Jane Chen (GSB '08) and Brian Trelstad (GSB '99) had understood each other for years. Trelstad, chief investment officer of nonprofit international venture fund Acumen Fund, had been a mentor to Chen and her co-workers as they worked to develop a low cost baby warmer to meet the needs of low-birth-weight babies, their moms, and health care provider in the under-developed countries.
Chen, who turned into the chief executive officer of the Embrace Global, the nonprofit founded to attain this aim, had come to value the guidance of Trelstad and trust his advice. Embrace was seeking an infusion of funds help the company quickly attain scale and to support its product launching. In the parallel, Acumen Fund was persistently looking for communities with game-changing commodities and amenities in need of the patient capital on their way to turniong into self-sustaining companies that effectively serve the poor.
Suddenly, Trelstad was an expected investor and Chen was a future investee. As they investigated the possibilities of a fiscal venture, among the key questions was whether or not it should consider embracing a for-profit or hybrid organizational structure by taking on equity investors, so that it could raise more considerable funds. Acumen Fund needed to think about whether it was interested in investing in Embrace, how to value the company, and how big a stake it might be willing to take if a deal moved forward. This case investigates the scenario from the standpoint of both organizations and can be used to support a high level dialogue between the two parties.
PUBLICATION DATE: April 14, 2011 PRODUCT #: SM191-PDF-ENG
This is just an excerpt. This case is about GLOBAL BUSINESS
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