Yola Case

889 words 4 pages

YOLA : Managing multiple challenges

1. How should Lingham manage the dual structure with Cape Town and Silicon Valley?

Lingham chose to found a company with one foot in South Africa and the other one in the West coast of the USA. After facing difficulties for his choice (for example, it was hard to get an American visa to find investors there), he had to fight to maintain a good atmosphere in his company.
How to avoid frustration and jealousy on both sides?
Until now, Lingham managed to deal with this dual structure by implementing initiatives such as virtual teams, frequent business trips for him and a real meeting of all employees in San Francisco at the end of 2008.
He also tried to clarify key tasks and
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After reading the case, there are two critical points for the future of YOLA.

The first one is the question of the revenue model: Ligham is wondering if the “freemium” model is viable for his business.
After all of his competitors decided to offer free services, YOLA had to change its previous revenue model in the same stream.
To guarantee benefits on the long term, Lingham chose the “freemium model” inspite of the tough conditions of the economic crisis. In fact, this is a risky bet: customers receive basic services for free and can pay for extra premium services and it is known that the “penny gap” is hard to fill.

The second one is the question of the location of the firm and the associated division of work. With the financial issue, South Africa has seemed to be a better place than San Francisco to reduce costs because of the cheapest labor force. So Lingham wants to move some roles in the lower cost base of Cape Town but he still has to decide which ones and to deal with the disadvantage of South Africa’s geographical position (too far from the American partners yet).
With the choice of the “freemium” revenue model, the role of YOLA’s partners would decrease and South Africa may finally become the headquarters of the firm.

Then, we can state that these two questions are crucial issues in the YOLA future strategy. However, with the answer to the first one (what revenue model?), it would be easier to decide of the location and to design the new