1) Isabella Nolte:- According to the 'Longevity gene' responsible for more efficient DNA repair, the longevity gene consists of SIRT6 which is a protein found within the DNA of different organisms. In mice, the protein is weaker than in a beaver, which is why a beaver lives longer than a mouse. With this finding, researchers are trying to see whether species like whales, that can live up to 200 years, have stronger SIRT6 proteins than humans. Many scientists aren't using their findings to live until 200, but instead to delay diseases like cancer and dementia. That being said, gene transplants may not cure diseases but may delay them. I think gene manipulation could have consequences because it allows mutations to be made within DNA which would present new health problems. Also if it did work, I imagine the process would not be cheap and people who had degenerative diseases wouldn't be able to get it done when they are the ones who need it most. Other than safety and equality, other ethical considerations include, consent. Many families may have children with disabilities and some will begin to think that swapping around genes is what's best for the child, but isn't like changing clothes it is something that would affect the entire being. In addition to this, scientists may want to experiment with embryos rather than adults or children. There are many different beliefs surrounding human embryos for experimentation though. I feel that some resources should be devoted to gene resources to become more familiar with the idea of gene manipulating, but I do think that there should still be sufficient funds to provide Medicare to people who aren't able to get good health insurance. I think the possibility to help people live longer and postpone degenerative diseases would be a breakthrough in the health and science industry. I think if it worked out, there could be a reduction in expenses for nursing care because people would be able to live longer and healthier lives. Although at some point, there would be just as many people in nursing homes due to the fact that people don't live forever even with gene manipulation. There just may be a few decades that the numbers decrease greatly in nursing homes before they even back out to what they were before the breakthrough. The idea of helping others live longer healthier lives sounds great, but this is a lot of reasearh and experimentation that needs to be done. Also those who need the procedure should be granted access to it rather than only the wealthy.  University of Rochester. (2019, April 23). 'Longevity gene' responsible for more efficient DNA repair. ScienceDaily. Retrieved July 21, 2021 from www.sciencedaily.com/releases/2019/04/190423133511.htm 2) Danielle Kuntz :- According to an article in MedLine Plus, longevity is not just determined by genetics but also by lifestyle and environment. I found this perspective interesting, causing me to really think about how longevity is complex. Even if we ...

1. 1) Isabella Nolte:-
According to the 'Longevity gene' responsible for more efficient
DNA repair, the longevity gene consists of SIRT6 which is a
protein found within the DNA of different organisms. In mice,
the protein is weaker than in a beaver, which is why a beaver
lives longer than a mouse. With this finding, researchers are
trying to see whether species like whales, that can live up to
200 years, have stronger SIRT6 proteins than humans. Many
scientists aren't using their findings to live until 200, but
instead to delay diseases like cancer and dementia. That being
said, gene transplants may not cure diseases but may delay
them. I think gene manipulation could have consequences
because it allows mutations to be made within DNA which
would present new health problems. Also if it did work, I
imagine the process would not be cheap and people who had
degenerative diseases wouldn't be able to get it done when they
are the ones who need it most. Other than safety and equality,
other ethical considerations include, consent. Many families
may have children with disabilities and some will begin to think
that swapping around genes is what's best for the child, but isn't
like changing clothes it is something that would affect the entire
being. In addition to this, scientists may want to experiment
with embryos rather than adults or children. There are many
different beliefs surrounding human embryos for
experimentation though. I feel that some resources should be
devoted to gene resources to become more familiar with the idea
of gene manipulating, but I do think that there should still be
sufficient funds to provide Medicare to people who aren't able
to get good health insurance. I think the possibility to help
people live longer and postpone degenerative diseases would be
a breakthrough in the health and science industry. I think if it
worked out, there could be a reduction in expenses for nursing
care because people would be able to live longer and healthier

2. lives. Although at some point, there would be just as many
people in nursing homes due to the fact that people don't live
forever even with gene manipulation. There just may be a few
decades that the numbers decrease greatly in nursing homes
before they even back out to what they were before the
breakthrough. The idea of helping others live longer healthier
lives sounds great, but this is a lot of reasearh and
experimentation that needs to be done. Also those who need the
procedure should be granted access to it rather than only the
wealthy.
University of Rochester. (2019, April 23). 'Longevity gene'
responsible for more efficient DNA repair. ScienceDaily.
Retrieved July 21, 2021 from
www.sciencedaily.com/releases/2019/04/190423133511.htm
2) Danielle Kuntz :-
According to an article in MedLine Plus, longevity is not just
determined by genetics but also by lifestyle and environment. I
found this perspective interesting, causing me to really think
about how longevity is complex. Even if we could ethically
justify gene transplants by ensuring consent and autonomy with
participants, I fear that the effects of such an advance would
lead to ripples that may be difficult to adjust to. Take into
consideration lifestyle. The current average retirement age in
the U.S. is 64 for men and 62 for women. If life expectancy
increased, retirement age would also have to increase due to the
financial impacts of living a much longer life. Would living
longer and working for almost 100 years cause negative mental
health concerns and cause an issue with quality of life. Would
our bodies be able to maintain the pace and productivity that is
required to financially sustain the longer life span, especially
for those in industries that are very physical and labor
intensive? Another consequence would be in government
programs such as medicare and social security. We already see
strains on the our healthcare system with the large population of

