* RISK.TXT

                                   RISK

*   This table shows an example of how risk may be evaluated, where it
    stems from, and which areas are most dangerous.  It allows you to
    compare your exposure, given various assumptions.

*   The example shows a relatively new company in a growing, yet new
    industry with an excellent management team, although they haven't
    enjoyed a lot of success [in this industry?] The most important
    variables, however, are the industry and position within that
    industry.  The assumptions play the next important role--this is
    saying that a lot is riding on their assumptions.


Elements              Degree of Risk
of Risk
----------------------------------------------------------------------
                  Low     Medium      High    Weight     Total
----------------------------------------------------------------------
Industry                    5                  .25        1.25

Maturity                    5                  .05        0.25

Competitive
Position           1                           .25        0.25

Strategy           1                           .05        0.05

Assumptions                            10      .20        2.00

Management         1                           .10        0.10

Past Performance            5                  .10        0.50


                           Overall Risk        1.00       4.40


RATIONALE

    * Fill in appropriate information.

Industry:  Company must stay competitive as business matures.

Maturity:  In the mature stages there are likely to be competing
           models/companies.

Competitive Position:   The market is wide open.  Few competitors.

Strategy:  Product/service, price distribution, promotion strategies are
           straight forward.

Assumptions:  Sales forecasts for new products/services are difficult
              to predict.  Product/service acceptance is good -- sales
              estimates are considered conservative.

Management:   Careful planning and clear objectives should not present
              much risk.

Past Performance:  NA
