Capital assets will be a very big part of the financing of this business. The central systems all need to be put in place, and the primary net work needs to be built. All this needs to happen before even one customer can be signed up. But there are also capital costs associated with every single customer who signs up. The cost of customer premises equipment and the installation cost of the equipment will rarely be fully covered by the up front cost paid by the customer Consequently, every incremental customer (in the early years) will need to be financed by equity. The investors in this business will be looking ahead to the point where the business can transition from equity financing to debt financing. Normally, this will be determined up front in the legal documents governing the financing. The debt providers will commit to providing certain levels of debt when certain milestones are reached.

(One key milestone might be operating cash flow break even. At this point, the business will still need to invest in capital assets, but it is generating positive cash flow from operations.)

Would venture capitalists be interested in funding this?

What would be a likely exit for investors? Who would buy a company like this? And who is likely to be your competitor(s)?

Why is debt a necessary component of the capital mix? Are margins of this business likely to be high or low? Why?

What is likely to happen to marginal revenue over time?