3. Baby Boomers now. We would likely need a whole new
healthcare system to accommodate a longer living
population. Another factor to consider would be if science
could alter our health to the degree of preventing heart disease,
cancer, etc., would there be any accountability in how we treat
our bodies? I wonder if gene alterations for heart disease and
other health related diseases would inadvertently encourage a
lack of awareness of living a healthy lifestyle.
The last area that I can see consequences of a longer lifespan is
on the environment. With the projected dream of lifespan almost
doubling, I wonder if we would see overpopulation and how that
may challenge our food sources, ultimately leading to more
deforestation. We are already seeing the negative impact of
humans and our carbon footprint on the ecosystem. Another
aspect to consider is how the increase in population would
impact our fresh water supply. We already have places in the
world that are water stressed. With only 2.5% of the world’s
water supply being fresh water, would it be responsible to
increase that burden with almost doubling our lifespan?
In summary, I can see the benefits of living a life free of the
diseases that currently steal so much personally and
relationally, however I question the motivations outside of that.
In my opinion there should be a bitter sweetness that comes
from knowing that life is “short.” I just wonder how different
things would be if we lived longer and if we would actually be
compromising quality for quantity.
The baby Boomer effect and Controlling healthcare costs: USC
Online. USC EMHA Online. (2020, March 4).
https://healthadministrationdegree.usc.edu/blog/the-baby-
boomer-effect-and-controlling-health-care-costs/.
Dillinger, J. (2021, February 24). The 10 most obese countries
in the world. WorldAtlas.
https://www.worldatlas.com/articles/29-most-obese-countries-
in-the-world.html.
LeBlanc, R. (n.d.). The environmental impacts of

4. overpopulation. The Balance Small Business.
https://www.thebalancesmb.com/how-overpopulation-impacts-
the-environment-4172964.
Munnell, A. H. (n.d.). Briefs. Center for Retirement Research.
https://crr.bc.edu/briefs/what-is-the-average-retirement-age/.
U.S. National Library of Medicine. (2020, September 18). Is
longevity determined by GENETICS?: MedlinePlus Genetics.
MedlinePlus.
https://medlineplus.gov/genetics/understanding/traits/longevity/
.
9B13M051
BEYOND EPIC: BUILDING THE BUSINESS BEYOND A
SINGLE EVENT
Greg Fisher and Michael M. Goldman wrote this case solely to
provide material for class discussion. The authors do not intend
to
illustrate either effective or ineffective handling of a managerial
situation. The authors may have disguised certain names and
other
identifying information to protect confidentiality.
This publication may not be transmitted, photocopied, digitized
or otherwise reproduced in any form or by any means without

5. the
permission of the copyright holder. Reproduction of this
material is not covered under authorization by any reproduction
rights
organization. To order copies or request permission to
reproduce materials, contact Ivey Publishing, Ivey Business
School, Western
University, London, Ontario, Canada, N6G 0N1; (t)
519.661.3208; (e) [email protected]; www.iveycases.com.
Copyright © 2013, Richard Ivey School of Business Foundation
Version: 2013-07-05
As Kevin Vermaak watched the final day of the ninth edition of
the Absa Cape Epic Mountain Bike Race
in March 2012, he felt a sense of pride. The multi-day mountain
biking event he had conceived while on a
beach in Costa Rica in 2002 was now well established as a
premier global cycling race, drawing
participants to Cape Town (South Africa) from almost 50
countries and generating more global TV
coverage than any other mountain bike race in the world. Yet
the success of the event also fostered a
sense of restlessness within Vermaak, as he pondered what more
could be done to build on what he and
his team had created. Vermaak admitted that the race was
created “as a business with a clear mission and
a rigorous approach to financial sustainability.”1 To date, the
business had centred largely on a single
event — the Absa Cape Epic Mountain Bike Race (Absa Cape
Epic), taking place for eight days in March
every year. Vermaak knew that much of the early success of the
Absa Cape Epic was because his team
had focused unrelentingly on making the event “an unsurpassed

6. and unforgettable mountain bike and
African travel-experience.”2 He also suspected that the lessons
they had learned, the infrastructure they
had put in place and the reputation they had established could
provide a platform for new opportunities.
He had numerous ideas for generating growth for the business,
but he did not want to distract the team too
much with the tenth edition of the race coming up in 2013. “In
what direction should I steer the
business?” he wondered as he surveyed the neat but sprawling
tented city that had been set up to host the
grand finale of the 2012 race on Lourensford, a picturesque
wine farm outside of Cape Town. “And how
should we spend our time in the upcoming year to ensure that
we seize on and exploit the right
opportunities but also deliver the absolutely best possible Cape
Epic in 2013?”
CREATING THE ABSA CAPE EPIC
While living and working in London, Vermaak had travelled to
Costa Rica to compete in La Ruta de los
Conquistadores (La Ruta) — a three-day mountain bike race
created in 1992 — which took competitors
along the path of the Spanish Conquerors of 1560 in their
exploration of Costa Rica from the Pacific
Coast to the Caribbean. “La Ruta was popular but it was very
expensive,” reflected Vermaak, who grew
1 Nic Dawes, “The Loneliness of the Long Distance
Entrepreneur,” Absa Cape Epic Ride Guide, Bicycling
Magazine, Cape
Town, 2007, pp. 6-7.
2 Ibid.

7. A
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10. vi
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Page 2 9B13M051
up in the Eastern Cape of South Africa. However, La Ruta
provided Vermaak with an idea that awakened
his entrepreneurial spirit. As he recalled:
I was destined to be an entrepreneur and work for myself. I
lived my life up until I started the
Epic with an assumption, rather than a dream to work for
myself. Hence there was a feeling of
relief when I had finally had an idea for which it was worth
resigning and making a full
commitment. I had completed an Electrical Engineering degree
at UCT [University of Cape
Town], commonly regarded as the toughest course on campus.
Doing well in my degree (Cum
Laude), gave me the confidence that I could achieve anything if
I really tried hard enough. I had a
feeling of invincibility that has stayed with me since university
days. That was possibly the
biggest lesson learned from my tertiary education, as I never
actually worked a single hour as an
engineer. I was always willing to try something different and

11. sought out “out of the ordinary
experiences” hence starting the Epic business did not seem like
a massive risk, it was just giving
me what I wanted.
While in London, Vermaak had initiated and led numerous
expeditions to exotic international locations.
His involvement in these expeditions provided him with the
confidence and insight to launch the Absa
Cape Epic:
My “holiday expeditions” and the planning required to complete
them, and the PR [public
relations] efforts around these expeditions, gave me invaluable
experience. Leading the first ever
combined mountain bike, climbing and snowboarding expedition
to Mustag Ata (a 7,546 metre
mountain in China), and crossing the Himalayas on my bike a
few times gave me an insight into
the type of people that travel the world for adventures. I used
my international adventure network
to launch the race and get international entries into the first
races. Living overseas gave me an
appreciation of what international clients would want at an
event in South Africa.
Vermaak knew that South Africa was a wonderful potential
venue for a world-class mountain bike event.
He recognized that “the terrain, beauty, people, services and
facilities in the Western Cape would make it
possible to organize a far superior race.” He went about creating
a business plan for the concept and
“three months later I’d packed up eight years in London and

