PROPOSED SOLUTIONS FOR VENTURE CAPITAL TO PROVIDE VALUE-ADDED SERVICES USING BELL-MASON DIAGNOSTIC (CASE STUDY: MDI VENTURES & COMPANY “A”)

• Main Author: Nata Dewi, Widya
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/46595
• Institution: Institut Teknologi Bandung

MDI (Metra Digital Innovation) Ventures is a corporate venture capital (CVC) initiative by Telkom Indonesia, the largest telecommunications company in Indonesia. MDI Ventures was established in February 2016. As the arm of Telkom Indonesia, MDI Ventures has 33 startups in its portfolio with five success stories to its name since the first investment in 2016. In December 2016, MDI Ventures has invested in Company A, an advertising technology company that empowers digital advertising industries with programmatic advertising platforms and insightful business services. However, since the investment, the revenue and valuation of Company “A” had decreased significantly and was not growing as expected. As a CVC, MDI Ventures is considering providing value-added services to boost the growth and increase the startups value of Company A. Bell-Mason Diagnostic (BMD) was conducted to assess the health of the company at four stages of organizational development: 1) concept stage, 2) seed stage, 3) business development stage, 4) market development stage. In assessing the health of Company A, the BMD illustrates the organization’s performance graphically in twelve dimensions of activity. As the result, the dysfunction(s) of Company “A” that hinders the growth can be clearly defined. Based on the BMD, there are critical deficiencies are faced by Company “A” in 6 areas: marketing, team, board of director, cash, financeability, and delivery. Considering the limited time and resources of MDI Ventures, Action Priority Matrix is used to help MDI Ventures charting out priorities effectively and efficiently. As the result, the solution analysis focuses on 3 critical dysfunctions of Company A, namely marketing, cash, and board of directors. These 3 dimensions are considered as a dimension that could create a large impact towards the company’s growth, but with a minimum amount of effort. An alternative solution for the marketing problem would be for MDI Ventures and Telkom Indonesia to provide Company “A” with value-added services by developing a positive collaborative synergy between its investee firms. Cash-wise, with the turnaround strategy, there are three possible ways for Company “A” to stabilize the cash crisis: 1) Cash Management through managing the collection of account receivable and account payable; 2) medium-term financing; 3) financial restructuring. In terms of addressing issues in the Board of Directors MDI Ventures could interfere through finding a representative either from MDI Ventures, parent company, or third party.