Having in regard all the information that is given in the Case Study, what is, in your opinion, the best Investor/Partner choice for NatuRi Corporation? Is it the Angel Investor, the Strategic Investor, Waltham Partners or Westlake Partners? Please justify your answers.
In order to make a comprehensive review, we will discuss each investor/partner choice separately on its positive and negative aspects.
The angel investor is a wealthy individual who is willing to make a personal investment in their venture. An advantage of this investor is that Kartik is familiar with him, as he has done some consulting work for him. The individual investor is willing to put up $1,000,000. A disadvantage of this angel investor is that, as NatuRi has not been valued yet, it is not clear how much equity Kartik and Aravind will have to give up. It is also not clear how much value this investor will add besides providing capital.
Proteon, a large European food company, is interested in NatuRi to capitalize on its technology and product. In addition to the expected return-on-investment, Proteon also pursuits a permanent stake in the business. They proposed a license-agreement to NatuRi so they can distribute Rice-Active themselves. A disadvantage of Proteon is that they are more concerned with their own business (integrating NatuRi’s product into their own business) than helping in the development of NatuRi. With these goals in mind, Kartik and Aravind believe that Proteon therefore would be willing to accept a smaller equity position than the other firms/investors.
Waltham Partners is a well-reputed V(enture)C(apital) firm which had a history of biotech investment but not typically in the natural products sector. An advantage of this investor is that they would immensely improve NatuRi’s credibility with scientists. Waltham Partners offers a total of $500,000 in seed funding (in two $250,000 tranches) with an option...
Please join StudyMode to read the full document