Entrepreneurship: The Zipcar Case Analysis

Entrepreneurship: The ZipCar Case Analysis

Being an entrepreneur is one of the most exciting things a person can do, but there is also a great deal of work that is involved. Many people overlook what it really means to be an entrepreneur, and do not clearly understand what it takes (Gartner, 2001). In the case of ZipCar, there are financing concerns that have to be addressed and there are relationship issues between the founders that also have to consider. By taking a look at both of those areas, one can better assess the business model based on the initial results and determine where those who are running the company should go from this point, and how they should begin to move forward in order to be successful. A large part of entrepreneurship is trial and error, but it is important to have as much of an understanding of business as possible, in order to have the best chance of seeing success (Mark & Mortensen, 2001).

The initial results of the business model show that the shared car idea is very successful in Europe. Danielson saw it used there, was impressed by it, and brought the idea back. She then presented it to Chase, who was also encouraged by others to begin developing the ZipCar idea. Investors showed some interest, and the company was able to get started with a few cars and a few stations where those cars would be checked out and returned. Because of that, and because the venture seemed to work well, the next step was for Chase to present the ZipCar information to other, larger investors who would be able to help the company get to the next level by securing their future and allowing them to expand throughout Boston and eventually to other cities in the U.S.

The relationship of the founders is such that Chase does most of the full-time work, and Danielson helps with the venture on weekends and evenings. This works out well, because Chase does not work full-time, and Danielson does. Chase and Danielson also divide the work based on their specific strengths. Danielson has car industry connections with Ford and other places, so she was the best choice to continue to build on and develop those connections. She also dealt with the in-car technology and related issues. Chase, on the other hand, knows much more about business and finance, so she has focused on securing financing, creating the business plan, giving presentations, and getting a secure footing under the company. This work has paid off, and the venture appears as though it will be successful if the financing comes through and investors sign on to the project.

Financing for ZipCar can be raised by getting larger investors on board. $50,000 was provided by an investor in the early days, but much more was needed. That was the reason behind Chase's desire to go to conferences and other events where she could make presentations and work toward getting more investors interested in the ZipCar idea. Chase moved quickly, too, because she was so encouraged by others who were convinced the idea was a winner. That gave her the confidence to explore financing options and show others what her idea would have to offer for people who needed an occasional car for a few hours.