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This is the fifth case in the Kellers' Freehouse series. See Kellers' Freehouse (A), Kellers' Freehouse (B), Kellers' Freehouse (C), Kellers' Freehouse (D), Kellers' Freehouse (F)

Follows a very creative founder and his business in becoming major forces in the sport and industry of cycling. Looks at a creative and visionary individual, Jim Gentes, and some of the important questions he faced as his first product (a revolutionary new bicycle helmet) became a market success. Details Jim's start-up experiences, including his beginnings when he stocked inventory in his bedroom, used his garage as a manufacturing plant, and expanded by trading a helmet with his neighbor for use of his garage. Giro maintained the highest quality and eventually placed its superior product on the heads of the sport's most respected athletes. Giro leveraged this reputation as the "helmet of champions" as Gentes worked hard to maintain the company's standards. His helmet became well-known among cycling enthusiasts and marketers, eventually garnering a reputation as an extemely "hot" new product. Along with success, the business became increasingly more complicated, and an increasing number of issues required more attention.

Many built-in problems and risks await the entrepreneur who is searching for capital. Being aware of the realities can help - realities like that raising money costs a lot. The process also drains managers' time and energy, which can make the business suffer. Delegating the capital search by hiring advisers to do the negotiating can also backfire if you don't choose the right adviser - one that will tailor the search to your needs.

Describes how Vinod Khosla got Sun Microsystems started, and a critical marketing challenge the company faced at the end of the first year. Objective is to illustrate how bold creative thinking can make or break start-ups.

Provides a continuation of the (A) case.

Provides a continuation of the (A) case.

Paul Ballisarian, owner of Ballisarian Beef, hired Mike Post in the 1960s when his children were too young to enter the business. Mike is an innovator whose contributions have resulted in more than half the business's profits. Now Mike wants half ownership of his part of the business. Paul's son, Gregory, would rather see Mike leave than give him part of the business, while Paul's daughter, Katherine, believes Mike should be made CEO. Five family business experts - John A. Welsh, formerly of Southern Methodist University's Caruth Institute of Owner-Managed Business and founder of Flow Laboratories; Joseph A. Baute, Markem Corp.; Charles E. "Gus" Whalen, Jr., Warren Featherbone Co.; Wendy C. Handler, Babson College; and Harry Levinson, The Levinson Institute - discuss the issues presented.

Picks up where National Demographics & Lifestyles (A) left off, describing the company's financing and very successful performance through 1987. At this point, the founders and venture backers face some difficult choices around how and when to harvest the value they have created. Options include a public offering or sale of the company.

Acquiring resources--or to put it more broadly, attracting stakeholders--is a basic entrepreneurial task. While every enterprise needs employees, customers, suppliers, and financiers who are willing to risk their time and money, attracting these "stakeholders" to an entrepreneurial venture is a particularly difficult challenge. This note first describes the importance of the challenge and then the set of tasks the entrepreneur must work on in order to overcome it: Designing the enterprise to minimize the stakeholder investment needed, selecting the right stakeholders, and then convincing them to participate in the enterprise.

Explores many of the issues that face rapidly growing venture-backed companies in high technology industries. Provides an opportunity for students to examine the issues involved in managing a cash flow crisis. Begins with the new MIPS CEO, Robert Miller, facing a number of serious problems. Overall, MIPS has been performing poorly. When Miller assumes his position, the company's cash account contains only $700,000 less than one month's funds. His cash problems are compounded by serious internal disagreement between the company's functional departments, which hold differing points of view regarding the direction the company should take both strategically and tactically. Provides a history of the company and its technology, beginning with its founding in 1983 based on a completely new technology that had been developed at Stanford University. Describes the goals of founding management and the company's subsequent difficulties in meeting these expectations. Students are asked to put themselves in the role of the CEO, examining what options they have and what process should they follow to reach a solution.

An account manager of a large bank is reviewing a request for term financing to assist with the repurchase of a minority interest in a large trucking company. The firm is considering a term loan as well as an investment by the venture capital arm of the bank. An equity investment would require agreement on the form of the investment and the price to be paid for any stock issued.

In June of 1988, Lee Greenspoon and Michael Bellman, two students at The University of Western Ontario, were excited about a new business proposal. After months of research they were anxious to launch their own bean bag chair to the university student market. Many decisions including product type, price and promotion strategy needed, would have to be made quickly if they were to be ready to sell bean bags by September 1988.

Describes the founding and subsequent growth of WaterTest, a New Hampshire firm run by a entrepreneur with little business background. Three Harvard Business School students are working on a project to help the firm refine its marketing strategy. The students collect a great deal of data--which is available in disk form--on the company's customers and potential customers. Students are asked to analyze this data to develop a marketing strategy for the firm.

Describes the various uses for a business plan and focuses on writing a business plan to attract financing for a new venture.

Describes the various tax laws that impact the purchase and sale of a business.

Deals with the issue of an entrepreneur in a very successful company deciding whether to stay through a period of great growth or to sell. What are the entrepreneur's responsibilities to the organization, to his employees, to the public? As subtopics, the issues of marketing versus having a strong product that sells itself, patents and the legal issues involved, manufacturing problems, and a rising business in a sharply declining market.

Leveraged buyouts are not just for the big guys. Money is available for buyers of smaller companies who know how to structure a deal. Borrowing against assets like equipment, inventory, and accounts receivable gives the entrepreneur the most freedom and thus remains the most popular LBO technique. If a deal is to succeed, the owner must have a compelling reason to sell.

A leading venture capitalist--who looks at people, particularly financial people, rather than at the financial projections in business plans--sets forth his beliefs as to how entrepreneurs can create successful, thriving enterprises. They must be brutally honest with themselves, accepting bad news and staying on top of disappointing developments. At the same time, they must believe in their ideas; understand how vital good management is to their company; if they can't provide it themselves, bring the right person in; be skilled managers who can be tough-minded with themselves and their team, can say "no," and ideally, are well versed in the technology on which the company is based.

Describes the legal odyssey of two engineers who left their old employer to start a company that was directly competitive. The issues include employment contracts, technology licenses, antitrust, trade secrets, and confidential information. Provides a good opportunity for students to explore the legal and ethical issues which surround the concept of intellectual property.

Contains a list of six questions that the jury was required to answer in order to deliver a verdict.