FITS Imaging Inc. (A)

Bruno Delean had developed a new technology for processing images and had used it to create a very advanced image-editing software product called “Live Picture.” In 1993, Delean helped found FITS Imaging Inc. and become CEO. Mark Kalow had been so impressed with the potential of FITS that he joined the company as an active partner, investing a substantial sum of his own money and leaving his former job to become FITS vice president. Kalow, however, was discovering that the process of converting this technological innovation into a viable, ongoing business was not going to be easy. Decisions had to be made quickly about target markets, research and development, pricing policies, distribution channels and customer support systems, and methods of financing the future expansion of the business. The case explores all of these decision areas, culminating with a disagreement among company executives about what the strategic direction should be.