When announcing their agreement to merge in December 2021, creating a clear leader in global pest control, UK-based Rentokil and Tennessee-based Terminix described extensive benefits of the cross-border combination. The companies touted the advantages of their combined scale, their complementary portfolios of products, regions and technologies, and the significant cost synergies. Yet, the markets seemed entirely unimpressed, with Rentokil's share price down 9% in the hours after the deal was announced. While the boards of both companies had recommended the merger, it would now be up to shareholders to decide. Was this deal a lifeline for long-suffering Terminix investors, who were increasingly apprehensive about the company's ability to improve performance? Was this the right moment for Rentokil to pursue such a large deal rather than continue with its historical approach of gradually consolidating the market? In short, would this proposed combination create value, and if so, for whom?
In the fall of 2022, boot maker UGG and its parent company, Deckers, were working to position the brand in the nascent but fast growing metaverse. The metaverse, the online realm that individual users could navigate as digital avatars, was becoming more commercialized, as a range of brands started offering digital products for sale to users. Given the importance of how physical UGGs felt on wearers feet, how should the company think about its metaverse operations?
This note provides an overview of real estate iBuying, or instant buying, a business model that involves buying homes and then reselling them at a profit. Introduced in the mid-2010s, iBuying streamlined the process of selling a home by offering instant, all-cash offers to sellers. This note includes context on the traditional home buying and selling processes, the impact of property technology (PropTech), the iBuying process and unit economics, and the iBuying market landscape (e.g., top players and geographic markets).
In January 2021, Byte co-founders Scott Cohen and Blake Johnson reflected on how far their Los Angeles-based direct-to-consumer (DTC) orthodontics company had come since launching its clear aligners just a little over two years earlier. Cohen and Johnson were both serial entrepreneurs who had guided several companies to successful exits. They had planned to take the same approach with Byte, preparing for an exit by focusing on profitability and stable growth and forgoing dilutive venture capital (VC) funding. Neither of them had expected Byte to grow as quickly as it had, but the market opportunity had unexpectedly expanded during the COVID-19 pandemic, when many consumers sought at-home treatment options. Cohen and Johnson thought about what their next move should be. Given Byte's rapid growth, the founders considered whether they should instead consider other options, such as a strategic acquisition or an eventual initial public offering (IPO). Either option would help position Byte for global expansion, which the founders felt would be a promising growth opportunity for the company.
When Ajaypal (Ajay) Banga became the CEO of Mastercard in 2010, digital technologies were on the rise, and innovation needed to become a strategic imperative at the company. Banga tasked Garry Lyons, who had joined Mastercard through the 2009 acquisition of Orbiscom, with infusing innovation into Mastercard's culture. With a significant incremental investment, and free reign to spend it as he pleased, Lyons created Mastercard Labs-a global innovation lab network that became a catalytic force for change at the company. In 2018, Ken Moore, a former innovation leader at Citigroup, became Mastercard Labs' new leader. By then, Mastercard had made significant progress on its journey of cultural and digital transformation, but the company had to continue to think and act differently in order to compete and thrive in the fast-changing digital world. Moore's task was to evolve Mastercard Labs so that it could continue delivering value to Mastercard.
In late 2021, Mastercard CEO Michael Miebach and Chairman and former CEO Ajaypal "Ajay" Banga considered how Mastercard could best position itself for continued success in the years to come. Since Mastercard's initial public offering in 2006, the company had grown and transformed, driven in part by a core strategy of "Grow-Diversify-Build" and vision of a "World Beyond Cash." During Banga's recent tenure as CEO, Mastercard had invested in creating a strong culture, recruiting top talent, driving innovation, partnering with would-be competitors, and launching new services. Now, with Miebach at the helm as Mastercard's CEO, the payments landscape was experiencing increasing democratization of the banking system, the rise of blockchain and cryptocurrency, and increasing nationalism, among other shifts. Miebach and Banga needed to identify the most pressing threats and opportunities in the ever-evolving payments landscape and determine how to take advantage of them. As they looked ahead, they asked themselves: Was Mastercard well positioned for the next 10 years?
When Ajaypal (Ajay) Banga became the CEO of Mastercard in 2010, he shifted the company's competitive focus from card networks to cash itself. Mastercard's new vision of a "World Beyond Cash" distilled into a three-pronged framework: Grow the core business, Diversify customers and employees, and Build new businesses that reinforce Mastercard's core capabilities. With digital technologies on the rise, Banga knew that innovation would need to become a strategic imperative. Yet, in a 2010 survey, Mastercard's 7,000 employees ranked "innovation" as the 26th most important factor for the future of Mastercard in a list of 27. Banga tasked Garry Lyons, who had joined Mastercard through the 2009 acquisition of Orbiscom, with infusing innovation into Mastercard's culture. With a significant incremental investment, and free reign to spend it as he pleased, Lyons created Mastercard Labs-a global R&D network that became a catalytic force for change at the company. In December 2017, Lyons is stepping down from his role as Chief Innovation Officer and reflecting on the path ahead for Mastercard and its Labs.
