Scaling the Pivot
Pivot” is the new black. Â Everywhere you turn, people are talking about the pivots their companies are taking. It’s not just limited to the startup World. I was watching BBC news recently where they showed a fun segment of World leaders, including President Obama, talk about pivots.
The reason this is word is so pervasive is that pivots are reality. Both of our 1st two investments at Real pivoted significantly before we even funded them.
But what does it mean to pivot? How do you preserve this crucial ability as your company grows?
When you are starting out, there is no process, machine, team, or bureaucracy standing in the way of change. You, and ideally a cofounder, are just reacting, surviving and hustling to build something people want.
This is when you are at your most lethal. When you ask the market larders who they fear it is never their direct competition. Rather it’s the mythical “two kids in a garage”.
Preserving the ability to pivot as you grow is a core cultural issue. If you allow politics to creep into your company you’re dead. If your Investors are intolerant of change you’re dead. If staff have to mask or spin data as it moves up to management you’re dead.
Only an open culture where anyone and everyone can call BS and point out when something is not working will you maintain the ability to pivot.
This starts at the top. You as the founder make it happen above you at the board level and below you company wide.
Remove any and all obstacles to maintaining this frank and open environment.
I am curious to know what you guys define as failure?
"You, and ideally a cofounder, are just reacting, surviving and hustling to build something people want". This pretty much sums it up, although I am not too sure if any of the bigger players care or even know about us at the moment (perfect, one less headache).
Love to put great analogies here but in our experience we are just learning and adapting based on user feedback and our instincts/passion. Stats and metrics definitely goes a long way (he can help http://www.kaushik.net/avinash/ ), and pivots lead to both ups and downs.
Just deal with it and keep moving along, my 2 cents.
@Paul, why such a harsh outlook on pivoting due to failures? I disagree with you, it is usually only through trial and error that you are able to identify the need for a 'pivot'
Every initiative you launch is to prove a hypothesis and when you fail to get the expected conclusion you 'pivot' to adjust strategy and try again.
You can not successfully evaluate strategy by only analyzing stats and reports in a glass bubble, you need to build product, interact with the marketplace, (re)-iterate product and generate your own data.
It is through these failed cumulative experiences gathered by by trial and error that you can prove your hypothesizes, and gather enough data to build a successful product which is a 'pivot' from the original concept.
Lots of good points! I’m founding a start up right now, and we just pivoted our marketing strategy to make easier to explain our product. The product didn’t change, just the way we are bringing it to market. After we start building membership we will ‘turn on’ the additional features. Account upgrade!
We are moving into a very ‘full’ market landscape with a lot of well established competitors. However our biggest fear is “two other guys in a garage”. The big guys have too much structure in place to be able to react to a disruptive technology quickly.
Clear market positioning is so important. Customers need to instantly understand the value that you provide. Good luck!
Being one of those investments that pivoted, I thought I'd add a comment here
I have a problem with the usage of the term.
The word 'pivot' is used to describe a few very different concepts – it's a mistake to conflate them like this as one usage is referring to a smart strategic play, and the other is referring to a situation that shouldn't have happened. Often it is used to describe failure – 'that didn't work so we pivoted'. I don't think that's the right use – a pivot is something you do when new data presents itself. It is a willed change of strategy. You could argue that failure is a type of data, but it's way too late to be changing path at that point – your current path just ended at a cliff. The whole point is that by gathering data and making an informed decision to pivot around that data, you avoid failure and increase the likelihood of success.
TL;DR – if you changed strategy after you failed, then that's not a pivot. It's a failure that you're trying to recover from. If you changed strategy after you analysed your position and data, then that's a pivot.
Totally agree Paul. Every startup I have ever been involved with has changed course either partially or fully. Don't know how I survived so long without the word "pivot" in my lexicon. I don't care for it.
Pivoting post failure is just denial.