What will remain 18 months from now ?
On costs, investments, and monsters.
I recently asked my Chief Financial Officer :
“Are we making any investments ?”
I know for sure that our company does spend money. But it wasn’t clear to me what the difference between an investment and a mere cost was.
I found out the distinction is pretty simple : A cost works only while you feed it. An investment keeps working after you stop it because it has created something that can act on its own.
Electricity, rent, insurance… they’re costs. They’re not useless, they keep you alive, but they don’t make you grow. Stop paying and it all stops. Documentation, reputation, automations… they change the business over the long term.
For this reason, investment sounds more noble. Saying that you’re investing is infinitely more acceptable than admitting that you’re just spending. “We’re investing in our brand” sounds more valuable than “we spend in advertising”. Oftentimes, it’s the exact same thing with a better story attached to it.
Plus, the notion of investment is also safer : if it does not work now, you can pretend it’s just a matter of time. Which you can’t do with something clearly labelled as a cost.
Clearing the blurry zone
The problem is : most costs don’t look like costs. They are often disguised as investments. But that’s a dangerous habit. It ultimately is a way to lower your expectation on the money and energy spent.
Even worse, it makes you believe you are actively building something, that you’re making fundamental progress. When the truth is you’re simply living from day to day.
That is why anyone who’s ambitious about building things, should be an expert at telling costs from investments. And you do that with one simple question :
“What will remain 18 months from now ?”
If nothing remains, it was never an investment, no matter what you called it.
How this extends to life
We people, unlike companies, don’t have a CFO to tell costs from investments. Yet, we do have choices to make on where we spend our money, energy, and most importantly, time.
Our life is filled with simple costs : going to the restaurant, rent, shopping… Nothing to be ashamed of, they’re making life go on. But many of us expect our lives to evolve. This can be attained if we leave room for some investments : learning (skills, languages) sits at the top, but maintaining deep and meaningful relationships, building a sound reputation for yourself are also immensely valuable. All of these things compound over time.
Interestingly enough, very few things are inherently investments. Most of them become investments only if done consistently and with intent. That’s why the distinction is largely dependent on HOW you do it. Consistency turns many simple costs into lasting effects.
Overall, it’s not about turning your life into an endless series of investments. It’s more about you dedicating some of your present time to reduce the effort your future will require.
Just don’t feed the monsters
While you can make your future easier, many times you actually borrow against it.
These are negative investments. Everything you consistently do that negatively compounds over time. Doomscrolling, durable sleep debt, chronic negative thoughts, addictions of any kind… All of which feeds monsters that grow slowly over the years if left unchecked. Monsters that you will eventually have to fight…
Or that will ultimately eat you someday, when it's grown enough.
Paul
