This case follows an African-American entrepreneur through the process of sourcing a potential acquisition, valuing a company, and securing the funding to purchase the company. This entrepreneur must decide if he should close the deal and which financing term sheet to accept.
Carmichael Roberts, a rare African-American venture capitalist, considered leaving his general partnership in a private equity firm near Boston and setting up his own in 2015. He weighed whether the timing is right, with the economy still not fully recovered from the Great Recession of 2007-2009. Where to base such a firm was another factor in his decision-making. A member of the board of the National Venture Capital Association, Roberts knew the industry was gravitating to the San Francisco Bay area, to invest in the social media and software startups centered there. His specialty and passion was bringing to market new products made from advanced materials that help people solve problems in their daily lives. That investment focus on manufacturing would go against the private equity trend, another factor he considered. But he knew few, if any, general partners at major private equity firms were focused singularly on the kinds of businesses he wanted to invest in. Roberts also took into account the possible impact on his mutually respectful relations with his fellow partners. From a housing project in Brooklyn, New York, Roberts became a scientist who did advanced study at Duke and Harvard, capped off with an MBA from MIT. He had experience as a developer of technical products for Fortune 500 companies, an executive of cutting-edge startups, and a venture capitalist for eight years. This case study also reviews how private equity investment works, the private equity spectrum, the history of venture capital, stages of venture capital funds, and their location.
Vox Capital was the first certified impact investing fund in Brazil. Founded in 2009, it provides early-stage capital for companies offering innovative and scalable solutions to enhance the lives of low-income Brazilians, while aiming to simultaneously generate attractive market-rate financial returns for investors. This case examines the evolution of Vox Capital, across understanding the landscape, launching, raising funds, selecting investees, structuring deals, building investee capacities, tracking performance, developing internal systems, and advancing the field of impact investing.
Private investment in public infrastructure can be encouraged when there are multiple avenues to capture and to share the value created by such a project. Gains in the market value of land adjacent to projects are not customarily channeled back into defraying the original capital cost of the project-but they can be. This case uses irrigation, agriculture, land values, and an arrangement between the local government in northern Peru and the privatizer firm to accomplish the irrigation of vast areas of land, leading to jobs and GDP growth in the state, based on a combination of fees for water, auction price for raw land, investment in enabling infrastructure, and market value increases for irrigated land. The mechanics of this three-component deal (land company, water distribution company, construction company) are tracked on a pro forma multi-year cash flow basis with the ability to make and test a variety of different assumptions. The choice of an agricultural setting with one possible use case (farming at ground level) leads in to more complex value capture analyses. Real estate, for example, can have more dimensions (more floors allowed) and more use cases (retail, housing, office) than does agriculture. The local government can accomplish hundreds of millions of dollars of construction without advancing any funds to do so.
Energy - both petroleum and electricity - had been terribly managed for decades in Mexico. The two national monopolies - PEMEX and CFE - were inefficient, overstaffed, corrupt, rife with subsidies, and losing money. Finally, in 2012, President Enrique Pena Nieto announced his intent to drastically reform both. Over the next two years, the Mexican constitution was amended, and a dozen implementing laws were passed, to break up the CFE, reorganize PEMEX, and impose competition between the pieces. By 2017, tracts of offshore oil were auctioned, renewable contracts were auctioned, and new regulators were trying to impose competition downstream in electricity.
Shisong Cardiac Center in Kumbo, Cameroon, is a regional cardiac referral center in central Africa. As the continent transitions from communicable to non-communicable diseases, there is a critical shortage of surgical care required to treat these conditions. This case describes an innovation solution to the shortage of professional skills, an international collaboration between a hospital in Milan and a hospital in Cameroon. The case highlights the challenges of building and staffing the facility, and then discusses the ongoing operational and financial challenges of operating a heart center in Africa. Can this model be sustained? Can Cameroon develop their own capability to deliver advanced cardiac services domestically? These are critical questions to consider. In spite of these challenges, Co-Founder Sr. Alphonsa finds hope in her favorite African proverb, "Your heart can take you where your feet cannot."
Years before Harvard University Professor Howard Koh was appointed by President Barack Obama as the 14th U.S. Assistant Secretary for Health (2009-2014) for the U.S. Department of Health and Human Services (HHS), where he went on to address a vast portfolio of health challenges, he played a leading role in two highly impactful coalition-based public health campaigns focused on tobacco control and organ donation. The tobacco tax and organ donation campaigns illustrate how public health advocates can effectively build and rally coalitions of diverse groups around a results-focused health mission. They underscore the perseverance and other leadership traits that public health leaders like Koh harness to push through innovative strategies in the face of powerful entrenched groups committed to preserving the status quo. And while the campaigns also demonstrate the difficulties of sustaining public health initiatives due to changing political and economic circumstances, leaders like Koh must surmount disappointments to find new ways to continue the mission over the course of a long career.
Before re-entering the Southeast Asian market in 2015, the Hisense-Hitachi joint venture mainly used the well known Hitachi brand to explore overseas markets. After the JV had accumulated enough capacity to adopt a product differentiation strategy, they decided to treat the Hisense brand as the focal brand in Southeast Asia and adopted a series of distribution strategies that differed from what they had used to sell Hitachi branded products elsewhere. The (B) case provides a basis for discussing target market selection, and the establishment of varying distribution channels (exclusive vs non-exclusive agents) in different countries. This case can be used with Hisense-Hitachi Joint Venture (A): Expanding Internationally.