12. was starting a new life in Cape Town.”
Recognizing the need to market the race on a global platform,
he sought a relationship with an
experienced global partner:
At that early stage of the project, I did not think I had the
expertise in mountain biking. I did not
have mountain bike contacts, only a few months earlier I had
participated in my first mountain
bike stage race. I sent two German companies a proposal and
my thoughts on a race in South
Africa. Initially it was my idea that they would be equity
partners. I chose to work with Planet
Talk — a small consultancy that did work for the TransAlp and
Adidas — as they seemed more
committed partners. But a few months into the project, I
realized that the more valuable skills
required were linked to project management, international
marketing, company establishment,
South African people skills, and the mountain bike experience
could be gained simply by visiting
a few races. Also, I was the one taking all the risk and making
the financial and lifestyle
investments (relocating back to South Africa). The outcome was
an amicable agreement that they
would henceforth be fee-earning consultants, and I would own it
100 per cent. They remained a
fee-earning consultant for eight years.
Vermaak spent the first half of 2003 developing the company’s
brand, logo and ethos and refining the
basic concept so that he could begin selling entries for the
inaugural event scheduled for March 2004 (see

13. A
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16. o
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Page 3 9B13M051
Exhibits 1 and 2). He and the small team he had assembled
promoted the event at the Pick n Pay Cape
Argus Expo (at 105 km, the largest timed cycle event in the
world, involving a road ride around the Cape
peninsula that attracts 35,000 participants annually). They
hosted a launch party that was attended by
more than 80 very important people (VIPs), sports journalists
and guests, launched a website, and
arranged training camps for potential riders. Vermaak was
delighted and relieved when entries for
Southern African participants were sold out in three days in
June 2003. By December 2003, Adidas
International had signed on as a sponsor. “Adidas sponsored
primarily because they trusted and worked
well with Planet Talk,” noted Vermaak. Three months later, 546
riders from 27 countries participated in
the inaugural event. Later that year, the 2004 Absa Cape Epic
(then presented by Adidas) was named the
Best Mountain Bike Race in South Africa at the South African
(SA) Cyclist of the Year Awards.
The Absa Cape Epic route of approximately 800 kilometers (500
miles) changes every year but always

17. includes approximately 15,000 meters (49,200 feet) of ascent
over rugged, unspoiled terrain in South
Africa’s Western Cape Mountains. Riders see wide-open plains,
majestic mountains, deep ravines,
indigenous forests, spectacular coastlines and flourishing
vineyards. The race website describes “dusty
and demanding gravel paths, strenuous rocky uphills, thrilling
technical downhills, magnificent river
crossings and stunning forested single tracks.”3
As described in a media guide:
Teams of two riders register in one of five different categories
(Men, Ladies, Mixed, Masters and
Grand Masters). The minimum age for participation is 19 years
old. Each team must remain
together at all times during the race and are expected to reach
the finish line by 5 p.m. daily. After
each stage, the winners of the day receive prizes and the leaders
in the overall classification are
awarded leader jerseys. Race nutrition, water and isotonic
carbohydrate drinks are available at the
feed zones to revive tired riders during the race. At night, all
riders and race crew sleep in the
tented race villages that are set up prior to arrival and taken
down immediately after the start each
morning by the race crew. Organizers also provide carbo-loaded
breakfasts and dinners, bike
servicing, masseurs and stage location specific entertainment
every evening.”4 (See Exhibit 3.)
BREAKING EVEN AND GROWING THE BUSINESS

18. The 2005 Absa Cape Epic attracted 866 riders from 32
countries, including Olympic medallists and top
World Cup riders. Premium-upgrade packages, including
overnight accommodation, physiotherapy
services and bike repair services, were included for the first
time as an option for competitors. Vermaak
ensured that footage of the event was available to TV channels
across the globe and the 2005 event
generated more than 2,500 global TV hours:
This was a requirement for us to get the Adidas International
sponsorship; they were only
interested in the international TV coverage, so we followed a
well-established TV distribution
model by engaging with a German TV distribution agency that
works with Adidas Outdoor. In
the early years we were more well known in Europe than South
Africa, since we were attracting
international well-known mountain bikers, and putting them in a
TV production riding through
Big 5 game reserves — this was very well received by TV
audiences in Europe.5
3 Absa Cape Epic, “About the Race,” www.cape-
epic.com/content.php?page_id=23&title=/About_the_Race/,
accessed
September 20, 2012.
4 Absa Cape Epic Media Guide 2009
5 Email communication with Kevin Vermaak, September 20,
2012.
A
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19. o
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Page 4 9B13M051
Despite the positive response to the race by both riders and the
media, the event still did not break even
financially. Vermaak was able to keep the Absa Cape Epic
going because of the timing of cash flows
from one year’s event to the next. Vermaak explained:
In the early days we collected the entry fees when participants
entered the race in June/July and
incurred most of our expenses when they rode the race in March
the following year. In some
cases I was able to stretch payments to creditors for an event
staged in March until the entry fees
for the following year’s event had been collected. Paying for the
2005 event with the 2006 entry
fees allowed me to keep the Cape Epic going, even though our
income was not yet covering our
costs on a single race.6
Recognizing that this approach to cash flow management was
not sustainable over the long term,
Vermaak knew that he needed to adapt his model and create a
more sustainable capital structure for the
business. The first thing he did was secure a loan of R3 million
(US$375,000) from the Industrial

