Wendy Borg Case Study
The case presents a situation where Wendy Borg & Jason Kushdog, the two founders of Trendsetter Inc. are looking for Venture Capitalists that could provide funds that can help them establish and scale-up their business. Trendsetter Inc. was a software startup company that provided innovative warehouse and distribution solutions mainly to clothing retailers. Out of the 7 pitch they had conducted, they got a positive response from six Venture Capitalists and have received two “Term-sheets” - summaries of the terms and conditions under which the Venture Capitalists would invest in Trendsetter. One term sheet is from “Alpha Ventures” and the other from “Mega Fund”. Both the Venture Capitalist firms are willing to invest five million dollar into
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received a very positive response from most of the Venture Capitalists they have pitched to. Wendy Borg & Jason Kushdog got a positive response from six Venture Capitalistic out of which two offered them their term sheet. This indicates that the business model of trendsetter Inc. is of high value and most Venture Capitalists see this business has a bright future. The other factor which we need to take into consideration is that Wendy Borg & Jason Kushdog would have been conservative in terms of estimating the performance of their business since currently they don’t even have a working prototype yet. The only thing that Wendy Borg & Jason Kushdog have is an idea that they have communicated in front of the Venture Capitalists, which placed them in a situation where they can’t be too demanding. Thirdly, we also need to take in account that Wendy Borg & Jason Kushdog only have six weeks of seed capita left. They are in desperate need for external funding to continue with their operations and development work. Finally we also need to take into factor that although trendsetter Inc. is on a rocky ground there are few assets on which the company can leverage upon while they are negotiating with the Venture Capitalistic. For example: - the founder’s connections a major retailer Walsdo who has agreed to work with Trendsetter Inc. for the development process. Also we know that Wendy Borg & Jason Kushdog are well educated and also well connected in the industry. Their vast industry experience will also be viewed well by the Venture
received a very positive response from most of the Venture Capitalists they have pitched to. Wendy Borg & Jason Kushdog got a positive response from six Venture Capitalistic out of which two offered them their term sheet. This indicates that the business model of trendsetter Inc. is of high value and most Venture Capitalists see this business has a bright future. The other factor which we need to take into consideration is that Wendy Borg & Jason Kushdog would have been conservative in terms of estimating the performance of their business since currently they don’t even have a working prototype yet. The only thing that Wendy Borg & Jason Kushdog have is an idea that they have communicated in front of the Venture Capitalists, which placed them in a situation where they can’t be too demanding. Thirdly, we also need to take in account that Wendy Borg & Jason Kushdog only have six weeks of seed capita left. They are in desperate need for external funding to continue with their operations and development work. Finally we also need to take into factor that although trendsetter Inc. is on a rocky ground there are few assets on which the company can leverage upon while they are negotiating with the Venture Capitalistic. For example: - the founder’s connections a major retailer Walsdo who has agreed to work with Trendsetter Inc. for the development process. Also we know that Wendy Borg & Jason Kushdog are well educated and also well connected in the industry. Their vast industry experience will also be viewed well by the Venture