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Then investors would start asking why there is so much cash in company accounts. Good CEO invests every penny into something (hopefully profitable), for example
by deepsun 8y ago
Then investors would start asking why there is so much cash in company accounts. Good CEO invests every penny into something (hopefully profitable), for example, Jeff Bezos.
- icelancer 8y ago>> Good CEO invests every penny into something (hopefully profitable), for example, Jeff Bezos. Apple?
- valuearb 8y agoA great CEO is a good resource allocator. Cook doesn't blow Apple's billions on dubious side projects, he returns it to shareholders. In the case of a startup like Uber, it's mandatory to never run low on capital before you turn profitable, or you will soon be either out of business or soon be forced to take massive dilution to stay in business. The reason their burn rate is massive in a big part part because of these dubious side projects and distractions, and it's already costs them substantial dilution. And even after decapitating most of their side projects, they can easily justify keeping a few years cash in the bank because they have a huge potential market in ride-hailing that they haven't even come close to saturating and are still burning capital building out..