Financing Balance Sheet

Existing Investments

Generate cashflows today

Includes long lived (fixed) and short-lived (working capital) assets

Assets in Place

Growth Opportunities

Expected value that will be created by future investments

Growth Assets
Debt

Fixed Claim on cash flows

Little or No role in management

Fixed Maturity

Tax Deductible

Equity

Residual Claim on cash flows

Significant Role in management

Perpetual Lives

Total value of assets
Total value of the firm to investors