The art of the pivot, part 2: How, why, and when to pivot
The art of the pivot, part 2: How, why, and when to pivotStrategies from the data for your “pivotal” decision👋 Hey, I’m Lenny and welcome to a 🔒 subscriber-only edition 🔒 of my weekly newsletter. Each week I tackle reader questions about building product, driving growth, and accelerating your career. 🚨 Please take my reader survey 🚨It’ll take 3 minutes and will impact the future of my newsletter and podcast 👇
In part one, I shared the largest-ever data set of startup pivots. The Google Sheet within the post (available to paid subscribers) includes the stories behind 40 pivots—why they decided to pivot, how they found their new idea, how long it took them to decide, and more. Today, I’m going to analyze this data and share the many lessons that emerged. Why you should consider pivotingIt’s heartbreaking to pivot. You are thinking about killing an idea you’ve been obsessed with for months or years. Your team joined because of it, you’ve built a lot of great product around it (so much sunk cost!), and some people probably love what you’ve done. You’ve spent so long convincing people (and yourself) that this is a huge idea. And who knows—if you give it just a bit more time, it could still work! No single post, video, or tweet is going to give you a definitive answer for whether you should pivot or not, but the truth is that pulling the plug on one thing often allows something much better to flow through. As Dalton Caldwell (Managing Director at Y Combinator), in his legendary talk on pivoting points out, pivoting is all about opportunity cost:
There are two kinds of pivots: ideation pivots and hard pivotsAs I was doing this research, I realized that people mix up two very different types of pivots and that it’s important to differentiate which path you’re on:
Occasionally a pivot is a mix of the two (i.e. you’re pivoting multiple times over 1+ years), but generally, when you’re following the advice below, make sure you’re clear on which category you’re in. How long to wait to pivotWhen looking at the data, a few interesting trends emerged:
My takeaway is that you should have a hard conversation with your co-founder around the three-month mark, and depending on how it’s going (see below), either re-commit or change the idea. Then schedule a yearly check-in. If things are clicking, full speed ahead. If things feel meh, at least spend a few days talking about other potential directions. Remember, you’re probably waiting too long to pivot. If you’ve tried your best ideas and they aren’t clicking, it’s unlikely that a few additional features will all of a sudden change everything. See: The next feature fallacy. The two signs it’s time to consider a pivotReasons to strongly consider a pivot are very clear across both the data and the advice from folks who’ve seen a lot of pivots:
Here are examples of each. Sign #1: Persistent lukewarm interestIf you see very low retention, a consistent growth plateau, and largely lukewarm interest in your idea, and you don’t have any more good ideas to drive growth, it’s probably time to pivot. It’s hard to put a super-strict time frame on this, but I’d say give it two to three months during the ideation phase, and six or more months if you have a live product with meaningful traction. But be sure to read this whole post before making the decision, since there are also good reasons to keep going. To make this more real, here’s what it felt like to founders right before they pivoted: Instagram:
Amplitude:
Twitch:
Notion:
Segment:
Lattice:
Yelp:
Loom:
Sign #2: Realizing it’s never going to be as big as you thoughtFor many founders, it wasn’t so much seeing hard data as it was just realizing they were mistaken about the potential of the idea. With time and the additional experience of building the thing, it’s not at all surprising that you may realize your idea is simply not good enough. Brex:
Slack:
YouTube:
Box:
Discord:
Flickr:
How to find a better idea...Subscribe to Lenny's Newsletter to read the rest.Become a paying subscriber of Lenny's Newsletter to get access to this post and other subscriber-only content. A subscription gets you:
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