The case highlights deliberations led by Brett Barakett, CEO and chief investment officer of Tremblant Capital, just months prior to launching an actively managed ETF, Tremblant Global (TOGA). However, his team continued to have reservations around the launch. On the one hand, TOGA would provide investors compelled by Tremblant's investment philosophy a more tax-efficient, liquid, and transparent product, at a lower cost than its long-only fund. On the other hand, there were concerns that TOGA might cannibalize Tremblant's higher-fee hedge fund business, increase its disclosure requirements, and expose the firm to greater counterparty risk.
The American Bully XL, first introduced to the United Kingdom around 2014, had been held responsible for a disproportionate share of both dog-related attacks and deaths. The case discusses the announcement, in October 2023, that the dog breed would be added to a list of banned dogs under the Dangerous Dogs Act. The case allows for a discussion of how society regulates risks, particularly related to products or activities that might result in personal harm or harm to others. The case also provides international comparisons of animal regulation, and potential issues resulting from the ban.
Social Finance is a Boston-based nonprofit that works at the intersection of finance and policy. It raises, allocates, and manages capital to fund projects in the areas of education, early childhood development, criminal justice, and health. The case explores how Social Finance designs and implements programs related to worker training. While Social Finance's recently launched New Jersey Pay It Forward program has garnered nationwide interest, the organization currently serves around 50,000 people and has ambitions to eventually help upskill millions of Americans. Social Finance's leadership is now examining how best to expand its reach, at a time when rampant shortages of "middle skill" labor threaten to slow economic growth and the energy transition in the United States.
This case explores the merits and drawbacks of Boston Mayor Michelle Wu's proposal to bring rent control back to the city in 2023. It lays out the features, objectives, and potential unintended consequences of this policy, before highlighting the expected impact of rent control on tenants, landlords, and developers. In addition, the case looks back at Massachusetts' long history with rent control to better understand whether rent stabilization efforts enacted in the 1970s and repealed in 1994, following a narrowly decided state-wide referendum, were effective in increasing local housing supply and easing rents in the Boston area.
Participants in the New England power market are exploring several strategies to meet the region's renewable power goals while also providing its residents with inexpensive and reliable electricity and heating fuel. New England was a first-mover into natural gas power generation in the U.S., yet has a dearth of pipeline capacity and the most expensive gas prices in the nation. The region has excellent wind power resources off its coasts, but a checkered past of permitting and legal delays. The case considers several key questions for the climate transition from an economics lens, including what we should call a clean resource; whether supply or demand-side incentives work better for reducing emissions; which types of generation resources are most effective for reducing emissions; and the societal impacts of these choices on consumers across the income distribution.
In early May 2020, Daniel Loeb's team at Third Point was evaluating a potential growth opportunity in the Walt Disney Company and whether investor activism might play a role. Battered by the effects of COVID-19, the company's stock had initially tumbled to $86 and then somewhat recovered to $110. This case explores the headwinds and tailwinds of Disney's ability to flesh out value for investors, including the growth of its Disney+ platform and the recovery of its theme parks. A supplementary case detailing Third Point's ultimate decision and its aftermath is also available.
In March 2020, the global pandemic was delivering a dose of volatility to the US economy. Catherine Faddis, the CIO of Grace Capital, a Boston-based long-only equity manager, analyzed movements in her portfolio while eyeing previously shelved opportunities to invest in preferred stock. The case explores the characteristics of preferred stock, the investment philosophy and strategy of Grace Capital, and the decision making process behind the team at the fundamentals-based investment fund.
McDonald's reported its fifth consecutive quarter of declining same-store sales growth in early 2015. Despite McDonald's recent poor performance, Jonathon S. Jacobson, the founder and Chief Investment Officer of Boston-based Highfields Capital Management, had initiated a large position in McDonald's stock. Jacobson and his team believed that there was enormous upside in McDonald's stock if management successfully implemented what they perceived to be straightforward operational and financial changes. McDonald's needed to return to its core competencies of producing quick and reliable burgers and fries. In addition, they believed that financial restructuring could unlock sizable value for investors. Jacobson and his team debated whether to more forcefully articulate their vision for the company and began drafting a letter to Andrew McKenna, McDonald's Chairman.
