pivot

When Your Startup Should Pivot (and When it Shouldn’t)

“Pivot” may be the one word that entrepreneurs and the television show “Friends” have in common. In either case, you hear it all the time. But a pivot isn’t always the best choice for your startup. How can you tell?

pivot

I’m going to share with you how to know when your startup should pivot. I’ll touch on the battles I went through with my own company when deciding whether or not to pivot, and cover:

  • What is a pivot?
  • What are signs telling you to pivot?
  • What other options do you have instead of a pivot?

What is a pivot?

A “pivot” is a massive change in what you do as a business

Instagram is a great example.

The company started off as Burbn, a social check-in app. Over time, its founders saw that their users didn’t care much about telling friends where they went – but they did constantly share photos of those places and what they did there. So Burbn pivoted to focus on that one feature (social image sharing) and rebranded as Instagram.

But you don’t have to rebrand to pivot. Take Text Request, for example.

We’re an online business text messaging software (SaaS). We started as a customer service tool for the hospitality industry. We thought, “If I’m a customer, I’d much rather text your business than call for help.”

But texting for customer service was not a big need for these particular businesses at the time, so the sales process was difficult and lengthy. What we found, though, was that other types of businesses really needed a texting solution to make sales and schedule appointments.

So we made a pivot. We went from a customer service tool for hospitality to a sales and marketing tool for home service businesses. We changed our product to meet the needs of home service businesses. We changed our messaging, and our sales and marketing strategies.

That’s the only pivot we’ve made, but we’ve since done a lot of refining.

“Refining” is changing how you do something as a business

You can refine your sales strategy, your product design or feature offerings, how you target your market, and more, but it doesn’t change the direction of your business.

A pivot changes direction, while a refinement improves how you get there.



Is a pivot right for your startup?

Your startup is constantly looking for traction. You’re looking for a target market, product, channel, etc. to start performing well.

An indicator of if and when your startup should pivot is when you’ve given the above segments time and effort to work, and you’re seeing no traction from any of them. That can tell you:

  • You have a product people don’t want
  • You’re targeting the wrong people
  • Or that you’re using the wrong avenue to find customers

Myth #1

Slow growth does not mean you should pivot. We often hear new startups saying they’ll get to a half million in sales and be profitable in year one, or something similarly bold. That’s probably not going to happen.

The average successful startup begins seeing exponential growth around year four. Until then, most are stair-stepping their way to growth. And in most cases, this is also a good and sustainable path.

If you know you can reliably get customers doing XYZ, you probably do not need to pivot. You should keep doing what you’re doing, and work toward more effective ways of doing XYZ. In that case, you’re in a good place to refine.

Myth #2

I often hear new entrepreneurs say something to the effect of, “I just need to get this product in front of more people for them to see how great it is.”

There’s a lot wrong with this mentality, but the main issue is that it normally leads founders to think a pivot is necessary. They’ll spend a ton of money on trade shows, press releases, or advertising, get nothing in return, and then decide they have to pivot to survive.

But that’s not necessary. What is necessary is working slowly with one customer to give them the product and experience they need to make their life better. Then, do that with another customer in the same market. Then again.

It’s a slow process in the beginning, but it consistently builds startups into sustainable and profitable businesses.


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What should my startup do instead of pivoting?

“Pivot” is not a bad word. It can be a helpful choice that leads to a very successful business. But too many startups are often pivot-happy. They try something for a few months, see no results, change everything, and repeat.

In any case, these massive and constant changes can be bad for business. If this sounds like you, take a step back and hone in on the goal of your business, as well as your target audience. Who do you serve? Why and how do you serve them?

Instead of pivoting multiple times, look to refine. Startups often know who their target customer is, they just don’t know how to sell to them. So try different methods, such as:

  • If email blast marketing isn’t working, try emailing individual targets
  • If networking events aren’t yielding, try one-on-one meetings
  • If your website isn’t bringing in targeted traffic, change up your message and content approach
  • If there’s interest but nobody’s buying, target different positions within an organization
  • If customers don’t use some of your features, ask them what would be most helpful

Examples like these are limitless. The main point underscoring all of them is that something in your business has to remain constant for you find footing and grow.

Multiple pivots keep you from grounding who you are and what you do. Once you find your base (i.e. your target market, ideal use case, etc.), you should no longer consider pivoting at all. Any change thereafter should be refining a process or strategy.

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