1uptoys: Breaking into the global toy industry

This case chronicles the start-up of 1uptoys, a Dutch start-up that aims to commercialize innovative electronic music toys in the highly competitive toy business. It examines the challenges resource-limited start-ups face when attempting to introduce a consumer product onto a market characterized by a highly concentrated seasonality, and short product life cycles.

In a race against time to meet the deadline for delivery of 1uptoys’ prototypes to its Chinese manufacturing partner the founder, Ronald Mannak, goes through a series of setbacks as he tries and fails to findthe necessary funding to pay the wages of his team and complete the prototypes. The future of the company is left on a knife-edge.

Written by Armand Smits and Wynand Bodewes from Maastricht University and Maastricht Centre for Entrepreneurship. Download the case and teaching note at www.thecasecentre.org or request them from w.bodewes@maastrichtuniversity.nl.

A venture capitalist’s investment in an emergent industry: which bets to place?

June 2001, the Belgian Investment Company (BIC) wants to invest in the booming Customer Relations Management (CRM) market. Dave Hudson, investment manager at BIC, has been asked to recommend a venture in which to invest a capital sum of 1 million euro. On his desk, Hudson has the business plans of two very promising ventures active in the CRM market. The first venture, Neurorithm NV, is still in the development stage of its revolutionary neural network-based software platform, which has the potential to become the next SAS or SPSS. Given the new and revolutionary character of their software, credibility will have to be established, however, before income streams will be generated. The second venture, DataMining NV, provides highly customized, unique data mining software for three market segments: the CRM market, bioinformatics and the sports analysis market. The company is expecting a steady growth in the years to come. The business plans of both companies display very diverse business models and ambitions. It is now up to Hudson to decide which one of these two companies to recommend to his superiors for future investment.

Written by Petra Andries and Yvonne Kirkels from the University of Leuven and Fontys University of Applied Science. Download case and teaching note at www.thecasecentre.org or request them from Petra.Andries@econ.kuleuven.be.

What next for fromAtoB?

Between 2005 and 2010, the internet became the preferred medium for people searching for passenger transport options. However, the search for connectivity from point A to point B was cumbersome and to obtain optimum results, necessitated calls to the web sites of many different transportation providers. The comparison between potential train connections, different airlines, using your own car, ride-sharing and sometimes the need for additional public transport links made this a time-intensive process.

However, in Germany in 2007, these inefficient and time-consuming search-and-compare processes were replaced by the internet platform www.fromAtoB.com. This enabled people to perform a comprehensive search that included every relevant transport mode (rail, air, own car, ride sharing, bus, rental car, taxi).

fromAtoB.com was founded as a spin-off from RWTH Aachen University, Germany. In 2009, the internet platform was successfully launched in the German market under the domain www.Verkehrsmittelvergleich.de. However, by August 2010, faced by the threat of competition from new market entries backed by big internet players such as Microsoft’s search engine, bing.com, fromAtoB.com’s founders were forced to consider expansion outside Germany. The question was, how best to finance an internationalisation strategy?

Written by Malte Brettel, René Mauer and Tobias Karmann from RWTH Aachen University. Download case and teaching note at www.thecasecentre.org or request them from karmann@win.rwth-aachen.de.

LUCID Market entry strategy: Is less more?

June 2010, less than six months since Steve Job announced the launch of the i-Pad an innovation creating a new product category. Since then, the industry had moved extremely quickly. After 80 days, Apple announced the sale of more than 3 million iPads, with major production bottlenecks restricting market expansion. Since then, more than 20 competing products had been announced, including some from major firms like Sony, HP, Lenovo or Dell computers. These facts indicated that products, and more specifically hardware innovation, would accelerate in the coming years. As usual in the consumer electronics business this was an important signal that production volumes associated with a market surge, would greatly benefit from economies of scales. It also meant that products and technologies that were once niche-oriented would quickly become mainstream and consumer-oriented. 

For LUCID  managers, this was a major signal. The different types of software developed over the last ten years were, to a large extent, linked with technical specificities that only innovative hardware used to provide. During a strategic meeting, the company’s top management questioned the assumptions made and challenged the strategy at the outset of the second phase of market entry

Written by Bernard Surlemont, Fabrice Pirnay and Emilie Vandermeiren from the University of Liège. Download case and teaching note at www.thecasecentre.org or request them from F.Pirnay@ulg.ac.be.

DataMining: Making decisions in highly uncertain emerging industries

During the mid nineteen-nineties, three Belgian doctoral students, Harry Flores, Stephen Douglas and Ian Moore, became interested in industrial applications for neural network technology. In 1999, encouraged by the prevailing positive financial technological climate, and supported by the spin-off policy of their mother university and with the backing of a faculty member, the students decided to commercialize their research in a brand new spin-off: DataMining.

The founders began by serving three different market segments, Customer Relations Management (CRM) bioinformatics and sports analysis, providing customized software based on neural network technology. However, soon decisions had to be made with regard to narrowing the market segment focus and the acquisition of additional capital for the company’s further development. Given the high level of uncertainty surrounding market size and needs characteristic of such emerging industries, these proved to be complex issues.

Written by Petra Andries and Yvonne Kirkels from the University of Leuven and Fontys University of Applied Science. Download case and teaching note at www.thecasecentre.org or request them from Petra.Andries@econ.kuleuven.be.

Fruitful prospects: A European apple breeding company

Since 1982, Martin Peeters, owner of an apple tree nursery and Robert Jensen, research director at the fruit breeding centre of a German university, had worked together on the development of new apple varieties. In the nineteen nineties, Peeters’ knowledge of traditional breeding and Jensen’s expertise in molecular breeding had resulted in a number of high quality breeds. They were now, in 1998, thinking of founding a company to commercially grow and sell these new breeds. In fact, they were convinced of consumers’ interest in new apple varieties. They based their opinion on a successful experiment of Peeters’ company had conducted with the German-based supermarket chain, Home.

However, there were important hurdles Peeters and Jensen needed to tackle. The apple market in Northern Europe offered ever diminishing margins for both apple breeders and growers. The absence of quality differentiation, an over-supply of fruit and declining consumption had led to low prices for the producer. Traditional breeding techniques were barely profitable, but the market was still unwilling to embrace Genetically Modified Organisms (GMO’s). If they wanted their company to succeed, they had to think very carefully about the commercialization of their produce. This required a thorough analysis of the value chain and the relationship between the different actors involved.

Written by Petra Andries, Anneleen Bruylant and Yvonne Kirkels from the University of Leuven and Fontys University of Applied Science. Download case and teaching note at www.ecch.com or request them from Petra.Andries@econ.kuleuven.be.

SENZ Umbrellas: Taking the world by storm

This case describes the start-up of SENZ Umbrellas, a Dutch venture founded by three graduates of Delft University of Technology (the Netherlands) who aimed to introduce an asymmetrical, storm-proof umbrella onto a mass-market where product innovation was limited.

It demonstrates the marketing challenges start-ups face in bringing an innovative consumer product to market. In particular, the case focuses on how to promote a new consumer product and create brand awareness when resources are limited. This case can be used both in entrepreneurship courses to illustrate marketing issues common to the ‘start-up’ stage, and in strategic marketing programmes.

Written by Armand Smits and Wynand Bodewes from Maastricht University and Maastricht Centre for Entrepreneurship. Dowload the full case and teaching note at www.thecasecentre.org or request them from w.bodewes@maastrichtuniversity.nl.