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The case on Moodcafe captures the journey of the start-up and its entrepreneurs from the beginning till the fund-raising stage. The case brings forth critical decisions that each entrepreneur or the team of co-founders have to address during their start-up journey. This short case gives opportunity to delve into two aspects mainly a) As a founder, which investor should one choose for seeking funds and what should be the terms and conditions of investment? and b) How can one review and assess the business model of a start-up?

Parsana Health Centre Private Limited, a part of the INR 4,500 crore¹ fitness industry, was a fitness centre established at Ahmedabad (Gujarat) in India in December 2002, as an integral part of the organized players of the fitness industry. It had been relentlessly working towards creating and nurturing a healthy lifestyle for the people of Ahmedabad over the previous two eventful decades. Under the able guidance of skilled trainers and dieticians, the fitness enthusiast could enjoy state of the art gym facilities, in the upcoming mega city of Ahmedabad. Parsana Health Centre Private Limited enjoyed the first mover advantage in Ahmedabad and tapped the fitness club² market through its 13 franchises opened in select vantage locations of the city. It was started by the Parsana brothers: Vijay and Dinesh. They strived hard to inculcate the fitness regime in people and attempted to interweave the benefits of fitness with their occupations. However, the road undertaken threw challenges at them – sometimes from people who failed to underline the importance of fitness in their daily schedule, and sometimes from other fitness brands which emerged as strong competitors. The emergence of many individual and branded fitness chains started making inroads into the busy streets of Ahmedabad and they too worked hard to pull out fitness enthusiasts to these social fitness centres by providing personal health counseling, rejuvenation, yoga, etc. Sustaining competitive advantage became a tough task.