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Pivot or not? That is the question we all want to know the answer to. In a life of entrepreneur and just anyone who makes a living by creating and selling products, digital or physical, there is nothing more important to know than if your idea is worth pursuing. When we pursue wrong idea, we are also losing chance to work on something that can be more valuable for the world. Making the decision to pivot is not that easy. You are de facto killing your baby. Goal of this post is to give you all the knowledge necessary to recognize if your idea is worth pursuing or you should pivot.
What Is a Pivot
Let’s start the discussion on this topic with clarification of what pivot is. In the simplest terms, pivot is a change in strategy of a startup. The word strategy is key in understanding what the full meaning of pivot is. Strategy, as a term used in business or battle or elsewhere, signify a fundamental long term plan (or direction) in which certain entity will move. It’s basically your vision. Damned, that sounds like a school lecture from economics or history. Let me put it this way. If anyone will ask you on meaning of strategy, the best answer will be that it is a set of tactics used in the long term planning, the “what”. Wider time span is what distinguishes strategy from tactic.
If we go back to economics and its terminology, strategy is often defined in range of five years and more. Tactic, on the other hand, is defined in range from approximately one to five years. So, if you will want to shock your friends, colleagues or co-founder any time, strategy is for the long term (five and more years) while tactics are for short term (one to five years) planning. Now, we can go back to the definition of pivot. As stated above, pivot is a change in or of strategy. Imagine it like being on a ship suddenly changing the direction for 180 or even 360 degrees. Another example would be abandoning the ship and taking a plane. Both of the situations described above are examples of a pivot – a major change.
I will give you another two business related examples of a pivot. Imagine you will create a small company focused on developing a social game. Wait, let me rephrase it. A game containing social elements such as profiles, communication widgets, picture sharing, etc. You and your team are working tirelessly on this game for a months. Unfortunately, the results are rather bland. Although you are getting some traction, users are not interested in playing the game as much as in its social aspects. Their major point of interest is sharing of pictures. This fact puts you and your team in front of tough decision … First, continue in the battle ignoring the cues. Or second, accept what data are showing and switch your focus from the game to picture sharing feature.
If you’ve ever heard about Flickr, you probably know what option that team chose. Here is the second example of another great pivot. Let’s say that you have an appreciation for podcasts. In a fact, you like it so much you decide to create whole network where people can discover new podcasts and subscribe to them or create their own. Let’s call this hypothetical company Odeo. Unfortunately, there is another company called Apple taking on the podcast world with their product called iTunes. What will your next step be? Fighting the Goliath or making a pivot?
In case if Odeo, the second option was the winning one. Employees of Odeo came up with various ideas and then decided to stick with one. What was that winning idea? It was creating status-updating micro-blogging platform. Today, the most of you will know Odeo under different name. This name is Twitter. The people behind that blogging idea? Jack Dorsey and Biz Stone. I will leave it to you to decide whether was this pivot successful or not.
To summarize the examples I used, pivot can occur in many shapes and forms. It can be a change of product or service your company is building. It can also mean changing your target customer or audience. And finally, it can mean changing target market segment. Pivot is a change happening on a large scale. It is a change of your vision.
What Is Not a Pivot
Although we’ve discussed the definition of pivot in-depth and also explored few examples, let’s take a couple of minutes to discuss what pivot is not. Here is the thing … I often hear people talking about making a pivot while in a fact they are just changing the design or feature of their product. You should understand that this is not a pivot. Although such as iterations can look like a serious change, they are only iteration not a pivots. Remember, pivot is a major change in your strategy.
Some Examples From Real Life
Let me give you couple examples. Let’s say you are working on an app for sharing code snippets between developers. As lean startup suggests, you created an MVP to test your hypothesis without going bankrupt. By the way, this is I think one of the most important lessons you can learn from lean startup methodology – test your ideas as soon as possible with the lowest costs possible. Anyway, with the feedback you will get from data, you will decide to make changes in design. Also, you will decide to customize your app according to reactions and feedback from the users.
This is not a pivot. It doesn’t matter how big the changes in design will be. And, it also doesn’t matter how deep that customization will go. You are still moving in the same direction with the same vision – to help software developers share snippets of code with each other.
On the other hand, let’s say you will decide to trash that idea. For some reason, people are not interested in sharing their code snippets. Fortunately, you will see another opportunity in the form of women awaiting their first child looking for a piece of advice and information from other, more experienced, women. As Richard Branson says: “Screw it let’s do it,” you will decide to pursue this idea instead. This is example of a pivot – you changed your target market, your target customer, your strategy and your vision.
Another example from the world of brick and mortar businesses. Let’s say you want to open a Greek restaurant. Why? Well, you like Greek cuisine. So, why not give it a shot? Unfortunately, your restaurant business will not be as sustainable as you thought. After couple of months of fighting for survival, you will decide to end that suffering. Just before selling the restaurant you will spot another opportunity. Although people in the neighborhood don’t give a damn about Greek cuisine, they like wine. Actually, they are complaining about shortage of good wineries.
Based on this hypothesis, you will transform your Greek restaurant into beautiful winery. You will create great place for people to meet with their friends and family while discovering the world of quality wine and cheese. This time, your business will not just make it. It will skyrocket and you will even create a chain of wineries. This is another example of pivot.
When Should You Pivot
The problem with pivots is that we, entrepreneurs, are often afraid of them. It’s that fear of losing an opportunity that keeps us pushing. It seems rational, at least on the first sight. What if you decide to pivot just before your idea will take off? You might miss the opportunity you’ve been waiting for your whole life. We should make one thing clear right in the beginning. Let me assure you that there will be tons of other opportunities in the future. And, as Drew Houston said, you only have to be right once. So, don’t worry about missing one opportunity now.
