This screen is about finding future Lindys: businesses that combine invention with discipline, transforming broken industries through structural innovation, vertical integration, and cultural resilience. The Emerging Lindy Screen is designed to uncover the next Amazon or Apple – the types of compounding machines we aim to own long before the world catches on.
The Emerging Lindy Screen blends qualitative insight with quantitative rigor, filtering for firms that exhibit both structural innovation and financial traction – early signals of future Lindy compounding.
- Zero-to-One DNA: Category creation and technological differentiation
- Forever TAM: Serving universal, durable human needs – compute, health, money, safety
- Founder-Led Mission: Long-term orientation and meaningful insider ownership
- Financial Traction: Sustained >25% revenue growth, expanding gross margins, high retention, and visible free cash flow inflection
- Path to Leverage: Operating expense as a percentage of revenue is declining, ROIC is rising steadily
- Vertical Integration: Expansion from a focused wedge into a self-reinforcing ecosystem
- Resilience: The ability to emerge stronger from cycles or shocks
By screening across these quantitative and qualitative dimensions, we aim to capture the moment when zero-to-one innovation turns into enduring compounding.
Here are the financial metrics we’ve used to produce today’s screen:
Sustained high growth
- Revenue CAGR (five year) ≥ 25%
Quality business with pricing power
- Average gross margin (three year) ≥ 50% or
- Average EBITDA margin (three year) ≥ 50% or
- Average EBITDA margin growth ≥ 30%
Efficiency improvement
- Operating margin growth (three year) ≥ 15%
Capital efficiency leading to compounding returns
- ROIC growth (three year) ≥ 15% or
- ROIC average (three year) ≥ 15%
Self-funding growth, demonstrating positive unit economics
- Positive FCF growth in at least three of last four years
Remove balance sheet outliers
- Net debt / EBITDA ≤ 6
Alignment and continuity (founder/operator)
- More than five insiders own shares
Click here to access previous Emerging Lindy Screens.