Entrepreneurship: CardSmith, Inc. Case Study - Essay Example

Strategy and operations: When the startup commenced, many commitments from start-up team members were made to work for more than 50 % of their earning potential. The team later on met Mitch, Taran’s previous partener, who was then the CEO of Comdata The team borrowed Mitch’s software and their engineering team’s expertise so as to build a specialty campus card system. This partenership with Mitch also led to an important contact in Uruguayan expert who was also willing to share his expertise.

Later on the team aimed for educational institutions in the US. They aimed at breaking even after spreading their customer base to 8 schools and then starting to make profits after arriving to a figure of 10. Besides, Card Smith decided to use some customer oriented promotional tools when it started giving short-term discounts to schools that were ready to serve as live beta sites for this ground-breaking system. Financing: Taran decided not to borrow any money from the potential investors because initially he thought that he would have to give up as much as 50 percent of the company to the investors.

The $1 million funding came from personal savings, home equity lines, and an SBA-guaranteed loan. 2. What would you recommend with regard to pursuing the opportunity with NASA? What implications does your recommendation have on their strategic focus? The offer from NASA was an awe inspiring one for CardSmih. It was a completely different market that CardSmith had the opportunity of catering. The most advantageous fact was that CardSmith’s name would be attached to a state-owned company which would bring in good word of mouth for the company and would exalt companies ranking and image.

Moreover, making a payroll deduction debit card system for 4,000 employees would earn a prolonged contract for CardSimth with NASA. Plus Taran and his team believe that the project would not engage into extreme technical sophistications and would likely necessitate fewer enduring oversight than educational accounts. Besides Taran knows that it’s a lucrative deal as it would bring more sales and profit given the company repute and image. The Strategic focus should be on fulfilling the requirements of NASA’s project accordingly.

That is CardSmith should not implement the project just like any other education institute. It should treat it as a separate market and should work according to its requirements. If CardSmith starts to treat NASA’s project as an ordinary educational institute’s project then it would most likely lead to a diffusion of focus. CardSmith has a proven and an efficient technology which has a clear market demand for it. It’s just about recognizing the essence of the opportunity and committing the team and other resources into achieving the NASA project efficiently without committing any major mistake. 3. What challenges do they face in scaling the business and how might that affect their strategic decisions?

The team was willing to scale up the business by increasing their client base. In achieving that milestone, the best options available were that of NASA and Berkeley School of Music. Because of the growing popularity of the company, the client base has been increasing year after year. But accepting the proposal from companies like