The protagonist Jamie Brown had been working in the textile industry for 32 years. He was passionate about the industry and enthusiastic about improving Coats's operations, particularly in the Shenzhen, China, factory. At an operational level, Jamie was challenged by the conflict of business priorities. One of the key directives set by the board of directors was to maximize cash flow. Inventory was the significant contributor to cash constraints in this industry, and Coats began to reduce batch sizes for production, and to reduce inventory stockpiles. To meet customer requirements for short lead times, thread was produced in small lots, and after the order was filled, the remaining thread was placed in inventory. With his strong operational background in the textile industry, Jamie was aware that by following this procedure, Coats was sacrificing economies of scale that could hurt profitability which could also impact cash flows through the year. This sacrifice also raised the question of whether Coats should pursue a make-to-stock or make-to-order strategy, since a make-to-order strategy implied that lot sizes would be set in accordance with customer orders.
Following case study UST 1215-050 Coats (A): Responsive Production and Order Fulfillment, Coats (B) examines make-to-stock (MTS) and make-to-order (MTO) strategies in more detail. First, it considers how strategic (especially cash flow) objectives affect MTS and MTO decisions and how decisions on lot sizing affect both fixed and variable production costs. In particular, it highlights the significance of the risk and costs of overstocking when facing a higher premium on cash flow tied up in the inventory of an unsold product. Secondly, on a tactical level, it suggests frameworks for determining aggregate production quantities prior to a sales season with the objective of minimizing the risks of overproduction and also conserving cash flow. Thirdly, it suggests a basic framework to determine minimum lot sizes based on some high level cost and demand data.
Stoker has a decision to make: he has been offered him a job in a 40-year-old successful barbershop that has retained its old-fashioned atmosphere, or with a small loan, he could open his own shop. Students are asked to prepare a projected annual income statement and answer some questions about what it would take to run a barbershop.
Established in 2013, Glints was an online job search service for new graduates, marketing itself as "LinkedIn for youth." The Singapore-based company was founded by three 21-year-olds who chose to put their university education on hold and forfeit their scholarships in order to pursue their entrepreneurial ambitions. Using the lean start-up approach, Glints pivoted its business model several times before finding a suitable position in a resegmented job-search market. As a young company, Glints' biggest challenge was growth. Having raised seed capital of SG$475,000 from its investors, Glints was expected to sustain its exponential growth in revenue base and the number of subscribers. Its young co-founders had to identify ways to make that growth happen.
This case (Parts A&B) takes students behind the scenes at the Indiana State Department of Health (ISDH) as it struggles to recognize and manage an unusual outbreak of HIV in a poor, rural community. As ISDH learns, illegal injection of prescription drugs, mainly opioids, is spreading the disease. Users are sharing needles and thus exposing the second, third, or subsequent users to infection with HIV from potentially contaminated blood residue. ISDH recognizes that "needle exchange" is one method generally found effective in other states in reducing infections among injection drug users. Drug users can bring used needles to a clinic or other exchange location and receive fresh ones without fearing that they will be subject to arrest or other sanctions. However, Indiana, with a conservative legislature and governor, has by law long banned needle exchanges because it perceives these to encourage drug use. In reading and discussing this case study, students will learn about how Indiana Governor Mike Pence, Indiana Health Commissioner Jerome Adams, and the legislature all sought to balance public health concerns against long-held beliefs about how best to fight the war against drugs.
This case (Parts A&B) takes students behind the scenes at the Indiana State Department of Health (ISDH) as it struggles to recognize and manage an unusual outbreak of HIV in a poor, rural community. As ISDH learns, illegal injection of prescription drugs, mainly opioids, is spreading the disease. Users are sharing needles and thus exposing the second, third, or subsequent users to infection with HIV from potentially contaminated blood residue. ISDH recognizes that "needle exchange" is one method generally found effective in other states in reducing infections among injection drug users. Drug users can bring used needles to a clinic or other exchange location and receive fresh ones without fearing that they will be subject to arrest or other sanctions. However, Indiana, with a conservative legislature and governor, has by law long banned needle exchanges because it perceives these to encourage drug use. In reading and discussing this case study, students will learn about how Indiana Governor Mike Pence, Indiana Health Commissioner Jerome Adams, and the legislature all sought to balance public health concerns against long-held beliefs about how best to fight the war against drugs.
This epilogue accompanies case number 2080.0. This case (Parts A&B) takes students behind the scenes at the Indiana State Department of Health (ISDH) as it struggles to recognize and manage an unusual outbreak of HIV in a poor, rural community. As ISDH learns, illegal injection of prescription drugs, mainly opioids, is spreading the disease. Users are sharing needles and thus exposing the second, third, or subsequent users to infection with HIV from potentially contaminated blood residue. ISDH recognizes that "needle exchange" is one method generally found effective in other states in reducing infections among injection drug users. Drug users can bring used needles to a clinic or other exchange location and receive fresh ones without fearing that they will be subject to arrest or other sanctions. However, Indiana, with a conservative legislature and governor, has by law long banned needle exchanges because it perceives these to encourage drug use. In reading and discussing this case study, students will learn about how Indiana Governor Mike Pence, Indiana Health Commissioner Jerome Adams, and the legislature all sought to balance public health concerns against long-held beliefs about how best to fight the war against drugs.
Established in 2013, Glints was an online job search service for new graduates, marketing itself as “LinkedIn for youth.” The Singapore-based company was founded by three 21-year-olds who chose to put their university education on hold and forfeit their scholarships in order to pursue their entrepreneurial ambitions. Using the lean start-up approach, Glints pivoted its business model several times before finding a suitable position in a resegmented job-search market. As a young company, Glints’ biggest challenge was growth. Having raised seed capital of SG$475,000 from its investors, Glints was expected to sustain its exponential growth in revenue base and the number of subscribers. Its young co-founders had to identify ways to make that growth happen.