What are J Curve Investments?

The old adage tells us that you have to spend money to make money.

J Curve investments are strategic decisions to spend money today to receive a benefit tomorrow. J Curve investments result from decisions to incur a short-term financial loss, which will be recovered in the future. The long-term benefits should outweigh the cost of the initial investment.

As I have indicated on the J Curve  Management  introductory page, every business has J Curves; some examples include:

•    Adding a new product line
•    Accessing a new market
•    Hiring new staff
•    Purchasing new equipment
•    Opening a new location
•    Moving manufacturing overseas
•    Investing in R&D
•    Acquiring competitors

J Curve investments can be classed as ‘macro’ – having an impact on the entire business, or ‘micro’ – having an impact on part of the business.

How important is it to properly undertake and manage J Curves?  As I see it, the key to entrepreneurial success lies in identifying, prioritizing and managing J Curves.

In my next post on J-Curves, I will discuss the importance ‘Ownership of J-Curve Investments’

If you would like to find out more, you can always contact us.  We'd love to hear from you.