What is a pivot?
A pivot is a change of a new venture’s strategic direction. It’s a point at which a new venture breaks with its core focus and changes direction in a fundamental way. Most often pivots take place early on in a company’s life, but sometimes it happens after one or more rounds of funding. A pivot might mean scrapping a key product or pursuing an entirely new market, or both.
When do you need to pivot?
It is important to pivot when you realize that current approaches–business strategy, core technology, or go-to-market strategy don’t work as expected. Early on in the life of a new venture, pivots happen when the most fundamental assumptions about the venture (technology, markets, target customers, etc.) prove wrong.
What is the danger of not pivoting?
The danger of not pivoting is in condemning the new venture to pursue business goals that will eventually lead to the venture’s failure.
What is the danger of pivoting too often?
The danger of pivoting too often is to lose focus, resources, and motivation of the team. Too frequent pivoting also means that the team errs on making their assumptions and commits mistakes when analyzing the target markets and defining target customers.
What are examples of a successful pivot?
Examples of successful pivots:
- Slack pivoted from game developer to a business messenger tool.
- Instagram, which began as a location-based check-in service before becoming a media platform.
- Netflix pivoted from delivering DVDs to your mailbox to streaming videos and producing proprietary content.
- Twitter pivoted from a podcast provider to a real-time microblogging platform.
- Play-Doh pivoted from a wall cleaner that removed soot to a popular children’s toy.
- Ninetnedo pivoted from a purveyor of hotels, noodles and vacuum cleaners to the gaming business it is today.