In December 2023, the 60-year-old weight management industry stalwart WeightWatchers announced the launch of WeightWatchers Clinic, which incorporated GLP-1s , a new class of prescription weight-loss medications, into the company's portfolio of products and mobile app experience. The company's embrace of prescription medications for weight loss represented a bold strategic evolution. Since its inception, WeightWatchers had promoted peer-to-peer support coupled with science-based behavior modifications for weight loss, rooted in the idea that weight management was fundamentally about establishing healthy diet and exercise habits. While the company's core business would continue to center on behavior modification, WeightWatcher's new CEO Sima Sistani believed an expanded "toolkit" could be a game-changer for people for whom the company's traditional weight-loss program was inadequate and who required other kinds of support. Sistani, a Silicon Valley veteran, had stepped into the CEO role at a critical moment for the company. Revenue had been declining for years due to slowing member subscriptions, a lackluster digital app, and increasing competition from a host of players. Now, a year and a half into her tenure, revenues continued to trend downward. As she looked ahead, Sistani pondered how to strike the right balance between investing in the "core" business and growing the nascent clinical offering. She recognized that, for the iconic company, there was a delicate balance to be struck between ramping up new products and services and winding down legacy offerings such as weekly in-person meetings, while also fortifying the digital app. She wondered if there were synergies that might offer new avenues for growth in a dynamic market.
Already a leader in the edtech space since its 2008 launch, Khan Academy was now one of the first edtech organizations to embrace generative artificial intelligence ("genAI"). In March 2023, Khan Academy began beta testing Khanmigo, a genAI "guide" and tutor built with ChatGPT, a technology developed by the San Francisco-based AI research lab OpenAI. In addition to simulating historical and fictional characters, Khanmigo assisted students with learning math, debugging code, writing, and completing other learning exercises. Khanmigo was also designed to help teachers develop lesson plans and quizzes, brainstorm creative teaching approaches, and evaluate students' progress, among other tasks. As the Founder and CEO of Khan Academy, Sal Khan felt that Khanmigo might just be "that holy grail we've all been reading about in science fiction for years, about an artificial intelligence that could emulate a human tutor." However, he pondered what the societal-and, for Khan Academy, organizational-risks might be of using OpenAI's ChatGPT. Was it possible that Khanmigo would introduce new problems or exacerbate existing problems in classrooms around the world? If so, what more could Khan Academy do to prevent such outcomes? How might Khan Academy itself need to evolve to support and shepherd this new tool? At the most extreme, might genAI increase Khan Academy's impact manifold, or might the new technology diminish its impact?
In 2022, senior executives of Cambridge, MA-based Akamai Technologies met to consider whether and how to scale a successful technical training program. The program, Akamai Technical Academy (ATA), was launched in 2016 to address a key challenge at Akamai and in the technology industry at large-the need to create an inclusive and diverse workforce. ATA participants came from communities typically underrepresented in the tech industry. They went through six months of in-class training followed by a six-month on-the-job contract working with Akamai project teams. By early 2022, nearly 150 ATA graduates from the U.S., Poland, and Costa Rica had converted to full-time employment, and internal hiring managers were interested in recruiting future ATA graduates. Ultimately, the company wanted to build a robust and diverse global talent pipeline, as well as promote inclusion and diversity in the global technology industry. If ATA were to be a catalyst for these changes, it would need to scale. As they prepared for their meeting, the ATA executives grappled with whether and how to scale the ATA to meet growing internal demand, while also building the platform to transform Akamai and the global technology industry.
Ten-year-old, Palo Alto-based Ribbit Capital is best-known for its global investments in fintech. The firm was also an early advocate of crypto and blockchain, having invested in more than two dozen startups in the space in the past decade. In the Spring of 2022, Partner Nick Shalek contemplates an investment into Gauntlet, a Brooklyn-based crypto startup. He weighs not only the pros and cons of the Gauntlet investment in the context of the fund's overall portfolio, but also the deal structure. While investing in crypto startups played to many of the strengths that the Ribbit Capital team had built investing in fintech startups, there were a variety of aspects of crypto startup investing that were new and different. Sourcing deals, performing diligence, providing guidance to entrepreneurs, understanding governance, and negotiating deal terms were similar in principle, but presented new opportunities and challenges to navigate.
In 2012, Evan Marwell launched EducationSuperHighway (ESH) to address a major problem: though most public K-12 schools in the US had access to the Internet, only roughly 30% had true broadband access that would enable every student to have high speed connectivity. Marwell and his team raised philanthropic capital and worked with schools, telecommunications companies, and local, state, and federal government officials to meet that challenge. By 2019, over 99% of the public schools in the US had true broadband access. Marwell and his team had begun the process of winding down activities at ESH when the pandemic erupted. Students were working from home, not physically at school. They decided to try to help 18 million households with 47 million people to have affordable broadband access at home. In 2020, Marwell and Jessica Reid Sliwerski also launched a program to tackle a pernicious problem in education; by third grade, only about one in three US children were reading at grade level. Ignite! Reading offered students access to an individual science of reading tutor for 15 minutes a day over Zoom while at school. Early evidence suggested that for every week working with an Ignite tutor, kids gained over 2 weeks of reading comprehension. Ignite was organized as a public benefit corporation.
