Session 4: From Idea to Opportunity I

Date: 
Thursday, January 16, 2020


Summary:
This is the first of two sessions where we discuss the differences between an idea and an opportunity. This startup that has found initial success and now must determine how fast to grow. The HBS case we are using takes place in January 2010, two months after a successful launch. The co-founders of Rent the Runway (RTR) are debating whether to grow their startup at a measured pace and focus on improving operational effectiveness, or raise a new round of venture capital sooner than originally planned. Raising more venture capital would allow RTR to aggressively expand its inventory and customer acquisition efforts, in order serve a broader range of customer segments with a wider selection of products, including accessories and even maternity wear. Although we will discuss which path RTR chose, we will focus our time today on the decisions made and actions taken by the co-founders regarding RTR's vision, opportunity evaluation, and hypothesis testing during its initial startup phase.

Quote of the Day
To succeed, jump as quickly at opportunities as you do at conclusions. Benjamin Franklin

Required Readings:
Study Questions:
  • Review the slide deck models of Session #2, the required eadings to date, and the Term Project (OAP) section of this website.
  • What was the vision of Rent the Runway in 2009?
  • Identify the major risks in each of these traditional categories: market, team, product/technology, and finance/business model.
  • Create a timeline of actions undertaken by Rent the Runway’s co-founders. Which actions were important in reducing "white hot risks" by validating business model hypotheses (i.e., experiments) and refining the concept?
Required Reading/Viewing:
Online Assignment: (Policy on Case Analyses.) - None

Although no assignment is necessary to turn in, please do work with teammates to share opinions and approaches to the Study Questions above. Be prepared to share in class during our discussion with Jenn.