American Financial Services

Babson Professor Bill Bygrave, Case Director

Sam Perkins, Case Writer

Arthur M. Blank Center for Entrepreneurship © Babson College, 1996.

Abstract

The case focuses American Financial Systems' (AFS') efforts to enter the international market. After unsuccessful attempts to sell the product in Japan and Britain, and an aborted joint venture, AFS finds a client in Argentina. The case illustrates the difficulty encountered by a small company as it tries to grow by entering the overseas market. The company is in a very specialized market niche: Supplemental Executive Retirement Plans (SERPs) based on corporate-owned life insurance (COLI). It has basically two sources of revenue: (1) sales and maintenance of software for designing COLI-funded SERPs, and (2) casework in which it customizes COLI-funded SERPs for clients. The company, founded in 1984, sells its products almost entirely in the domestic U.S. market. The AFS case can be used toward the end of a New Ventures or Managing a Growing Business class.

Location of the company: Boston, Massachusetts & Buenos Aires, Argentina

Year(s) spanned by the case: 1984 through 1995

Industry segment(s): Software and casework for designing supplementary retirement plans funded with life insurance

Stage of the company: Early and later growth

Age of the entrepreneur(s): 30s and 40s

DVD

There is a 24 minute DVD available for this case. Please place orders through ecch.

Teaching Notes

A seven page case teaching package, written by Bill Bygrave, is available for this case The teaching package includes strategies for case presentation, key concepts, solutions to the assignment questions in the case, and suggestions for the most effective ways to work this case into a course.