<font color="#330099"><font size="2"><font face="arial,helvetica,sans-serif">Hi Francis,<br></font></font></font><div><font class="Apple-style-span" color="#330099" face="arial, helvetica, sans-serif"><br></font></div><div>
<font class="Apple-style-span" color="#330099" face="arial, helvetica, sans-serif">It was hypothetical, I understand the need for taxes etc, I guess I should have better put out my thoughts... My point was more on what happens to cash you don't re-invest/pay out as dividends? Basically, what does one do with their cash reserves? Or is it that we don't have cash reserves?</font></div>
<div><div class="gmail_quote"><br></div><div class="gmail_quote">On Thu, Jul 7, 2011 at 12:24 PM, Francis Hook <span dir="ltr"><<a href="mailto:francis.hook@gmail.com">francis.hook@gmail.com</a>></span> wrote:<br><blockquote class="gmail_quote" style="margin:0 0 0 .8ex;border-left:1px #ccc solid;padding-left:1ex;">
Phares, I'd wager at least 30% needs to be paid in taxes for a start :-) unless you have included that in the expenses already (excluding PAYE for staff) in which case I have to ask why such high margins? If the value add is very good, and assuming its a service and not a product (and you indicate) then salaries too must be high? If a product, the question remains, what has been the value add such that after acquiring the product and adding value, you still have huge profits? <div>
<br></div><div>If all above is taken into account...then I suppose re-investing in the business, in expansion and in diversifying the offerings would be the best way to go. </div><div><br><div class="gmail_quote"><div><div>
</div><div class="h5">On 7 July 2011 12:15, Phares Kariuki <span dir="ltr"><<a href="mailto:pkariuki@gmail.com" target="_blank">pkariuki@gmail.com</a>></span> wrote:<br>
</div></div><blockquote class="gmail_quote" style="margin:0 0 0 .8ex;border-left:1px #ccc solid;padding-left:1ex"><div><div></div><div class="h5"><font color="#330099"><font size="2"><font face="arial,helvetica,sans-serif">Hi,<br clear="all">
</font></font></font><div>
<font color="#330099" face="arial, helvetica, sans-serif"><br></font></div>
<div><font color="#330099" face="arial, helvetica, sans-serif">Question, for those who have run tech startups, how do you deal with excessive revenue? Given that tech firms many times operate on high margins, let's, for the sake of example, say you have a product that, with an expense book of roughly 1M (Rent + Salaries), and your monthly revenue is 8 M KES. What do you do with the remaining 7M? Some say invest in product development but even then, you will still have quite an amount of change. What happens to that change? Invested in a bank? Or in some form of Fixed Income Securities (Bonds, T-Bills etc). What's the general practice in .ke? </font></div>
<div><font color="#330099" face="arial, helvetica, sans-serif"><br></font></div><font color="#888888"><div><br></div><div>-- <br><font style="font-family:arial,helvetica,sans-serif;color:rgb(51, 0, 153)" color="#000066" face="tahoma, sans-serif">With Regards,<br>
<br>Phares Kariuki<br><br>| T: <a href="tel:%2B254%20720%20406%20093" value="+254720406093" target="_blank">+254 720 406 093</a> | E: <a href="mailto:pkariuki@gmail.com" target="_blank">pkariuki@gmail.com</a> | Twitter: kaboro | Skype: kariukiphares | B: <a href="http://www.kaboro.com/" target="_blank">http://www.kaboro.com/</a> |</font><br>
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</blockquote></div><br><br clear="all"><br>-- <br>Francis Hook<br><a href="tel:%2B254%20733%20504561" value="+254733504561" target="_blank">+254 733 504561</a><br><br><br>
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</blockquote></div><br><br clear="all"><br>-- <br><font style="font-family:arial,helvetica,sans-serif;color:rgb(51, 0, 153)" color="#000066" face="tahoma, sans-serif">With Regards,<br><br>Phares Kariuki<br><br>| T: +254 720 406 093 | E: <a href="mailto:pkariuki@gmail.com" target="_blank">pkariuki@gmail.com</a> | Twitter: kaboro | Skype: kariukiphares | B: <a href="http://www.kaboro.com/" target="_blank">http://www.kaboro.com/</a> |</font><br>
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