QuantumScape CEO Jagdeep Singh juggles the many activities required to lead the next-generation battery pioneer. Founded in 2010, QuantumScape's mission was to develop new "solid-state" car batteries that would improve upon traditional lithium-ion batteries in key areas such as range, charging speed, durability, cost, and safety. Success, they believed, would accelerate the transition from gasoline-powered cars to electric vehicles. Between 2010 and late 2020, QuantumScape operated in stealth mode and raised venture financing totaling more than $800 million. The team grew to over 200 employees, nearly all scientists and engineers working on the technical challenges associated with creating a solid-state battery that could be produced at scale. By summer 2020 it was clear to Singh and the board that the company required more capital to help fund its commercialization plan. In November 2020, QuantumScape went public by merging with a Special Purpose Acquisition Company (SPAC). Now, with that capital in hand, production facilities under construction, and a signed joint venture with Volkswagen, Singh expected to see cars with its batteries on highways by 2025.
As the COVID pandemic spread in early 2020, global travel ground to a halt. For Airbnb, the San Francisco-based platform for renting accommodations, the impact was both swift and severe as revenues plummeted more than 70% over the prior year. Responding to the sudden downturn was a challenge for CEO Brian Chesky and his leadership team because the firm had adopted a stakeholder model with five key constituents: guests (renters), hosts (landlords), employees, communities and shareholders. While all five groups could benefit in the long-term if the firm succeeded, it was less clear how they should balance the potentially conflicting demands in the short-term particularly given the mounting losses. For example, in the face of travel restrictions, Airbnb could support guests by requiring hosts to refund deposits or could support hosts by allowing them to keep deposits. Similarly, should Airbnb use existing cash to maintain employment levels or downsize to protect capital providers? In the highly uncertain environment that existed in April 2020, Chesky and his team had to make many critical decisions with little precedent and limited information to guide them. As one of the first Silicon Valley "unicorns" to adopt a stakeholder business model, the world would be watching to see what they did, how they did it, and why.
As the covid pandemic spread in early 2020, global travel ground to a halt. For Airbnb, the San Francisco-based platform for renting accommodations, the impact was both swift and severe as revenues plummeted more than 70% over the prior year. Responding to the sudden downturn was a challenge for CEO Brian Chesky and his leadership team because the firm had a adopted a stakeholder model with five key constituents: guests (renters), hosts (landlords), employees, communities and shareholders. While all five groups could benefit in the long-term if the firm succeeded, it was less clear how they should balance the potentially conflicting demands in the short-term particularly given the mounting losses. For example, in the face of travel restrictions, Airbnb could support guests by requiring hosts to refund deposits or could support hosts by allowing them to keep deposits. Similarly, should Airbnb use existing cash to maintain employment levels or downsize to protect capital providers? In the highly uncertain environment that existed in April 2020, Chesky and his team had to make many critical decisions with little precedent and limited information to guide them. As one of the first Silicon Valley "unicorns" to adopt a stakeholder business model, the world would be watching to see what they did, how they did it, and why.
Set in January 2021, the CEO of SafeGraph, a four-year-old startup that sold Data as a Service, looked to the future. His aim was to become the most trusted source for data about a physical place. The company provided points of interest (POI) and foot traffic data on nearly 7 million businesses in the U.S. and Canada from a variety of providers, then labelled attributes of the data such as the brand affiliation and how long consumers remained at the site. The company sold this data to nearly one hundred customers in advertising tech, retail, and financial services. Clients such as Verizon, Sysco, and Goldman Sachs used it to better understand rapidly changing patterns of consumer behavior. At the outset of the COVID-19 pandemic, the company offered free access to its data through the COVID-19 Data Consortium to government agencies to help them understand pandemic behavior and make policy decisions. Nearly a year into the health crisis and with a vaccine rolling out, SafeGraph needed to decide how to evolve the COVID-19 Data Consortium. Perhaps the data offered for free should soon be converted to a paid model, albeit on a subsidized basis? More broadly, how should the team prioritize the government sector into its enterprise customer segment mix and how would this impact the business model and pricing?
