Depth of pockets

In the general framework for mapping resources proposed by Benoit F Leleux the following points are made with respect to depth of pockets:

• Financing resource differ in their ability to fund large projects and/or repeated rounds of financing
  • Some will explicitly limit their contribution to a one-shot deal
  • Some will want to aim for multiple rounds
• Repeated rounds of financing have the following advantages:
  • Lowers the Cost of money by only raising what is required at a certain stage
• A venture capitalist can be critical to a growth company by providing:
  • Access to technology
  • Management
  • Distribution channels
• Alternative sources of finance may be more appropriate at later stages, because
  • Resources and the costs of financing would be less valuable to the firm

Part of: General framework for mapping resources