1366 Technologies: Scaling the Venture Harvard Case Solution & Analysis


            The company 1366 Technologies is basically a Massachusetts, United States based firm that looks to develop a technique that shall help the company in producing silicon wafers by casting them in their original shape in a direct mold, rather than in fact, the already developed prevailing standard methods in which the wafers are looked to cut down from a large ingot. The company has been co-founded by Frank van Mierlo and Ely Sachs.

            The management of the company has looked to introduce a new approach that shall help in producing wafers that shall be less costly approximately 40% below the current or the existing rates. The name of the company has been adopted with reference to the solar constant that represents the watts of the solar energy that has struck the meter of the surface of the earth.

Moreover, the future objective that has been laid by the management is to rather focus on the elements on innovation that shall help in collectively holding the position to boost the PV efficiency from an industrial average that I around the percentage of 15 to 19. The major operations, licensing strategy, partnering has been rather dependent upon the IP for the company 1366 Technologies.

Finally, it can be said that the company 1366 Technologies has looked to work upon the vertically integrated solar cell manufacturer, however with the financial crisis struck the global economy in the year 2008 had created the hindrance to raise the amounts that shall be needed to build upon the business.

Problem Statement

The major problem that has been identified in the case “1366 Technologies: Scaling the Venture” is the fact that the management of the company has to rather make a choice for the company. The company 1366 Technologies needs to decide whether it shall expand to produce the silicon wafers itself and raise the required financials from “friendly” investors which shall help in accelerating the market entry.

The second option available for the company 1366 is to go for the option of developing a partnership or a joint venture with an Asian manufacturer which shall not only provide the required finances, but they shall also help in reducing the overall cost quite significantly.

The two options available for the company and its management are both risky and shall expose the company to intellectual property with respect to the wrong partners. However, 1366 Technologies has no intention where it shall lose control over its technology, in spite of the different issues, the management has to decide method for the race that shall help win the company by the cautious.

Porter Five Forces Model

Bargaining Power of Buyers: High

            The bargaining power of buyers for the industry is high. The reason it is high because of the limited number of customers available in the market. Moreover, the information availability for the customers is also a factor which increases the bargaining power of the buyers. The buyers hold the prices and they have options to choose from.

1366 Technologies Scaling the Venture Case Solution

Bargaining Power of Suppliers: Low

            The bargaining power for the suppliers is low for the industry. The reason it is low because of the excessive number of suppliers available in the industry. Moreover, the competition amongst them is stiff which makes the bargaining power low for the suppliers. To generate the profits for themselves, the suppliers have to achieve economies of scale. Moreover, the volume plays a critical factor for the industry suppliers.

Threat of New Entrants: Low

            The threat of new entrants is low for the industry. The reason it is low because of the increasing number of government rules and regulations on the industry players. Moreover, the high capital investment that is required to enter the industry is also a shortcoming for a new player in the market.Along with this, the distribution network for the industry players has to be strong. Therefore, it can be said that the industry is not a feasible for new entrants.

Competitive Rivalry: High

            The competitive rivalry for the industry is high for the industry rivals. The reason is simple; the competitors for the industry are not only in the western countries, but most of the major industry players compete from the Asian markets also. Along with this, different industry players offer innovative products in the industry which makes their bargaining power high...............

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