Investment and Financing Strategy_Essay

Investment and Financing Strategy_Essay - While the...

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Investment and Financing Strategy We will launch Softwaredirect.com with seed money acquired from personal finances and the goodwill of family and friends; this exists as a feasible option due to the relatively small amount of seed capital necessary for the launch (approximately $8,000). In order to cover the initial labor costs of this venture we will leverage the sweat equity of the management team and any other employees by providing labor at rates below their value during the critical gestation period of our business. As softwaredirect.com grows, there will be an increasing appetite for supplementary forms of capital which we will procure from outside investors. Such an investment would be attractive to investors who are knowledgeable about software and technology for the following reasons: We offer an unparalleled combination of products and services to our target market As an online software provider, we expect to enjoy significant growth We have high growth potential in a relatively unnoticed market
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Unformatted text preview: While the previous reasons are in accordance with the qualities of a typical venture capital investment, we differ from conventional venture investments because we do not have great cash needs. Also, our mission is to provide consistently superior products and services to our customers through quality control; therefore, we will not be poised to exercise a quick liquidity event soon after the launch. Perhaps the most attractive aspect of Softwaredirects launch period is that it will need less than $100,000 in its first year of operation. The most expensive portion of our costs is software engineers salary expenses. As our clientele and product base increase in size, additional software engineers will be needed in order to ensure quality control. However, we will hedge our susceptibility to high salary costs initially by leveraging our in house expertise in software engineering. After such time additional sources of revenue will be used to pay the various salary costs....
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Investment and Financing Strategy_Essay - While the...

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