Below is the discussion, you need to read and reply this discussion: Assuming the company has already
Question:
Below is the discussion, you need to read and reply this discussion:
Assuming the company has already made major investments in creating a new product which is ready to be tested, the next step would be to decide on financing options to help keep the company afloat and increase cash flow until the product is sold to the public. “The financial manager’s second main responsibility is to raise money that the firm requires for its investments and operations” (Brealey, 2015). There are three ways that the company can obtain the funds needed to keep the company alive: equity financing, debt financing, or a combination of the two. First, the company could receive cash from investors in exchange for part ownership of the corporation, or shareholders. This would promise them a share of future profits from the business. Second, the company could take out a bank loan, which would need to be eventually paid back in full plus interest. It is also possible for a company to use both methods of providing investors with shares and using a bank loan to provide the cash necessary for operations.
Throughout this phase of raising funds, communicating openly with stakeholders about the status of the company can maintain positive attitudes. “Communication is one of the most essential skills of a project manager, and if you’re unable to communicate progress and performance of key areas within your project to the appropriate stakeholders regularly, you’ll find that they’re definitely not a happy bunch” (Larsen, 2014). Even if there isn’t much progress to report to shareholders, it is essential to establish a transparent relationship with them.
The Bible shares several examples of giving before receiving, which can be likened to a corporation taking risks before reaping profits. Companies usually need to take on debt to have the liquidity to thrive, but this is not a bad thing. With safer methods comes modest return, but with higher risks comes greater returns.
Systems analysis and design
ISBN: ?978-1118808177
5th edition
Authors: Alan Dennis, Barbara Haley Wixom, Roberta m. Roth