Finance.

The framework

1. 01

   Put all five homes on the page before you argue about any one of them.

   Day 105 had you write a reserve floor while the account was empty. This morning the rest of the money gets somewhere to go. Write the five down: reinvest in the business you already have, acquire another one, pay down debt, hand money back to the owners, or hold it in cash. Then put this year's spare money against them. Choosing badly isn't the risk here. What happens instead is that a single proposal arrives, gets debated on its own, and gets called an allocation decision when it was only ever a yes-or-no question about one thing. The second site, the new hire, the piece of kit: each of them wins by default, because nothing was ever standing next to it on the page.

2. 02

   What does the dollar earn in each home?

   Every one of the five returns something, and the comparison only works when all five are stated the same way. Reinvestment returns whatever the project clears above your hurdle rate, appraised on discounted cash rather than on the payback story someone tells in the meeting. An acquisition returns its own return on invested capital, after the price you paid for it. Repaying debt returns your interest rate, certain and risk-free, which is why it quietly beats a great many exciting projects. Distribution returns the money itself. Put the five numbers in one column and most of the argument evaporates.

3. 03

   Holding is a position, not a failure to decide.

   Cash on the balance sheet earns almost nothing, so it reads as indecision, and your advisors will press you to put it to work. Sometimes they're right. But holding buys the ability to move when something good becomes cheap, and that ability has a value the spreadsheet never shows; this is where you pay to keep it. So state it as a position: the amount, the reason it is being held, and the date you will look at it again. Written down that way, a low return stops being an accusation and becomes a price you agreed to pay.

4. 04

   Rank the five once a year, and give the ranking an owner.

   Allocation isn't a decision you make once. It's a decision you make annually and then defend against every urgent request that arrives in the eleven months afterwards. So do it properly: rank the five, write the reasoning where you can be held to it, and name who may move money between homes without reopening the page, which is Day 76's decision rights applied to the only resource that's genuinely scarce. Then read the page back twelve months later against what actually happened. An allocation you can't audit teaches you nothing.