When Ajaypal (Ajay) Banga became the CEO of Mastercard in 2010, he shifted the company's competitive focus from card networks to cash itself. Mastercard's new vision of a "World Beyond Cash" distilled into a three-pronged framework: Grow the core business, Diversify customers and employees, and Build new businesses that reinforce Mastercard's core capabilities. With digital technologies on the rise, Banga knew that innovation would need to become a strategic imperative. Yet, in a 2010 survey, Mastercard's 7,000 employees ranked "innovation" as the 26th most important factor for the future of Mastercard in a list of 27. Banga tasked Garry Lyons, who had joined Mastercard through the 2009 acquisition of Orbiscom, with infusing innovation into Mastercard's culture. With a significant incremental investment, and free reign to spend it as he pleased, Lyons created Mastercard Labs-a global R&D network that became a catalytic force for change at the company. In December 2017, Lyons is stepping down from his role as Chief Innovation Officer and reflecting on the path ahead for Mastercard and its Labs.
In December 2021, more than a decade after its founding, Goldman Sachs's 10,000 Small Businesses program was still going strong - and the firm now needed to evaluate potential program modifications to reach a wider group of small business owners. Launched in the aftermath of the Global Financial Crisis, 10,000 Small Businesses provided business education, a wide network, and access to capital to U.S. small business owners through more than a dozen city- and state-based program and a National Cohort model. By 2020, Goldman Sachs achieved its goal of graduating 10,000 small business owners from the program, and the firm decided to renew the program with the goal of reaching another 10,000. Against the backdrop of the COVID-19 pandemic, which placed unprecedented strain on small business owners across the U.S., the 10,000 Small Businesses program office team expanded the program's efforts to organize a collective voice for small business owners in U.S. politics, support an internship program that paired community college students with local small businesses, and admit owners of smaller businesses than had previously been accepted into the program. In late 2021, the team considered how to approach its latest effort: supporting Black women business owners in line with the firm's broader One Million Black Women initiative. As 10,000 Small Businesses expanded its reach to smaller businesses and sole proprietors, what modifications did the team need to make? In what ways did Goldman Sachs need to rethink its work to render its One Million Black Women initiative effective?
In May 2021, Perch CEO Chris Bell needed to decide whether his e-commerce aggregator company, which bought and scaled Amazon Marketplace brands, should acquire up to three acquisition targets. The prospective acquisitions, Web Deals Direct, HomeCo, and Future Brands, were much larger in size and complexity than Perch's previous deals. Acquiring one or more businesses could help Perch grow but could also prove challenging from an operations and integration standpoint. In addition, Bell had decisions to make around financing the acquisitions. He had received a term sheet for $100 million from a private equity firm and an offer of up to $500 million from Japanese conglomerate SoftBank. The offer from SoftBank might provide the level of funding Perch would need to achieve market leadership in a crowded aggregator space but could put pressure on Perch to grow too quickly in pursuit of being a category champion.
In September 2020, Diana Ferguson was nearing her first Audit Committee meeting as the newly appointed Audit Committee chair of Mattel, Inc. Mattel was just recovering from an accounting scandal which had revealed the company's poor internal controls and weak board oversight over financial reporting, and the committee had important decisions to make going forward. In early 2018, Mattel's Tax team had discovered a significant reporting error in its third-quarter financial results. In consultation with Mattel's independent auditor, PricewaterhouseCoopers (PwC), Mattel's finance team opted not to issue a correction and instead (effectively) concealed this mistake. This cover-up came to light in 2019, when an anonymous whistleblower reported the incident, setting off a chain of negative press coverage and senior-level resignations. Mattel responded by conducting an internal investigation, and concluded that, while their accounting processes needed to be improved, there was no evidence of fraud. Despite this, this issue had resurfaced in early 2020 when the United States Securities and Exchange Commission (SEC) launched a fresh investigation into the accounting error and subsequent cover-up. In light of these events, Ferguson and the Audit Committee faced a challenging road ahead with several important issues to consider. They needed to tackle Mattel's problematic governance and internal controls, and restore investor confidence in the company's financial disclosures. They also needed to review their earlier decision to continue to engage PwC as Mattel's auditor going forward.
