20 Sep How can you make reasonable returns in the social investing space?

A compact case that you will be writing in this exercise is limited to between 500 and 1,000 words.  The case must be factual and accompanied by a teaching note that utilizes frameworks or analyses from ENGN2110 or ENGN2120 or both to explain how you would approach the case analysis.  We are working with many frameworks and financial analysis techniques in class you do need to apply several to your analysis however only where they make sense in supporting the case analysis.  For example, if your case relates to a firms business model utilizing the business model canvas in the required teaching note would be expected.  If you are considering stakeholder issues preparing a stakeholder analysis makes sense.  If it has financial elements including numbers in the case and the analysis in the teaching note is the right approach.  The teaching note should be an additional 500 to 1,000 words in length.  Note in both cases images, graphs and tables are not considered against the word count.

We will be structuring the case write-ups per the guidelines of The Case Association (links are provided below).  These case write-ups are different from the Harvard cases we are using in class.  Within the case references must be cited (avoid plagiarism) and the teaching note has a strong academic bias (as noted above).  The exemplar case study provided below gives good guidance on how to do citations and what a short case looks like.

We have had good success in past years with student work being accepted for academic conferences and in this case possible publication in The Case Journal.  For cases that look promising for this path, and if of interest, I will work with you to edit the case and teaching note for a potential submission.

For those having difficulty thinking about companies to study a few suggestions follow.  This is solely to help you focus should you have difficulty thinking about a company or market area of interest to you (if public the ticker is provided in some cases):

Nkarta (NKTX) bio-pharma IPO in July
Moderna (MRNA) bio-pharma, COVID-19 vaccine trial with Pfizer
SunPower (SPWR) solar energy 66% owned dby total S.A. from France
Exhibit 10 from Elon Musk case of renewable energy companies
Federal Realty Investment Trust (FRT) solar rooftop real estate company
com tech platform with business model in the renewable space
Appfolio (APPF) IT in the building management space
Cloud Agronomics Brown start-up in agriculture and data analytics space
Exhibits with companies from our case on the FinTech industry
Xerox PARC (pat of Xerox XRX) technology invention and commercialization
Brown Technology Innovations
TikTok issues with the U.S. market
Alibaba versus Amazon
. and lots of others.

Materials related to writing a compact case can be found via these links:

Guidelines for authors:  https://caseweb.org/pdf/Guidelines_for_authors_2017.pdf

Sorry no carnitas: balancing Food with Integrity and growth at Chipotle compact case exemplar: https://www.emerald.com/insight/content/doi/10.1108/TCJ-06-2015-0016/full/html

The following is guidance on the “teaching note” for your case submission.  I am not asking for a full “teaching note” and as such I don’t have any good exemplars to provide you with as examples.  I will provide two example scenarios below which outline a good “teaching note” approach for this assignment however where my intent is to have you demonstrate a good understanding of some of the frameworks from our course (or Professor Chaltas) as well as financial analysis skills if case appropriate.  Referencing the Grant or Higgins text as appropriate is also wise.

Example 1:  Tesla purchase of Solar City – Enriching whom?

Case could be about you being hired by the courts to conduct an independent  analysis of the acquisition decision 

a.  Provide references to the web if available

https://arstechnica.com/tech-policy/2019/09/solarcity-was-insolvent-when-tesla-paid-2-6-billion-to-buy-it-lawsuit-says/

https://www.theverge.com/2016/11/21/13698314/tesla-completes-acquisition-solarcity-elon-musk

b.  State the question(s):

Was the price Tesla paid for Soar City reasonable?

Was their strategic benefit to this acquisition?

c.  Framing & analysis:

1.  Porter 5 Forces on SolarCity, Porter 5 Forces on Tesla (reference Grant)

2.  Business model canvas post merger (reference Business Model Generation book

3.  Get financials on Solar City pre-acquisition (can look at Elon Musk case but get for their 10-K filings on the SEC Edgar database and provide the reference to these). 

4.  Do a valuation of Solar City at the time of acquisition (Landmark case approach) and determine the premium for control (reference Higgins.  Determine the “premium for control” paid (Higgins chapter 9)

5.  Reference Tesla financial (Yahoo finance for stock performance, SEC Edgar 10K filings) to suggest impact post acquisition.

_____________________________________________________________________________

Example 2  Why did Anshul say no to investing in Mountain Hazelnuts

a.  Provide references to the web:

Asha Impact:  http://ashaimpact.com/

Mountain Hazelnuts:  https://www.mountainhazelnuts.com/

b.  State the question(s):

How did Asha Impact get visibility to the Mountain Hazelnut funding round?

What did they decide not to invest?

How can you make reasonable returns in the social investing space?

c.  Framing & analysis

Provide references to venture capital investment model (Chap 9 Appendix Higgins)

Do a stakeholder analysis of Asha Impact (references from our class discussions)

Do a Business Model Canvas for Asha Impact (reference Busines sModel Generation book)

Discuss social impact investing and CSR/ESG. UN Millenium Goals (references available from class presos)

Mock up some hypothetical cash flows for MH to demonstrate the problem for Asha – 25% IRR return to investors in 5 years (close of fund)

Reference some of the articles on base of pyramid investing from class (and others you fins from a literature search).  Comment on tranching and the need to get a balloon payment  (exit of some type) to get the returns needed in this case by the limited partner stakeholders in the Asha Impact fund.  Note issue of fund stage and timing in these type decisions – independent of merits of the investment.

Hope this is helpful.