Risk, Return, Capital Budgeting, and Weighted-Average Cost of Capital

There is a common phrase in" rel="nofollow">in busin" rel="nofollow">iness: "Cash is kin" rel="nofollow">ing." "Cash flow is the life-blood of a company. Without it, a company will fail" (Hicks, 2012). Yet, companies often have to take risks that could potentially jeopardize their cash flow (e.g., new projects, growth, capital budgetin" rel="nofollow">ing, etc.). Assume you are the CFO of a strugglin" rel="nofollow">ing company. While you do have a positive cash flow, it is min" rel="nofollow">inimal at best. If somethin" rel="nofollow">ing does not change soon, the company will go under. Fortunately, your product development team has just created a new product that will not only save the company from fin" rel="nofollow">inancial demise but will also revolutionize how the in" rel="nofollow">industry does busin" rel="nofollow">iness. The problem is that the product is still 2 years away from bein" rel="nofollow">ing able to be sold to the public, and you will run out of cash within" rel="nofollow">in the next 6 months. How would you propose obtain" rel="nofollow">inin" rel="nofollow">ing the funds needed to keep the company alive and thrivin" rel="nofollow">ing for the next 2 years until you are able to see a return on the product development? How would you keep the stakeholders happy?