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Proteak: Valuing Forestry Assets
In early 2020, 414 Capital was hired by Proteak, Mexico's largest forestry platform, to perform a valuation of its teak business, a high-grade hardwood commonly used to build boat decks, outdoor walls, furniture, doors and small objects. Teak plantations typically became commercially viable upon reaching 20 to 30 years of maturity and Proteak was two years away from reaching its final harvest period for several teak plantations in Mexico. Teak productivity could vary significantly across plantations. Ariel Fischman, founder and CEO of 414 Capital, a leading independent corporate financial services firm, recognized valuing land in Mexico was also a tricky business, and although they had previously performed a valuation of Proteak in 2014, the market dynamics had changed in the last six years, and so had the company's position in the market. -
Digitally-Enabled Healthcare Delivery in India: Meddo and the Convergence of Technology and Medicine
Meddo is a healthcare service delivery innovation in India that simplifies the patient journey through outpatient services, lab tests, and medicines management. It was born out of a collaboration between a medical doctor who cofounded a hospital chain, and an entrepreneur who had led a major food-delivery service. The case allows for the exploration and growth of a business model innovation in the complex ecosystem of healthcare. -
Embraer E-Jets E2: Flying High
This field-based case chronicles how Embraer, a recognized market leader in Brazil's regional aircraft industry, designed and developed an almost entirely new aircraft, the E2-190. Given the success of the E1-190, a project to redesign that successful product was a bold move. Yet the E2 project excelled. It surpassed industry expectations, including being under time and under budget, and it logged many firsts, such as setting a world record for first flight and triple flight certification. The case explores how the project team created work groups and teams embedded within the company and leadership values to guide actions and decisions during this project, which was large in both scale and scope. Throughout the case, executives execute a change process and use influence and project-management tools, especially critical chain analysis, to align business practices with human behavior and scale the program with 98.5% scheduled reliability. -
DIY CAMBRIDGE ANALYTICA: RUNNING PERSONALITY ANALYTICS
The case walks the readers first through the Cambridge Analytica scandal, eliciting its effect and presenting an overview of the analysis the infamous company did. Readers are then introduced with simple steps on how a similar approach may be used today - running surveys on inconspicuous questions very affordably and quickly, and creating simple analytical models (linear and logistic) to infer respondents' age and gender. The raw survey data is available upon request to the co-authors. -
Capital Bikeshare: Analyzing Bike Rental Demand
In November 2018, a bicycle program specialist who worked in the Planning and Sustainability Division at the Washington, DC, District Department of Transportation, wanted to analyze Capital Bikeshare's bike rental demand for the past two years. Capital Bikeshare was a station-based bike-sharing operator that provided an expansive, multi-jurisdictional transportation system to Washington and the surrounding area. If the bicycle program specialist could determine some significant factors that affected users' ridership patterns, he could best design his expansion plan of adding 40 new bike-rental stations to the system. He obtained the hourly bike rental demand for October 2016-September 2018 to evaluate how sensitive the demand was to some external factors. -
Agarwal's 420: Challenges of Establishing and Growing a Traditional Business
Agrawal's 420, a cottage industry started in 1962 in Indore, Madhya Pradesh, setup several companies by 2016. Papad business revenues were at INR 70 crores plus. The reasons for setting up the company, its guiding values, facing intensive competitive rivalry, journey of growth, manual manufacturing process, mechanising the process, product portfolio and development, setting up and managing sales distribution system, and challenges of growth to go national are featured here. The case can be used for exploring the factors that impact entrepreneurial motivation to sustain a small business in a highly competitive market, and growing from a small single brand one product local business to a large multi-product multiple brand national one. -
Professionalization of HR at Mahindra (A): Trigger for Transformation
The three cases provide a longitudinal account of the transformation of the Human Resource (HR) division of Mahindra's Automotive and Farm Equipment Sector (AFS). An aspirational nudge from the Managing Director about the need for a more strategic HR role triggered the transformation exercise. The follow-up diagnostic study revealed significant gaps in the readiness of the HR division for the future. The redesigned HR organisation with three pillars of Shared Services, HR Business Partners, and Centre of Excellence turned out to be quite successful. The efficiency improved, and HR gained a reputation for being a strategic partner to the business. With a high degree of standardised processes, the HR organisation seemed ready for digitisation. The three cases have been written in a way so as to provide the readers a detailed description of the diagnostic process in Case A, the restructuring and change process in Case B, and the impact of the transformation exercise in Case C. -
Carnival Corp: Cruising In the Time of Covid
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Humana (A)
To implement a bold new strategy, Humana needed to decide how to prioritize the pillars; where to own and where to partner; how much risk is acceptable; and how to continue to deliver strong operational performance while implementing a new strategy. Had the firm made the right decisions? -
Verdeagua: What Is At Stake When Investing in a Certified B Corporation?
