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Questions to Answer Before Investing in a Start-Up

Strategy Driven

However, before making any investment decision, it is essential to ask yourself some tough questions to make sure you are ready for the commitment. What Rate of Return is Expected? . For example, do you want a guaranteed return , or do you need one that entails more risk?

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Volatile, Uncertain, Complex and Ambiguous (VUCA) Business

Coaching Tip

The report identified the top four skills that have the greatest impact on leader preparedness and confidence in addressing VUCA challenges: introducing and managing change; building consensus and commitment; inspiring others toward a challenging future vision and leading across generations.

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Venture Capitalists Get Paid Well to Lose Money

Harvard Business Review

The public pension funds, endowments, and foundations (called limited partners, or LPs) that foot the bill for the industry through their investments in VC funds do so to realize the outsized returns that VC claims to provide. There are, of course, individual firms that succeed in generating venture rates of return.

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Walmart Broadens ROI for Green Power

Harvard Business Review

And the commitment to green energy has helped Walmart take third place on the U.S. We worship internal rates of return (IRR) to our detriment. The typical (but evolving) view is that all sustainability initiatives are either an expense and/or should only happen if they meet the strictest hurdle rate.

ROI 13
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Don’t Take Money from VCs Until You’ve Asked 4 Questions

Harvard Business Review

Investors in VC funds see returns data from a wide range of firms, and those performance figures make it clear that many well-known “brand” VC funds consistently fail to generate minimum venture rates of return. As a result, entrepreneurs are fully committed to the economic performance of their company.

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What Private Equity Investors Think They Do for the Companies They Buy

Harvard Business Review

Rather, they rely on internal rates of return and multiples of invested capital. Instead, PE investors typically target a 22% internal rate of return on their investments on average (with the vast majority of target rates of return between 20 and 25%), a return that appears to be above a CAPM-based rate.

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Two Forces Moving Business Closer to Climate Action

Harvard Business Review

It’s a perfect storm bringing us to two important tipping points: one of belief and commitment to action, and one of economics. This week, an important coalition of coalitions, We Mean Business , launched with its own report and commitment by large organizations to recognize the reality of climate science and the ability to act on it.

IRR 8