Lifecell group is India’s first and largest stem cell bank with presence in multiple cities and catering to more than 4lakh customers. The company wanted to enter the K12 segment starting with their first school in Chennai.
We were engaged to help the group create the entire business plan, do a viability analysis and create a financial model for the school. The primary areas where we assisted the group were
1. Identify the right partner: Evaluate established K-12 brands for possible partnership and help the group finalize the terms and conditions
2. Recommend the school characteristics: Validate the business plan hypothesis to identify the product/market fit through market research and competitor analysis
3. Create a financial model: Build financial model with different scenarios according to the school positioning options
4. Implement right entity structure: Develop and implement a plan to formalize the entity structure considering various short-term, medium term and long term objectives
We adopted different approach to address the 4 areas
IDENTIFY THE RIGHT PARTNER
The team did as-is assessment of the group’s capabilities and then identified various partners who would complement them. We then assisted the group in negotiating the terms and conditions and finalizing the way forward.
RECOMMEND SCHOOL CHARACTERISTICS
The group had certain hypothesis for the school value proposition, we followed a structured approach to recommend the right product for the market.
1. Market research: The first step was to analyze the market trends in Chennai,mapping the kind of schools and their USP and understanding the evolution of parents requirements
2. Competitor analysis: Thorough analysis of the offerings in the market to identify the white space
CREATE A FINANCIAL MODEL
We recommended 3 options for the group based on the market research. Financial model was created for the 3 options with best case, base case and realistic case scenarios. This helped the promoters to deliberate further and finalize the product
DESIGN THE RIGHT ENTITY STRUCTURE
Based on the short term, medium term and long term objectives we proposed entity structure to minimize tax leakage, make the structure investible for external investors and comply with government regulations
Our study brought out some interesting nuances about the Chennai market that led to a change in the initial hypothesis of the group. The value proposition and the characteristics of the school was finalized along with the financial model. The group also agreed on the recommended entity structure and started implementing the same.