Wall Street has a type. It’s loud. It’s fast. It grows at 40% year-over-year and says words like total addressable market with a straight face. It raises capital like oxygen is optional. It promises that scale will fix everything. And then one day it doesn’t grow at 40%. That’s when the room gets quiet. Because most investors are trained to chase acceleration. Revenue acceleration. User growth acceleration. “Beat and raise” acceleration. The cult of the upward slope. But here’s the truth seasoned investors eventually learn: There is life beyond acceleration. In fact, some of the best long-term returns come from companies that have already had their dramatic growth spurt and are now entering what I call The Second Act . The second act is not flashy. It’s not viral. It doesn’t trend on social media. It doesn’t get breathless headlines about “disruption.” It gets better. It gets disciplined. The First Act Is Seduction The first act of a company’s life is intoxicating. Reven...
Investors tend to obsess over yield in the present tense. What’s the current dividend yield? What’s the distribution rate? How much income will this generate next quarter? These are reasonable questions. They are also incomplete. Yield, when examined only at the moment of purchase, is static. Income investing, when practiced with discipline and patience, is dynamic. The real power does not lie in the initial yield. It lies in what that yield becomes over time. Incremental yield on cost is the concept that reframes income investing from a snapshot into a timeline. It is not about what an asset yields today. It is about how rising payouts compound against your original capital. This approach requires patience, analytical rigor, and an unusual tolerance for slow beginnings. It also offers one of the most durable pathways to long-term income growth. Defining Yield on Cost Yield on cost (YOC) is a simple calculation: Annual income received ÷ Original purchase price. If you buy a...