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The Boardroom Daily Brief is a daily business podcast for executives, board members, and leadership-minded professionals who want fast, strategic insights. Hosted by Ash Wendt, each episode delivers breaking business news, leadership strategy, governance insights, and talent development advice—without the fluff. Whether you're a CEO, investor, or rising leader, you'll get clear, actionable intelligence to navigate boardroom decisions, stay ahead of market trends, and lead with confidence.
Strategy is the story you tell with money. If your capital allocation feels like an annual food fight followed by eleven months of regret, you don't have portfolio management, you have pet projects, and politics. The fix isn't more process. It's a rhythm that moves money toward evidence and away from executive enthusiasm.
Freeman:The boardroom daily brief delivers strategic intelligence for executives who need clarity fast. Cut through the noise, get to the decisions that matter, and understand the implications before your competitors.
Ash:Welcome to the boardroom daily brief. I'm Ash Wendt delivering daily intel for executive minds. Special thanks to our sponsors, Cohen Partners Executive Search, The Boardroom Pulse, and execsuccession.com. Today is Friday, 10/03/2025. This week, I'm on vacation.
Ash:While I'm out, you're getting something different, pure strategy sessions, no news required. Consider it a masterclass in the operating systems that create compound advantages. Let's discuss making capital allocation a weapon, not a weakness. Most companies run capital allocation like a medieval court. Once a year, the nobles gather to petition the king.
Ash:Powerpoints are polished. Politics are played. Promises are made. The loudest voices or longest tenures usually win. Then everyone disappears for eleven months to spend their bounty while finance tries to figure out what just happened.
Ash:This isn't capital allocation. It's capital abdication. And it's why most companies get exactly the innovation they deserve. None. Start with a portfolio map, so simple, an intern could explain it.
Ash:Three buckets, that's it. Defend the core, the profitable engine that pays for everything else. Extend into adjacencies, the logical next steps from where you win today. Explore options, the bets that might change everything or might change nothing. Now here's the discipline.
Ash:Publish what percentage of free cash flow goes to each bucket, not dollars, percentages. 70% defend, 20% extend, 10% explore, or sixty thirty ten. The exact split matters less than having one. When everyone knows the portfolio split before the budget fight starts, the conversation changes from why them and not me to which bucket are we playing in. Clarity beats combat every time.
Ash:Replace PowerPoint theater with narrative briefs that actually say something. Ban the decks. Require one page written narratives for every capital ask above a threshold. The format never changes, context in two sentences, options considered with trade offs, recommended path and why, risks if we're wrong, reversal plan if it fails, and the single metric that proves progress. If an executive can't explain their capital need in one page, they haven't thought it through.
Ash:If they can't name the reversal plan, they're not asking for investment. They're asking for faith. Faith is beautiful in religion, dangerous in business. Move from annual budgets to rolling gates and watch discipline emerge. The core business runs on an annual plan with quarterly checkpoints.
Ash:That's stability. But extend and explore run on gates, not calendars. Gate one unlocks gate two when evidence appears, not when January arrives. Example, you're funding a new market entry. Gate one is 50 customer development interviews and a validated willingness to pay study.
Ash:Gate two is a pilot with three lighthouse customers. Gate three is proven unit economics at small scale. Gate four is rollout. If gate one reveals customers don't care, you don't get gate two. You get a thank you for saving us from a bigger mistake.
Ash:The money flows to the next bet that cleared its gate. Price risk like adults, not like politicians. Different hurdle rates for different bets. The core defending investments might clear at eight percent returns because they're protecting a profit stream. Adjacent bets need 15% because they're stretching.
Ash:Exploration might need 30% or might be measured in learning per dollar instead of returns. But here's the key. Make the hurdle rates transparent and the math visible. When everyone can see why project a cleared and project b didn't, the politics drain out of the process. Add a reversal premium.
Ash:Reversible bets get lower hurdle rates than one way bets. A sixty day pricing test you can unwind carries less risk than a five year factory lease. Price them accordingly. Make killing projects a badge of honor, not a career killer. The biggest capital allocation failure isn't funding the wrong things, it's continuing to fund them after you know they're wrong.
Ash:Create a culture where killing a project at Gate two gets you promoted, not punished. Public recognition for teams that shut down their own projects when the math stops working. Bonuses for leaders who return capital instead of spending it just because they have it. Case studies of smart kills that saved millions. When killing becomes honorable, truth emerges.
Ash:When truth emerges, capital flows to reality instead of fantasy. Tie capital explicitly to talent and watch both improve. Never fund a b player with a dollars. If you wouldn't bet your own money on the team, don't bet the companies. This isn't cruel.
Ash:It's clear. Weak teams with big budgets create big disasters. Strong teams with constrained budgets create clever solutions. Rotate high potential operators through extend and explore portfolios. Running a gate based bet teaches judgment in a way no classroom can.
Ash:Your future GMs learn to place bets. Your future CFOs learn to size them. Your future CEOs learn to kill them. Run a weekly capital council that actually decides things. One hour.
Ash:Five agenda items maximum. Decisions in the room. Not let's take this offline. Monday's capital council reviews gates. Did anything clear?
Ash:Did anything fail? What moves from one bucket to another? The CEO's job isn't to make every call, it's to enforce the system. Are the briefs complete? Is the math transparent?
Ash:Are the Gates real? Are the kills clean? When capital decisions happen weekly instead of annually, small bets compound into big wins and small failures never become big disasters. Install these three mechanisms to make the system self healing. First, the venture board.
Ash:Five senior operators who review all extend and explore bets. They don't own them, that's management's job, but they advise, challenge, and recommend. When operators review operator bets, the quality rises. Second, the kill list. Every quarter, force rank the bottom 20% of active bets.
Ash:Make the owners defend continuation. Half will volunteer to shut down rather than defend weak math. The other half will get honest about what needs to change. Third, the reallocation reserve. Hold back 10% of capital for mid year reallocation.
Ash:When something takes off, you can pour gas on it. When something stalls, you can redirect without waiting for next year's budget cycle. Here's a fourteen day implementation sprint. This week, publish your portfolio splits, defend, extend, explore with percentages. Write the one page brief template and require it for everything above your threshold.
Ash:List your top 10 active bets with owners, gates, and next decision points. Next week, kill one zombie project that everyone knows is dead, but nobody wants to bury. Reallocate its budget to the top two bets that are exceeding gates. Pick one reversible experiment to accelerate by removing all process friction. By month end, the organization stops talking about who got what and starts talking about what evidence earned what.
Ash:Politics dissolve when math is visible. If you need operators who've run portfolio based capital systems, real gates, real kills, real reallocations, Cohen Partners places CFOs and GMs who measure success and return on capital deployed not size of empire built. Here's the truth about capital allocation nobody admits. Most companies would generate better returns by randomly distributing capital than through current political processes. At least randomness doesn't compound bad bets to save face.
Ash:But the best companies, the ones that compound at 20% while peers struggle at five, treat capital allocation like product development, rapid iteration, quick kills, double downs on winners, evidence over ideology. Strategy isn't what you say in presentations, it's what you fund in practice. And if your funding still follows politics instead of proof, you don't have a strategy. You have expensive hopes. Stop the annual budget battle.
Ash:Start the weekly evidence race. The market rewards companies that move capital fast toward truth and away from fantasy. That's it for the boardroom daily brief. I'm Ash Wendt, delivering daily intel for executive minds. Get in, get briefed, get results.
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