Welcome to the twelveth article of our Entrepreneurial Wednesdays series. In this series, I share my thoughts on lean entrepreneurship as I take my first steps in my journey. I will be sharing my lessons learned with you.
As you might know from stories of different startups, many projects started with one idea but developed into a completely different one. Suddenly, the company focused on a different segment of the industry or even had a slightly different product. These changes are called pivots. For many people involved in the development of startups, pivots are a nightmare. It might be because they are tools that can heavily change the ”game plan”.
From a more scientific view, you can understand pivot as a structured correction of the track with an aim to experiment and test the new hypothesis about the product, strategy and the engine of growth. Even though that pivots might bring a lot of pressure with them, successful pivots are able to point to companies growth (in any kind) towards the right direction.
Experimenting prior to pivoting
In this part, I will strictly follow the points that are made in the book. I will describe the ones that I think are important when it comes to pivots.
To uncover when to do a pivot you need to do a lot of experimenting and research many results prior to pivoting. This is when A/B testing gets super handy. I gave a short explanation of A/B testing before but let me do it again (what I wouldn’t do for fellow startupers). When you are A/B testing, you give two customer groups to different versions of the product, later you examine the behavior of the groups towards that concrete version of the product and see the differentiated impacts they have. With this in mind, it is clearer to understand when to do the pivot. Once the customer group reacts badly on the version of product your development is working on, you know pivoting might be a better alternative.
While doing this be ready for negative feedback and also expect to fail at some point. Don’t forget that failing in startup world is not the end, it is a step forward. Every single fail that occurs on the road gets you closer to the right track. Especially when it comes to pivots, failing is the fuel to getting closer to understanding IF to do the pivot.
While being in the process of A/B testing (or while searching for the answer to ”Should we do the pivot?”) make sure you understand and process every result you have. It is essential to LEARN FROM YOUR PREVIOUS MISTAKES. Without this realization, you have absolutely no clue where to lead your experiments in the future. You will be lost in a maze of numbers without having an idea where to move next.
David Binetti from Votizen found himself in an unpleasant situation. There was a clear need of pivot, but the question was how it needs to be done. David came out with an excellent idea which was later named ”zoom-in pivot”. This type of pivot focuses on the single original feature included in the MVP and focuses on its development. It is the value, in the eyes of the consumers, that makes the very first feature so important. This feature also represents the foundation of the product upon which the development can build.
What David did by ”zoom-in pivot” was jumping from one segment of the customers to another. Basically, Votizen became a B2B company. Eventually, this pivot didn’t lead to a happy ending. Many other problems with the new model occurred and David was forced to do another pivot.
Another pivot took half the time compared to the first one. It was because now, David and his team had much crucial information about the customers and the market and knew exactly how to approach the next pivot. It was the efficiency of creating their MVP and fast pivots that finally lead to sustainability.
Even though I do understand why pivots are frustrating for startupers, they are undoubtedly the only solution sometimes. ”I didn’t imagine it this way,” that’s what people think when they are forced to think about pivots. The fact is that pivots (if executed properly) lead to bigger success and are the gap between shutting down the company and continue with it. That is why I think startups should not be afraid to pivot.
Let us know in the comments what do you think about pivoting and if you already have any experience with it. It’s a crucial but very interesting chapter in building a startup and we would love to hear about it from experienced individuals.