23. Development Corporation (IDC), a financial institution owned
by the South African government. “This
suggests that Vermaak’s business model and his numbers were
thoroughly put through the wringer,”
suggested journalist Nic Dawes.7 Next, Vermaak convinced
Absa, one of South Africa’s leading banks
and a member of the Barclays Group, to come on as title
sponsor:
In 2005, Absa was the biggest sponsor in SA sport. It was
unthinkable that a blue chip brand
would sponsor mountain biking, let alone Absa. After the
success of the first race, many smaller
companies that were sponsoring mountain biking approached us.
I set a personal secret threshold
for our title sponsor — they needed to have at least a marketing
budget of R100,000,000
(approximately US$12.5 million in 2005) otherwise they would
not be able to maintain/support
our ambitious growth curve. I approached Absa through the
executive assistant to the CEO. He
had entered the 2006 Epic and I spotted his email signature on
an inquiry he had sent to the race
office. I approached him and he channelled my proposal to the
right people. With Absa we had a
company with a marketing budget in excess of R1 billion
(US$125 million).8
For Absa, the Cape Epic provided an opportunity to offer its
business bank clients unique access to the
race experience. Absa recognized the fit between the teamwork
ethos of the race and the partnership
brand positioning of Absa Business Banking. As part of its
sponsorship package, Absa received “access

24. to entry” rights to the event, which provided it with
opportunities to invite important clients to participate.
Furthermore, Absa valued the corporate social investment focus
of the race, which aligned with the
bank’s corporate social investment focus. The sponsorship
objectives were defined and measured
annually in terms of demand generated, potential for future
corporate finance deals, cross-service
opportunities and engagement levels among employees and
clients. Oscar Grobler, Absa’s general
manager of Business Banking Services, suggested in 2006 that
Absa
recognized the value that sports and lifestyle activities present
in establishing and building new
relationships with various segments of the market. This strategy
is underpinned by Absa’s drive
to take banking to the next level by building partnerships to
provide effective financial solutions
for customers — both on a national and provincial level.9
6 Interview with Kevin Vermaak, December 6, 2010.
7 Dawes, “The Loneliness of the Long Distance Entrepreneur,”
2007, pp. 6-7.
8 Email communication with Kevin Vermaak, September 20,
2012.
9 Kevin Vermaak, “Dear Mountai n Bike Enthusiast,” The Cape
Epic Newsletter, March 31, 2006, www.cape-
epic.com/data/files/newsletters/newsletterfriday31march200611
22143309.html, accessed September 20, 2012.
A
u

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Page 5 9B13M051
More recently, Absa was pleased to notice the increasi ng
numbers of senior-level executives and
decision-makers participating in the event, resulting in an
extension of Absa’s sponsorship to include
Absa Capital, Absa Private Bank and Absa Wealth clients.10
As a result of the new cash injections from the Absa
sponsorship and from the IDC loan, the 2006 version
of the Absa Cape Epic presented by Adidas attracted 1,046
riders. By 2007, those numbers had increased
to 1,206 riders from 43 countries, including seven of the top 10
ranked UCI (Union Cycliste
Internationale) mountain bike riders. From the beginning, the
race entries quickly sold, with lottery
applications oversubscribed by four times.11
Since 2005, Vineyard Races had been part of the grand finale
(final day) of the Absa Cape Epic. Vineyard
Races, which catered to all fitness levels, offered a selection of
one-day mountain bike and trail running
races on routes separate from the Absa Cape Epic but at the
same venue as the finish of the Epic. The
starting times for the routes, including a children’s fun ride,
were designed so that the majority of
participants could complete their race and then “wind down and

29. cheer in the Absa Cape Epic riders.”12
The final day of the 2007 race attracted a crowd of 10,500
spectators at Lourensford, which was now
being touted by the world’s elite mountain bikers as the
“Champs-Élysées of Mountain Biking,” an
explicit reference to the traditional finish line for the Tour de
France, the world’s most prestigious road
bike race. In 2007, a daily 26-minute TV highlights package
was distributed globally, a world first for any
mountain bike stage race.
The 2006 Absa Cape Epic was the first mountain bike stage
race, and one of only four stage races across
the globe awarded UCI classification of Hors Categorie (beyond
classification — the most challenging
bicycle races possible). The other three stage races with the
Hors Categorie classification were the Tour
de France, Giro d’Italia and La Vuelta a España. Vermaak
commented:
Receiving support and affirmation from the UCI was a huge
milestone for the race. We had
successfully convinced the international mountain biking
community of the merit of a race like
this. By guaranteeing that the race always ends at least three
weeks before the World Cup season
begins, we made it possible for the top riders to participate. Not
only does this make for great
viewing, but it offers amateurs the opportunity to compete
against their heroes.13
Pat McQuaid, UCI’s president, stated:

30. The event format chosen by the organizers has made the Absa
Cape Epic into a model to be
followed by all those who are still searching for innovative
solutions, and the UCI is delighted
with their enthusiasm and above all their competence. The Absa
Cape Epic is a totally unique
event, whose promotion of cycling on a continental level is
absolutely vital as part of the UCI’s
strategy to globalize the sport.14
From a business standpoint, 2008 was noteworthy as it was the
first year that the Absa Cape Epic made a
small profit. Also around that time, Vermaak forged a
relationship with a business mentor, the chair and
retired chief executive officer (CEO) of a top 40 listed company
in South Africa. This relationship
provided Vermaak the opportunity to explore alternatives, such
as ways to further refine the
organization’s business and operational model to make the most
of what he had created. One logistical
10 E-mail communication with Lynn Naude, Absa, July 20,
2012.
11 Email communication with Kevin Vermaak, October 5, 2012.
12 “Welcome to the Vineyard Races,” www.vineyard-
races.co.za/vr/, accessed September 20, 2012.
13 “History of the Absa Cape Epic,”
www.mtbonline.co.za/club/capeepichistory.htm, accessed
September 20, 2012.
14 Absa Cape Epic 2012 Event Summary.
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Page 6 9B13M051
enhancement initiated internally for the 2009 event was to keep
the overnight stops the same for at least
two nights, with riders doing a circular route starting and
ending at the same place on certain days. This
enhancement was appealing to both the riders and the event
organizers as it meant fewer logistical
disruptions during the race. As the reputation of the Absa Cape
Epic developed, demand to be associated
with the event increased, allowing for profit generated by the
event to grow. In 2012, net profits grew by
55 per cent over the prior year; and, in 2011, the growth in
profits over the prior year was 78 per cent,
suggesting that the event was becoming the kind of sustainable
business Vermaak had in mind when he
had created the race (see Exhibit 4).
“The Absa Cape Epic is organized and presented with the riders
as the focal point,” explained Vermaak.
“Rider satisfaction, well-being and enjoyment are our primary
goals.”15 The experience of the rider
allowed the organization to generate revenue in three primary
ways: entry fees, sponsorships and rider
sales. Entrants in the 2012 race paid R35,400 per team
(approximately US$4,425). Different types of
sponsorships were available, including a title sponsor (Absa),
headline sponsors (Exxaro and Telkom
Business), venue sponsors and others. In addition to acquiring

