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</o:shapelayout></xml><![endif]--></head><body lang=EN-US link=blue vlink=purple><div class=WordSection1><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri","sans-serif";color:#1F497D'>Also, There are a number of methodologies employed in sales/rev forecasts and these take into account all variables. Using any/combination of these methods will give you an indication on how much you need to retain, invest, etc in any given season to cushion an organization from future uncertainties- even the uncertainties can be estimated to near accuracy levels<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri","sans-serif";color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri","sans-serif";color:#1F497D'>Edwin</span><span style='font-size:11.0pt;font-family:"Calibri","sans-serif";color:#1F497D'><o:p></o:p></span></p><div style='border:none;border-top:solid #B5C4DF 1.0pt;padding:3.0pt 0in 0in 0in'><p class=MsoNormal><b><span style='font-size:10.0pt;font-family:"Tahoma","sans-serif"'>From:</span></b><span style='font-size:10.0pt;font-family:"Tahoma","sans-serif"'> kictanet-bounces+eonchari=lynxbits.com@lists.kictanet.or.ke [mailto:kictanet-bounces+eonchari=lynxbits.com@lists.kictanet.or.ke] <b>On Behalf Of </b>Andrea Bohnstedt<br><b>Sent:</b> Thursday, July 07, 2011 12:53 PM<br><b>To:</b> Edwin<br><b>Cc:</b> KICTAnet ICT Policy Discussions<br><b>Subject:</b> Re: [kictanet] Finance Policy - Tech Startups<o:p></o:p></span></p></div><p class=MsoNormal><o:p> </o:p></p><div><p class=MsoNormal>I wish I had that problem :) <o:p></o:p></p></div><div><p class=MsoNormal><o:p> </o:p></p></div><p class=MsoNormal>I think in the case of most start ups, this is a very unrealistic scenario as cash flow is one of the biggest problems. Usually you're chasing your clients for payments, but have to keep paying rent, staff, electricity etc. But my two shillings: <o:p></o:p></p><div><p class=MsoNormal><o:p> </o:p></p><div><p class=MsoNormal style='margin-bottom:12.0pt'>If you reinvest, have a plan for it - and that will tell you how much money you need when. <o:p></o:p></p></div><div><p class=MsoNormal>Ask your bank for their short and medium-term investment opportunities in government securities etc. Unless you're an investment expert, you want something conservative, and accessible when you need the money, so it might be important that you put at least part of the cash into short-term, liquid instruments.<o:p></o:p></p></div><div><p class=MsoNormal><o:p> </o:p></p></div><div><p class=MsoNormal><o:p> </o:p></p></div><div><p class=MsoNormal><o:p> </o:p></p><div><p class=MsoNormal>On 7 July 2011 12:44, Edwin Onchari <<a href="mailto:eonchari@lynxbits.com">eonchari@lynxbits.com</a>> wrote:<o:p></o:p></p><div><div><div><p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto'><span style='font-size:11.0pt;color:#1F497D'> </span><o:p></o:p></p><p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto'><span style='font-size:11.0pt;color:#1F497D'> </span><o:p></o:p></p><p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto'> <o:p></o:p></p><p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto'>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? <o:p></o:p></p><div><p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto'> <o:p></o:p></p></div></div><div><div><p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto'>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. <o:p></o:p></p><p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto'><span style='font-size:11.0pt;color:#1F497D'> </span><o:p></o:p></p></div><p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto'><span style='font-size:11.0pt;color:#1F497D'>To add to what Francis has said – assuming that expansion of the tech company is not possible, then as a good corporate entity, you could participate in a worthy corporate social responsibility program</span><o:p></o:p></p><p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto'><span style='font-size:11.0pt;color:#1F497D'>Edwin</span><o:p></o:p></p></div><div><div><p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto'> <o:p></o:p></p><div><p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto'>On 7 July 2011 12:15, Phares Kariuki <<a href="mailto:pkariuki@gmail.com" target="_blank">pkariuki@gmail.com</a>> wrote:<o:p></o:p></p><p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto'><span