Let us understand…What is startup pivoting?
In very simpler terms, Startup pivoting is essentially a shift in the business strategy, to steer your venture into a profitable or desirable situation.
A startup pivot occurs when a company shifts its business strategy to accommodate changes in its industry, customer preferences, or any other factor that impacts its bottom line.
A pivot could be anything, from changing how a product is manufactured to shifting marketing efforts to appeal to new buyer personas.
The term PIVOT is relatively fluid, but it is always related to a change in a startup's business strategy, generally dictated by factors beyond its control.
When to Pivot a Startup
It can be tricky to know when to pivot your business model.
First and foremost, pivoting should not be considered as a failure.
It is essentially the process of a startup.
Many startups have an unconventional beginning and later they get into a field… that they have not intended to be in.
When startups decide to pivot their primary focus area will be:
1st Area is technical development.
The founder should review the good and bad areas of their operation… and bring in improvement in those areas.
However, complete revamping would be easier, quicker, and more reliable than working on fragmented areas for improvement.
2nd Area is improvement in the revenue model.
Even though your startup is backed up well by technical support, you might need to work on your revenue model for sustenance.
There are various revenue models available, you need to choose the one that suits your startup well.
3rd Area is marketing.
There comes a time in the startup journey when a startup experiences a dip in popularity.
At this stage, marketing strategies and tie-ups with opinion leaders become more crucial for a startup.
Marketing strategies will provide a roadmap for the future of a startup.
Based on my own experiences and my experience of working with startup founders, I am in a position to list a few reasons why startups should Pivot.
Reason -1 when A single feature of your product stands out
Sometimes, a single feature of your product, service, or business model will perform remarkably well than other features around it.
If it is so, then it’s worthwhile to explore the possibility of pivoting to support that single feature exclusively.
As a startup founder, if you can identify a single feature of your product or service that your customers enjoy more than others, then you should consider pivoting and building around it.
Reason -2 when the business is no longer financially viable.
Startup founders often have sentimental stakes in their businesses. That makes it inherently personal.
Despite what it might mean to a founder personally, a business can go as far as its capital allows it to go.
If your business is running out of money, you'll need to pivot your business to something more financially viable.
Take an honest objective look at your business - without bringing in emotion - and see where and how you could be doing better.
Reason -3 when the market didn't respond the way you'd expected.
If your product or service doesn't resonate with consumers like you thought it would, then it is certainly the reason for a pivot.
You have to change your business model to offer a better value to your target customers.
By pivoting, you have to make your customers see your business in different lights.
Reason -4 when you're consistently being outperformed by the competition.
The startup realm is by all means will be more competitive.
You are always going to be pitted against some kind of competition.
If other companies are dominating your space- it's probably time for a pivot.
You'll need to radically alter how your company operates.
You might have to change your product or service, or completely alter your sales strategy.
Reason -5 when you just want to be different.
Let’s say your startup has been operating for a while now, and… you're becoming unhappy with the growth of your business.
Your perspective and goals might likely have shifted.
Or
you might have developed new values as your business has grown.
Or
maybe, a lucrative niche to which you get attracted.
In any of those cases, some kind of pivot is a viable option.
But be careful while pivoting.
If your business is doing well, it could be risky to make a radical shift.
Still, as a startup founder, it's up to you to decide how your business operates.
Do what you feel is right- concerned with your vision, morals, finances, or all of them.
It may seem undergoing a business pivot is an easy task, but pulling a one-off requires a lot of work.
Let me suggest a few tips to follow, to ensure your startup pivot process is successful.
Tip-1 Focus on what works.
Evaluate your business model and products. Keep the things that perform best.
Tip-2 Inform and involve stakeholders.
Talk to your startup’s investors.
If you’re changing business directions, they’ll need to know.
Communicate the need for a business pivot to employees and get them on board.
Tip -3 Act quickly and there is no going back.
Once you’ve decided on a new business model or direction, get started immediately. All your resources will need to be directed to your new projects or a new brand strategy.
Tip -4 Up-Skill if you need to.
Undertaking a startup pivot may require learning a new skill set and a new workforce.
Tip -5 Get comfortable with change and embrace it.
Pivoting your business model in such a dramatic way can be very stressful. Embrace the newness and focus on recalibrating your business to make it the best it can be.
Pivoting your startup isn't a decision to take lightly.
No matter what you choose to do, it's going to take considerable effort on your end.
It's a tough call to make.
To Pivot, or Not to Pivot
Pivoting is a humbling process.
It requires a real understanding of where your business is heading and deciding on a potentially drastic course of action.
Still, if your startup is radically underperforming, some kind of pivot may be necessary to stay in business.
Category:Business