35. marketing rights, many race sponsors
leveraged their investments by providing critical services. For
example, Telkom Business provided the
telecommunication infrastructure for the event; venue sponsors
provided locations for race registration,
overnight stops and the race finish; and the other sponsors
provided a range of goods and services, such as
vehicles, clothing (Craft), bike wash services (Pragma),
provision of food (Woolworths) and bike
servicing (Cycle Lab). The organization also had a long list of
supplier partners that helped ensure the
event was professional in every respect. The third revenue
stream was rider sales. Rider sales referred to
the extra goods and services that participants purchased before,
during or after the event, including
accommodation, DVDs, clothing and massages.
The race website played a critical role by marketing the event to
a global audience and by providing a
platform whereby, prior to the event, participants could interact
with each other and with the race
organizers. The race website also allowed supporters to track
the progress of riders during the event and
provided a window on the event for the media. In addition to the
race website, the organizing team
invested heavily in providing high-quality coverage of the
event: they paid for the creation and
distribution of video coverage of the event, hired a team of
professional photographers to cover the event
and wrote interesting stories surrounding the event, which then
found their way into magazines,
newspapers and blogs. Vermaak pointed out that generating all
the media coverage was “a complicated
and expensive thing for us to pull off. We have two helicopters,
satellite uplinks, two production units,
host broadcast facilities for independent teams, and a team of

36. photographers” throughout the event16 (see
Exhibit 5).
Over the years, international media interest in the race had
continued to increase, while rider participation
from abroad was actively kept below 40 per cent to encourage
South Africans to participate in the event.
In 2012, 49 countries were represented in the race with
international riders making up 34 per cent of the
field (of which more than 60 per cent were drawn from Europe).
The Absa Cape Epic was broadcast in
175 countries, attracting more than 4,400 hours of global TV
coverage. With these numbers underpinning
the event, the Absa Cape Epic was reportedly the largest full-
service mountain bike stage race in the
world.
Because of the event’s complexity and intensity, the race
originally relied heavily on an intricate
combination of unique company-owned assets. Initially,
Vermaak and his team acquired and created
specialized infrastructure assets that allowed them to establish a
fully functional race village in remote
15 Interview with Kevin Vermaak, June 5, 2012.
16 Dawes, “The Loneliness of the Long Distance Entrepreneur,”
2007, pp. 6-7.
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40. Page 7 9B13M051
locations. Some of these assets included portable showers that
could be mounted on the back of a truck,
portable toilets, large and small tents, portable washing
machines, state-of-the-art bike-washing
equipment and security systems to protect bikes and other
equipment. However, over time, the need to
own such assets had diminished. Vermaak explained:
In the beginning, much of these specialized assets did not exist
so we bought and built them
ourselves. However, now with the proliferation of quality
mountain bike races in SA, there is a
market for quality service providers to provide these services,
and we are now employing a
strategy of selling these specialized assets to expert service
providers in exchange for cash and
long term discounted service contracts which reduces our cost
and streamlines our business.17
GROWING THE BUSINESS
In 2007, Vermaak told a reporter: “We’ve built a really scalable
infrastructure, our accounts and the
structure of the company are what you would expect to find in a
much bigger business, so we can easily
snap on new things. I’ve got some ideas.”18 The Absa Cape
Epic brand was owned and managed by a

41. company called Grandstand Management, which Vermaak
founded and ran. The business was divided
into Operations and Events, with a director leading each
division (see Exhibits 6 and 7).
The operations director, Richard McMartin, “runs all matters
relating to operations of the company: HR,
finance, legal, facilities, IT, reporting etc.” explained Vermaak.
“Their structure would not change if we
started and managed 10 new/other events. They exist to
completely free up the Events Division to focus
exclusively on organising, managing, and marketing the Cape
Epic.”19 A total of four people comprised
the operations team, including McMartin.
The event director, Kati Csak, led the team that coordinated
route design and permission requests, rider
registration, race rules, emergency and medical services, the
marshals, timing and results, and optional
extras available to riders, as well as management of the crew
and volunteers. The events team also
oversaw the planning and implementation of infrastructure,
through different divisions under the event
umbrella, which, explained Vermaak, “staff up considerably
closer to the race.” The organization
therefore expanded from 21 full-time employees to more than
700 people who played a role in making the
event happen.
“Because of skill sets and where I can add the most value, I get
involved in elements of the event
management, too,” 20 explained Vermaak. In addition to
McMartin and Csak, the heads of Marketing &
Communications, Sponsorship and Hospitality also reported to
Vermaak. An event management forum
comprising all division heads met monthly to provide a

42. structure for “efficient decision-making and new
idea refinement.” Vermaak explained, “We also have quarterly
team getaways for team building, training,
blue-sky thinking, event updating, etc.” “Observing the team in
action, it is evident that they love what
they do and they are passionate about the race. They seem to
have a great respect for and understanding of
each other,” reported a volunteer who had worked on the race
since 2008. 21
In 2007, Vermaak and his team decided to leverage their
learning from the Absa Cape Epic to launch a
five-day, 200-km (125-mile) trail-running event starting on the
Southern Cape Coast and finishing in the
17 Email communication with Kevin Vermaak, October 5, 2012.
18 Dawes, “The Loneliness of the Long Distance Entrepreneur,”
2007, pp. 6-7.
19 Email communication with Kevin Vermaak, September 12,
2012.
20 Ibid.
21 Case writer’s discussion with a race volunteer, December 5,
2010.
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Page 8 9B13M051

