In early 2013, the head of business development and commercial operations of Arla Foods, a dairy enterprise focused on Northern European markets, is examining, in the light of a new five-year strategy, alternatives to the existing organization structure. His dilemma is to determine the best structure that can deliver the strategy, which is focused on renewed international expansion. The new structure must support the company's strategy in relation to both the existing core markets in Northern Europe and also the growth markets of the future in countries of Asia and Africa. It must ensure that Arla Foods has the right competitive stance in individual markets, which vary widely in terms of customer buying habits and retail formats. It must also ensure regular innovation of dairy categories developed from local resources and marketable globally.
OWNI was founded in April 2009 as a copyright-free online news and image distribution firm. As part of a web agency that developed web content and graphics for French companies, it insisted that all content produced could be made freely available to others under the Creative Commons licence. OWNI delivered hard-hitting news, sourced in the beginning mostly from bloggers and later supplemented by a team of investigative journalists. Set up to challenge the dominance of traditional French media, OWNI sought to carve out a niche for itself as a provider of richly illustrated, insightful news articles that were available to the public at no cost. Yet, despite its aspirations, the recognition it had received in the form of industry awards and the commitment of its employees, the firm filed for bankruptcy by the end of 2012. A former journalist at OWNI considers its impact on French media, what it represented, what changes — if any — it sparked and what it could have accomplished had it achieved what it set out to do. What were the challenges of growing and maintaining a unique business model in the face of competition and dwindling resources that OWNI’s management failed to meet?
In a testament to the power of social media and the effect it can have on a business, the chief executive officer of a bank adopts the habit of taking to Twitter on a daily basis to promote his company’s services. But when the bank’s most recent ad campaign ignites a furor among TV audiences, Twitter quickly becomes a vehicle for crucifying the bank rather than promoting it. Within a week of the ad's air date, the bank is inundated with angry tweets, Facebook messages and media criticism. It becomes clear that the bank has made a mistake and will have to act quickly to decide on an appropriate response.
Two business-school grads are the co-founders of a technology startup that provides a mobile-based solution for automotive reviews. The case focuses on customer validation and on fitting a demand model to the aggregate sales data from the test versions of their product.
In June 2013, the founder of Healing Through Humour, a comedy school for people with mental illness, considered his options to overcome the barriers to growth for his not-for-profit organization. The school, located in donated space in the offices of the Schizophrenia Society of Saskatchewan in Regina, was designed to build self-esteem and life skills for people suffering from mental illness, to raise public awareness about mental health issues and to break down barriers of mental health discrimination in the community. The classes were free to encourage attendance by those with limited means. Money from ticket sales for the class’s public performances was used to fund performance and operating costs, but there was little left over to expand the organization’s promotional budget beyond maintaining a basic website and Facebook page. Low attendance for both the classes and the performances underlined the need to identify and access target market segments to increase community awareness of this support service, grow the class size to a critical mass and secure ongoing funding to make this health care initiative sustainable.
In 2013, the chief executive officer of the Canadian guitar manufacturer MacKenzie & Marr Guitars was reviewing all options to increase monthly sales, which were well short of the goal of 100 guitars a month or $1 million in annual revenue. Unlike its competitors in Canada, the company sold its products only online, promising delivery within 10 days and providing a seven-day return guarantee if the customer was not satisfied with the product. The first set of decisions related to the launch of a new guitar model: what market segment should be targeted, whether to expand into the United States where the company would face significant online and brand competition, whether the guitar should be endorsed and how it should be priced. He also had to decide whether to begin selling guitar accessories to increase revenues. As well as his concern about product, he had to consider changes in tariff policies that might affect the costs of manufacturing in and shipping from China. Once these decisions had been made, he would then decide on how best to allocate the company’s limited monthly promotional budget, especially whether to increase his Facebook and Google advertising, or invest in industry magazine print ads, or do both.
In 2013, Mohamed Hage, founder of the rooftop farming business called Lufa Farms, thought his company had reached a level of maturity where scaling the business model was the next logical step. With two greenhouses already in Canada, he was looking into other locations in the U.S. Though Lufa Farms' advanced cultivation technologies made the company stand out in its sector, the industry was still young and investors were not fully comfortable putting their resources into rooftop farms. This case explores the intricacies of a rooftop farming business, how it built a successful brand, and presents the challenges that might lie ahead for the company as the founder thinks about expansion.
