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FOUR MODELS
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Tu
Idea
rb
Generation
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InternalceFinance
Path of Entrepreneurship
Proof of Concept
External Finance
Expansion
IPO
Entrepreneurship Turbulence
Bob Bennett works with Star
Technologies Sells high speed
processors
Disagreement with management
over direction company was taking
Wants to innovate and come up
with a new business
Idea generation
Proposed new idea of combined Microwave oven
and refrigerator to GE deal didnt go through
Encountered lack of willingness from American
manufacturers while Samyan lost its retails
partner (Sear)
Partnership generated synergy for both
Products
MicroFridge for colleges, motels and military
MicroMart Placed in motel lobbies to increase their
revenue
Microbar Used as mini bar in hotel rooms
Internal Finance
Invested $5000 for market survey
Proof Of Concept
First order came for 1700 units
Capital needed was $ 170000 for tooling and $ 100 per unit sold to be given
to Samyan
This was the first possible sales hit for the company in the market: One of the
first steps to glory
Sold over 4000 units to distributors who in turn sold to various colleges
Market
Colleges
(55% Revenue)
1.25 million dorm rooms in 1877
colleges
Military
(25% Revenue) 280,000
military barracks at 200 military
bases across U.S
Colleges
Campus installation
Campus rental
Schools to give
orders with
advanced cheques.
Company Rental
Competition
Existed from regional refrigerator rental
companies
Microfridge made its 1st acquisition and was
closing in on 2nd
Increased reach and penetration
For new rental customers it gained MF replace 6000
refrigerators with Microfridge
Alternate Suppliers
Looking for multiple supplier for sourcing to reduce over
dependency on Samyan
Struck a deal with Daewoo which supplied Microwaves
at $83 as compared to $100 of Samyan
Few issue in multiple sourcing
Assembling the microfridge became a tough task due to diferent
suppliers for refrigerator and oven
Samyan RnF would not accept delivery of Microwaves made by
Daewoo
External Finance
More investment required as they
wished to introduced new products to
cater to home away from home
market
Received $4 million from institutional
investor selling 20% stakes
SWOT Analysis
Strengths
Weakness
First Mover
Advantage
Focused customer
base
Management
dedicated to
customer service
Lack of internal
resources
Opportunities
Threats
Untapped market,
can be captured
completely making
it hard for
competition to
enter
Possible entry by
bigger players
Fewer students
living on campus
Thank You