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Let's Practise: Case Study NEWTECH (Part 1) NewTech is a company that aims to develop innovative products based on Galileo, the European global satellite-based navigation system that accurately locates moving objects worldwide through satellites. Table 7.3 lists the assump- tions underlying the forecast. Given that the expected development time and sales lead-time together are expected to take 21 months, the venture is expected to generate its first sales after 22 months, for a total value of 15,000. After that, the company anticipates a monthly growth rate of 10 per cent for a period of Table 7.3 NewTech's assumptions under the most likely scenario 1. The entrepreneur invests 50,000 in cash and another 30,000 in kind (a testing machine) when the venture is founded. The machine is depreciated over a period of 5 years. This is the only capital expenditure at startup. 2. The development and first sales process takes 21 months. 3. First sales are expected in month 22 for a total amount of 15,000. 4. Sates will grow at a monthly rate of 10 per cent for a period of two years. After this period, sales growth is assumed to be equal to the growth of the overall economy (3 per cent annually). Let's Practise: Case Study NEWTECH (Part 1) NewTech is a company that aims to develop innovative products based on Galileo, the European global satellite-based navigation system that accurately locates moving objects worldwide through satellites. Table 7.3 lists the assump- tions underlying the forecast. Given that the expected development time and sales lead-time together are expected to take 21 months, the venture is expected to generate its first sales after 22 months, for a total value of 15,000. After that, the company anticipates a monthly growth rate of 10 per cent for a period of Table 7.3 NewTech's assumptions under the most likely scenario 1. The entrepreneur invests 50,000 in cash and another 30,000 in kind (a testing machine) when the venture is founded. The machine is depreciated over a period of 5 years. This is the only capital expenditure at startup. 2. The development and first sales process takes 21 months. 3. First sales are expected in month 22 for a total amount of 15,000. 4. Sates will grow at a monthly rate of 10 per cent for a period of two years. After this period, sales growth is assumed to be equal to the growth of the overall economy (3 per cent annually)

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