Hey Silvan – thanks for the response. Some great questions. Total made the investment for a ~60% stake in 2011, and from what I know there is no clear timetable to exit. In regards to their role, SunPower has been able to leverage the strength of Total’s balance sheet in reducing capital costs. For example, in 2014 Total refinanced some existing SunPower debt at a lower cost convertible bond. Furthermore, I believe that Total’s extensive global reach has played a key role in reducing customer acquisition costs for SunPower when entering new markets.
Hey Lidiya – thanks for the response. The YieldCo structure really just presents a unique way to monetize high quality, contracted projects that should provide a steady stream of cash flows going forward and thus can generate a nice diversified source of relatively low cost-capital to fund other project development. A YieldCo offers investors a more stable stream of dividends (hence the ticker, CAFD, which is a clever acronym for “cash available for distribution”) without exposure to the volatility associated with the broader SPWR / FSLR businesses. In regards to the JV structure, I think scale is the key factor. By partnering, SPWR and FSLR could combine to contribute assets without overselling their contracted portfolios and get the investment vehicle to market quicker and at a better price. If you’re interested in reading more about YieldCo structures, the overview at the link below is pretty helpful.
Great post. While as huge fan of Chick-Fil-A I was aware of some of the business model cornerstones you highlighted, I was surprised to learn how tightly they control their franchise model. It seems it has really helped them accelerate growth accordingly and maintain their key attribute of high quality service by selecting the right partners. A few months ago Chick-Fil-A opened its first free-standing store in Manhattan (three blocks from my old apartment a week after I moved out, talk about bad timing…), and it will be really interesting to see how well the 6-day model succeeds with such exorbitant real-estate expenses as well as how it informs their urban market expansion strategy going forward.
Great post, Sarah. As I sourced probably 90+% of my meals over the last 4 years from Seamless (sad, but true), it’s a business I’ve become quite familiar with! I agree with your assessment of how the company’s ability to align incentives has made it such such a success and believe it’s leading market position and familiarity with restaurants and consumers remain its greatest assets. However, as Monica noted above, I believe the door for competitive entry has been left relatively open. The company seemed to face serious integration issues in the GrubHub / Seamless merger early this year that resulted in major usability issues and deteriorating customer service, both of which publicly diminished brand equity in a significant way. As capital continues to flow into the space and fees are forced to retract, it will be very interesting to see if they can continue to leverage their leading position and how the industry evolves more broadly.
Great post, David. Topgolf is a such a fantastic idea, and it’s amazing how quickly it has grown and been successful in each new market. However, I am curious as to it’s ability to maintain it’s current growth trajectory and how rapidly it will try to expand given the large amount of remaining market white space (it’d be great if they put one in Boston already…). Likewise, it’s brand name and some of the key aspects of it business model you highlighted such as the strategic partnerships give it a great head start, but I wonder how long the model can remain unique and if a well capitalized and aggressive competitor could quickly start challenging.