Simultaneously to creating economic value, the two founders were committed to creating social value and respecting the environment. Social value stemmed from employing mostly women from the poorest segments of the population on a full-time, unlimited basis -while the industry largely employed workers on a temporary basis. Furthermore, wages, benefits, and shared decision-making created a unique organizational culture where fairness, learning, and personal development were paramount. At the same time, hydroponic technology, specialized infrastructure, and internal processes resulted in the industry's lowest environmental impact. By taking up a USD 300k bank loan, the founders had recently purchased a 25-acre lot and set up an up-to-date greenhouse. They had plans to continue growing the company and enlarging their market presence but were unsure of their business skills and if the business' cash-flows would be enough to pull this initiative through. They started looking for investors. Would investors accept their unwavering commitment to their triple bottom-line way of doing business? How would they relate to a purely business-oriented management philosophy? How could the company grow profitably and simultaneously maintain its commitment to the creation of social value without impacting their return on investment? Would the founders and the organizational culture respond satisfactorily to the severe demands of growth? -
Urban Axes: First Mover in US Experiential Entertainment
Urban Axes introduced the Canadian indoor sport of axe throwing to the US market, beginning with one location in Philadelphia, Pennsylvania, in 2016. Although Urban Axes was started as a "side hustle" by four friends with corporate jobs, it soon became apparent that the concept could be both popular and profitable. The partners quickly decided to become fully involved in the business to maximize its potential. This case features a woman protagonist as chief financial officer and the originator of the business plan. It is a novel, contemporary example of the first-mover principle, highlighting the risks and rewards of creating a new line of business in a competitive and volatile industry-in this case, the indoor or experiential entertainment industry. -
Blue Meridian Partners (A): Scaling for Impact
In 2018, Edna McConnell Clark Foundation in a bold move transferred all its assets to a fund pooled with other General Partners and Limited Partners, called Blue Meridian Partners, to focus substantial long range investments in a few carefully chosen nonprofits. The fund was intended to find proven, scalable solutions to problems that trapped America's young people in poverty. In addition to discussing the merits and demerits of this new approach to philanthropy, the case poses questions on two particular investments (Youth Villages and Nurse Family Partners) and whether they should receive the next tranche of investments. The (B) case, situated in 2020, describes the many quick decisions taken by the fund in response to the COVID-19 pandemic and the calls for social justice, and raises the question of whether and how these decisions are aligned with the long range strategy of the fund. -
Seeding and Selling Asana
In December 2019, Oliver Jay, Asana's Chief Revenue Officer (CRO), was reconsidering his go-to-market (GTM) strategy. Asana was cloud-based work management software that enabled users to break up projects into discrete tasks that could be assigned, scheduled, and tracked on a single, integrated platform. Jay was wondering how to increase annual recurring revenue by year-end 2020. Just three years earlier, when Jay joined Asana as its first CRO, thousands of companies were already using free and paid versions of its software. Since Asana was a software-as-a-service (SaaS) offer, all a new user needed to do was to create an account. This meant individual users and teams could onboard easily and initially for free, using an array of self-service tools, without purchasing approval from their IT departments on conversion to paid subscriptions and without initial sales support from Asana. This mix of free and paid users proved sustainable and profitable for Asana. However, reaching senior directors, vice presidents, and executives of potential client companies to drive larger, enterprise-wide adoptions was a challenge for the Asana sales team. Jay's desire to improve sales performance led him to a novel concept: to structure the sales team based on where customers were in their adoption cycles with Asana-that is, to organize sales by stages of the customer journey rather than by the time-honored approach of organizing by account size (e.g., SMB, mid-market, and enterprise). Was this radical idea the right structure for Asana to reach its revenue growth goals-or was it fraught with too much risk? -
Shrujan: Weaving Long Lasting Threads of Life
Shrujan, a 50-year-old social enterprise, was started to provide work for villagers following a severe drought in the Kutch region of India. The organization focused on using the villagers' appreciable skills in embroidery to create and market high-end handicrafts. The products both generated a source of added income for their households and helped to preserve the traditional crafts of the artisans. Shrujan had grown over the years, increasing sales and thus increasing the number of artisans supported by the project. However, in January 2020, a young fashion designer-the niece of the trustee manager and an employee at Shrujan-had ideas for growing and expanding the organization even further. The trustee manager needed to evaluate her niece's proposal and decide whether or not it was possible to scale Shrujan and grow the business without compromising its social commitment. -
The Plastilene Group: Sustainable Innovation Strategy
In 2020, the corporate purchasing and sustainability manager at the Plastilene Group (a plastics producer based in Colombia) needed to address a sustainability challenge. In response to media and legislative attacks and consumer behaviour changes regarding the use of plastic products globally, the corporate purchasing and sustainability manager, supported by the company's chief executive officer, was tasked with leading a strategic renewal in the 62-year-old business group known for its integration of various lines of innovation both inside and outside its organization. The organization's process of strategic renewal had arisen from the theories of sustainability and the circular economy. How could the company management enhance not only the sustainable innovation strategy within the organization's structure, but also its spirit of corporate entrepreneurship and innovation? -
