Final answer:
The introductory phase of a company's life cycle is characterized by a lack of customers and profits. It is a challenging stage for raising financial capital due to the absence of a track record of profitability. This phase focuses on product development and building a customer base.
Step-by-step explanation:
The introductory phase of a company's life cycle will most likely have a lack of customers and profits. During this stage, the company is just beginning and has an idea or prototype for a product or service but has few or no customers.
As a result, the company faces challenges when it comes to raising financial capital since it hasn't demonstrated its ability to generate profits yet. Paying a rate of return to financial investors becomes difficult without a track record of profitability.
Overall, the introductory phase of a company's life cycle is characterized by a focus on product development and building a customer base.