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CASE 2A:BIZLAND1

Bizland,Inc. was founded by RaviAgarwal in 1997.

Its provider of online resources for small business, and was his second start-up only in 6months.

His first venture, an online web site selling movies videos.

Like many nascent business, Bizland,Inc encountered some potentially fatal incidents in its first few months of operation. Ravi categorized them in the areas of profitability, customer relations, staffing and growth.

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First originally launched the company as credit card processing business.

And it was re-launched in January ,1999 When they added free web-hosting services.

In January, 1999,Bizland, Inc. was beginning to gain some financial strength and market share.

Ravi also started making presentation to angel investors.

On June 1999 Ravi achieved his funding objective, the investors liked the project and committed first round financing.

It was funded with first round financing of $1.3million.

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Bizland, Inc. condensed into business into two main services lines:

1. Marketing advice’s for small business

2. A co-operative market, offering products such as payroll and telephone @ wholesale prices.

In addition to those listed in exhibit 1, BizLand,Inc. also sold books and computers.

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BULDING THE TEAM

FINDING THE PERFECT CANDIDATE

NEXT STEPS

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A key success factor in both of these areas was executive staffing. While he was confident in his abilities to continue growing Bizland, Inc., on his own, he was also aware of the potential opportunity costs associated with the status quo.

On the advice of the board, Ravi retained john Hoagland, lll, a partner, and head of the north American Technology Practice at Whitehead Mann Pendleton James Associates.

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After several meetings, they arrived at the following list of “must haves” for the position:

Extensive direct marketing experience

Significant knowledge of B-to-B (business-to business), ideally with a small company focus

Management experience in a multi-tier distribution channel

Comfort, and a demonstrated record of accomplishment with equity fund-raising.

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In-depth knowledge of “Internet economics” and the emerging “new” business economy

Experience in high-tech companies, preferably software

Strong educational background

Exceptional leadership skill

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FINANCIAL PACAKAGE

The base salary would be “well into the six figure range

and contain the additional incentive of an almost 30 percent cash bonus based on company and individual performance.

The amount of the bonus would be determined by Board review.

The CEO would receive slightly over 10 percent of the company’s outstanding shares at the time, with a four-year vesting period, and anti-dilution protection.

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Senior executive staffing

Office space expansion

Equity fund raising

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Candidate #1: Michael Speer

Undergraduate Education: University of Michigan.

Graduate Education: University of Chicago, MBA

Professional Certifications: CPA

Current Position: General Manager, G.E. Capital,

Small Business Services Initiative

Prior to receiving his MBA, this 37-year-old candidate worked in the audit department of KPMG.

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Candidate #2: Robert Barbers

Undergraduate Education: Culver-Stockton College (Canton, Missouri).

Graduate Education: Harvard Business School, MBA

Professional Certifications: CPA

Current Position: Senior Vice-President, Excel Software

Prior to receiving his MBA, this 42-year-old candidate

worked in both NewYork and Tokyo as a junior consultant for Boston Consulting Group (BCG).

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Candidate #3: Sanjay Gupta

Undergraduate Education: University of Connecticut

Graduate Education: Boston College, MBA

Professional Certifications: CPA

Current Position: Chief Marketing Officer, egghead.com

Prior to receiving his MBA, this 39-year-old candidate

worked in the audit department of Ernst & Young for five years.

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Candidate #4: Daniel Peters

Undergraduate Education: Middlebury College

Graduate Education: Columbia University, MBA

Professional Certifications: None

Current Position: General Manger, G.E. Capital, Commercial Credit Card Business.

Prior to receiving his MBA, this 39-year-old candidate worked on “ski patrol” for two years.

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The Case is related with an institutional entrepreneur, Ravi Agarwal. Even though there was a glitch in his first venture, he learned from his mistake and analysed the market completely & entered into e-Business with 2 specific features

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Primary Problem

Is it right time to hire a CEO

Secondary Problem

Selection of a Key Person

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Strength

Visionary & committed entrepreneur

Weakness

Financial unsteadiness

Opportunity

Huge market

New concept of e – commerce

Threat

Unforeseen competition28-10-2011

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CEO should have the competency of looking at the “whole”: outside of the company and inside of the company.

CEO should be able to communicate with all sorts of people everywhere, effectively.

CEO should be good in his analysis, judgments, decision making and firmness.

CEO should be great in strategic planning and goal setting.

If Ravi & john did make changes .The four candidates can be measure up to revised list by character analysis.

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CANDIDATE STRENGTH WEAKNESS

Michael Speer Working big brand nameExperience of required domain as well as B2BAnalytical & financial background

No experience in Equity fund raising

Robert Barbers Working big brand nameExperience of required Internet economyEducated from a good collegeAnalytical & financial background

No experience of Equity fund raisingNO experience of B2BNo experience of Distribution

Sanjay Gupta Experience of required Internet economyAnalytical & financial backgroundHave experience of direct marketing

No experience of Equity fund raisingNO experience of B2B

Daniel peters Experience of required Internet economyHave experience of direct marketing

No experience of Equity fund raisingNo experience of Distribution

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It is very difficult to hire a Key person in the start-up organization, to whom you can handover your dream, so all aspects should be taken into account.

Hiring for a key position, so all the elements of must have taken into consideration, there should not be any compromise.

There is significant possibility of growth of venture with the given professionals. Stretching the process is based on the time Limit & intensity of requirement

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According to me, If Ravi as to make a decision today, Its better to choose “Michael Speer” is the best suitable candidate .

METHOD OF SELECTION OF KEY PERSON:

Best Option - Balance score card method

Adv : Less complication, fast decision making.

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Skill Weighted MichaelSpeer

RobertBarbers

SanjayGupta

Danielpeters

Extensive direct marketing

20 5 5 5 5

B2B Small company 20 5 3 3 5

Distribution 10 5 3 5 3

Equity fund raising 10 3 5 3 3

Internet economy 10 5 5 5 5

High tech company s/w

10 5 5 5 4

Education 10 4 5 4 4

Leadership 10 5 5 5 4

37 36 35 33

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Organization financial position is not so strong with $1.3 Million it is not a wise decision to hire a CEO whose salary is around $.1 Million.

Option

Should not go for full time hiring

Solution

Existing employee, Consultant

Adv:Less Financial burden

Dis:Growth can be slow

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