Whether a company is a start up, early stage or a mature company, odds are that they will come to a point where the CEO looks into the eye of the storm and realize that a change is needed…a shift in business strategy is needed. To use the popular term, coined initially by Eric Ries in 2009 in Start up Lessons Learned: they pivot. They don’t abandon their vision, but the adjust and shift the direction of their product; their go to market; their target customer; their sales approach; whatever is needed to succeed.
When it comes to start ups….Entrepreneurs will be inspired, have a great idea that they believe will take the market by storm. They pitch it to investors. The have meeting after meeting, yet the investors just stay away. One of two things happen:
1) the entrepreneur blames the investors for “not getting it”
2) the entrepreneur pivots. They shift to a model that gets their product in the hands of customers who want it and are willing to pay for it.
“Pivot” – used to describe smart start ups that change direction quickly, but stay grounded in what they’ve learned. They keep one foot in the past and place one foot in a new possible future. Over time, this pivoting may lead them a bit away from their original vision, but not away from the common principles that link each step.
Mature businesses also pivot to maintain or regain a competitive advantage. The two triggers for a mature company to pivot are not much different from the two triggers driving start up and early stage pivots.
1. wise counsel from advisers, mentors, team members that can see the big picture and bring their own unique experience to the company that goes beyond the founder’s to help chart a course that can lead to success in growth in market share and sales.
2. reaction to a skid – decline in market share or decline in revenue due to technical shift or competitive environment.
In this podcast: Karen Rands walks through examples of companies – in start up and mature stages discover when to pivot and get on the right track to stellar results.
So You can’t raise capital, or Customers aren’t buying…. You realize you need to PIVOT. How do you do that?
Martin Zwilling describes 8 types of Pivots for entrepreneurs, CEOs to explore as their way to PIVOT and grow their business and profits. From Jan 2012: A smart business knows 8 ways to pivot