Carrot Rewards: Carrot at a Crossroads
(9 pages of text)
In December 2018, the founder and chief executive officer (CEO) of Carrot Rewards (Carrot), a profitable Canadian social enterprise, was facing a turning point. The company, which had been founded three years earlier, was about to implode. Its single largest client had just conveyed its decision to pull out, causing a sudden 65 per cent drop in the company’s annual revenue. Should Carrot continue with the prevailing model—one day at a time? Should it launch a freemium version of its app? Should it pivot toward new geographies and new locations? Should it begin to focus on new verticals and go after new clients? Should it go on the auction block and salvage what is left of the original company? The founder and CEO wondered whether the future held workable options other than those he was considering in dealing with the enterprise he had founded, built, and nurtured.
The case can be used in undergraduate- graduate- and executive-level courses focused on entrepreneurship in general and social entrepreneurship in particular. After working through the case and assignment questions, students will be able to do the following:
- Analyze the organizational forms available for social enterprises and the benefits of a hybrid organizational form such as that of a B Corporation.
- Assess the challenges of building and sustaining a profitable business model for a social enterprise.
- Summarize the options that are available to entrepreneurs when a venture is on the verge of failure.
- Develop an action plan for the future.
Canada, Medium, 2018
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