46. Cape Winelands. The event, called The Cape Odyssey, saw the
first running of the event in October 2007.
Similar to the Epic, runners needed to enter as a two-runner
team, and the organizing team put great
emphasis on “taking excellent care of the participating athletes,
with the goal of providing an
unforgettable African-style trail running experience.”22 To
achieve this goal, 24-hour service was
provided, which included water points, tented accommodation
in the race village each night, dinner,
masseurs, entertainment and a carbo-loaded breakfast to start
each day.23 The Cape Odyssey was hosted a
second time in October 2008; and, although participating
runners had nothing but good things to say
about the race, the organizing team felt that the trail running
market was not as valuable as the mountain
biking market and the race had not been run since.
Also in October 2008, Grandstand Management hosted the
inaugural Cederberg Escape, a three-day full-
service individual mountain bike stage race. The race route
included three out and back loops from the
race village in the picturesque Cederberg mountain range.24
Entries for this 60 km to 90 km per day race
sold out quickly, with increased demand for subsequent
editions. Participants described the race as a
“mini Cape Epic, where they “immediately felt at home,” as
“Grandstand really know how to put an event
together.”25 Although positive feedback was received, the
Cederberg Escape was not hosted again.
Having built a significant “event-organizing machine,” Vermaak
recognized that larger events with bigger
budgets might be better suited to effectively exploit the team’s
expertise.

47. In 2011, two Exxaro executive committee members participated
in the Absa Cape Epic, as part of a
charity drive. Exxaro was a listed mining group in South Africa
with a Black Economic Empowerment
rating. The two executive committee riders were joined by three
other senior managers and an executive
from an external company. Exxaro also sponsored the grand
finale, where it hosted a hospitality suite for
invited stakeholders. Although the Exxaro executives were
pleased that their participation raised R1.5
million (US$187,000) for charity, they noticed the virtual
absence of any Historically Disadvantaged
South African (primarily Black South Africans) riders —
probably fewer than 10 out of the 1,200 total
participants. Although many reasons could account for this low
turnout, including a traditional lack of
resources, lack of interest and limited access to support
structures, Exxaro was interested in encouraging
mountain biking in all levels of South African society. By the
end of the grand finale, Exxaro’s CEO,
Sipho Nkosi, expressed the wish to one day see someone from
one of Exxaro’s rural mining communities
participate in (and even win) the Absa Cape Epic.26
By August 2011, Exxaro had signed on as the official
development academy partner to the Absa Cape
Epic for a period of five years. Through the Exxaro Mountain
Bike Academy and Exxaro’s association
with the Absa Cape Epic, the business hoped to remove the
“elitist tag associated with mountain biking,
expose many to the healthy outdoor benefits of mountain biki ng
and take the sport to rural
communities.”27 Exxaro entered 12 teams in the 2012 race and
planned on entering 20 teams for 2013.28

48. 22 “Introducing the Challenging Cape Odyssey Race,”
www.southafrica.com/blog/introducing-the-challenging-cape-
odyssey-
race, accessed September 20, 2012.
23 Ibid.
24 The Cederberg Escape Mountain Bike Classic,
www.capetownmagazine.com/events/The-Cederberg-Escape-
Mountain-
Bike-Classic/2008-10-24/11_37_9219, accessed September 20,
2012.
25 Cederberg Escape 2008,
www.rudeawakenings.co.za/report/mountain-biking/cederberg-
escape-2008, accessed
September 20, 2012.
26 Exxaro MTB Academy Charter.
27 Ibid.
28 Interview with Lizette Kohn, Exxaro, July 16, 2012.
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Page 9 9B13M051
WHAT NEXT?
As Vermaak watched the large crowd of more than 15,000

52. spectators enjoying the live music
performance, aerobatics display and hospitality at Lourensford
on the final day of the 2012 Absa Cape
Epic, he wondered what more could be done to build on the
capabilities and asset base of the company.
“The Absa Cape Epic is recognized as being a ‘best in class’
event in the mountain bike community, but it
is still not that well known outside of the mountain bike world.
What would it take to generate a broad
audience following similar to that of the Tour de France?” he
wondered to himself. Vermaak considered
how Absa could leverage its title sponsorship internationally
through the Barclays brand, and what
implications doing so would hold for the race. He was also
excited about the new direction the Exxaro
relationship might open up in South Africa and wondered how
to best take advantage of that commitment.
With 85 per cent of this year’s riders stating they would return
to ride again and other performance
metrics showing double-digit increases, Vermaak felt a mixture
of comfort and restlessness:
Should we focus on building just this race or should we work to
establish a global series of
mountain bike stage races similar to the Grand Slam in tennis,
the Majors in golf or the Formula 1
circuit in motor racing? Should we diversify out of mountain
bike racing to make the most of our
capabilities and assets? How should we spend our time in the
year leading up to the 10th running
of the event in 2013 to ensure that we continue to build on our
past success, stay true to our vision
and ethos, but still leverage the opportunities that lie before us?

53. A
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Page 10 9B13M051
EXHIBIT 1: ABSA CAPE EPIC’S SELECTED KEY EVENT
MILESTONES
07/01/2003 International marketing partners, Planet Talk
GmbH, recruited to market the race
internationally
16/05/2003 The Cape Epic website is launched and the
inaugural newsletter is distributed to 2,546
worldwide subscribers
17/09/2003 –
25/09/2003
First-ever trial ride of the route completed successfully
09/12/2003 Adidas International announce their presenting
sponsorship
01/06/2004 The 350 SA regional team entries for 2005 Cape
Epic sell out in less than 5 hours
09/10/2004 The international block of entries sells out for the
first time

