STOP focusing on Profit
START focusing on Cash Flow
Cash Flow Statement 101:
Every company has 3 reports in its financial statements
1. Balance sheet
2. Income statement
3. Cash flow statement
Most people focus on the Income Statement to look at PROFIT
There is nothing wrong with this…
But profit, isn’t CASH FLOW
Profit is an accounting measure
It doesn’t tell you how much MONEY actually came into the business
Sounds confusing?
Let’s look at an example:
In 2021 Google’s profit was: $76 billion