PRACTICAL QUESTIONS FOR COMPANIES TO INVEST IN
Practical Questions for Companies To Invest In. Professor Aswath Damodaran explores the concept of the corporate life cycle, arguing that every company (just like a human being) is born, grows, matures, and eventually declines. He emphasizes that the biggest threat to value in business is companies refusing to 'act their age', whether through startups behaving as if they were mature or mature companies desperately attempting to regain youth. Damodaran explains that successful companies must adapt their strategies and leadership styles to each life stage, and similarly, valuation should not solely rely on numbers but also integrate the narrative or story of the business. 1. What 'life cycle' stage is the company in? 2. Is the company’s strategy and leadership 'acting its age' ? 3. Does the 'valuation narrative' match the underlying business reality? This lecture offers a blend of finance, storytelling, and pragmatic management advice for evaluating and...
