Limiting Liability
Article Abstract:
When Knogo Corp. was looking for a way to finance future expansion without putting itself in debt for the long term, the company president came up with a unique solution. The company borrowed the money from Swiss banks at a very low rate of interest. The debt can be converted into company stock, which means that Knogo may never have to repay the loan with cash. Flow Industries is a privately held research company which raised capital for the production of their innovative wind turbine by forming a limited partnership. The company hopes to repeat the process in the future and, eventually, to take the company public. Gerald Grossman is not your typical venture capitalist. While most venture capital companies concentrate on the high technology areas, Grossman invests on the slow track, the more traditional businesses where he can bank on the hard assets of a company, for he does not like to take equity risks.
Publication Name: Inc.
Subject: Business, general
ISSN: 0162-8968
Year: 1984
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Big Deal
Article Abstract:
In 1981, when the founders of Sytek, Inc., a consulting firm, decided to diversify into manufacturing the hardware and software for local-area networking systems, they began looking for someone willing to make large capital investments. Although they had offers from venture capitalists, they decided to join forces with one of the giants of the cable industry. Industry giants have tried before to help out smaller companies, often with mixed results as they seek too much control in the start-up companies. Sytek was determined not to let that happen, and before agreeing to any financial help, spelled out their own position which included future independence. Both parties agreed to the terms, and now, over two years later, the relationship between the two companies remains beneficial to them both.
Publication Name: Inc.
Subject: Business, general
ISSN: 0162-8968
Year: 1984
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