The “Harvest” Decision

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Presentation transcript:

The “Harvest” Decision Advantages Disadvantages - Access to short- & long-term capital - Lose of operating confidentiality - Future offerings to fund growth - Cost of public auditing, reporting - Establish market value and shareholder fiduciary responsibility - Controls to protect shareholders and and from shareholders - Image management more serious - Info controlled to prevent inside trading - SEC limits timing and amount of stock insiders may sell - Founders get money immediately - Key managers/employees needed to keep - Acquiring company assumes all risks. core employees - Non-compete clauses limit expenditure . - If sale through stock exchange, founders receive a fraction of the purchase price - Access to resources required to grow - Synergies do not materialize - Increase scale, scope and market share - Clash of cultures, operations, or system - Management continues to be involved - Lack of freedom to operate the company Public offering Outright sale Merger, acquisition or partnership

Evolution of Basic Portal Concept Where users would link to all manner of Internet services and activities (search, content, personal authoring, transaction, and social-interactive sites) Advertising income: more than cover the cost of maintaining the portal To keep them in the Portal, and coming back. So advertisement and sales increase. “Attract, engage, entice, and entrap.”

Characteristics of Web Portal - Data from multiple sources and in multiple formats organized into a single, easy-to-use menu. - Incorporate triggers that alert users or run an application when a specific event take place. - Allow users conduct business transactions. - Web-based services, such as: chat rooms, searches, free-password-protected email, FTP,bulletin boards, live moderated events, hosted discussion forums, news, entertainment, and retail services.

Emerging Business Models Examples Key factors Revenue model Markeplace Aggregator Vert. Portal Hor. Portal QuickenIns. InsWeb Quicken.com Yahoo! E-Loan AutoWeb.com Heltheon AOL Controlling No inventory Deep content Provides access; inventory; and solutions partners and selling affinity groups Transactions; Transactions; Transactions; Advertising; service fees; adverstising; commissions; affiliation fees; commission marketing fees advertising; subscription affiliation fees or access fees

QUICKEN INSURANCE CASE STUDY WERE: THE PRIMARY OBJECTIVES OF QUICKEN INSURANCE CASE STUDY WERE: 1. TO EXPLORE B2C INTERNET BUSINESS MODELS –A SHIFT THAT IS LESS ABOUT TECHNOLOGY THAN ABOUT A NEW BEHAVIOR THAT IS REACHING CRITICAL MASS 2. TO EXAMINE DIFFERENT EMERGING E-BUSINESS MODELS: MARKEPLACE, AGREGATOR, VERTICAL PORTAL, AND HORIZONTAL PORTAL 3. ANALISIS OF THE TRANSFORMATION OF THE INSURANCE INDUSTRY.