“In finance, leverage is any technique involving the use of debt rather than fresh equity in the purchase of an asset, with the expectation that the after-tax profit to equity holders from the transaction …” Wikipedia

The whole idea with Financial Leverage is to often use Opium – OPM ie Other Peoples Money borrowed at a Low Rate aka Bonds and use it to buy a business making more percentage wise than the cost of borrowing the spread between the bond and the business profitability is pure profit. This model has made billions of dollars.   This model is not without a lot of risk as when there is an economic downturn the business profits can evaporate and so does the means to pay back the loan an ouch for the debt holder.

What I am now seeing is Digital Leverage which is much less risky as the Debt involved is Technical Dept. and development costs.  Lets say a Video hosting business processes transactions manually as the business grows so will the need for more people to process the sales.  Your margin will stay the same and maybe even shrink . Lets say instead you automate the whole process using Salesforce as the platform.  The customer has their own portal, login etc. As your business grows you may at some point need to add more licences, more server space etc. But the costs grow much slower than your revenue, that is the power of digital leverage.

Automation plays a big part in this process, and now it is available to even a small single location business.  I am seeing even complex human intensive processes now being automated. In the past it took building a factory, adding & training people etc to grow a business all of which took a long ramp up period. The volume of business will not be the limiting factor, with digital leverage as it scales automatically.

Where does it work? in most any process that is routinely performed by officer workers.  Think of process intense businesses, like Banks approving loans, applying for most anything, ordering products & services. We are just now seeing the tip of the iceberg. I don’t suppose any of this applies in your situation ? It may be worth a fast phone call.