(6 pages of text)
This case is about an ambitious “technopreneur” with ideas that were at the forefront of technology, such as in enterprise resource planning (ERP) systems. Compassion Web had been successful initially, then swamped with challenges, and the original business model needed major changes in order to work in the fast-changing environment. At the same time, the company was facing a lawsuit with a major client, which could threaten its survival. To make matters even worse, the company lacked the strong and unified leadership necessary to pull it out of its difficulties.
The main objective of this case is to help students understand the realistic challenges faced by an entrepreneur, especially in the technology industry. Key lessons include:
- Not every start-up is an Apple, Yahoo, or Google. Behind every success story lie thousands of failures and hundreds of ordinary small enterprises.
- A good technological product or idea is a necessary but insufficient condition for success. Many bright, tech-savvy entrepreneurs fail because of a lack of business perspective.
- The problem of cash flow for start-ups.
- The problem of co-founders with different perspectives of a business and the potential consequences of equal equity shares between co-founders.
The case can be used in a course on entrepreneurship. It can also be adapted for a class on angel financing or venture capital, where the angel contemplates whether to invest in the company and what changes it would make if it did invest.
Information, Media & Telecommunications
Singapore, Small, 2002
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