| Best Practice: Ideas and Insights from the World’s Foremost Business Thinkers
Joseph B. Fuller and Michael C. Jensen
Fuller, Joseph B., and Michael C. Jensen. "What's a Director to Do?" In Best Practice: Ideas and Insights from the World’s Foremost Business Thinkers, edited by Tom Brown and Robert Heller, 243–250. Basic Books, 2003.
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| HBS Case Collection
Maricopa, Inc.: Finding the Right Treatment for Growth
William A. Sahlman, Thomas R. Eisenmann, Joseph B. Fuller and Shikhar Ghosh
The founders of Maricopa, Inc., a startup that sold proprietary hair-care products directly to salons, were preparing a board presentation to address the young company's inability to meet financial projections. While the products had caught on with customers, the financial shortcomings raised some questions about the company's business plan. The company had gone through much of its cash and needed additional funding to continue operating.
At the same time, two VC investors were deciding how to proceed with their investments in Maricopa. The larger VC firm questioned Maricopa's management's decisions and was hesitant to further fund the company. However the Maricopa investment was much more important to the smaller VC firm, and its representative on Maricopa's board worked hard to convince her counterpart from the larger firm that while the firm had struggled, it was a young startup with strong potential. Without the larger firm investing again in Maricopa, the business was at risk of going under.
Keywords: Business Startups;
Financing and Loans;
| HBS Case Collection
(Revised January 2014)
GenapSys: Business Models for the Genome
Richard G. Hamermesh, Joseph B. Fuller and Matthew Preble
GenapSys, a California-based startup, was soon to release a new DNA sequencer that the company's founder, Hesaam Esfandyarpour, believed was truly revolutionary. The sequencer would be substantially less expensive—potentially costing just a few thousand dollars—and smaller than other sequencers, many of which were large devices costing tens of thousands or hundreds of thousands of dollars. GenapSys' device, named GENIUS, could also quickly generate large amounts of data, as it was capable of sequencing an entire human genome in less than eight hours. At this price, GenapSys' device would be attractive to customers that had been unable to afford sequencers, such as smaller laboratories or hospitals, and even expand the market to include industries such as agriculture and biofuels.
As GenapSys came closer to releasing its product, Esfandyarpour and his Senior Director of Operations and Strategy, Leila Rastegar (HBS '11), sat down to decide which of three business models they would choose to bring this device to market. In the first model, the company would sell sequencers at a higher price to those entities which already purchased sequencers, primarily major research labs and pharmaceutical firms, but position its machine as a faster alternative to existing technologies. In the second model, GenapSys would sell its sequencer at a lower price but charge more for the cartridges necessary to run a sample, and earn its primary revenue from these cartridges. The third model would see GenapSys sell its device at or around cost, but use the data customers generated to create a proprietary database of genetic information. Customers could pay to access the database for research, to create genetic tests, or for many other purposes. GenapSys would also build an online store with the genetic tests customers created.
Esfandyarpour's and Rastegar's decision would determine GenapSys' customer base and financial position for the coming years, and also impact development and capital needs of the firm. Which was the right model to bring the device to market and have a meaningful impact?
Keywords: DNA Sequencing;
innovation ＆ entrepreneurship;
Health Care and Treatment;
Medical Devices and Supplies Industry;
MuMaté: Funding Growth
Shikhar Ghosh, Joseph B. Fuller, Thomas R. Eisenmann, Alex Godden and Andrew Sandoe
Financing and Loans;
Consumer Products Industry;
Division of Faculty & Research
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