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In 2016, Pythagoras Global Fund (Pythagoras), based in the United Kingdom, decided to launch a fund focused on emerging markets, especially those in Brazil, Russia, India, and China (BRIC countries). Pythagoras’s fund manager favoured investing in family-owned businesses, but the investment opportunities in India used ownership structures different than those used in developed markets. The structures in Indian groups altered the cash flow and effective ownership rights in the subsidiary firms, which had ramifications for stakeholders and raised associated governance issues. The fund manager needed to decide which firm to choose by assessing the investment opportunities and evaluating the corporate governance of the companies.

Spreadsheet for product W25643.

In 2016, Pythagoras Global Fund (Pythagoras), based in the United Kingdom, decided to launch a fund focused on emerging markets, especially those in Brazil, Russia, India, and China (BRIC countries). Pythagoras's fund manager favoured investing in family-owned businesses, but the investment opportunities in India used ownership structures different than those used in developed markets. The structures in Indian groups altered the cash flow and effective ownership rights in the subsidiary firms, which had ramifications for stakeholders and raised associated governance issues. The fund manager needed to decide which firm to choose by assessing the investment opportunities and evaluating the corporate governance of the companies.

Spreadsheet Supplement for Case W25643

This case describes the financial undertakings of Lehman Brothers Inc., which was once the fourth-largest investment bank in the world. On September 15, 2008, less than a year after the bank presented its largest profit ever, the world watched its decline. In terms of size of assets, Lehman is considered the largest bankruptcy in history, with assets totaling US$639 billion and liabilities of US$613 billion. The U.S. credit crisis had uprooted the strength of Wall Street, with Lehman announcing a petition it filed under Chapter 11 of the U.S. Bankruptcy Code. The bankruptcy raised some interesting questions, the biggest among them being: How could a large company such as Lehman, with a record of reporting huge profits, become so helpless that it had to file for bankruptcy?<br><br><br><br>Undoubtedly, the financial scenario in the United States had become dire, especially for those companies involved in mortgage banking. Lehman had some additional drawbacks. This case deals with a couple of these problems, one of them being the accountancy of its Repo 105 transactions. The modus operandi of the company has been unveiled to show how it managed to hide its true financial state through gaps in the financial reporting system and remain clean-handed for years.

This case unfolds the financial undertakings of Lehman Brothers Inc., which was once the fourth largest investment bank in the world. On September 15, 2008, less than a year after the bank presented its largest profit ever, the world saw it descending. In terms of size of assets, Lehman is considered the largest bankruptcy in history, with assets summing up to US$639 billion and liabilities of US$613 billion. The U.S. credit crisis uprooted the strength of Wall Street, with Lehman announcing a petition it filed under Chapter 11 of the U.S. bankruptcy code. The bankruptcy raised some interesting questions. The biggest among them being: How could a large-sized company such as Lehman with a track record of reporting huge profits, become so helpless that it had to file for bankruptcy?Undoubtedly, the financial scenario in the United States had become bad, especially for those companies that were into mortgage banking. Lehman had some additional drawbacks. This case tries to deal with a couple of such problems, one of them being the accountancy of its Repo 105 transactions. The modus operandi of the company has been unveiled to show how it managed to hide its true financial state by using gaps in the financial reporting system across the borders and remain clean handed for years.

From the 1970s onward, after the emergence of microfinance, lending for the poor started shifting from informal sources (e.g. moneylenders) to formal sources. The Grameen Bank (Grameen) led this change, primarily due to its chief executive officer (CEO) and his innovative microcredit model. On the basis of the CEO's rich understanding of on-the-ground realities, he began to experiment and modify the business model for microfinance, which, in the past few years in Bangladesh, was largely dominated by a few big players. As a result of some very interesting and insightful experiments that had been conducted, the microfinance landscape was changing the way banking services were modeled for the poor, not only in Bangladesh but throughout the world. The case profiles a situation wherein Baring Private Equity Partners India, one of the largest private equity players in emerging markets, was looking to invest in the high-growth, profitable microfinance industry of South Asia.This case is oriented toward helping students understand the credit needs of the poor and their perspective on money management, hunger, investment and savings. Students should be made to appreciate how an innovative business model can be developed through a deeper understanding of the local context combined with conceptual thinking. The case strongly vouches for the development of sustainable solutions that require both financial viability and sensitivity to the conditions of the poor. The most important point to be highlighted about the microfinance landscape is that the entrepreneurship model is changing from being socially focused to being business focused. Earlier, most players entered the microfinance arena as a not-for-profit venture; however, many for-profit organizations have now entered this sector.

From the 1970s onward, after the emergence of microfinance, lending for the poor started shifting from informal sources (e.g. moneylenders) to formal sources. The Grameen Bank (Grameen) led this change, primarily due to its chief executive officer (CEO) and his innovative microcredit model. On the basis of the CEO's rich understanding of on-the-ground realities, he began to experiment and modify the business model for microfinance, which, in the past few years in Bangladesh, was largely dominated by a few big players. As a result of some very interesting and insightful experiments that had been conducted, the microfinance landscape was changing the way banking services were modeled for the poor, not only in Bangladesh but throughout the world. The case profiles a situation wherein Baring Private Equity Partners India, one of the largest private equity players in emerging markets, was looking to invest in the high-growth, profitable microfinance industry of South Asia.This case is oriented toward helping students understand the credit needs of the poor and their perspective on money management, hunger, investment and savings. Students should be made to appreciate how an innovative business model can be developed through a deeper understanding of the local context combined with conceptual thinking. The case strongly vouches for the development of sustainable solutions that require both financial viability and sensitivity to the conditions of the poor. The most important point to be highlighted about the microfinance landscape is that the entrepreneurship model is changing from being socially focused to being business focused. Earlier, most players entered the microfinance arena as a not-for-profit venture; however, many for-profit organizations have now entered this sector.