The long run value from end users
At LWCM we see that value comes from satisfying end user needs, but that’s only part of the story. This diagram from a presentation I gave at Innovation Tech Week yesterday explains a bit more:
In order for investors to get their lasting returns, we need to also identify and sell to the paying customers, and to build a company that creates, sells and supports the products and services. Investors also need to think about lasting returns, and not about quick gains. Investors searching for quick gains are really indulging in trading, and while that may be perfectly valid as a financial strategy for some, businesses themselves should focus on creating lasting value.
I found this cartoon from the middle of the dot com bust in 2000, and it really exemplifies the difference in approach between the long-term customer focused CEO and short term investors. A quick check of Amazon’s share price since then (a 16% annual return) shows just who was right in the long run.