style='font-size:10.0pt;color:#330099'>Hi,<br clear=all></span><o:p></o:p></p><div><p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto'> <o:p></o:p></p></div><div><p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto'><span style='color:#330099'>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? </span><o:p></o:p></p></div><div><p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto'> <o:p></o:p></p></div><div><p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto'><span style='color:#888888'> </span><o:p></o:p></p></div><div><p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto'><span style='color:#888888'>-- <br></span><span style='color:#330099'>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> |</span><o:p></o:p></p></div><p class=MsoNormal style='mso-margin-top-alt:auto;mso-margin-bottom-alt:auto'><br>_______________________________________________<br>kictanet mailing list<br><a href="mailto:kictanet@lists.kictanet.or.ke" target="_blank">kictanet@lists.kictanet.or.ke</a><br><a href="http://lists.kictanet.or.ke/mailman/listinfo/kictanet" target="_blank">http://lists.kictanet.or.ke/mailman/listinfo/kictanet</a><br><br>Unsubscribe or change your options at <a href="http://lists.kictanet.or.ke/mailman/options/kictanet/francis.hook%40gmail.com" target="_blank">http://lists.kictanet.or.ke/mailman/options/kictanet/francis.hook%40gmail.com</a><br><br>The Kenya ICT Action Network (KICTANet) is a multi-stakeholder platform for people and institutions interested and involved in ICT policy and regulation. The network aims to act as a catalyst for reform in the ICT sector in support of the national aim of ICT enabled growth and development.<br><br>KICTANetiquette : Adhere to the same standards of acceptable behaviors online that you follow in real life: respect people's times and bandwidth, share knowledge, don't flame or abuse or personalize, respect privacy, do not spam, do not market your wares or qualifications.<o:p></o:p></p></div><p class=MsoNormal style='mso-margin-top-alt:auto;margin-bottom:12.0pt'><br><br clear=all><br>-- <br>Francis Hook<br>+254 733 504561<o:p></o:p></p></div></div></div></div><p class=MsoNormal><br>_______________________________________________<br>kictanet mailing list<br><a href="mailto:kictanet@lists.kictanet.or.ke">kictanet@lists.kictanet.or.ke</a><br><a href="http://lists.kictanet.or.ke/mailman/listinfo/kictanet" target="_blank">http://lists.kictanet.or.ke/mailman/listinfo/kictanet</a><br><br>Unsubscribe or change your options at <a href="http://lists.kictanet.or.ke/mailman/options/kictanet/andrea.bohnstedt%40ratio-magazine.com" target="_blank">http://lists.kictanet.or.ke/mailman/options/kictanet/andrea.bohnstedt%40ratio-magazine.com</a><br><br>The Kenya ICT Action Network (KICTANet) is a multi-stakeholder platform for people and institutions interested and involved in ICT policy and regulation. The network aims to act as a catalyst for reform in the ICT sector in support of the national aim of ICT enabled growth and development.<br><br>KICTANetiquette : Adhere to the same standards of acceptable behaviors online that you follow in real life: respect people's times and bandwidth, share knowledge, don't flame or abuse or personalize, respect privacy, do not spam, do not market your wares or qualifications.<o:p></o:p></p></div><p class=MsoNormal style='margin-bottom:12.0pt'><br><br clear=all><br>-- <br><a href="http://ke.linkedin.com/in/andreabohnstedt" target="_blank"><span style='font-family:"Verdana","sans-serif"'>Andrea Bohnstedt</span></a><span style='font-family:"Verdana","sans-serif"'><br>Publisher<br>+254 720 960 322 <br><br><a href="http://www.ratio-magazine.com" target="_blank">www.ratio-magazine.com</a><br></span><a href="http://www.ratio-magazine.com/careers/index.php" target="_blank"><span style='font-family:"Verdana","sans-serif"'>Find/post East Africa careers</span></a><span style='font-family:"Verdana","sans-serif"'><br></span><a href="http://www.ratio-magazine.com/businessevents/index.php" target="_blank"><span style='font-family:"Verdana","sans-serif"'>Find/post conferences, workshops, trainings, other business events</span></a><span style='font-family:"Verdana","sans-serif"'><br><br><br><br></span><o:p></o:p></p></div></div></div></body></html>