I chatted with a founder about his plans for his company. His goal is generational wealth for his family. He’s aiming to sell the company in an all-cash deal. I thought the focus on an all-cash deal was interesting given his company’s trajectory. It’s growing quickly, and I believe it has the potential to be worth a billion or even ten billion dollars one day.

Compounding is a powerful force that many—including founders—don’t grasp. If you own equity for a long time in a company with a healthy growth rate, the value of the equity compounds over time and can end up being massive. If accumulating wealth is a priority, owning equity in a great, growing company is the way to accomplish it. The families that understand this concept have continued to own significant equity for decades in the company their patriarch or matriarch started. Their wealth has compounded over that time into massive fortunes. Think Walton family and Walmart. Jim, Alice, and Sam Walton are worth close to $200 billion because of their decades-long ownership in Walmart. Even some of the recent entrepreneurs who’ve accumulated immense wealth did so because of the compounding value of the equity they owned in their company. Think Bernard Arnault, Jeff Bezos, and Elon Musk.

Founders (and everyone for that matter) should be keenly aware of the power of compounding when they’re thinking about financial security.