Katerra (B)

Name: Katerra (B) (English version)
SKU: 822025

Hyde, Lindsay N.; Eisenmann, Thomas R.; Quinn, Tom

Product #:822025

Supplier:Harvard Business School

Discipline:Entrepreneurship

Setting:United States, 2021

Details:Supplemental Case (PDF) • 4 pages • 2021-12-06 (Rev: 2023-01-27)

Subjects:

Bankruptcy Business failures Entrepreneurship Insolvency Start-ups Corporate finance Entrepreneurship

Geography:

United States North America

Your Price:

$7.50

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In May 2020, SoftBank executives, having invested nearly $2 billion in Katerra, decided the vision of an end-to-end, vertically-integrated construction process was worth saving-with some major changes to company structure. The SoftBank Vision Fund invested $200 million in Katerra as part of a company restructuring in which cofounder Michael Marks stepped down as CEO, and former oil industry executive Paal Kibsgaard was promoted from chief operating officer to CEO. However, by June 2021, Katerra had initiated the bankruptcy process. Should Katerra's failure be attributed to mistakes made by the company's management team? Or did the company encounter a series of misfortunes that made it impossible to continue forward?

Learning Objectives

This case is design to be paired with the Katerra (A) case. In Katerra (B), students will explore the decision that SoftBank made to continue to invest in Katerra. Despite an additional $400M of investment on the part of SoftBank and the forgiveness of $435M of debt held by SoftBank-backed Greensill Capital, Katerra filed for bankruptcy in June 2021. Through the case discussion, students will have the opportunity to consider the role that both mistakes on the part of management and misfortunes related to macroeconomic trends play in the failure of an entrepreneurial venture.