GE Digital: Racing to Lead Industry 4.0
GE Digital started out in 2009 as a center of excellence to enable the digital transformation of services to industrial customers who had previously bought GE hardware. Now it finds itself competing with a variety of other providers. The case explores the basis of its competitive advantage (data analytics) and how it positions itself to succeed in what has become a crowded field. -
EU Court of Justice to Decide on Back Taxes Owed by Apple to Ireland after Commissioner Vestager Launched Appeal
On 30 August 2016, Margrethe Vestager, the European Commissioner for Competition, ordered Ireland to recover €13 billion in illegal state aid (plus interest) that Ireland was alleged to have granted Apple over a decade from 2003. Within months of the ruling, both Tim Cook, CEO of Apple, and Enda Kenny, the Irish Prime Minister, appealed the Commission's judgment to the European General Court in Luxembourg, the EU's second highest court. In mid-July 2020, the General Court returned its verdict and annulled the Commission's ruling giving Commissioner Vestager two months and 10 days to appeal. At the very last minute, the Commissioner announced that she would seek an appeal before the EU's highest court, the Court of Justice of the European Union, citing "errors of law" committed by the lower court. No date has been set for the CJEU to decide on the merits of the appeal. The case explores these events from five analytical pillars: 1) the role of Ireland's low corporate tax rate in attracting FDI; 2) Apple's decision to allocate its earnings to a paper company in Ireland with no physical presence in the country; 3) the repatriation of foreign earnings to the United States; 4) the transfer payments that Apple makes to the USA to pay for R&D; 5) the Commissioner's decision to impose a retroactive tax penalty on a foreign company that acted in accordance with the tax arrangements granted by its host country. -
Valeo: Innovating to Lead the Mobility Revolution
In 2019, the chairman and chief executive officer of Valeo, an automotive supplier and partner to automakers worldwide, faced the challenges of maintaining the company's speed of growth and balancing its growth with profitability. Valeo had started as a small automobile component manufacturer in 1923 in France. By 2019, however, it was partnering with automakers to design innovative solutions for smart mobility with a focus on intuitive driving and reducing carbon dioxide emissions. Valeo had grown not only organically, but also through partnerships and acquisitions, which enabled it to develop new technologies and new markets. What should the chairman and chief executive officer do to achieve the twin challenges of maintaining the company's speed of growth and balancing growth with profitability, while not losing sight of the three current automotive revolutions-vehicle electrification, vehicle autonomy, and digital mobility? -
Corruption at UNHCR Refugee Camps: Can it be Tackled?
The Inspector-General of the United Nations High Commissioner for Refugees (UNHCR), Fatma Özdamar, receives two highly distressing pieces of news concerning the UNHCR-administered refugee camps in Lundya. The first is an anonymous letter detailing rampant levels of corruption at the camps, including fraud and abuse by UNHCR officials. To make things worse, a key UNHCR donor country informed her that its Ambassador in Lundya had received a personal threat and a demand to leave the country. Investigations revealed that the note to the Ambassador had originated from employees of the Lundyan refugee camps. Thus, the donor country was threatening to withdraw its financial support to UNHCR. Having been told to prioritise the investigation of incidents involving UNHCR staff elsewhere, Inspector-General Özdamar faced hard choices on how to proceed. -
Evaluating the Social Value of Impact Investments: Vox Capital and Magnamed
Vox Capital was a pioneer as an impact investment company in Brazil, with the purpose of creating a world where businesses can generate positive social transformations. Vox Capital decided to invest in businesses that improve the current essential service provision, such as the Health Sector, and that contribute to the reduction of social inequalities in Brazil. In 2015, Vox Capital decided to invest in Magnamed, a Brazilian company, 100% national, which develops, manufactures and sells medical equipment, specialized in pulmonary ventilation for the care of hospital patients dependent on critical care (intensive care) and transportation of patients in ambulances. Around 70% of the Brazilian population relied on the public health system (SUS) when they needed assistance, especially low-income classes. But SUS had a mayor problem, which was the shortage of beds in hospitals, mainly due to lack of both equipment and trained personnel capable of operating them. Vox Capital invested in Magnamed because its products could make SUS better, reducing inequalities in access and quality of health service. Their products were cheaper, easy-to-use and were better adapted to the living conditions of our country (have longer-lasting batteries and take up less space). Magnamed's main markets were emerging countries, in which the characteristics of the Brazilian equipment were suited to local realities. In 2017, the company announced bold internationalization plans with the opening of its first international factory, with an investment of $ 2 million, in the United States. The situation portrayed in this case is fictional and reflects some questions faced by Gilberto Ribeiro, a partner of Vox Capital. In this scene, Gilberto was challenged during a public event by the moderator of the panel in which he participated with the question, "In seeking to grow abroad, does the company [Magnamed] continue with its social focus?