In July 2017, shares of Automatic Data Processing, Inc. (ADP) surged 12% following a report that the activist investor Bill Ackman had acquired a sizable stake in the company and planned to nominate his own slate of directors at the company's annual meeting in November. Over the months that followed, Ackman and ADP engaged in an increasingly acrimonious battle of words about the future of ADP. Ackman argued that the company was materially underperforming its potential and could substantially improve its operating margins. ADP vigorously rebutted Ackman's assertions, arguing that none of his ideas were new and that ADP shares had outperformed the market. As the November deadline loomed, ADP shareholders needed to decide whether to vote for Ackman's slate of directors or the company's slate. In making this choice, shareholders needed to consider a single, critical question: Is ADP achieving its maximum potential?
In February and March 2009, the US economy was in the midst of a terrifying financial and economic crisis. Between the beginning of 2008 and early 2009, four of the 25 largest U.S. financial institutions had failed, and nine of these 25 institutions had taken extraordinary steps to avoid failure -either receiving one-off government support, merging with another firm, or submitting to heightened regulation to qualify for future government support. Led by Treasury Secretary Timothy Geithner, the government had to quickly devise policies to stabilize the financial system and the economy. The case explores the details of policies, and the decision making process that led to them, that Geithner and his team devised under immense time pressure to stabilize the system. The case features an extended discussion of Geithner's innovative "stress test", which would reveal the longer-term health of the country's largest banks.
On the afternoon of Monday October 13, 2008, Hank Paulson Jr., the Secretary of the Treasury of the United States, walked into the large conference room across the hall from his office in the Treasury Department. Joining him were Federal Reserve Chairman Ben Bernanke, President of the Federal Reserve Bank of New York Timothy Geithner, Chair of the Federal Deposit Insurance Corporate Sheila Bair, and the Chief Executive Officers of nine of the largest banks in the United States. This distinguished group had been brought together by the most serious financial crisis since the Great Depression of the 1930s. Financial panic was pushing the U.S. and European financial systems to the brink of failure. Paulson hoped his meeting with the bank CEOs would be a turning point. U.S. financial markets were closed for Columbus Day, and Paulson was planning to announce the latest government actions to stabilize the financial system before markets reopened on Tuesday.
Ethan Anderson, the CEO of San Francisco-based e-commerce company MyTime, must decide on the company's growth strategy. MyTime's first product was a website and mobile app that offered consumers a convenient way to book appointments with local merchants throughout the United States. Student must assess the company's growth strategy and develop a model to value a prospective customer to the company's website.
In June 2015 William A. Ackman, the CEO and Founder of New York Hedge Fund Pershing Square Capital, reflects on the success of the fund he has spent over a decade building. Since its inception in 2004, Pershing Square's assets under management had grown from $500 million to well over $18 billion. Ackman is now considering a sizable new portfolio position and must decide how he should raise capital to undertake this new investment. This choice is affected by the recent launch of his new, $6 billion closed-end vehicle, Pershing Square Holdings, as well as the firm's lengthening investment horizon. Although always activist in nature, Ackman and his fund had in recent years become substantively involved in the management of portfolio companies, often working to drive shareholder value by improving operating performance.
This case explores reasons for Blackstone Alternative Asset Management's (BAAM's) growth from 2007-2013, a time when the overall fund of hedge funds industry contracted substantially. Additionally, the case analyzes evolving business models and value propositions within the fund of hedge funds industry. J. Tomilson Hill, CEO of BAAM and Vice-Chairman of The Blackstone Group, is the protagonist. At the time of the case, BAAM was considering two potential directions for future growth: 1) providing hedge fund products for the defined contribution pension space, and 2) beginning direct internal "manufacturing" of investments. In the context of the current fund of hedge funds industry, the case considers challenges and opportunities for these potential new areas for growth.