How to Explain What Makes Your Business Special

What distinguishes your business in a crowded market? This can be done in various ways, including through product knowledge, pricing, and individualized customer service. Whatever makes your business distinctive, capitalize on it and embrace it!

The following advice can help you identify your USP. Once you’ve figured out what makes your firm special, you’re ready […]

How to Explain What Makes Your Business Special — ravkoo Health


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For Entrepreneurs and Investors, Discovering Truth Takes Time


For Investors, Discovering Truth Takes Time



The Roman philosopher, playwright, statesman and occasional satirist Lucius Annaeus Seneca wasn’t talking about the stock market when he wrote that “time discovers truth,” but he could have been. In the long run a stock price will reflect a company’s (true) intrinsic value. In the short run the pricing is basically random.

Here are two real-life examples:

Let’s say you had the smarts to buy Microsoft in November 1992. It would have been a brilliant decision in the long run — the software giant’s stock has gone up manyfold since. But nine months later, in August 1993, that call did not look so brilliant: Microsoft shares had declined 25 percent in less than a year. In fact, it would have taken you 18 months, until May 1994, for this purchase to break even. Eighteen months of dumbness?

In the early ’90s the PC industry was still in its infancy. Microsoft’s DOS and Windows operating systems were de facto standards. Outside of Macs and a tiny fraction of IBM computers, every computer came preinstalled with DOS and Windows. Microsoft had a pristine balance sheet and a brilliant co-founder and CEO who would turn mountains upside down to make sure the company succeeded. The above sentence is infested with hindsight — after all, that was almost 30 years ago. But Microsoft clearly had an incredible moat, which became wider with every new PC sold and every new software program written to run on Windows.

Here is another example. GoPro is a maker of video cameras used by surfers, skiers and other extreme sports enthusiasts. If you had bought the stock soon after it went public, in 2014, you would have paid $40 a share for a $5.5 billion–market-cap company earning about $100 million a year — a price-earnings ratio of about 55. Your impatience would, however, have been rewarded: The stock more than doubled in just a few short months, hitting $90.

Would it have been a good decision to buy GoPro? The company makes a great product — I own one. But GoPro has no moat. None. Most components that go into its cameras are commodities. There are no barriers to entry into the specialized video camera segment. Most important, there are no switching costs for consumers. Investors who bought GoPro after its IPO paid a huge premium for the promise of much higher earnings from a company that might or might not be around five years later.


What is even more interesting is that some of those buyers were then selling to even bigger fools who bought at double the price a few months later. GoPro was a momentum stock that was riding a wave about to break. Fast-forward a year and GoPro sales are collapsing, so now the stock is trading in the low teens ($11.65 as of this writing).

These two examples bring us to the nontrivial topics of complex systems and nonlinearity. My favorite thinker, Nassim Taleb, wrote the following in his book Antifragile: Things That Gain from Disorder: “Complex systems are full of interdependencies — hard to detect — and nonlinear responses. ‘Nonlinear’ means that when you double the dose of, say, a medication, or when you double the number of employees in a factory, you don’t get twice the initial effect, but rather a lot more or a lot less.”

The stock market is a complex system where in the short term there are few if any interdependencies between decisions and outcomes. In the short run stock prices are driven by thousands of random variables. Stock market participants have different risk tolerances and emotional aptitudes, and diverse time horizons ranging from milliseconds (for high-speed traders) to years (for long-term investors).


In other words, predicting where a stock price will be in a day, a month or even a year is not much different from prognosticating whether the ball on a roulette wheel will land on red or black. In the longer run, however, good decisions should pay off because fundamentals will shine through — just as was the case with buying Microsoft in 1992 and not buying GoPro in 2014. But in the short run there is no correlation between good decisions and results. None!

Whenever you look at your portfolio, think of the Microsoft and GoPro examples above. The performance of your stocks in the short run tells you absolutely nothing about what you own or about the quality of your decisions. You may own a portfolio of Microsofts, and its value is still going down because at this juncture the market doesn’t care about Microsofts. Or maybe you stuffed your retirement fund with overpriced fads that may not be around a year from now. But in the longer run, which always lies out there past the short run, time discovers truth, as Seneca said.


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STUPIDITY? Five Universal Laws

The Five Universal Laws of Human Stupidity

We underestimate the stupid, and we do so at our own peril

By Corinne Purtill







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Physician Assets, Liabilities and Personal Net Worth

How are Assets and Liabilities Related to Doctor Net Worth?


