Interactive Minds (A)

William A. Sahlman; Michael J. Roberts; Christina L. Darwall

Case | HBS Case Collection | November 1997 (Revised October 2000)

Interactive Minds (A)

by William A. Sahlman, Michael J. Roberts and Christina L. Darwall

Abstract

The efforts of two recent Harvard Business School graduates to start a venture capital/consulting firm focused on opportunities related to the Internet are recounted. Raises the question of what the nature of this opportunity is, how well-positioned the protagonists are to pursue it, and what the deal structure should be.

Keywords: Venture Capital; Internet; Market Entry and Exit; Financing and Loans; Business Startups; Consulting Industry;

Format: Print

35 pages

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Citation:

Sahlman, William A., Michael J. Roberts, and Christina L. Darwall. "Interactive Minds (A)." Harvard Business School Case 898-072, November 1997. (Revised October 2000.)

The case focuses on issues involved in managing the direct multilevel marketing sales consultants who sell R+F skin care products. The company is trying to better manage the inconsistent and highly variable recruitment behavior of the sales force i.e., the degree to which existing consultants recruit new consultants. The company utilizes a range of periodic incentives for recruitment, but hopes to build a system of salesforce compensation and management that relies more on intrinsic rewards and less on these periodic incentive programs. The case forces students to address principles of compensation system design, as well as more fundamental issues around what they believe motivates this "volunteer" (i.e., non-employee) sales force.

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