This session is called The Pivot.
Pivot is a term you hear quite a bit in entrepreneurship. And a pivot refers to a significant change in direction by a new venture, usually because the original plan isn’t working out. So you proceed with Plan A and then you pivot into Plan B. For example, Keya Dannenbaum founded a company called ElectNext. And what ElectNext did, was provide to voters information about candidates on an issue by issue basis. So you could reflect how you felt about guns, how you felt about taxation, how you felt about social issues. And ElectNext, would tell you which candidates matched up with you based on your interest. The problem with ElectNext, was that it was really seasonal, so during major elections, you could get a lot of customers interested. But then it would be, at least in the United States, sort of a long four years before the next round of interest. So Keya pivoted into really a quite different business called Versa. And what Versa did was to try to build the engagement with voters, really with the public at large, throughout the year by allowing them to participate on Op-Ed pages in printed publications and on the web. So Versa was Plan B, and was her pivot in response to a failure to really get what we might call traction with Plan A, with ElectNext. Now I’m of two minds about pivoting.
On the one hand, of course, if Plan A is failing, you gotta go with Plan B. And entrepreneurs face a lot of intrinsic uncertainty, when they start a new venture and so if that uncertainty is resolved, and it turns out that Plan A just isn’t going to work, then there’s no harm in changing direction. Given the intrinsic uncertainty in new ventures, pivoting is extremely common. I would say at least a quarter of the ventures that I’m involved with, will do some kind of pivot.
On the other hand, if you jump head along into the first opportunity you consider, and without really some careful analysis, then the pivot might have been avoided, and a waste of time and money could have been avoided, with a little bit of work up front. For example, when I was 25, I spent several months of my life building a snow bike that was based on having a tractor tread, instead of a rear wheel. And this was part of a plan to cross Antarctica by bicycle.
Now, what I had failed to do, was really do a careful analysis of the topography of Antarctica.
Instead of investing months in building a bicycle, I should’ve done a little research, about what the train actually looks like in Antarctica. This was before the days of Google Images by the way. And had I known what the train would have looked like, I would have realized that the snow bike was really a foolish idea to begin with. One effective strategy for dealing with uncertainty, is to actually consider several possible alternatives from the outset, to spend a little bit of time and effort to explore them. And only when some of that initial uncertainty is resolved, to then commit and invest and develop. And that reduces the probability of having to make a pivot. Nevertheless, as I said before, entrepreneurship is intrinsically fraught with uncertainty. If you’re not doing something new and uncertain, then you’re really not doing something interesting in entrepreneurship. As a result of that intrinsic uncertainty, it’s not at all common to have to pivot. But, smart entrepreneurs, are those who can marry an exploration of several concepts with a willingness to pivot when, and if, the concept they pick doesn’t materialize as planned.
This session is called The Pivot.