Juniper Networks Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

Juniper Networks Case Solution

Question no 1:

Initial Fundraising Strategy:

The founder of Juniper Networks, Pradeep Sindhu, while planning the new start-up made the rule that he has to work with the venture capital because the goals of entrepreneurship and venture capitalists are perfectly aligned at the beginning of the business. However, there are many ways to raise the funds to start the business such as Asset based lenders, bank debt, IPO and some other ways. The strategy to raise funds was aligned with the objectives of the founder.

Criteria for Selecting venture capital Firm:

Initially, even after the advice of his friend who worked with him, Sindhu made cold calls to different venture capitalist firms and didn’t get any proper response. Sindhu made a list of well-known companies which had the history of investing in the technology related firms specially the firms which have invested in the network industry. The top most firms with the credibility to finance the startups include Kleiner, Perkins, Caufield and Bayers Firm as venture capital partners as they are considered as the top prestigious firms among all the firms.

Expectations from Venture Capital Firms:

The main role of the venture capital firms is to aid in formulating the business objectives from the business plan to reality and to give the suggestions with respect to achieving the corporate goals of the companies throughout the whole period until the exit of the Venture capital firms. The founder of the Juniper, Sindhu, expected that the venture capital firms are the quickest in getting funds from and therefore, he could start acting on the planned business he was working on.
Sindhu expected that the venture capital firms that he has selected better have the previous experience in the related field in order to help and know the time frame that it takes to build a product and market it so that the firms he has chosen do not rush and expects the company to make profits in the first year of inception.

Change in the Criteria between 1st and 2nd Round of Financing:

In the first round of financing the objective was the inception of the company therefore, less finance was required, however due to the credibility of KPCB more venture capitalists firms wanted to invest in the company, due to which the criteria of Sindhu changed from accepting any firm to the following:
• Firms that brought some key value to the company aside from finance.
• Where Sindhu likes people he is dealing with.
• Where the people understand what it takes to build the systems company in the industry targeted by Juniper.
Sindhu evaluated the firms based on the question that firms asked; the knowledge of the individual partner and the contact base.However,, in the first round Sindhu had no options to choose the firms and most of the firms that he considered were evaluated by him, rather than Sindhu evaluating them for the financing.................

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