In his talk ‘Forms of Uncertainty’, Florian Grote uses the 1969 book of mathematics and logics ‘Laws of Form’ by George Spencer-Brown to show a social model for building and operating a start-up. The logics set out in Laws of Form are based on the basic notion and function of making distinctions. Whenever something is observed, it gets an outline as is identified as such. This then, stands into a new relation to its background and context. It is now in what is called a ‘marked’ stage, or what Grote ascribes an ‘area of meaning’. Grote describes that the stages of a start-up to take into account to function (in)effectively are the society, economic activity, funding, founders, vision, dynamic capabilities, scaling potentiality, problem-solution fit, and ultimately product-market fit. These are all entities of analysis to look at when observing start-up organisations. As a ‘unity of difference’ it means that it is important to observe any of the areas to see how they feed back, re-enter, into another.

Hence, next to the notion of distinction, Spencer-Brown’s notion of re-entry comes into play. It would be possible to replace the areas of meaning with another variable, for example if the founder of the organisation pulls out, theoretically the organisation would look at this as an empty space to be filled. The distinctions are stable, but the ultimate form is dynamic due to the re-entry. It is like what is called the ‘butterfly effect’: where a decision is or is not made in one area, it affects the operations of another. Moreover, re-entry could be analysed to make something operate better from the perspective of the ideal form, rather than just from what is going wrong/right from within. In this way, it could be possible to run models of different variables for the different areas of meaning to get alternative forms of start-ups. Therefore, different societies would get different kinds of companies. While in the 90’s companies could become successful as ‘one-trick ponies’, there are now different problems and demands, and a different market-fit, so they would not operate the same.

One of the questions in the discussion is whether this model is not restricted to global capitalistic society. Would it still look similar when companies are state-run, egalitarian or profit is not a part of ‘economics’? Grote points towards the break made within the model between on the one hand the areas of meaning that make a start-up possible, i.e the contextual conditions, and on the other hand the actual operation of a start-up. The context might change, and if hypothetically economic activity would be merged with political activity, some of the distinctions would be a different category. With this in mind, Grote had already run through an adjustment of ‘society’ to ‘resilient society’, in order to come up with models of start-ups that operate according to societal impact, rather than revenue or scaling. Nevertheless, the ‘economics’ of the distinctions and their dynamics are a constant.

Florian Grote is Professor of Product Management at CODE University of Applied Sciences in Berlin. He has filled design and product roles in the music technology industry, working on innovative instruments for electronic music production. His research focuses on cognitive and systemic perspectives on learning organizations with special attention to resilience.

Text: Yael Keijzer