Case Scenario: COMPANY: Blue apron

Business idea: Launch a service that provides ready-tocook meals with premeasured ingredients and cooking instructions. Deliver the ingredients directly to customers' homes in refrigerated boxes. pitch: Many people enjoy cooking but do not have the time and expertise to cook elaborate meals. People also tire of restaurants, takeout meals, and quick meals at home. Even people who have time to do the actual cooking often don't have the time it takes to find a recipe, shop for the ingredients, and then cook the meal. This is a frustrating reality for people who enjoy cooking and spending time in the kitchen. Blue Apron was founded to address this problem. It is a weekly subscription service that delivers to its customers a refrigerated box each week that contains the ingredients and cooking instructions for three fresh meals. For Blue Apron, each week involves four steps. First, its recipe team brainstorms meal ideas, drawing inspiration from restaurants, cookbooks, and anywhere food is served. Second, the company sources ingredients, mostly from local family owned businesses.

Third, they test cook the meal and, if it takes more than 35 minutes to prepare, requires advanced skills, or needs utensils that wouldn't be found in a normal kitchen, it gets cut from the roster. Finally, if the meal makes it, it is put in the queue for Blue Apron customers. From the customer's standpoint, Blue Apron offers six meal choices each week. The customer picks three. The meals arrive in a refrigerated box once a week. The meals cost $9.99 per person, per meal. So, for two people the box would cost $60 per week. The box includes premeasured ingredients for each meal. Also inside the box is a card featuring step-by-step instructions with photographs of how to prepare and cook the meal. Each recipe serves two people. Along with providing people a way to quickly prepare fresh meals, Blue Apron's aim is to introduce people to new things. The company rarely repeats a recipe. The company's name is a tip of the hat to cooking tradition in that in the culinary world, beginner cooks wear blue aprons while more experienced chefs wear aprons with black and white stripes. In recent years high profile chefs have set aside the tradition and have donned the blue apron, in recognition that cooking involves a lifetime of learning. Blue Apron has distribution centers in New York and Northern California. It currently ships approximately 17,000 meals a month. The firm's products are available in 80 percent of the United States.

1. Based on the material covered in this chapter, what questions would you ask the firm's founders before making your funding decision? What answers would satisfy you?

2. If you had to make your decision on just the information provided in the pitch and on the company's website, would you fund this company? Why or why not?