CASE DISCUSSIONS AND WRITTEN ANALYSIS

  • CASE DISCUSSIONS AND WRITTEN ANALYSIS

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    Senior Lecturers Jeffrey J. Bussgang and Jeffrey F. Rayport and Associate Case Researcher Olivia Hull (Case Research & Writing Group) prepared this case. It was reviewed and approved before publication by a company designate. Funding for the development of this case was provided by Harvard Business School and not by the company. HBS cases are developed solely as the basis for class discussion. Cases are not intended to serve as endorsements, sources of primary data, or illustrations of effective or ineffective management. Copyright © 2017 President and Fellows of Harvard College. To order copies or request permission to reproduce materials, call 1-800-545-7685, write Harvard Business School Publishing, Boston, MA 02163, or go to www.hbsp.harvard.edu. This publication may not be digitized, photocopied, or otherwise reproduced, posted, or transmitted, without the permission of Harvard Business School.

    J E F F R E Y J . B U S S G A N G

    J E F F R E Y F . R A Y P O R T

    O L I V I A H U L L

    Delivering the Goods at Shippo

    In early November 2014, Laura Behrens Wu, cofounder and CEO of technology start-up Shippo, stepped off a cable car in downtown San Francisco and headed toward the office. The German-born entrepreneur was in a hurry to start the day. Late the previous night, her cofounder and chief technology officer, Simon Kreuz, had sent her a new data set that showed trends in customer behavior since Shippo first introduced its shipping rate comparison and label-printing software the previous February. The data showed steady growth for Shippo’s dashboard application (app) customers, the small e-commerce merchants that used Shippo’s software to purchase and print shipping labels. In

    contrast, growth had been slow among the larger enterprises interested in using Shippo’s APIa technology. But recently, that picture had changed. According to Kreuz’s chart, labels printed using the API were up nearly 300% since August. But there was a catch—all of that volume was coming from one customer, Shippo’s largest by far.

    Though the journey had not been easy, things at Shippo were going well. Since Shippo’s founding in November 2013, the firm had attracted a total of $2.5 million in funding and increased monthly shipping volume from 500 labels to 87,000 labels. But as the team prepared to look for a second round of venture capital, Behrens Wu faced an important strategic decision. Shippo had raised its most recent seed round based on the growing adoption of the dashboard product, not the API, which was proving difficult to sell. In recent months, however, API label volume had grown substantially due to one major customer—a Japanese peer-to-peer marketplace called Mercari. Behrens Wu wondered if Mercari was a fluke or a sign of a more repeatable model.

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