Sign Up Now
Get instant access to over 1 million+ study documents
OR
Already registered? click here to login
By creating your account, you agree to our terms of service, privacy policy and student honor code.
The company has only just entered the Boston market and has not developed other markets, but is the first-mover in North America. Strategically, ZipCar could benefit significantly from rolling out into other cities before other competition emerges.
It is believed that in another six months, more financing will be required to facilitate further expansion. Filling in the Boston market is expected to utilize all of the $1 million remaining after the debt is paid off. Venture capitalists are believed to want to see a couple of things from ZipCar in order to make the successive financing rounds smoother. The first is that the company will need to demonstrate that the current leadership team is capable of leading this growth. At present, there is concern that the team's lack of experience is going to inhibit its ability to grow. However, when professional management was brought in before, it was not successful. The other thing the venture capitalists are going to want to see in the future is that that company has built a critical mass in Boston. This will help create strong network effects for the company that will facilitate further investments from the venture capital community. Strategically, however, this may mean forgoing first mover advantage in other cities. However, moving into other cities before having the capital required to do so is not recommended, so the focus for Robin at this point has to be to earn additional capital by demonstrating the concept's...
The cost of rolling out to four more cities in the coming year is $1.6 million, but the rollout is expected to be profitable in its second year. In year five, the company is expected to enjoy revenue of $1.227 million and net income of $459,000 on that total. A reasonable exit value in five years would be revenue of $111 million. The growth of the company is expected to be self-sustaining within a year of the national rollout, as projections show that each new city is likely to be profitable within a year of launch, based on the Boston experience.
Given the recommendation for a round of financing and four city rollout in six months, followed by a further round in a year that will constitute a nationwide rollout, the company will need progressively large sums of money. The cost of a four-city rollout is going to be $400,000 per city, plus the expected operating loss of $615,000. Thus, the next round of financing should be for $2.2 million. The round subsequent to that would add another ten cities. At $400,000 per city, and with expected operating losses in the first year of the rollout, the total funding that would need to be raised during that round would be $5.54 million, which would be rounded up to $6 million in order to accommodate…
Financing Expansion My company has enjoyed a good run of success, and is now considering purchasing a competitor in order to expand further. After twelve years of business, we have expanded, becoming profitable, and are now franchising as well. In order to adopt a nationwide strategy with an eye to going global, we are looking at options for expansion. Taking over a competitor is one of the main options. This paper
Financing Foreign Trade The promising prospects of Asian economies and to be specific China has endeared many business enterprises the world over to trade with it. China's trade volume totals 1.4 trillion U.S. dollars while its export amounts to 762 billion U.S. dollars (Alomar, 2007). This paints a rosier picture of foreign trade. That is not a true representation especially for small businesses that undertake to engage in foreign trade. Such
Financing Public and Private Higher Education Higher education in the United States consists of varieties of institutions that award degree certificates, associate certificates, and postgraduates' certificates. Data presented by National Center for Education Statistics (2011) reveal that there are approximately total number of 4,495 degree and non-degree granting institutions in the United States where 2,774 grant 4-year and postgraduate degrees and 1,721 higher institutions grant associate degrees. As being revealed in
Financing Community Business The Importance of Small Business in the Economy Canadian Federal Support for SMEs Tackling SME Tax and Fiscal Priorities Rebalancing Canada's EI System Assist Small Business Owners with Succession Plans Growing Small Firms into Larger Firms Federal Support for SMEs Depleted Communities in Canada Distressed Communities in United States Community Economic Development Investment Funds Community Economic Development Funds in U.S. Non-Bank Financing Community-based financial organizations have been developed in many countries to serve the critical needs of small to medium
82), and through charities, which has been mentioned in this paper in previous pages. By the middle of the 1990s, the CIA estimated that "...fifty Islamic charities 'support terrorist groups, or employ individuals who are suspected of having terrorist connections'" (Gunaratna, 83). And as to the international "formal" banking infrastructure of al-Qaeda - such as it was prior to September 11, 2001 - President George W. Bush issued executive order
Financing and Foreign Ownership of Real Estate in Mexico Due to the similarities of real estate transactions in general, many Americans assume that the basic real estate terms and principles of the United States also hold true in Mexico (Peyton, 2003). Because much of the American real estate terminology is adopted for real estate transactions in Mexico, a lot of the paperwork appears to be similar. However, many aspects of Mexican real