Sidoti & Company: Launching a Micro-Cap Product

Posted: 14 Feb 2012

See all articles by Boris Groysberg

Boris Groysberg

Harvard Business School

Paul M. Healy

Harvard Business School; National Bureau of Economic Research (NBER)

Sarah Abbott

Harvard University - Business School (HBS)

Date Written: January 3, 2011

Abstract

It is 2010 and Sidoti & Company, a New York-based brokerage firm specializing in small capitalization stocks, has just launched a new product - micro-cap stock research. The firm has hired a group of five analysts who will produce written research reports on micro-cap stocks, that is, publicly traded stocks with a market capitalization of less than $250 million. Peter Sidoti, Sidoti & Company's founder and CEO, knows that there is demand for this product. However, he is not entirely certain how this new business will function, both with respect to how the product is distributed and to how Sidoti & Company will get compensated for it. The case discusses Sidoti & Company's business model, and how the new business fits with, and differs from, that model. It discusses the challenges Sidoti faces in making this new business a success.

Learning Objective: Provide students with insight into the stock brokerage business. Discussion of financial and strategic planning at a firm level.

Suggested Citation

Groysberg, Boris and Healy, Paul M. and Abbott, Sarah, Sidoti & Company: Launching a Micro-Cap Product (January 3, 2011). Harvard Business School Entrepreneurial Management Case No. 411-072, Available at SSRN: https://ssrn.com/abstract=2005144

Boris Groysberg (Contact Author)

Harvard Business School ( email )

Soldiers Field
Boston, MA 02163
United States
617-496-2784 (Phone)
617-496-5271 (Fax)

Paul M. Healy

Harvard Business School ( email )

Soldiers Field
Boston, MA 02163
United States
617-495-1283 (Phone)
617-496-7387 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Sarah Abbott

Harvard University - Business School (HBS) ( email )

Soldiers Field Road
Morgan 270C
Boston, MA 02163
United States

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