Sunrun - Managing Hypergrowth
The Sunrun case profiles the evolution of this residential solar financing startup, focusing on the company’s hypergrowth during its early years. The case begins with Sunrun’s launch by two GSB graduates, Ed Fenster and Lynn Jurich, together with one of Fenster’s high school classmates based on an innovative solar leasing model for the residential sector. The model took off rapidly, forcing Sunrun to deal with both the benefits and challenges of rapid growth. The model took off rapidly, forcing Sunrun to deal with both the benefits and challenges of rapid growth. The case details four vignettes that highlight the implications of hypergrowth. The first describes a scenario whereby Jurich and Fenster are on the verge of an IT crisis and must decide whether or not to hire a less-than-ideal VP of engineering to fight the immediate fire. The second scenario describes the decision of whether or not to fire the VP of HR who has made herself a go-to resource for employees but has proven to be a poor cultural fit with the cofounders’ values. The third scenario describes a potential partnership with PG&E which offers a tremendous opportunity for investment capital at the risk of Sunrun losing a significant competitive advantage. Finally, the last vignette broaches the cofounders’ difficult balancing act of delegating important tasks as the company scales vs. retaining control.
The learning objective of the case is to evaluate a company in the midst of a period of hypergrowth to highlight the resulting tradeoffs. What kinds of sacrifices/tradeoffs must the company make in order to maintain the pace required to stay at the head of the pack? What does the company risk if it takes a more controlled, steady approach to growth? Is there a right or wrong decision and what are the implications of the slower vs. faster pace?