise in action.

Feature image for Strong at Capital, Bad at Everything Else

Strong at Capital, Bad at Everything Else

Two examples of operators who were strong on the capital side of the business expertise triad, but weak in just about everything else.

 Members only
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