Aparkalo (C): Normal Crisis or Sudden Death

  • Reference: E-210-E

  • Year: 2010-2012

  • Number of pages: 2

  • Geographic Setting: España

  • Publication Date: Jul 31, 2020

  • Source: IESE (España)

  • Type of Document: Case

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Description

Aparkalo was born as the brainchild of Luis París and Iván Rodríguez, who developed the initial business plan for the venture as part of an IESE EMBA course on entrepreneurship. Their simple yet appealing idea was to introduce the concepts of reservations and dynamic pricing as a business model innovation to parking lots, so that clients could reserve spots in advance, and parking lot managers could charge more during peak times (e.g., concerts or football games). After winning a startup weekend competition, Luis quit his day job to pursue the project full-time, whereas Ivan continued to work in order to save money to invest in the venture. The (A)-case ("Dynamising A Sleepy Industry") presents a short introduction to the project, as well as the first business plan. The (B)-case ("Revised Business Plan September 2011") presents the revised business plan that was used for fundraising. Case (C) ("Normal Crisis or Sudden Death?") describes a situation that brought the new venture to the brink of collapse.

Learning Objective

The main purpose of using the case in class is to discuss the pros and cons of a business plan, and to learn what makes a great business plan. Instructors use the case to highlight and apply the criteria that entrepreneurs and entrepreneurial managers should follow to develop a winning plan. More generally, the case series can also be used to introduce and discuss the fundamental idea that entrepreneurship is a process that needs to be managed effectively and with discipline in order to maximize the upside gain and minimize the downside risk. In this context, business planning as illustrated by cases (A) and (B) can be discussed as an effective risk management technique for entrepreneurial managers. Case (C) then confronts readers with a sudden crisis and thus allows for discussing questions about mindset and attitude, and what to do when reality does not go according to plan. It gives the instructor an opportunity to introduce and discuss the idea of pivoting, as it turns out that the business model of the venture (as it had been originally conceived) was designed to solve the wrong problem.

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Keywords

Business model innovation business plan Digital transformation Entrepreneurship reservation management. Startup