The Influence of Customer Feedback on Software Startups : The Identification of crucial Pivot Triggering Factors through the Application of the ESSSDM Funnel.

Abstract: Most Software Startups fail to establish a working business model. One of the main reasons is that they fail to validate their hypothesis and neglect to learn from their customers. Therefore, Software Startups are supposed to continuously adjust their direction to achieve product-market fit. The purpose of this study is to explore the role of customer feedback in the context of Software Startups during the decision to pivot. Thus, the central research question of this thesis is: What role does customer feedback play when a Software Startup decides to pivot? By living up to the values of a pragmatic research philosophy this qualitative study used nine semi-structured interviews with experts from the relevant field. Afterwards, these insights have been placed into the four stages of the Early Stage Software Startup Development Model (ESSSDM) funnel. This study showed that customer feedback plays a crucial role when a Software Startup decides to pivot. However, the interviewees revealed that it is essential how customer feedback is perceived and used for the product development. Furthermore, customer feedback was not perceived as the only crucial triggering factor, but an element of a broader set.