The Rise and Fall of Wikimart
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Questions and Answers

Which of the following is a self-reinforcing process that can occur in a Death Valley scenario?

  • Declining performance standards (correct)
  • Increasing performance transparency
  • Recognition and promotion
  • Growing number of successful clients

    • What is a characteristic of agents in the principal-agent problem?

  • They prioritize the vision and results
  • They invest full responsibility and effort
  • They avoid performance transparency (correct)
  • They put clients first

    • Why do agents feel resistance to making the result clear?

  • It leads to higher salary and titles
  • It benefits the clients
  • It means taking on painful responsibility (correct)
  • It increases their influence

    • What can happen if a fake effort is rewarded in a team?

    <p>Cheating becomes a Nash stable strategy</p> Signup and view all the answers

    What is a potential risk in a Death Valley scenario?

    <p>A stock bubble burst</p> Signup and view all the answers

    What is the 'Death Valley' in the context of startups?

    <p>A decline in the probability of achieving product-market-timing fit</p> Signup and view all the answers

    What is the likelihood of a startup making it to an IPO, according to the text?

    <p>1 in 10,000</p> Signup and view all the answers

    What happened to Maxim Faldin and Wikimart, as mentioned in the text?

    <p>Maxim Faldin declared personal bankruptcy, and Wikimart lost investments</p> Signup and view all the answers

    What does the author mean by 'Comfort is Suicide'?

    <p>Being comfortable leads to failure in startups</p> Signup and view all the answers

    Which of the following is true about teammates helpful to jump through death valley?

    <p>Teammates immediately question someone who provides vague or misleading information</p> Signup and view all the answers

    Based on the text, why are some employees engaged in talking behind the back?

    <p>Tacitly collude against supervisors and the entire team</p> Signup and view all the answers

    What is the preferred response of teammates when receiving feedback?

    <p>Teammates accept feedback</p> Signup and view all the answers

    How to support the strategy "to keep tasks transparent and deliver" to be Nash stable?

    <p>Insist to make a task transparent on standup if it is not in Story format</p> Signup and view all the answers

    Study Notes

    Death Valley Scenario

    • A self-reinforcing process that can occur in a Death Valley scenario is a fake effort being rewarded in a team, leading to more fake effort.
    • A potential risk in a Death Valley scenario is that the team might not be able to deliver due to lack of transparency and fake efforts.

    Principal-Agent Problem

    • A characteristic of agents in the principal-agent problem is that they feel resistance to making the result clear.
    • Agents may not provide clear results due to their own interests and biases.

    Team Dynamics

    • If a fake effort is rewarded in a team, it can lead to more fake efforts and a lack of actual progress.
    • Teammates who are helpful in jumping through Death Valley are those who provide clear and honest feedback.
    • Some employees engage in talking behind the back due to a lack of transparency and trust within the team.
    • The preferred response of teammates when receiving feedback is to take it constructively and make necessary changes.

    Startup Success

    • The 'Death Valley' in the context of startups refers to the challenging phase of a startup's journey where it is struggling to survive.
    • The likelihood of a startup making it to an IPO is very low, with only a few successful startups making it to this stage.

    Case Study

    • Maxim Faldin and Wikimart, as mentioned in the text, are examples of startups that failed to overcome the Death Valley phase.

    Strategy

    • The author means that 'Comfort is Suicide' in the sense that if a team becomes too comfortable, it can lead to complacency and a lack of innovation, ultimately leading to failure.
    • To support the strategy "to keep tasks transparent and deliver" to be Nash stable, it is essential to encourage clear communication, honest feedback, and a culture of trust within the team.

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    Description

    Test your knowledge about the rise and fall of Wikimart, Russia's Amazon equivalent, and the bankruptcy of its founder Maxim Faldin. Explore the journey of this tech entrepreneur and discover key insights into the challenges faced by startups in the ever-evolving business landscape.

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