57. 09/04/2005 Inaugural Vineyard Race attracts 550 participants
30/06/2005 The first-ever public lottery, introduced due to the
massive demand to ride 2006 Cape
Epic, closes and 500 lucky teams are invited to ride the race and
complete their online
registration
06/10/2005 The Cape Epic wins Platinum at the SA Logistics
Achiever Awards ahead of major SA
industrial companies
26/10/2005 The Cape Epic is the first-ever mountain bike race
to exhibit at the Sportel TV Rights Fair
in Monaco and surpasses 2,500 hours of global TV hours to
become the most televised
mountain bike race of all time
24/10/2006 Absa announces a 3-year extension to its title
sponsorship and the all-new 2007 route is
launched at the glittering Route Launch Charity Gala at the
Hilton Sandton in
Johannesburg
31/01/2007 Toyota announces sponsorship as Official Vehicle
of the Absa Cape Epic
24/03/2007 -
31/03/2007
1,206 riders from 43 countries, including 7 of the top 10 ranked
UCI XCO riders, ride the
toughest race yet. A daily 26-minute TV highlights package is
distributed globally — a
world first for any mountain bike stage race
31/03/2007 10,500 spectators attend the final day at

58. Lourensford; 1,100 riders ride the Cape Times
Vineyard Race; 1,017 riders finish the 2007 Absa Cape Epic
30/10/2008 New route concept announced — multiple days in
one stage location. Prologue to take
place beneath Table Mountain. Traditional finish in Lourensford
04/04/2009 Race registration takes place with the backdrop of
Table Mountain. After the prologue
riders begin stage 1 in Gordon’s Bay, staying 2 nights at their
next destination in
Villiersdorp, then Greyton and Oak Valley.
31/10/2009
New 2010 route announced — keeps the same multiple stage
route concept after 2009’s
success. Diemersfontein marks the start of stage 1, arriving in
Ceres where riders will stay
3 nights. Route touted to include more singletrack than ever
before.
38/03/2010 Stage 2 in Eselfontein, Ceres voted the best stage in
Absa Cape Epic history
26/10/2011 2011 route announced – prologue is reintroduced,
Tokai forest. Stage 1 begins in
Saronsberg, Tulbagh. Other towns include Worcester and Oak
Valley
27/03/2011 –
03/04/2011
2011 Absa Cape Epic finisher’s rate at 88.2% with participants
representing 54 countries.
Riders rode 707 km with 14 550 metres of climbing. Proud

59. Winning team 36One-Songo
Specialized finishing with a winning time of 28:44,44.0. Burry
Stander, riding with Swiss
partner and multiple world champion Christoph Sauser, is the
first-ever South African to
win the race.
25/10/2011 CRAFT is announced as new cycling apparel
sponsor after 8 years with Adidas
02/02/2012 Grand Masters category for 2013 is announced —
where both riders must be over 50
years of age
Source: www.cape-
epic.com/content.php?page_id=25&title=/Milestones/, accessed
September 20, 2012.
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Page 11 9B13M051
EXHIBIT 2: ABSA CAPE EPIC’S VISION AND ETHOS
Vision

63. To create the world’s premier mountain bike race in which
every serious amateur mountain biker desires
to participate and every professional mountain biker aspires to
win.
Ethos
The individual philosophy of the founder of the Absa Cape Epic
is the foundation for the Untamed African
Mountain Bike Race. On March 11, 2003, the Absa Cape Epic
was awarded Proudly South African
status.
1. The Absa Cape Epic is organized and presented with the
participating athletes as our focal point.
Their satisfaction, well-being and enjoyment of the race are our
primary goals. We aim to deliver
an unsurpassed and unforgettable mountain bike and African
travel-experience.
2. We will endeavor to source all products, services, and human
resources for the Absa Cape Epic
in South Africa, to stimulate general economic activity and to
support local job creation.
3. The Absa Cape Epic will promote the culture and beauty of
South Africa and introduce the South
African mountain bike scene to the world.
4. We will work closely with legal and environmental
authorities to make the Absa Cape Epic a
sustainable success on the global mountain biking circuit.

64. 5. It is our hope that the Absa Cape Epic will introduce the
mountain biking experience to the local
communities through which the race will pass. In partnership
with existing South African cycling
development bodies, the Absa Cape Epic will endeavor to
develop mountain biking and cycling in
the previously disadvantaged communities.
6. We are committed to transformation at all levels of sport in
South Africa and will eagerly
participate in activities and initiatives that further the
transformation of all cycling formats in South
Africa.
Original Logo
Source: www.cape-
epic.com/content.php?page_id=118&title=/Company_Ethos/,
accessed September 20, 2012. This

65. statement has also appeared in media material since the
inception of the event.
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Page 12 9B13M051
EXHIBIT 3: ABSA CAPE EPIC’S DAILY COMPETITOR
EXPERIENCE
05:15 Rider wake up siren
05:30 Rider bag check opens
05:30 Bike park opens
05:30 Breakfast opens
06:15 Start check-in opens
06:30 Breakfast closes
06:45 Rider bag check-in closes
06:45 Seeded start chute close
06:50 Bike park closes
07:00 Race start
11:00 First riders arrive
11:00 Showers/basins open
11:00 Massage tent opens

69. 11:00 Bike wash opens
11:00 Bike park opens
11:00 Race hospital opens
14:00 Race office opens
17:00 Riding cut-off time (subject to
change)
17:00 Personal race nutrition hand in opens
17:30 Rider bag check-out closes
17:30 Entertainment starts in rider dining
marquee
18:00 Final race results posted
18:00 Start sheets for the following day
posted
18:00 Bike wash closes
18:00 Dinner opens
18:30 Personal race nutrition hand in
closes
18:45 Awards ceremony in the rider
marquee
19:00 Dinner closes
20:00 Race hospital closes
20:00 Race office closes
21:00 Showers close
21:30 Massage closes
22:00 Bike park closes
22:00 Lights out race village
Source: Absa Cape Epic Media Guide 2009.

