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Ge 598sc Midterm Exam

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Submitted By vishwahere
Words 250
Pages 1
The company has a strong vision of positioning itself as a global leader in business applications for software companies
The most important factors while evaluating the potential investment are
a. Management Team
The Management team has three experienced and successful software executives managing the company. They have proven themselves in their ability to manage growth and transitional situations. Over past year, these executives have devised and executed their strategy. These factors indicate a strong management team who can be trusted for their commitment.

b. Market Sector
The software industry market outperforms the US economy. The U.S. software industry has grew over five times, and increased employment seven times faster than rest of the economy. During 1996, Software and Information was the leading industry selected for capital investment capturing 24% or $2.2 billion of a $10 billon investment pool. Making this investment a very lucrative one.

c. Business Model
SOFTRAX business model has 4 different sources of revenue.
a. Initial License fees: priced on a per-user basis
b. Additional user fees as company grows
c. Consulting and implementation revenue
d. Maintenance revenue
There is strong and early cash flow, recurring revenue d. Proprietary product or service
SOFTRAX is a proprietary software product. With internal systems being the competition.
With fourth year projected sales of $35 million and profits of $4.9 million, RBS would be positioned for a high multiple IPO or find itself as a very attractive acquisition by strategic partners, customers or another software

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