Awareness Without Actions

Abstract

The success and survival of software startup companies depend on the decision-making of entrepreneurs. Risk perception and management is an important part of making both business and product-related decisions. In contrast to the popularity of research on risk management in the context of established organizations, there is relatively limited research on risk management in early-stage startup companies. In this work, the authors aim at understanding the perception and practices of managing risks in software startups. They interviewed CEOs and CTOs of nine early-stage software startups in Denmark and Norway. The results revealed an awareness of common types of risks among software startups. However, risks are not measured or managed by any established approaches. They found that startup founders do not believe in risk management methods and prioritize other tasks on their to-do list. The findings have direct implications for startup founders in their early stages in Nordic countries.