Need help? We are here

Discussion post
1.)
You have a great idea about a new business opportunity. You’ve run the numbers and are confident that with an initial investment of $500,000, you can turn a profit in three years and generate $150,000 in operating income per year. But you realize there are no guarantees. Further, you anticipate that there is at least a 50/50 chance the economy will enter a recession within the next two years.
·
What factors will be most important in determining if you want to fund your venture through equity or take a loan for the $500,000?
·
If you meet all your projections, will you be happier in five years that you used equity to fund the venture or debt? Why?
·
If the company goes bankrupt in five years, would you have a different answer? Why?
2.)
Strategic Alliances
·
Under what circumstances should an organization seek a strategic alliance? Provide a specific example of a company where a strategic alliance was preferential to an acquisition and summarize some of the unique challenges that were faced by the alliance leadership team.