Pivots: Part 4 | Some pivoting myths

 In Business Finance, Canadian Innovation, Entrepreneurship, Loxley, Marketing, Start Up, Venture Capital

 

Hopefully by now you should know what pivoting is and what it isn’t.

But you might still have some doubts about whether or not you have what it takes to pull off a successful pivot, or whether or not your company would survive a pivot.

If you feel this way, it’s likely because you’ve bought into some of the myths surrounding pivoting.

Myth #1: You need crazy skills and courage

Perhaps the most widespread myth about pivoting is that it requires you to be immensely courageous and that to pull it off you need a massive tolerance for risk.

It’s often because of this myth that you’ll come across entrepreneurs who like to talk about the fact that they’re pivoting. After all, who wouldn’t want to be seen as having those traits?

But the notion that you need to be a crazy, risk-seeking entrepreneur in order to pull off a successful pivot couldn’t be further from the truth.

Now sure, there might be stories out there of entrepreneurs who remortgaged their house in order to pivot their business—but those stories are the exception rather than the rule. And as we’ll see later, a lot of the time such scenarios could possibly have been prevented by taking some proactive steps.

In any case, if you use the right methodology (which we’ll cover in later in this series), it’s quite easy to cap downside and maximize upside when pivoting. That’s because pivoting is all about running rapid, sturdy experiments that help you figure what you should do next in order to achieve product–market fit. (You’re testing assumptions like a scientist, remember?)

Companies that run into trouble when pivoting often do so because they take too long to run these experiments.

And that is a point that segues nicely into our second myth about pivoting…

Myth #2: Pivots are done with an all-or-nothing mentality and out of desperation

Right. Let’s clear this one up once and for all.

Pivoting should be seen as a positive, iterative process that is done over the long-term. It’s not necessarily a bad thing.

The goal of pivoting is to figure out how you can achieve better product–market fit so that you can better serve your marketplace (or another one) and enable your company to sustain long-term growth.

Marketplaces change naturally over time and if your business is to survive in the future, it’ll need to pivot at some point or another. Heck, even Coca-Cola had to pivot toward “healthier” options—and 43% of their sales now come from that!

So the question isn’t whether or not you’ll need to pivot. But rather, whether you’re going to implement a pre-emptive process of constantly implementing pivot experiments.

Should you wait for the marketplace to tell you when to pivot? If you do, your business will be put in a precarious position and the future probably won’t look rosy. Well, at least not as rosy as it should.

For those that wait, the myths about pivoting stop being myths.

That’s because pivoting then becomes something you need to do out of desperation, putting you in a position where you may even need to remortgage your house!

However, if you implement a consistent “pivot process,” then pivoting can be actually something you can have a lot of fun with as you conduct experiments to figure out the best way create long-term growth for your business.

Myth #3: Pivoting means changing our mission

Later in this series, we’ll discuss “types of pivots” and how not all pivots are created equally.

More importantly, not all pivots are massive, all-in moments like Shopify, who pivoted from selling snowboards online to selling e-commerce software.
Pivots can be as small as changing the way you position yourself to your customer.

Or changing the way you acquire customers.

Or moving toward a market segment or customer persona that is really loving your product.

Or shifting the value proposition you offer your existing customers.

Or transforming the technology you use to deliver your product or service.

In fact, when I think of pivoting, I think of my two-year-old son playing with his toys. When faced with the challenge of fitting a shape into a hole, he makes small, frequent adjustments until he finds the right fit.

The key here is that if you adopt a scientific approach and discipline to growing your business and you proactively look for leverage points, you will find many areas to explore and with which to experiment.

Next in this series
In Part 5, we examine three impressive pivoting case studies: PayPal, Flickr and YouTube.

 

By Jeff Goldenberg

Recent Posts