The case profiles the protagonist, Vineet Rai, managing partner of Aavishkaar Venture Management Services (an Indian, early stage VC firm with a focus on rural, underserved regions and sectors), as he initially formulates the concept for the Aavishkaar, and seeks to initially capitalize the fund. The case follows Rai through his ongoing struggles and perseverance for capital, after which it discusses the thesis, structure, and nuances of the fund. It then shines the light on a prospective investment by the fund in an Indian dairy company, Milk Mantra, and deliberates whether the specific investment is a prudent one at that moment in the fund's life. It is recommended that this case be taught in conjunction with the GSB's "Note on Angel Investing and Venture Capital in India.
The case profiles the protagonist, Vineet Rai, managing partner of Aavishkaar Venture Management Services (an Indian, early stage VC firm with a focus on rural, underserved regions and sectors), as he seeks to build on the initial traction of his first venture fund and strives to raise a second, larger, and more ambitious fund. The case discusses Rai's "lessons learned" from his first fund (profiled in Case A), and discusses how such lessons have informed a changed approach to the Aavishkaar thesis and fund structure. It also provides a series of snapshots from prospective LPs in the fund being raised.
The case profiles the protagonist, Vineet Rai, managing partner of Aavishkaar Venture Management Services (an Indian, early stage VC firm with a focus on rural, underserved regions and sectors), as he debates whether to make a follow-on investment in a portfolio company, Milk Mantra. The case provides an update on Aavishkaar's fundraising efforts to date (updating Case B), and then provides an overview of the events at Milk Mantra since Aavishkaar's first investment (profiled in Case A). Given that progress at Milk Mantra is a mixed bag, the case raises the question as to whether it's worthwhile for Aavishkaar to increase its investment in and exposure to Milk Mantra.
The United Nations' Millennium Development Goals represented a global commitment to cut in half the population living in extreme poverty, and improve the lives of women and children worldwide. In Brazil, the population living in the extreme poverty represented about 16 million people in 2012. Several very successful initiatives during the Lula administration radically improved the lot of the poor in Brazil. Casa Transitoria is a charity located in the Valley of ParaÃba, state of São Paulo, whose central goal is to provide extended comprehensive assistance to expectant mothers. Urbanization, migration, and social dislocations have led to the creation of slums around large Brazilian cities. Casa Transitoria is one of the nonprofit institutions committed to alleviating the problems of these families and transforming their economic and social prospects. The charity has been recognized as one of the best-managed nonprofit organizations in the country. After 40 years of service under the leadership of its original team, the organization must confront the difficult process of succession, while, at the same time, adjusting to a new set of circumstances, both at the level of the populations served and its volunteer work force.
This note provides an introduction to the process of loan syndication and the evolution of the leveraged loan market. The note emphasizes the role of banks as loan originators and the evolution of the institutional investors' entry into the leveraged loan market. In particular, the note discusses the role and incentives of collateralized loan obligations (CLOs).
Cathay Capital Private Equity (Cathay) was started by Mingpo Cai and Edouard Moinet in 2007, at the brink of the global financial crisis. The firm initially opened offices in Shanghai and Paris, aiming to invest in fast-growing small and medium enterprises, either French companies looking to expand in China or Chinese companies seeking to move up the global supply chain in France. By the end of 2012, Cathay closed a EUR350 million second fund, and, planned to move beyond France and China, by looking at other European countries and the United States for potential deals. With the growing competition of local private equity (PE) firms in China and the ongoing European debt crises, was the firm ready to replicate its business model in other geographical markets in the near future? What did the firm have to do to ensure success in the long run?
LOLC Microcredit, a microfinance company within the LOLC group in Sri Lanka, has been serving the financial needs of the base of the pyramid through micro-leasing and group lending. The question now is whether to grow the exisiting business, use diversification to increase impact or prioritize its expansion into Myanmar.
In October 2006, Ms. Suzanne Blanchet, President and Chief Executive Officer of Cascades Tissue Group (CTG), was pondering how much weight should be given to products sold under the CTG brand compared to those sold under distributors' or retailers' private labels. The fourth largest tissue paper producer in North America, CTG was one of the four divisions of Cascades Inc.: a giant in the Canadian pulp and paper industry. The distributor and retailer private label market offered an attractive prospect for growth, but at the expense of CTG's own brands, which were more economically viable. However, developing a brand required sustained resources and investments, especially in marketing, which CTG's plant managers were still reluctant to support. Furthermore, her decision had to take into account the opportunities and threats related to the arrival of producers from emerging countries.
Dr. David Keith, President of Carbon Engineering, a company based in Calgary, Alberta, is commercializing a technology to capture carbon dioxide (CO2) from the atmosphere. The company plans to market the captured CO2 to produce low carbon transportation fuels in markets such as California where regulation, derived from a state law designed to manage climate change, restricts the maximum carbon intensity of transportation fuel.