Practice // Questions and comments // Financial policy of a high tech company

Financial policy : Question 1
Is the financial policy of a high tech company different from that of other companies?

ALL THEMES
  • COST OF CAPITAL
  • FINANCIAL ANALYSIS
  • FINANCIAL ENGINEERING
  • FINANCIAL MANAGEMENT
  • FINANCIAL POLICY
  • VALUATION
No, the financial policy of a high tech company is not fundamentally different from that of other companies.

What is different about high tech companies is that they are extremely sensitive to the general economic situation, as can be seen from the number of start-ups that shut down. Also the low visibility of the activity means that high tech companies tend to go more for equity financing.

For more information, see chapter 35 of the Vernimmen.