70. EXHIBIT 4: SUMMARY OF FINANCIAL RESULTS FOR
ABSA CAPE EPIC, 2010–2012
2010 (ZAR) 2011 (ZAR) 2012 (ZAR)
Approximate Income 29.2 million 36.0 million 42.7 million
Revenue Split
Sponsorship 43% 44% 43%
Entry Fees 43% 42% 45%
Rider Sales 11% 11% 9%
Other 3% 4% 3%
Increase in Net Profit Before Tax over the
Prior Year# -- 78% 55%
Entry Fees Per Team of Two Riders 25,200 29,900 35,400
Note: ZAR = South African Rand; US$1 = Approx. 8 ZAR
# Increase in Net Profit Before Tax over the Prior Year = (Profit
before tax from the current year – Profit before tax from the
prior year)/(Profit before tax from the prior year)
Source: This table was created by the authors from the Absa
Cape Epic management accounts supplied by the operations
director at Grandstand Management.
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74. Page 13 9B13M051
EXHIBIT 5: ABSA CAPE EPIC’S MEDIA HIGHLIGHTS
South African Media Values
South African media values were tracked by Newsclip for a 12-
month period up to May 31, 2012. Overall,
the 2012 media value increased by 30% from 2011. Broadcast
made the biggest contribution to the
overall increase, as this nearly doubled from 2011.
A key off-event activity period is the Route Launch week in
October. This week was marked by an
increased media coverage compared with the 2011 event and
provided even more year round exposure
for the Absa Cape Epic.
Overall SA Media Value Composition of South African Media
Value
Global Media Values
Absa Cape Epic produced four television products (Daily News,
26-minute Daily Highlights, 24-minute
International Racing Highlights, 52-minute Event Documentary)
plus customized short reports for
international news stations. With 4,400 broadcast hours across
175 countries, it remains the most
televised event of its kind in the world. In addition to the above,
local audiences could once again watch
the Prologue and Stage 7 live on SuperSport. These two 5-hour
broadcasts were streamed live online to

75. international audiences — a first for the event. The Daily
Highlights saw the most growth in 2012 with an
increase of 20% in takers and 129% in number of transmissions.
Half of all takers broadcast the shows
within a 24 hour window.
Top News Broadcasters in 2012
Bloomberg (Worldwide), Euronews (Worldwide), France 3
(FRA), ZDF (GER), RTL (GER), RAI (ITA), SF
2 (SUI)
Global Broadcast Hours Number of Transmissions per Product
Type
Source: Absa Cape Epic 2012 Event Summary.
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Page 14 9B13M051
EXHIBIT 6: ABSA CAPE EPIC’S TOP MANAGEMENT TEAM

79. Kevin Vermaak – CEO and Founder
While pursuing an I.T. Professional Services career in Europe,
this Cape Town native and UCT
Engineering graduate took some time out to lead the first-ever
combined mountain biking and
snowboarding international expedition to Muztaq Ata in
Pakistan/China in 2000. He also completed
numerous mountain bike epics in Tibet, Nepal, Pakistan,
Norway, Costa Rica and Europe. Renowned for
always thinking “outside the box,” Kevin conceived the idea for
the Cape Epic whilst participating in La
Ruta de los Conquistadores in Costa Rica in November 2002.
Not wasting any time, he returned to South
Africa in February 2003 to establish the Cape Epic.
Kati Csak – Event Director
Kati was born and grew up in Konstanz, Germany, and holds
English and German business degrees.
After having lived in London, Maine and Vermont, she left the
northern hemisphere in search of paradise,
which she found in South Africa and made Cape Town her new
home in 1997. Kati is an experienced and
well-travelled events manager. Before joining the Absa Cape
Epic in January 2005 she proved her skills
in a number of prestigious events, including the international
press launches for the Mercedes Benz SLR
McLaren and BMW GS1200 Motorbike. With her move to the
Absa Cape Epic she has followed her heart
— Kati could easily be described as a universal-sportsperson
with a keen interest in cycling, paddling,
snowboarding, triathlon, diving and generally anything active.
Richard McMartin - Operations Director

80. Born in Durban and raised in the Natal Midlands, Richard
discovered a love for sport and adventure at a
young age, which has shaped a well-rounded sense of balance
and enjoyment in life. A water sports
fanatic, he has paddled most rivers and coastlines that Southern
Africa has to offer. After working in
London, Richard returned to South Africa in 2005 and joined
the Absa Cape Epic team, where he is the
Operations Director. Richard holds a BComm PPE degree from
the University of Cape Town.
Source: www.cape-
epic.com/content.php?page_id=200&title=/The_Team/, accessed
September 20, 2012, and Absa Cape
Epic Media Guide.
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Page 15 9B13M051
EXHIBIT 7: ABSA CAPE EPIC’S ORGANIZATIONAL
STRUCTURE AND VALUES: GRANDSTAND
MANAGEMENT

84. Note: Number of people in each team reflected in parenthesis
(#)
Company values
1. Accountability – We individually take ownership of the tasks
for which we are responsible, and see
them through to completion before and during the event
2. Attention to Detail – We tirelessly focus on the detail – this
is our key organisational trait
3. Build on Experience – we implement processes to embed
learnings and innovations from previous
races
4. Candour – we tell it like it is. We don’t sugar-coat
constructive criticism, and team members expect to
receive communication in this fashion. Candour must always be
executed with respect.
5. Communication – Our unique business environment, where
every team member’s work impacts on
other teams’ work, requires robust, pro-active communication.
It is acceptable that pro-active
communication is sometimes at the expense of personal
productivity.
6. Customer Focus – We provide unrivalled customer service to
our riders, sponsors, suppliers and
crew
7. Efficiency – we train, we mentor, we challenge and we

85. inspire ourselves and our colleagues to work
as efficiently as possible
8. Integrity – Don’t be a chop
9. Pioneering – We’re creating something without precedent in
the sport of mountain biking and
therefore are always willing to explore new ideas
10. Premium – We work with premium-quality brands and
suppliers to emphasise our status as the
world’s premier mountain bike race
11. Relationships – we seek to create and maintain personable
relationships between team members
with all our current and past partners including sponsors,
suppliers and crew.
12. Relentless Quest for Perfection – since our mission is to be
the premier race in the world, only
perfection is good enough, which negates the requirement for
comparison
13. Respect – We respect the function, input and time of every
other staff member. We respect every
team member for his or her contribution to our overall success
14. Results – We recognise effort, but results are king
15. Sports Participation – we love participating in sport, be it
ballet, karate, yoga or mountain biking.
Source: Constructed by authors based on discussion with staff at
Grandstand Management and email communica tion with
Kevin Vermaak, October 5, 2012.
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