I am curious to how start-up funding works.
A company receives 7 million start-up funding from Venture Capital representing a 4 year start-up plan. How does the company protect this money from being taxed as income or profit? Obviously the start-up expenses for the company are not going to exceed 7 million in the first year, although on the books the company has just made 7 millions dollars. How does the company maximize the use of this 7 million dollars so that it is not taxed as income or profit. Thanks,
Dan