Durability

What it is\nDurability is the time dimension of moat. A business with a 25% ROIC today is great. A business with a 25% ROIC that's been earning that for 30 years and seems likely to keep earning it for 30 more is much greater. Compounding rewards duration.\n\n## How Buffett tests it\nBuffett's 10-year test: "I try to envision the business 10 years out. If I can't see it clearly, I don't buy."\n\nProxy questions:\n- Will people still drink Coke in 2035? (yes — 100+ years of evidence)\n- Will people still use Visa in 2035? (yes — payment networks have crushing inertia)\n- Will people still use [today's hottest social network] in 2035? (probably not — every previous social network died on a 10-year timeline)\n\n## Anti-durable signals\n- Technology disruption risk: every business that depends on a current technology being current 10 years out\n- Regulatory risk: businesses whose moat is government licensing (utilities, telecoms) have a moat that politicians can revoke\n- Fashion-cycle risk: branded goods that depend on remaining "cool"\n- Single-customer concentration: anything earning > 30% revenue from one buyer\n\n## Pro-durable signals\n- Product is consumed daily (Coca-Cola, food, basic services)\n- Switching costs grow over time (databases, ERP systems, payroll)\n- Network gets stronger as it grows (payment networks, marketplaces)\n- Brand has been #1 for 20+ years (M&M, Hershey, Boeing)