Orb: The Next Big Thing (A)

Orb: The Next Big Thing (A)

Pedro M Gardete, Debra Schifrin
2016|Case No.M363A| Length 9 pgs.

In 2003, the tiny start-up Orb came up with a breakthrough technology. Through its software, every type of media on a PC (including music, photos, and videos) could be streamed remotely to any mobile device for free.  Orb also enabled users to stream live TV onto their PCs and mobile devices. This was a technological feat in the days before the iPhone and other smartphones. When Orb launched in 2005, it won the “Next Big Thing” award from the influential tech publication CNET. It had been a challenging technology to develop, and with such positive press, Orb watched and waited for the technology to go viral.

This case is divided into three parts. Part (A) covers the early challenges Orb had with user adoption, unexpected technology challenges, and its realization that it was not going to go viral — at least not as the company and product existed at that time. At the end of 2005, Orb had about 300,000 users, and it needed to decide its next move.  It could keep pushing the product to consumers — either on its own or through partners; try to find partners in the B2B space and supply streaming architecture; or maybe call it a day and try to sell the company for the technology.

Parts (B) and (C) cover Orb in 2006 and 2007. Topics include: 1) New product and feature development, 2) Strategy and product pivots, 3) Customer acquisition versus product usage, 4) Marketing opportunities and challenges, and 5) decisions about selling a company.  Part (B) and (C) of the case are for instructor use only. 

Learning Objective

Teaching objectives include: 1) Familiarizing students with the significant amount of uncertainty start-ups face 2) Contrasting the people vs. function perspective of marketing activity in a start-up 3) Challenging expectations about what constitutes a “good venture” 4) Debunking the myth that to be successful a start-up should focus on reaching a critical “x” number of users, and 5) Considering the true “cost of capital” of venture money, which often implies a “boom or bust” scenario.

This material is available for download by current Stanford GSB students, faculty, and staff, as well as Stanford GSB alumni. For inquiries, contact the Case Writing Office.