Case Study Description of CircleUp in 2018: Systematic Private Investing
Supplement to case E562. Between the back half of 2015 and early 2018 CircleUp had both grown and changed substantively. The company's core data and Helio platform had enabled the firm to offer a new set of equity and credit services to startup consumer companies that were too small for traditional private equity but needed growth capital. The transformation of the company was both exciting and a bit unexpected as CEO Ryan Caldbeck navigated the organization through tremendous change and growth.
Swot Analysis of "CircleUp in 2018: Systematic Private Investing" written by Robert E. Siegel includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Circleup 2018 facing as an external strategic factors. Some of the topics covered in CircleUp in 2018: Systematic Private Investing case study are - Strategic Management Strategies, Technology, Venture capital and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the CircleUp in 2018: Systematic Private Investing casestudy better are - – increasing energy prices, there is increasing trade war between United States & China, increasing transportation and logistics costs, there is backlash against globalization, customer relationship management is fast transforming because of increasing concerns over data privacy, geopolitical disruptions, banking and financial system is disrupted by Bitcoin and other crypto currencies,
increasing household debt because of falling income levels, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of CircleUp in 2018: Systematic Private Investing
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in CircleUp in 2018: Systematic Private Investing case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Circleup 2018, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Circleup 2018 operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of CircleUp in 2018: Systematic Private Investing can be done for the following purposes –
1. Strategic planning using facts provided in CircleUp in 2018: Systematic Private Investing case study
2. Improving business portfolio management of Circleup 2018
3. Assessing feasibility of the new initiative in Innovation & Entrepreneurship field.
4. Making a Innovation & Entrepreneurship topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Circleup 2018
Strengths CircleUp in 2018: Systematic Private Investing | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Circleup 2018 in CircleUp in 2018: Systematic Private Investing Harvard Business Review case study are -
Ability to lead change in Innovation & Entrepreneurship field
– Circleup 2018 is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Circleup 2018 in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– CircleUp in 2018: Systematic Private Investing firm has clearly differentiated products in the market place. This has enabled Circleup 2018 to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Circleup 2018 to invest into research and development (R&D) and innovation.
Organizational Resilience of Circleup 2018
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Circleup 2018 does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Circleup 2018 is one of the leading recruiters in the industry. Managers in the CircleUp in 2018: Systematic Private Investing are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High switching costs
– The high switching costs that Circleup 2018 has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Successful track record of launching new products
– Circleup 2018 has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Circleup 2018 has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Learning organization
- Circleup 2018 is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Circleup 2018 is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in CircleUp in 2018: Systematic Private Investing Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Circleup 2018 are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Training and development
– Circleup 2018 has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in CircleUp in 2018: Systematic Private Investing Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Strong track record of project management
– Circleup 2018 is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Diverse revenue streams
– Circleup 2018 is present in almost all the verticals within the industry. This has provided firm in CircleUp in 2018: Systematic Private Investing case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Operational resilience
– The operational resilience strategy in the CircleUp in 2018: Systematic Private Investing Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Weaknesses CircleUp in 2018: Systematic Private Investing | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of CircleUp in 2018: Systematic Private Investing are -
High bargaining power of channel partners
– Because of the regulatory requirements, Robert E. Siegel suggests that, Circleup 2018 is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Circleup 2018 supply chain. Even after few cautionary changes mentioned in the HBR case study - CircleUp in 2018: Systematic Private Investing, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Circleup 2018 vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the segment, Circleup 2018 needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Increasing silos among functional specialists
– The organizational structure of Circleup 2018 is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Circleup 2018 needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Circleup 2018 to focus more on services rather than just following the product oriented approach.
Skills based hiring
– The stress on hiring functional specialists at Circleup 2018 has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Circleup 2018 has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Slow to strategic competitive environment developments
– As CircleUp in 2018: Systematic Private Investing HBR case study mentions - Circleup 2018 takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Need for greater diversity
– Circleup 2018 has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Products dominated business model
– Even though Circleup 2018 has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - CircleUp in 2018: Systematic Private Investing should strive to include more intangible value offerings along with its core products and services.
Slow decision making process
– As mentioned earlier in the report, Circleup 2018 has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Circleup 2018 even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Low market penetration in new markets
– Outside its home market of Circleup 2018, firm in the HBR case study CircleUp in 2018: Systematic Private Investing needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities CircleUp in 2018: Systematic Private Investing | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study CircleUp in 2018: Systematic Private Investing are -
Leveraging digital technologies
– Circleup 2018 can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Loyalty marketing
– Circleup 2018 has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Circleup 2018 to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Circleup 2018 to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Circleup 2018 to increase its market reach. Circleup 2018 will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Circleup 2018 to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Low interest rates
– Even though inflation is raising its head in most developed economies, Circleup 2018 can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Buying journey improvements
– Circleup 2018 can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. CircleUp in 2018: Systematic Private Investing suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Circleup 2018 can use these opportunities to build new business models that can help the communities that Circleup 2018 operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Circleup 2018 in the consumer business. Now Circleup 2018 can target international markets with far fewer capital restrictions requirements than the existing system.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Circleup 2018 can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Circleup 2018 is facing challenges because of the dominance of functional experts in the organization. CircleUp in 2018: Systematic Private Investing case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Circleup 2018 can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, CircleUp in 2018: Systematic Private Investing, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– Circleup 2018 can use the latest technology developments to improve its manufacturing and designing process in Innovation & Entrepreneurship segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Threats CircleUp in 2018: Systematic Private Investing External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study CircleUp in 2018: Systematic Private Investing are -
Regulatory challenges
– Circleup 2018 needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Innovation & Entrepreneurship industry regulations.
Consumer confidence and its impact on Circleup 2018 demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Circleup 2018 in the Innovation & Entrepreneurship industry. The Innovation & Entrepreneurship industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Circleup 2018 with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Circleup 2018 will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Circleup 2018 business can come under increasing regulations regarding data privacy, data security, etc.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Circleup 2018 in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Environmental challenges
– Circleup 2018 needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Circleup 2018 can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
Technology acceleration in Forth Industrial Revolution
– Circleup 2018 has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Circleup 2018 needs to keep up with the evolution of technology in the Innovation & Entrepreneurship sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Easy access to finance
– Easy access to finance in Innovation & Entrepreneurship field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Circleup 2018 can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study CircleUp in 2018: Systematic Private Investing, Circleup 2018 may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Innovation & Entrepreneurship .
Weighted SWOT Analysis of CircleUp in 2018: Systematic Private Investing Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study CircleUp in 2018: Systematic Private Investing needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study CircleUp in 2018: Systematic Private Investing is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study CircleUp in 2018: Systematic Private Investing is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of CircleUp in 2018: Systematic Private Investing is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Circleup 2018 needs to make to build a sustainable competitive advantage.