财务或融资策略对组织的盈利能力有重要影响，从而影响组织在这段时期内的增长。这是一份为Midas Touch Technologies (MTT)提供的咨询报告，目的是为新业务的投资提供最合适的资金来源。这份报告能够有效地识别出公司通过风险投资所具有的优势和劣势。它还包括风险投资公司在资本投资评估中需要考虑的风险，以及为MTT推荐另一种融资策略，接下来加拿大传播学论文代写-MTT融资策略分析如下:
The financial or funding strategy has a significant influence on the organisational profitability and consequently its growth over the period. It is a consultancy report, which is proposed for Midas Touch Technologies (MTT) in order to recommend the firm for the most appropriate source of funding for the investment purpose in the new business. MTT is managed by four people geographically and is engaged in developing wearable technologies, which have a huge potential for success. From its flagship product, MTT gained sales of £936K in the year 2015 and it is planning to launch a new product in 2016, which will also increase its sales and profitability. For the investment in the new product, the firm is seeking venture capitalist as the venture capital firms are more concerned to invest in the innovative technologies with the major benefits (Missoni and Alesani, 2013). This report is effective to identify the advantages and disadvantages, which the firm can have through venture capital funding. It also includes the risks that are required to be considered by the venture capital firm in the capital investment appraisal along with recommending another alternative funding strategy for MTT.
Risk minimisation: The major advantage of venture capital as full equity funding is that the firm will not be obligated to repay the money if the business fails. Venture firms have a share in ownership or in profitability, which will be effective to reduce the risk related to financial liability of the firm. In the current, MTT has liability to pay loan £400K and £300K of crowd funding that is already creating the financial obligations of the firm. MTT will be benefited by investing the fund in its new product development through venture firm because it will help to minimize the chance of bankruptcy and reduce the uncertainties & risks (Lantza, et al., 2011).
Alliances: VC is an easy way of increasing the reputation in the market and to get the assistance in expanding their business domestically and internationally through the strategic alliances. It is because VC has a good reputation and the involvement of them in a firm causes an increase in the reputation of that firm also (Miller, 2014). It will also enable MTT to expand its market easily throughout the country with the help of effective alliances.
Recommendation to Venture Capital Firm
For the recommendation to venture capital firm whether to invest or not, the capital budgeting methods are used. Net present value (NPV) is an effective method to determine the return on an investment (Götze, et al, 2015). For the investment of venture capital firm in MTT, it is assumed that it has a cost of capital equal to 10% and on the basis of this, the below is the calculation of NPV value:
As the investment is made in the year 2016, it is assumed as the investment made at the end of the year 2015, so it is taken as year 0. So, the next five years’ cash flows are considered for conducting the investment appraisal through NPV method. From the cash flows, it can be determined that the cash flows are improving significantly and there is a huge growth potential for MTT in the industry. But from the NPV analysis of the cash flows in MTT, it can be recommended to the venture capital firm that it should not invest in MTT as there is a negative value of NPV, which indicates a decline in the return for VC firm in the future time period (Erickson, 2013). The investment in MTT will cause a decline in the value of its investment of £10 million due to negative NPV, so the firm should not consider investing in MTT.
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