Nanogene Harvard Case Plus 3 Of

What are the critical human resource issues for new ventures The NanoGene case examines the big three: assembling a team, developing a compensation policy, and creating an innovative culture.

Winston Churchill Guests (Click for Bios) Dan Dorosin, Fenwick and West Lewis Cirne, New Relic Study Question ( Policy on Study Questions).

How will you encourage Lew Cirne to accept the deal and what actions will you take to ensure a smooth transition Required Readings ( Policy on Required Readings.).

The company is currently composed of five founders and top-notch scientists from Eastern Institute of Technologys (EIT) Advanced Materials Sciences Lab (AMSL), namely Will Tompkins (currently serving as CEO), Don Rupert, Mark Masterson, Ravi Rhoota and Gary Garfield.

The company is currently in the process of raising US10 million in equity through Venture Capital (VC) funding.

The company is also in discussions with Paige Miller, a business consultant with considerable experience in biotechnology operations and management.

As potential investor, would these decisions concern you Reading the case files I do not have any doubt in mind about the commitment and dedication the founding partners have.

I believe that after giving up their lofty posts doing what they are very good at doing (i.e.

It is evident that none of the founding partners have any degree of understanding of what business requires of them.

I am not agreeing to their current equity distribution structure and compensation scheme.

Using the numbers proposed, a US 10 million total company valuation in Series A preferred stock means each partner will receive 333,000 shares (3.15 equity) at US1.54share.

I think that the founding partners are too unassuming of their importance in the business to accept only 3.15 shares a piece, especially at this stage of financing.

In terms of balancing their shares, each one believes that their contributions will be the same hence, similar expectations by way of similar shares and salaries.

What would be business-world equitable would be compensation commensurate to their business contribution to the company, with the CEO making more to reflect the level of involvement needed for that post.

Evaluate the size and composition of the founding team.

What is the difference between being a founder and an early employee I do not share the insight of this group being too large.

The peculiarity of the business is such that the founding partners all contribute individually, hence are all required to be part of the business.

However, there is a thin line between being a founder and being an early employee.

For founding partners, the risks are greater since they will be putting in cash and resources of their own while employees simply move into another job, albeit less stable than their previous organization in the financial sense.

Evaluate Paige Miller as an addition to the team and assess her compensation demands.

Would you hire her on the terms she seeks There is no question about the need for a business person to help NanoGene in achieving their goals.

I think that their current and best option, Paige Miller, should be hired on the following merits: a.

She has considerable business background and operations management background in the life sciences industry.

Millers contribution will be her ability to negotiate with VCs and other investors in behalf of NanoGene.

Remember that the founding partners of NanoGene are all highly technical; none of them have actually ran a business.

Millers contribution will be to organize the company, help in identifying and funding the company and lead in ensuring that the company reaches its business potentials.

Nanogene Harvard Case Plus 3 Of

In terms of compensation, Miller demanded for what she believes is her market rate, which is US 175,000 in salary plus 3 of the equity (after Series A financing) which translates to an equity of 7.81 post Series A financing (computed as 3.15 X 2.5 which is vested at 20 starting on year 1, 20 at the end of year 2 and the balance of 60 at 2 increase per 12 months).

I think there will have to be some rationalization in this case for Miller and for all the founding partners.

Miller is needed and should be hired, her salary of US 175,000 cannot be higher than the CEOs hence the CEOs salary must be increased, and the shareholdings must be rationalized to ensure that Miller becomes a part of the organization but does not control more shares than the founders.