We Study Billionaires - The Investor’s Podcast Network TIP772: How Great Compounders Turn Time Into a Superpower w/ Kyle Grieve
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Nov 28, 2025 Kyle Grieve breaks down the secrets behind elite compounders and their remarkable ability to generate immense returns, even at high valuations. He explores why some companies deserve premium pricing and highlights the importance of two key reinvestment strategies. The discussion touches on the role of decentralized cultures in driving success, particularly in Swedish businesses known for serial acquisitions. With insights on resilience and the significance of niche markets, this chat uncovers the surprising ingredients that turn time into a true superpower for investors.
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Pay Up For Durable High ROIC
- Companies earn value when ROIC exceeds cost of capital, so high-ROIC firms can justify premium multiples.
- Time magnifies this advantage if firms can sustain reinvestment and ROIC over decades.
Culture And Reinvestment Power Compounding
- Exceptional compounders combine decentralized high-performance cultures with durable reinvestment engines.
- Both attributes together let firms consistently reinvest at attractive returns and strengthen over time.
Use Three Metrics To Judge Compounding
- Evaluate a compounder by its reinvestment rate, ROIC, and the time it can sustain both.
- Favor businesses that can reinvest a high share of operating cash at durable high ROICs for many years.
