R & R

Trivia, Inc. Performance

Outcomes

• Bob Reiss made a total of $1,153,187 + $1,450,000 = $2,957,250 – 507,500 (7% commission to sales reps) = $2,095,687 on an initial investment of $26,250.

• Kaplan made $1,153,187 on an initial investment of $26,250 (and a repaid loan of $300,000)

• TV Guide made $725,000 on an investment of $25,625 (or $450,625 if include opportunity cost of ads)

• Alan Charles (designer) made $362,500 on an investment of $15,000 (opportunity cost of 3 weeks time)

• Sales Reps made $507,500 for an investment of incremental selling time

• Manufacturer made $140,000 for an investment of ~$10,000 startup costs

• Heller Factoring made $72,500

Advice from Bob Reiss

• http://video.hbs.edu/playVideo.jhtml?clip=reiss_interview

Takeaways

• Don’t be afraid to imitate successful strategies• Sustainability may be overrated

– You don’t need to always emphasize long-term profits.

• Entrepreneurship need not involve large risks, nor are entrepreneurs necessarily risk-seeking individuals.

• Experience and network can be a key resource– Entrepreneurs having experience in an industry have many

advantages over those without experience

• Attracting the right partners / stakeholders can be critical– Figure out what you are missing and find partners to fill those gaps

• Kenny Rogers was right!– You gotta know when to fold ‘em!

• Entrepreneurship is about selling!!!

Prep Work

• Thursday Intro to Financial Ratios (casepack)

• Homework – Calculate Anheuser Busch financial ratios (Katalyst)

• Read Balanced Scorecard (Katalyst)