M-Lab's founding goals were to infuse an innovation mindset into Mitsubishi Corporation; to catalyze new business opportunities; and to enable a dialogue between Japanese business and Silicon Valley. M-Lab housed representatives from each of Mitsubishi Corporation's verticals who were joined by executives from other prominent Japanese corporations. While M-Lab was still early in its history, its leader, Tsunehiko Yanagihara, was pleased with its progress: the ecosystem was fertile with research on cutting edge technology; resident executives collaborated across industries on a daily basis; several investments and proof of concept projects were underway; staff had launched an innovation learning program; and soon, an on-site retail-tech accelerator would welcome its first participants. As some of the projects born out of M-Lab now evolved to commercial businesses, Yanagihara saw yet a new role for M-Lab - that of startup advisor. How might he harness Silicon Valley insights on scaling technology ventures and feed them back to the young ventures made possible by M-Lab? And how might he help those now responsible for implementing and executing at these new businesses apply these learnings to the hurdles they faced?
Avni Patel Thompson, founder and CEO of Poppy, an online marketplace for on-demand childcare, revisits the venture's final months, and discusses the steps she took in the wake of the shutdown. This case explores experiments the company conducted to refine its original business model, as well as how Patel Thompson rekindled her entrepreneurial ambitions. It is part two of an A and B case, the A case being: Poppy: A Modern Village for Childcare Case 818 075, November 2017.
Opportunity Insights -- a non-profit that researches drivers of economic opportunity and develops policy solutions to help families achieve better life outcomes -- seeks to expand its impact.
While still a general partner at Silicon Valley-based New Enterprise Associates (NEA), Ravi Viswanathan considered the challenges presented by evolving market dynamics in the venture capital space. Startups were staying private longer, which led to limited partners thirsty for liquidity and venture capital funds managing overloaded portfolios. Viswanathan and the senior leaders of NEA orchestrated the purchase of 31 NEA unrealized portfolio companies by the newly created $1.35 billion NewView Capital spinout that he would head. This secondary transaction provided liquidity to NEA's limited partners and reallocated NEA partners' time to shepherd other portfolio companies, while at the same time allowing NewView Capital to reap gains from future exits from a portfolio of diverse, high-quality growth stage technology companies. Now, as he prepares to raise Fund II, Viswanathan acknowledges that the unique circumstances that enabled the launch of Fund I would not be replicable, and he must consider alternative strategies to pursue next. Should he continue to focus on secondary transactions, focus on direct investments, or some combination of the two?
An unlikely but highly effective leader of a traditional bank, Rakefet Russak-Aminoach, simultaneously leads a classic change effort and an unconventional effort to innovate.
A founder looks back at the issues at play in the final year of failed furniture e-commerce startup, Dot & Bo. He shares his perspective and learnings in the aftermath.
By 2018, Netflix had been credited for revolutionizing how viewers consumed entertainment-shifting from ad-fueled linear network programming to a highly personalized, on-demand, all-you-can-consume, ad-free model. The company was riding a long wave of revenue and subscriber growth as it expanded internationally and into original production. From its earliest days, Netflix leadership had fostered a workplace characterized by such values as excellence, maturity, transparency, accountability, candor, and autonomy. The Culture Deck, later dubbed the Culture Memo, documented how Netflix's culture had evolved and enabled the organization to repeatedly innovate, disrupt, and pivot. The case examines the company's history and delves into ways leadership continues to nurture its unique culture through an emphasis on concepts such as "freedom and responsibility," "context, not control," and "highly aligned, loosely coupled." The case allows students to assess CEO Reed Hastings' view that the culture is capable of further scaling even as headcount surges and the company continues its expansion into new geographies and even more content production.
Founded in 2005, Zillow had become the leading online real estate and home-related marketplace. The brand was recognized as a trusted resource for players in the real estate market, providing information and transparency on home prices. Revenue, which was historically derived primarily from advertising fees paid by realtors and mortgage lenders, totaled $1.3 billion in 2018. This was in the process of changing, however. The company had entered the direct home buying and selling market in 2017. To Zillow, the move was a logical extension of its business model. Research showed that there was pent up desire to sell homes, but that sellers disliked the conventional process. Zillow Offers made home selling easy and fast - for sellers of homes that met certain criteria, Zillow Offers made an offer within 48 hours of the seller submitting a request for an offer online. Zillow Offers provided sellers a fair price and a guaranteed cash close, then performed renovations and hoped to sell the home within a target of 90 days, although actual times varied by market. The company's stock was more volatile in the period since launching Zillow Offers and some industry observers wondered if it was in part due to the market's perception of the risks associated with the new business. CEO Rich Barton believed the "instant buyer" or iBuyer market could one day account for up to 30% of all domestic real estate transactions and that Zillow Offers could bring in an additional $20 billion in annual revenue within three to five years. But there remained work to be done to improve transaction metrics, fend off competition from well-funded startups and incumbent realtors, and convince shareholders of the attractiveness of the new businesses.