On a day when it is likely that the US stock markets will open down and Asian markets are in free fall, it is worth taking a second and talking about why capital markets matter and why they don’t.
If your business consumes capital and needs more of it, then changes in capital markets can affect you.
If your business produces cash flow and you can finance your business, then changes in capital markets are not likely to affect you.
This is one of many reasons that I like to see our portfolio companies get to break even and ideally producing cash flow.
I don’t remember when I said this, but I am glad I did.
