The best investment is in the business that compounds the fastest while requiring the least capital to do so. Most people focus on the numerator and ignore the denominator.

The best investment is in the business that compounds the fastest while requiring the least reinvestment. Most people focus on the first part and ignore the second, which is why they end up with businesses that eat cash.

The difference between a good business and a bad business is that a good business throws off cash and requires little capital to grow, while a bad business requires lots of capital and doesn't throw off much cash.