Dr. David E. Marcinko MBA 

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Before the relationship among financial assets, liabilities and net worth can be examined, some based definitions must be understood. 

[A] Short-Term Assets

Short-term goals (less than 12 months) require liquidity or short-term assets. These assets include cash, checking and saving accounts, certificates of deposit, and money market accounts. These accounts have two things in common. The principal is guaranteed from risk of loss, and pay a very low interest rate.  As an investment, they are considered substandard and one would only keep what is actually needed for liquidity purposes in these accounts.           

[B] Long-Term Assets

Longer-term assets (more than 12 months) include real estate, mutual funds, retirement plans, stocks, and life insurance cash value policies. Bonds may also be an appropriate long-term investment asset for a number of reasons, for example, if you are seeking a regular and reliable stream of income or if you have no immediate need for the amount of the principal invested. Bonds also can be used to diversify your portfolio and reducing the overall risk that is inherent in stock investments. 

[C] Short-Term Liabilities

Short-term liabilities (less than 12 months) include credit card debt, utility bills, and auto loans or leasing. When a young doctor leaves residency and starts practice, the foremost concern is student debt. This is an unsecured debt that is not backed by any collateral, except a promise to pay. There are recourses that an unsecured creditor can take to recoup the bad debt. Usually, if the unsecured creditor is successful obtaining a judgment, it can force wages to be garnished, and the Department of Education can withhold up to ten percent of a wages without first initiating a lawsuit, if in default.  It is also probable that young medical professionals have been holding at least one credit card since their sophomore year in college.  Credit card companies consider college student the most lucrative target market and medical students hold their first card for an average of fifteen years. There are several other types of other unsecured debt, including department store cards, professional fees, medical and dental bills, alimony, child support, rent; utility bills, personal loans from relatives, and health club dues, to name a few.  

[D] Long-Term Liabilities

A secured debt, on the other hand, is debt that is pledged by a specific property. This is a collateralized loan. Generally, the purchased item is pledged with the proceeds of the loan. This would include long-term liabilities (more than 12 months) such as a mortgage, home equity loan, or a car loan. Although the creditor has the ability to take possession of your property in order to recover a bad debt, it is done very rarely. A creditor is more interested in recovering money. Sometimes, when borrowing money, there may be a requirement to pledge assets that are owned prior to the loan.  

For example, a personal loan from a finance company requires that you pledge all personal property such as your car, furniture, and equipment.  The same property may become subject to a judicial lien if you are sued and a judgment is made against you. In this case, you would not be able to sell or pledge these assets until the judgment is satisfied.

A common example of a lien would be from unpaid federal, state or local taxes. Doctors can be found personally liable for unpaid payroll taxes of employees in their professional corporations.  Be aware that some assets and liabilities defy short or long-term definition. When this happens, simply be consistent in your comparison of financial statements, over time. 

[E] Personal Physician Net Worth

Once the value of all personal assets and liabilities is known, net worth can be determined with the following formula: Net worth = assets minus liabilities. Obviously, higher is better.  In The Millionaire Next Door, Thomas H. Stanley, PhD, and William H. Danko give the following benchmark for net worth accumulation. Although conservative for physicians of a past generation, it may be more applicable in the future because of current managed care environment.

Here is the guide: Multiple your age by your annual pre-tax income from all sources – except inheritances – and divide by ten. 

Real-Life Medical Example: As an HMO pediatrician, Dr. Curtis earned $ 60,000 last year. So, if she is 35, her net worth should be at least $ 210,000.

How do you get to that point? In a word, consume less, save more and watch the student loans. Stanley and Danko found that the typical millionaire set aside 15 percent of earned income annually and has enough invested to survive 10 years, at current income levels if he stopped working.  Now, if Dr. Curtis lost her job tomorrow, how long could she pay herself the same salary? 

[F] Common Liability Management Mistakes

 A common liability management mistake is not recognizing when you are heading for trouble. If doctors are paying only the minimum payments on credit card debt, while continuing to charge purchases at a rate faster than the pay-down, trouble is brewing. If you don’t categorize your debt, you could find yourself paying down non-priority debt while ignoring priority debt.

A priority debt is one that is essential or subject to serious consequences, if not paid. Examples include rent, mortgage payments, utility bills, child support, car payments, unpaid taxes, and other secured debt. If in one month, a doctor had to choose between paying his accounting bill or his rent, it would be essential to pay the rent.

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