Mapping decisions in startup settings: Case Rafla : Need for Seed

Abstract

In a perfect world everything would be pink, stable and predictable. However, constant Schumpeterian “creative destruction” prevails offering startup founders opportunities to earn economic rent. Therefore, under conditions of extreme uncertainty, ambiguity, volatility and cognitive stress yet-to-be-made future is built by the startup founders. Prevailing chaos in the entrepreneurship domain due to evolving markets and changing customer preferences are causing human cognition to be prone to various flaws. These flaws are acknowledged to be helpful in majority of cases because flaws (e.g. heuristics, biases and other mental shortcuts) make the uncertainties feel more under control. After all, a rational person might not like to guess possible with serious financial consequences. This thesis taps into how various heuristics alter the case company’s (i.e startup called Rafla) two building blocks in its business model during the 17-month action research whereas the author acts both as a co-founder and an researcher. The data (i.e. chats between the co-founding team) is collected from case company’s main communication platform Slack and analysed and verified with the help of other documentation (e.g. Google Workspace). Two building blocks of the business model, more precisely, customer segments and value proposition, are defining fundamentally how the the startup is able to get funding. The funding its various forms is key for the early-stage startup to grow rapidly in its intended nascent market, the blue ocean, and how fast it might sail to its desired destination faster than competitors.