Strava Case Study: Assessing the Materialization of 2010 Projections

This case study examines Strava's performance against its 2010 forecasts, focusing on user growth, revenue resources, and premium conversion rates. While Strava experienced significant user growth exceeding projections, its revenue growth lagged behind forecasted figures. The premium conversion rate was also substantially lower than anticipated. The study highlights the discrepancies between projected and actual results, providing insights into Strava's early business challenges and areas for improvement. Desklib provides access to similar case studies and solved assignments for students.

The present case relates to Strava derive form Swedish term to strive which deals with Cyclist and
Running subscriber. The company has been successfully run by two of its initial founder Hovarth and
Gainey who has been business partners in previous venture too. Further, after years of operation the
company was considering procuring funds form Sigma Partners and Proforma Financial Statement
were prepared to project the profitability of the company in the long term. The report deals with
comparison of forecasted results and the actual results achieved. The following parameters have
been compared:
(a) User Growth: On perusal of the PPT for Starva, September 2014 it can be concluded that the
company has witness growth by leaps and bounds in terms of user subscription. The number of
subscribers 1.3 Million to 2.4 Million in 2013 which is much higher than forecasted for 2013
which stood at 1.6 Million. Thus, Starva has performed better compared to the forecasted
results in actuality.
(b) Revenue Resources: On perusal of the PPT for Starva, September 2014 it can be concluded that
the company has witness slow growth in revenue compared to forecasted results. The results
forecasted was 7.3 Million . However, the crystallised figure was near about 5 Million. Thus,
revenue did not match increase in customer base. Thus, Starva did not perform better
compared to the forecasted results in actuality.
(c) Premium Conversion: Starva Premium conversion for Cohort was 14% of actives at 12 months
and 7.5% of actives at 6 months as per actual data while the conversion rate as per the
forecasted data was greater than 25%. Thus company failed on this parameter.