Causation and Effectuation -- Two Guiding Decision-Making Principles in Startups.

About 50% of all business startups in the U.S. vanish by their fifth year (Fisher, Maritz, & Lobo, 2014). A survey by the U.S. Census Bureau (2015) identified 5.4 million small businesses in operation, with about 67% having fewer than 20 employees. Most small businesses are known as micro-business enterprises (MBEs) and are run by micro-business owners (MBOs). This qualitative phenomenological study explored decision-making principles of causation and effectuation on MBOs whose MBEs had fewer than 15 employees. There are challenges MBOs experience when the MBE transitions out of the startup phase and enters into growth--a phase known as the inflection point (Dimovski, Penger, Peterlin, & Uhan, 2013). Exploring MBO decision-making was central to the study. Understanding the role decision-making principles of causation and effectuation had on the success or failure of an MBO's business at the inflection point in the business lifecycle was central to the study findings. The findings in the study supported the problem statement in that MBO behavioral characteristics contribute to how decisions are processed as the MBO engages in decision-making when looking at opportunity, resource utilization, strategy development, and other functions necessary to the building of a successful business. [ABSTRACT FROM AUTHOR]