1. What categories of costs would you expect to see in a list of MooBella start-up costs?
The categories of costs I would expect to see in a list of MooBella start-up costs are: - Owner's salary
- Employee wages and benefits
- Computers, internet, telephone, and other technology
- Promotion, advertising, web site hosting
- Professional services
- Debt service
- Legal/accounting fees
2. It took nearly 20 years from idea to market for MooBella. Clearly, it had a long development and start-up period. Reflect on the emotional and other nonmonetary factors that were likely involved for Bruce Ginsberg.
MooBella was a seemingly simple concept that was technically complex and cost nearly $85 million in investment capital. Ginsberg was faced with many challenges with the research, development and start-up processes. The machines themselves were very costly, costing approximately $40,000 per machine, and it took 5 years to develop the computer portion alone.
3. What was the mix of funds used by MooBella to get started?
Some of the start-up funding included:
- Saturn Asset Management--$25 million in equity (2000-2005) - Inventages (Swiss venture firm)--$15 million in 2007 and $18 million in 2009 - Bruce Ginsberg--$1 million
- W Health LP--$9 million (November 2010)
- Debt--$17.5 million in high-interest loans and convertible notes
4. What are the start-up costs that you would expect to encounter if you were a company that purchased a MooBella machine?
I would expect the cost of buying the machine itself, the supplies for the ice cream the machine dispenses, taxes, maintenance, if I buy multiple machines for different locations and hire people to refill and maintain them then employee wages, and debt if I cannot pay out of pocket.
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