Babson Professors Andrew Zacharakis and Jennifer Walske, Case Directors
Carl Hedberg, Case Writer
Arthur M. Blank Center for Entrepreneurship
© Babson College, 2007.
Bladelogic, a high flier in the large and growing market of data center automation software, had reached a critical juncture. The company, which had already garnered two rounds of venture funding and closed deals with dozens of blue-chip firms, appeared to be headed in the right direction. Revenues, however, were becoming increasingly hard to forecast.
As the CEO, Dev Ittycheria’s leadership position was entirely based on his ability to execute in a tough, high-stakes environment. Monthly board meetings were becoming increasingly tense; Bladelogic was becoming vulnerable to missing its revenue forecasts unless one or two “big” deals came through at the end of each quarter.
With less than twelve months of cash left at the firm’s current burn rate, Dev knew that they were going to need another round of capital well ahead of schedule. Current investors were in no mood to put more money in at a higher valuation, so the company was facing the very real prospect of a down round . Dev knew they had to get additional capital fast…but how could he secure a new financing round without the participation of existing investors? At what price would the current investors participate?
Teaching Objective: To present an example of a high-potential, venture-backed enterprise software start up that is going up against a vast array of huge competitors in a race to develop the industry standard.
Key Words: High potential ventures, Enterprise software, Venture capital, Entrepreneur in residence ,Team building, Funding strategies, Opportunity recognition, Research & Development, Sales channels, Acquisitions
There is a 6-page teaching note available for this case.
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