Harvard Case - Getting Started (A)You Can Play, but Will You Win?
"Getting Started (A)You Can Play, but Will You Win?" Harvard business case study is written by Gregory Fairchild, Cole Fairchild. It deals with the challenges in the field of Finance. The case study is 9 page(s) long and it was first published on : Jul 6, 2020
At Fern Fort University, we recommend that the founders of the "Getting Started" game, focus on securing funding through a Series A round of investment to accelerate their growth and capitalize on the emerging market opportunity. This funding will be crucial for scaling production, marketing, and distribution to reach a wider audience. We believe this strategic move will position "Getting Started" for success in the competitive gaming landscape.
2. Background
The case study focuses on 'Getting Started,' a board game designed by two entrepreneurs, David and Sarah. The game, which teaches basic financial concepts and decision-making skills, has garnered early success through a successful Kickstarter campaign and positive reviews. However, the founders face the challenge of scaling their business to meet growing demand and compete in the crowded gaming market.
3. Analysis of the Case Study
The case study presents a classic scenario for a startup facing rapid growth. We can analyze the situation through the lens of a Financial Strategy Framework, focusing on the following key aspects:
- Financial Analysis: The game has demonstrated strong initial sales, but the founders need to project future demand and assess the financial viability of scaling production. This requires a detailed financial model to analyze key metrics such as cost of goods sold, marketing expenses, and profitability.
- Capital Budgeting: The decision to secure funding involves evaluating the potential return on investment (ROI) of different financing options. The founders need to carefully consider the cost of capital and the impact of debt or equity financing on their capital structure.
- Risk Assessment: The gaming market is highly competitive, and the founders need to assess the risks associated with scaling their business. This includes potential competition, market saturation, and changes in consumer preferences.
- Financial Forecasting: A robust financial forecast is essential for attracting investors. This forecast should project revenue growth, profitability, and cash flow over the next few years.
4. Recommendations
- Secure Series A Funding: The founders should pursue a Series A funding round to raise capital for scaling their business. This funding will be essential for:
- Production Expansion: Investing in manufacturing capacity to meet growing demand.
- Marketing and Distribution: Developing a comprehensive marketing strategy to reach a wider audience and establishing partnerships with retailers.
- Product Development: Investing in research and development to create new game versions and expansions.
- Develop a Robust Financial Model: The founders should create a detailed financial model to project revenue, expenses, and profitability. This model will be crucial for:
- Investor Pitch: Presenting a compelling financial case to potential investors.
- Decision-Making: Guiding strategic decisions related to pricing, marketing, and production.
- Focus on Key Performance Indicators (KPIs): The founders should track key performance indicators (KPIs) to monitor business progress and make data-driven decisions. These KPIs could include:
- Sales Growth: Tracking the growth of sales revenue.
- Customer Acquisition Cost (CAC): Measuring the cost of acquiring new customers.
- Customer Lifetime Value (CLTV): Assessing the long-term value of customers.
- Build a Strong Team: The founders should invest in building a strong team with expertise in finance, marketing, and operations. This will be essential for scaling the business effectively.
5. Basis of Recommendations
- Core Competencies and Consistency with Mission: The founders' core competency is game design, and their mission is to educate and entertain. Securing funding aligns with their mission by allowing them to reach a wider audience and continue developing engaging educational games.
- External Customers and Internal Clients: The external customers are gamers and educators who value the game's educational content. Internal clients include potential investors who seek a profitable and scalable business.
- Competitors: The gaming market is highly competitive, but 'Getting Started' offers a unique value proposition by combining entertainment with education. Securing funding will allow them to compete effectively by investing in marketing and product development.
- Attractiveness - Quantitative Measures: The financial model will project the potential ROI of the Series A funding round, demonstrating the attractiveness of the investment opportunity.
6. Conclusion
By securing Series A funding, 'Getting Started' can leverage its early success to scale its business and capitalize on the growing market for educational games. This strategic move will position the game for long-term success in the competitive gaming landscape.
7. Discussion
- Other Alternatives: Other options include bootstrapping the business or seeking debt financing. However, bootstrapping would limit growth potential, and debt financing could create financial strain.
- Risks and Key Assumptions: The key assumption is that the game will continue to enjoy strong demand and positive reviews. Risks include competition, market saturation, and potential changes in consumer preferences.
- Options Grid: A detailed options grid could be created to analyze the pros and cons of different financing options, including Series A funding, debt financing, and bootstrapping.
8. Next Steps
- Develop a Detailed Financial Model: Complete a detailed financial model to project revenue, expenses, and profitability.
- Create an Investor Pitch Deck: Prepare a compelling pitch deck to present to potential investors.
- Identify Potential Investors: Research and identify potential investors who align with the company's vision.
- Negotiate Funding Terms: Negotiate favorable funding terms with selected investors.
- Close the Funding Round: Secure the Series A funding to accelerate business growth.
This comprehensive plan will guide the founders of 'Getting Started' toward achieving their goals of scaling their business and becoming a leading player in the educational gaming market.
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Case Description
This case follows Jason, a high school student who is looking forward to going to college. He is an excellent student and a basketball star, which allowed him to receive two full-ride scholarships: the first to play Division 1 basketball at Pennsylvania State University (Penn State) and the second to attend the University of Virginia (UVA). This leaves Jason with a huge decision to make. Should he attend Penn State and try to fulfill his dream of playing in the NBA, or should he attend UVA and fulfill his passion for engineering? To gain more information to guide his decision, Jason solicits advice from two of his mentors: his basketball coach, Coach Roberts, and his math teacher, Ms. Humphries.
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