Paranoiabox. Ru: Early Growth Decision Dilemma of a Quest Start-Up

Abstract

Case Objectives: The case is a multidisciplinary case with the aspects of entrepreneurship, marketing strategy and finance. It is intended primarily for a course in Entrepreneurship, but it can be also used in a Marketing class or an Entrepreneurial Finance class at the undergraduate or graduate level. Case Synopsis: Paranoiabox.ru case presents an entrepreneurial and strategic marketing decision situation. In May 2019, in Moscow, Russia, two young residents of the MGIMO University business incubator Anastasia and Max founded the start-up business called Paranoiabox.ru. This project was a quest in a new format with home delivery: a mixture of escape, detective and board game. The player received by post a box containing various objects. Interacting with them, he or she unraveled the plot thread, found clues and gradually approached the final clue. The game with complex copyright puzzles had a built-in hint system and provided mechanisms for interaction online. By July 2019, 30 boxes for their first quest were sold. The subscribers were waiting for a new quest. Despite the first sales, Anastasia and Max had no budget for hiring freelancers or outsourcing. They were faced with an urgent and challenging dilemma: whether to concentrate on the current product sales and spend all the budget on promotion, or, alternatively, to launch a series of new quests and focus on the target market with high brand awareness. The latter may also lead to launching a crowdfunding campaign to finance the growth.