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May You Live in Interesting Times: The Case of BXL Zoute
How can a popular neighborhood restaurant in the trendy Flatiron District in Manhattan survive the significant challenges that arise during the COVID-19 pandemic? Indoor dining is banned, offices are closed, and many residents have fled the city. This case describes how Klaas Claes, the co-owner of BXL Zoute, adapts his restaurant to the changing business landscape during the initial coronavirus lockdown. During the first ten days, he implements several initiatives to keep the restaurant in people's minds and to create much-needed cash flow. Claes develops the capability for customers to buy online gift cards and he adds alcohol to his delivery menu when New York States relaxes its liquor laws to help restaurants. He is also taking steps to sell and deliver ready-to-heat vacuum-sealed (i.e., sous vide) meals to customers directly. Ten days after the announcement of the lockdown by New York's Governor, it dawns upon him that the pandemic restrictions will be in force for a while and that these new initiatives will not be enough to get him through extended periods of indoor dining restrictions. Faced with considerable uncertainty, he wonders how he can he leverage his resources and his vast network of friends and restaurant professionals so that BXL Zoute will survive these "interesting" times? -
Splitting the Founders' Equity Pie: Is Equal Equitable?
Negotiating the initial equity split among founders is not as straight-forward as it might first appear. In this case, five Belgians launch Novosanis, a university spinoff, to commercialize two promising medical devices: VAX-ID and Colli-Pee. VAX-ID is an injection device suited for highly accurate and painless drug delivery effective at low volumes. Colli-Pee provides a non-invasive method of detecting Human Papilloma Virus (HPV) and other infectious diseases. The Novosanis founding team includes two scientists who proposed the original ideas, two project coordinators who managed the R&D process at the university, and an industrial partner who provided technical support. The team's first inclination is to split the equity evenly, to reflect their relatively equal contributions prior to the spinoff. It becomes clear however, that if future contributions are included in the decision, an equal split might actually be unfair and counterproductive. One founder agrees to be the spin-off's full-time CEO and another consents to be part-time CTO. The remaining founders choose not to take active roles post start-up. The team has an important decision to make: How should they divide the shares of Novosanis to compensate prior contributions, while also supporting the venture going forward? Would equal be fair?