Ditching your original idea, product or service offering and taking a completely different route is perhaps one of the toughest decisions for an entrepreneur to make. Most businessmen find it difficult to part with their original idea on which they built their business.
But as they say, “fail fast, pivot faster” — one doesn’t have an option. You can either pivot and join the road to success or slowly fade away into oblivion. Pioneer of the Lean Startup movement, Eric Ries defines pivot as “a substantive change to one or more of the nine components of the business model canvas”:
The history of tech innovations is littered with pivots. In fact, most apps on your mobile phone have undergone tremendous evolution to be what they are currently.
Let us discuss some of the best pivot examples in the mobile market:
Twitter started out as Odeo, a network that was launched in 2005 for people to find and subscribe to podcasts, and share audio content. After the launch of iTunes by Apple Inc, Odeo creator realized it would be hard to sustain this app idea for its business value.
Hence, Jack Dorsey and Biz Stone pursued the idea of developing a micro-blogging channel, and so Twitter was born. Today, it has a base of more than 200 million users and is considered one of the most successful social media platforms of our time. Now, even governments across the globe communicate with people on Twitter and even space agencies and rovers have their own Twitter handles for inter-space communications.
Today, this photo-sharing mobile app is an efficient marketing and advertising tool. But did you know it began its journey as Burbnb — an app that enabled location-aware photo and note sharing?
Even though Burbnb raised $500,000 in an early funding, it never took off. The founders realized there were too many unnecessary features and hence decided to keep the basic ones such as uploading images, commenting, liking, etc.
The Minimum Viable Product (MVP) born out of the pivot was named Instagram.
Founders Jeremy Stoppelman and Russel Simmons launched Yelp in 2004 with an aim to offer an emailing recommendation service for the users. But soon the founders realized the most popular feature of the app was “Real Reviews” wherein the users voluntarily participated in writing reviews about local businesses. Thus, the modern-day Yelp was born — which now has more than 17 million online reviews.
Foursquare initially launched as Dodgeball, a mobile-based networking platform in 2000. The biggest drawback of Dodgeball was that without smartphones, the users had to connect with each other via SMS messaging — which wasn’t cost effective.
Since the timing was wrong and the founders wanted to start making profits, they pivoted Dodgeball into Foursquare a few years later. And smartphones weren’t as smart 17 years ago as they are now, nor was the concept of receiving continuous updates from friends.
Now, thanks to WhatsApp and Facebook, this problem has been solved. FourSquare now lets you exploit the full potential of your smartphones by showing you results of your interest based on your location.
Before Groupon was ‘The Point’ — a consumer activism website started by Andrew Mason, offering anyone to create a campaign for social good and to invite participants to pledge for the same thing. Groupon was just a side project that started in 2008. It applied the same business model, but instead of social media, it focused on local deals.
Groupon soon became more popular than The Point, and therefore, the creators decided to focus on expanding the “daily-deals” platform ‘Groupon’.
Joseph Bernstein and Kayvon Beykpour started ‘Bounty’ in 2014 for users to explore events around the world via location-based requests in real-time via images. As Instagram had already established itself as the go-to app for location-based images, the founders decided to rebrand.
And so, a video live-streaming app called Periscope was born that allowed users to see the happenings in real-time via someone else. Twitter acquired Periscope for around $100 million, even before it was launched.
Meerket was the original live streaming app that went viral in 2015. It even managed to raise $14 million in venture capital from many Hollywood insiders and VCs. But soon came the point where Meerket had to face serious competition from Facebook Live and Twitter’s Periscope.
In early 2015, Meerket rebranded itself into Houseparty, a live group video chat app. It is a step ahead of Facetime which allows just a one-to-one video chat. As of now, the app has more than a million users with a majority of them being under 25 years of age.
This one did a 360-turn. Quite interestingly, Flickr was previosuly an online role-playing game called Game Neverending which allowed the users to interact with each other, buy and build items. The game later including a photo-sharing tool which became the most popular with the existing users.
Game Neverending switched to Flickr and was eventually bought by Yahoo! in 2005. It is one of Yahoo’s most successful acquisitions till date.
Launched in New York in 2008, Ignighter began its journey as a group dating platform that allowed the users to sign up and go on dates in a group. Unfortunately, it could only sign up 50,000 users in the States. But in India, the same number of users signed up in just one week!
The founders realized their target audience was India and not their home country. In 2010, Ignighter officially declared itself as an Indian dating platform, and the pivot was made official.
A lot of people don’t know this, but Pinterest was originally a mobile shopping app which allowed the users to browse through and shop their favorite brands and even share products with other users. The founders soon realized that users were mostly interested in building collections of their favorite products and sharing them with friends.
That’s how Pinterest was conceived. Funnily enough, the current revenue model of Pinterest is similar to the eCommerce store it was originally intended to be!
Every new business has pivoted at least a little in their lifetime. As you can see from the examples, there are many twists and turns a pivot can take. But it is for the entrepreneurs to decide whether they want to stay the course or switch to a different direction to drive business growth.
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