HARVARD UNIVERSITY FACULTY OF ARTS AND SCIENCES BUSINESS PLANNING FOR CLOSELY HELD ENTERPRISES MANAGEMENT E- 5610 Questions for the Kochman Case 1. What financial problems are posed by KR+H’s operating strategy? 2. Assuming KR+H can obtain external funds to make the capital expenditures, what are your cash flow forecasts for the years 1993 through 1998? What is the value of the business? To facilitate comparisons, please assume sales growth of 10% and 1992 profit margins. Assume that cost savings occur in the year after the investments. You should also prepare forecasts using assumptions that you think are appropriate. 3. Assuming KR+H finances its investments internally, what are your cash flow forecasts for the years 1993 through 1998? What is the value of the business? Use the same cases examined in Question 2. 4. Should KR+H finance capital expenditures internally or should it rely on external financing? If you recommended external financing, what kind should it use and how should it obtain it? Questions for ENDONAV Adapt EndoNav’s “Six Million Dollar Plan” so that the company can be financed successfully by angel investors. Consider at least the flowing issues: 1. Value proposition a. What is the company’s central value proposition? b. Does the company need to change its investor pitch? How so? 2. Human Capital a. What skills and which individuals must EndoNav keep? b. Which people and position should be eliminated from the plan? c. How will the revised plan compensate for those people’s absences? d. Once EndoNav adjusts its team, how should managers go about creating a culture that will help the team succeed? 3. Benchmarks a. What should the company’s key benchmarks be? b. How should the company adjust its schedule for those milestones? 4. Financing a. How much money does the company need? b. How should it structure that funding?
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