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Finance & Accounting
Pages 3 (753 words)
Generally, during the development stage of businesses, financing is a major critical success factor. As pertains to the Laundromax case, whose major goal was to revolutionize the laundry industry and seek nationwide recognition, the company would hence have to incur major capital, corporate and development expenditure.
With my financial management role, my plan for financing would start with personal owner equity. This would act as a show to outside investors of the personal trust that the founders have in the growth and success of their business and hence worth a further inducement for additional outsider investment. In order for Laundromax to attain self-sufficiency as a company, 100 stores must be established at an estimate of $500,000 per fully functional and operational store. This puts the total capital required to attain self-sufficiency at an estimate cost of $50,000,000. With such heavy initial capital outlay, personal equity would not be sufficient to meet this expenses and hence the vision of the business. I would result to investment capital with major focus on investment banks and venture capital firms who are willing and able to raise a major part of the required capital in return for an equivalent stake in the company’s assets. ...
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