The answer needs to be over 250 words
Bill Gates has said that Microsoft is the quintessential firm that operates on “human capital.” He once said that if someone developed a better operational system, Microsoft would be ‘out of business in 90 days.’
If indeed the software industry is driven by ‘brains and ideas’ and not by ‘plant and equipment’ (like automotives), what would the implications of that be on the ‘capital’ organizational structure of a company and the need for a healthy mix of equity and debt?
Please, include specific references to course materials in your response where appropriate.