- It shouldn't surprise but I am still surprised by the fact that most ventures that are on a tight lease have issues with undercapitalization. You would think that the owners would know where to inject money into their business to watch it grow but time and time again, I read articles and reports on the need to grow ideas and businesses by bringing on more opinions. Like a good friend always says, once you're in the rabbit hole, it's hard to see out. It shouldn't surprise me at this point but it still does.
2) Identify at least one part of the reading that was confusing to you.
- Definitely the part about discounted the cash flow was confusing. I don't get how or why a business is suppose to discount its cash flow and I don't think the author did a good job at explaining that.
3) If you were able to ask two questions to the author, what would you ask? Why?
- Why would you discount cash flow for the discounting earnings valuation method? I want to know!!
- How are you suppose to estimate what a buyer could earn elsewhere with the amount of money they are investing in a company? I don't know where that investor could be putting his money! Well, I know a couple of places...
4) Was there anything you think the author was wrong about? Where do you disagree with what she or he said? How?
- I disagree with the terms outlined in the Letter of Intent. The terms listed have no mention of the employees that work for the startup. What about them? Sure, maybe they don't get a say in what happens to the business but shouldn't there be some mention of what happens to them after the acquisition? I think so at least.
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