What’s more, we are bombarded with sayings and quotes about perseverance and success stories from media on a daily basis. It is not a mystery why we are so often willing to blindly follow our “great” ideas beyond almost any limit. In this last section of this post, I want to discuss is the idea of perseverance in comparison with pivot. I hope it will make it easier for you to distinguish truly great ideas from crappy ones.
Pivot vs Perseverance
Entrepreneurs are often advised to preserve when facing struggles. There are people who will tell us to hold to our idea no matter how many failures will we go through. On the other hand, there is another group of people, much bigger, that will urge us to abandon our idea. They will argue with almost anything to convince us that we are delusional. According to their opinion, we should stop pursuing our idea because it was once or twice proven wrong. Should we pivot or persevere?
In such situations, making the decision whether to pivot or hold on for a little bit longer is very tough. To make things worse, we are often attached, emotionally or materially, to the idea we are pursuing. Let me tell you that this is already dangerous. Falling in love with your idea will make it much harder to cut it off and start from scratch. This is already tough if you’ve invested only your time and couple of bucks. Unfortunately, it is close to impossible to say whether you should be attached to your idea emotionally or not. Why? One advice you will often hear is to never start a business unless you are thinking about it all day long.
You have to dream about it while sleeping. It must be that one thing you are breathing for. Only then you should think about starting a business. Great, now what? You shouldn’t fall in love with your idea, but you should breathe and live for it. If this makes sense to you, let me know. I would love to wrap my head around it. At this moment, it just seems like a two contradictory premises. How can you on one hand live for something while on the other be emotionally detached from it? When people are telling me such things, I always start to question it. I don’t have to tell you that these discussions are often very short.
Pivot and Winston Churchill
Anyway, when your idea hit the wall, should you pivot or persevere? God damned, I really don’t know what to answer. Eighty-five percent of me want to tell you to keep going and find a way through the wall. Remaining fifteen percent of me want to tell you to stop, assess the situation, take what you have and do a fast pivot. As you can see, I am a big fan of perseverance. This is probably my favorite personal trait. It always brings a quote by Winston Churchill to my mind: “Never give up on something that you can’t go a day without thinking about.” Let me answer this dilemma in this way … You should persevere unless there are clear signs that your idea is not viable. If there is no one willing to pay for your idea, you had better let it go.
For example, if your product is not selling no matter how much you and your team are busting your butts off and you are still not seeing any results, that’s one of the pretty clear sings. Another example of a clear sign that something is wrong can appear during working with focus groups. What am I talking about is when more and more users you will invite on testing your MVP are telling you the exact same thing. This is another sign that you should consider making some changes. And, it doesn’t even have to be anything said out loud.
When Signs Are Not so Obvious
You can spot many clues and signs just by observing the behavior of your users and customers. This is also the reason you should conduct such a focus groups and A/B testing. The fact is that people will not always tell you the whole truth, or they will lie directly. Some reasons for this is that a) it is too personal to talk about it publicly, b) it’s embarrassing or c) they don’t know they are doing it – it’s unconscious action. Unfortunately, the most important sign are often from the last category. This is where the problem arises. How can you describe your issue with something to someone if you don’t know this issue exists at all?
Having said that, I don’t suggest that some of your customers or users are paranoiac or need a specialized medical care. Not at all. What am I trying to point out is that there are many feelings and reactions happening only on unconscious level. To give you a better idea, imagine you want to go to your favorite coffee house. It’s a place you visit couple times a week. You know that place very well and feel comfortable there. However, today you feel that something is different. You don’t know what it is, but your intuitions is telling you that something has changed.
It’s only later in the day when you will find out that one of the waitresses in the coffee house has vacation this week and so there is a temporary replacement for her. Or, imagine you are taking your dog for a walk and when you leave the house, you feel something is different. Again, you have no idea what it is, you just feel it. Later in the day, your roommate will tell you about new neighbor. It is only then, when you notice that it was a car of your new neighbor on the parking lot what caused that feeling. The thing is that you were used to seeing the same cars on a parking lot on a daily basis for months. You were accustomed to it.
The last example of not so obvious signs is anything that you do habitually. When you do something repeatedly for a long time and it becomes a habit, your brain will literally automate your behavior so it has more energy on other tasks. Unfortunately, after some time, you may lose track about the smaller details because you are doing the unconsciously. All of these signs are actions hidden from our direct perception and we often can’t explain them. Sometimes, as mentioned above, we don’t even know we perform such as actions.
These hidden signs are often what we need to find out whether our products can succeed or not. Remember, relying on the feedback of your customers is one thing, seeing what they are actually doing is another. It is for this reason lean startup insists on testing every hypothesis you have, testing it soon and testing it often. Or, as Steve Blank puts it: “Get Out of the Building”.
Closing Thoughts on Making a Pivot
When I discussed this subject of making a pivot with another entrepreneurs and got an idea to turn it into a blog post, I initially wanted to call it “Art of a Pivot – How to Go From Survival To Epic Success”. Although it looked good and overall feedback was also pretty good, I decided to remove that “art of a” part. Why? Goal of this post is to make the whole subject of pivot easier for anyone interested in it. From this point of view, calling it art could make it seem unreachable for some people. Also, it was a bit too long for search engines …
Anyway, I hope you enjoyed this post and got at least some valuable information from it. If you have any suggestions or ideas to improve it, please let me know.
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