Cash Flow Over Profit

Your business can be profitable on paper and still go bankrupt tomorrow. That is the single

biggest trap in corporate finance. See, accounting is just history,

but finance is about the future. You can’t pay bills with net income; you pay them with

cash flow. That’s why the only rule that actually matters is Net Present Value.

You take all that future cash, discount it back to today, and if the number

is positive, you pull the trigger. If it’s negative, you walk away. Profit is just an

opinion, but cash is the only reality.