Information systems (IS) projects are complex and costly, but only a 3rd of IS projects are successful; the Standish Group reported that 32% of IS projects were successful in 2012. Although investments in research have led to improvements in practice, there is a general perception that management failures are responsible for the low rate of IS project success. The effects of initiating factors on project outcome had not been sufficiently explored; few IS researchers have explored the initiation phase. The purpose of this grounded theory study was to explore project initiation factors, including relational, as well as decision-making aspects, and how they might be addressed to enhance the possibility of success. The research questions were oriented at identifying key initiation factors, how they might be managed to promote project success, and how decision-making factors at initiation might facilitate project success. A conceptual framework consisting of chaos theory and Ashby's law of requisite variety was used. Purposive and snowballing sampling techniques were used, and 24 IS managers and project managers were interviewed. A 3-stage data analysis approach was used and included open coding, focused coding, and theoretical coding. Key themes identified included project governance and management, as well as stakeholder engagement. The emergent theory of IS project initiation indicated that the factors represented by the themes must be identified during initiation but implemented throughout the project lifecycle to ensure project success. Positive social change may be realized as IS managers, and project managers apply the findings and recommendations to achieve project success and avoid costly failures thus benefiting both companies and customers.