by Peter Dragone | Mar 5, 2023 | Peter Dragone Blog, Planning
My last blog described the importance of EBITDA as both a profitability metric and as a tool for estimating the value of a company. EBIT, its close cousin, is simply EBITDA minus depreciation and amortization expenses. It is also a crucial profitability measure but,...
by Peter Dragone | Feb 23, 2023 | Peter Dragone Blog, Planning
In my last blog I discussed Contribution Margin: Company revenues minus variable expenses. It’s the money left over to pay operating expenses. Once those operating expenses are deducted, what remains is Earnings before Interest, Taxes, Depreciation and Amortization...
by Peter Dragone | Feb 9, 2023 | Peter Dragone Blog, Planning
The importance of gross profits cannot be overstated. If you’re contemplating a fundraising round or an exit event, then it’s a benchmark metric right up there with ARR (annual recurring revenue), Sales & Marketing Expense/Revenues, and EBIT. Investors want to...
by Peter Dragone | Feb 6, 2023 | Peter Dragone Blog, Planning
Investors as famous as Warren Buffet have dismissed profitability, as measured by EBITDA, as a suitable corporate financial metric, favoring “Owner’s Earnings” or Operating Cash Flow instead. Given Mr Buffet’s record of success, it is hard to argue the point . . . on...
