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About this quote

What does it mean?
Invest in simple businesses that can survive poor management since change is inevitable.
In plain terms
Pick simple businesses that are hard to ruin.
What can you take from it?
Choose resilient businesses.

Where it applies

  • venture investing
  • startup valuation
  • business selection

Putting it to work

  • look for simple models
  • assess management dependency
  • check durability

Questions to consider

  • Is a business too dependent on one person?
  • What makes a business simple?

Another view

Complex businesses can sometimes be profitable even with poor management for a time.

More from Peter Lynch

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  2. When stocks are attractive, you buy them. Sure, they can go lower. I've bought stocks at $12 that went to $2, but then they later went to $30. You just don't k…

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  3. You get recessions, you have stock market declines. If you don't understand that's going to happen, then you're not ready, you won't do well in the markets.

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