Genapsys Case Study

GenapSys Case Study

Esfandyarpour and Rastegar are considering between different strategies, the three options that they have are:

Traditional Sales Strategy:  In this model, the company would sell sequencers at a higher price to those entities, which already purchased sequencers, primarily major research labs and pharmaceutical firms, but position its machine as a faster alternative to existing technologies. In this strategy, the device's low cost would attract entities unable traditional, higher-priced sequencers. Operate with small group of sales and support team of fewer than 10.Only sell relatively few devices but earn high margins per machine given low cost design. The goal is price the device and cartridges lower than the competition on traditional strategy, but still high enough to generate substantial revenue in a short timeframe

In addition the risks of this strategy are its directly challenged incumbents because their target customers would be those served competitors and there is no way they would not retailed. The financial stability of these market sequencers, most research centers relied on grants and government funding, which could be unreliable

Razor and Razor Blade:  GenapSys would sell its sequencer at a lower price but charge more for the cartridges necessary to run a sample, and earn its primary revenue from these cartridges. In this strategy, earned a roughly 50% profit margin. National laboratory companies, which performed right volumes of tests for hospitals and clinics, would also be targeted. Target players in relatively new to sequencing, such as biofuels companies and agribusiness firms, to understand complex plant genetics. Underserved markets and form partnership with biotech or diagnostics companies around researching and better understanding certain diseases a 'disease category. The risks on this strategy: Due sufficient headcount, not able produce new product based on customer demand. Since not able meet the customer requirements, they tend to move to another company, which is cheaper and faster machine and test

Data Analytic:  The third model would see GenapSys sell its device at or around cost, but use the data customers generated to create a proprietary database of genetic information. Customers could pay to access the database for research, to create genetic tests, or for many other purposes

In Data Analytic strategy, the risks are that it required a significant R&D investments and created large overhead costs. Most of the financial requirements would be too much for traditional investor.

I believe the data method will maximize the founder’s value. While it will be a slow start, it has potential to gain great momentum as time goes on. I also believe that if they price the equipment at only 10% above their cost, it would help them to generate more cash flow at a higher rate.