Essay Brian Razzaque Case Study – Essay Writing Assignment Help

Assignment Task:

 As a Web developer, Brian Razzaque recognized the power and efficiency of social media marketing and wanted to make social media marketing easier for companies but wasn’t sure exactly how to achieve his goal. Then an employee asked to be notified every time Razzaque made a post to the company blog so that he could then share the post with his social network. Razzaque realized that every company has “super fans,” customers with a strong affinity for a company and its brand, who will readily share content about the company if it is easy and convenient to do so. That realization was the beginning of Razzaque’s company, Baltimore-based Social Toaster, a platform that sends simple e-mails notifying super fans of new content, such as blog posts, articles, events, promotions, and awards, that fans can, in turn, share with members of their own social networks with just one click. Social Toaster magnifies a company’s social media efforts many times over, drives traffic to its Web site, enhances customer engagement, and improves brand recognition and loyalty at minimal cost. In essence, Social Toaster allows a company’s super fans to increase exponentially the visibility of the content that the company creates through the fans’ social networks. Razzaque says promoting a business through a company’s super fans using Social Toaster is as easy as making toast. Razzaque began promoting Social Toaster’s power and began landing clients around Baltimore. As success stories began to spread, Social Toaster landed bigger clients, including the Baltimore Ravens, the Baltimore Symphony Orchestra, the Detroit Lions, Lifetime Network, A&E, VH1, Sony Pictures, Universal Music, Johns Hopkins University, and many others. Clients report that their fans share 60 to 74 percent of the content they promote, providing exposure that is almost impossible for companies to achieve through their own social media accounts alone. In its first year of operations, Social Toaster generated $300,000 in sales, an amount that more than doubled to $800,000 in its second year. Razzaque is at an important crossroads in the life of his company. He needs financing to fuel its rapid growth, but he wants to ensure that he selects the right sources of financing. He estimates that he will need $500,000 as bridge financing to fuel the company’s short-term growth. That financing will give him time to raise the $2 million he will need to increase the size of Social Toaster’s sales force, hire account managers, increase the company’s marketing efforts across the globe to land more clients, and hire more technical staff to constantly upgrade and improve the product and enhance its features. Razzaque has called on several wealthy individuals in New York City, Boston, and Silicon Valley. None were willing to invest in Social Toaster, but they did offer Razzaque helpful feedback that enabled him to improve his pitch. He also discovered the differences in how potential investors in Silicon Valley and on the East Coast view start-up companies. Razzaque says investors in Silicon Valley were not impressed by Social Toaster’s existing (but modest) revenue stream. Instead, they were looking at the company’s growth rate as an indicator of market potential. Does the company have the potential to become a billion-dollar business? East Coast investors, however, were more interested in the company’s fundamentals, its revenue stream as proof that the product is viable, its “burn rate” (how quickly the company’s monthly expenditures were burning through its capital), the soundness of its business model, and its staying power. 

Questions 

1. What tips can you offer Brian Razzaque for creating a business plan that will attract the capital Social Toaster needs to fuel its growth? [5marks]

2. Which sources of debt capital and equity capital offer the greatest potential for Social Toaster’s financing needs? In what order would you prioritize the sources you have listed (from greatest potential to least potential). [10 marks]

3. What advice can you offer Razzaque about avoiding potential dangers and pitfalls in accepting outside financing for a business? [5 marks]