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A Brief Guide To Startup Pivots (4 Types Of Pivots)

blog.eladgil.com · 1,924 words · saved by 1 readers

Most of the times, startup don't work. At some point it may make sense to either (1) give up on your original product and to sell the company, (2) shut down what you are doing and return money to investors, or (3) to pivot. You can read more on making the decision to give up in a future article. This post focuses on pivoting for small, early stage companies (e.g. 10 or fewer people). A. The Four Types Of Pivots 1. Pivot inside your existing market, without clear new signal. The most common type of pivot is to change direction in a market you are already in, but without any new information on the market or a new customer segment. This is the most common type of pivot, and the most likely to end badly. In general founders worry too much about sunk cost and the industry knowledge they have built. So when they pivot, they pivot inside their market instead of considering new areas to work in. In general, startups tend to fail due to bad product/market fit (either the product is not differ

By staying the same bad market, the company may be doomed despite the pivot. 2. Reposition or edit down your product. Find behavior in existing product/market and amplify or focus on that (Instagram, Twitch). Sometimes your overall product is not being adopted, but some component of it is seeing high use or early signal of user excitement. For example, Burbn was a location check-in app with photos, and the photo portion was getting all the attention so the product was edited down into Instagram. One could argue Instagram was not really a pivot, but really just good product editing.…

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