Usually seen as disruptors, growth companies typically demonstrate strong product-market fit backed up by strong revenue growth. These are the companies that are changing how things are done, usually for the better. Because they are continually reinvesting in their business to seize their opportunity, they may oftentimes accept net losses and even negative cashflow in an effort to grow and increase market share.
A long-term mindset is critical for investing in growth companies, since attempting to understand growth companies entails embracing the unknown future. Present and future valuations are usually determined by not-so-concrete data including