Founded in 1989, Posse Foundation was a nonprofit organization with a mission of developing future leaders who reflected the U.S.'s rich diversity. The organization ran a selective, localized admissions process in 10 U.S. cities to identify outstanding students with leadership potential, known as Posse Scholars. Then, it placed them in "posses" - groups of 10 Scholars from the same city - at selective U.S. higher education institutions, which agreed to provide full tuition to all selected Scholars. Although Posse did not screen applicants for race or financial need, it focused selection efforts in areas with racial and socioeconomic diversity. Posse received national recognition and expanded considerably in the decades after its founding, but by 2020 its growth had started to plateau. In 2020, during the COVID-19 pandemic, Posse signed up several new partners, driven in part by a new, virtual selection option that could find Scholars from locations beyond the cities where Posse maintained brick-and-mortar offices. The virtual option might help Posse scale, but it was not yet clear whether bringing together Scholars from different places versus from the same city would have any implications for the program's effectiveness. Looking ahead, Posse Founder and CEO Deborah Bial considered how to continue Posse's momentum and sign up more institutional partners. Posse focused exclusively on roughly 150 of the most selective colleges and universities, and some prospective partners were unwilling or unable to work with Posse unless it only selected students with financial need. Expanding the list of potential partners or adding a financial need screen might yield more partnerships, but Bial and the rest of the Posse team believed that working with selective institutions and being solely merit-based were key parts of Posse's identity and its ability to achieve its mission. How could Posse best position itself for continued scaling?
Founded in 2010, Worldreader was an international nonprofit organization that promoted reading to children around the world. For many years, Worldreader distributed e-readers to under-resourced communities and funded its operations primarily through philanthropic donations. In 2019, Worldreader launched the BookSmart mobile reading application, and soon thereafter came the idea of a new, self-perpetuating funding structure: the "flywheel." Worldreader aimed to charge schools and community-based organizations a $6 monthly subscription fee per child to use BookSmart, with the goal of using earned revenue to sustain operational costs and using philanthropy to cover other strategic priorities. However, Worldreader soon realized that ability to pay varied greatly among potential "customers," leading to several exceptions to the initial price. The team also worried that the subscription hindered achieving scale and conflicted with Worldreader's ultimate goal of impacting millions of children. As Co-Founder and CEO David Risher and his team prepared for an upcoming meeting with UNICEF, which typically sought fixed-price contracts, they considered whether a price per-child, per-month would be acceptable. More broadly, they considered whether they had landed on the optimal price point and funding strategy-and the potential implications of pursuing earned revenue on Worldreader's ability to bid for international development grants.
In December 2020, Mary Kay Inc. Chief Marketing Officer Sheryl Adkins-Green considered several strategic dilemmas. Founded in 1963 by Mary Kay Ash, Mary Kay was a direct sales company whose Independent Beauty Consultants purchased its beauty and cosmetics products at wholesale and sold them to end-consumers at retail. As the coronavirus pandemic spread in 2020, Mary Kay worked to equip its Consultants with digital tools and strategies to help them run their businesses remotely. Adkins-Green and the Mary Kay team were now looking for ways to continue refining the company's digital approach and product sampling strategy. Looking beyond COVID-19, Adkins-Green and her team had several other big questions to consider around product innovation, the competitive landscape, navigating the digital world and its implications for retail, and communicating its brand values to the next generation-all while honoring and staying true to the rich history, heritage, and culture that had served as the foundation of Mary Kay for the past 57 years.
Founded in 2015 by Dan Gilbert, Josh Luber, and Greg Schwartz, StockX was an online platform where users could buy and sell unworn luxury and limited-edition sneakers. Sneaker resale prices often fluctuated over time based on supply and demand, creating a robust secondary market that bore similarities to the stock market. Inspired by these similarities, StockX's co-founders created a secondary platform that tracked sneaker resale prices over time and that emphasized authenticity, anonymity, and transparency. In 2017, StockX began to experiment with ways to expand from the secondary market into the primary market, using a new type of online auction known as an initial product offering (IPO). Based on the results of its first IPOs, was StockX on the right track with its strategy to expand into the primary market?
More than one third of Americans were said to suffer some type of behavioral health ailment at some point in their lifetime, with many people requiring chronic therapy or intervention. Despite significant clinical needs, access to reliable treatment has been difficult due to shortage of providers, stigma, and poor reimbursement. Marvin's primary offering was online teletherapy via video chat. They hoped to bring Marvin's solution to a wider audience and thought that the race belonged to the swift. As they considered the market opportunity and the complex landscape of digital mental health, they wondered what to do?
This is a supplement to the Student Success at Georgia State University (A) case. The (B) case includes the results of a randomized control trial that Georgia State conducted to test education technology start-up AdmitHub's chatbot solution as a strategy for improving "summer melt" (i.e., applicants confirming that they planned to enroll but then not enrolling).
Georgia State University had developed a reputation for driving student success by nearly doubling its graduation rate for students of all racial, ethnic, and socioeconomic backgrounds. It did so while growing its student body and the proportion of Black/African American, low-income, and first-generation students-groups with historically lower postsecondary graduation rates compared to national averages. Georgia State's Student Success team, led by Tim Renick and Allison Calhoun-Brown, used a data-based approach to deploy micro-grant programs to retain students, implemented predictive analytics to improve student advising, and optimized course sequencing to help students graduate before they exhausted their financial aid. In 2016, they faced a growing "summer melt" problem where nearly 20% of incoming students who committed to attend never actually enrolled at Georgia State-and many never enrolled at any college. At the same time, they wondered how to balance continuing to incrementally improve student success at Georgia State and scaling their efforts to help the many other universities facing similar problems who sought to learn from their experience.