Reference no: EM131919464
You are the President of a small software development firm in beautiful Half Moon Bay, California, and you have a strategic dilemma.
Your VP of R&D wants to purchase a very, very expensive 3-D Holographic graphics accelerator that has the potential to make the games we develop the most realistic in all of the gaming industry.
The equipment costs nearly $1 billion, but we have access to debt and equity funding to cover it. If we are successful, we will likely become #1 in our markets. With that revenue volume, we could actually pay off the equipment in about 5 years.
The CFO (Chief Financial Officer) is strongly against the purchase. We are already profitable, though not in the top 3 firms in our markets.
The CFO says that even if we succeed, the accelerator might be technologically obsolete before we can even pay it off, and if we're not successful, we will go bankrupt. You sit in your office and ponder your options. "Go Big, Or Go Home!" the VP of R&D had warbled loudly in the meeting.
Perhaps so, you think; but then again, this is real life, not Sylvester Stallone in The Expendables Part 7 (coming soon to selected theaters).
What would you do?
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