No entrepreneur starts with her final idea. In fact, often an entrepreneur needs to change her business in dramatic ways throughout the startup process – this could involve changing a product, service, business model, or the plan for growth. These changes are often prompted by customer discovery, and they are called pivots.
Eric Ries describes pivots in his well-known book, The Lean Startup. Ries discusses a variety of different ways a startup may pivot. Below are a few of the pivots he describes:
A zoom-in pivot involves a single feature of a product becoming the full product a business offers. Logistically, this may be the simplest type of pivot because it does not involve reimagining the entire business. However, it can be difficult for founders to let go of unsuccessful aspects they were excited about.
A zoom-out pivot is the reverse of a zoom-in pivot. Businesses that undergo zoom-out pivots use their original products or services as singular features amongst many others they offer. For example, MilesAhead started by providing airfare consulting services to clients, but it now offers a complete set of consulting services for the entire travel experience.
A customer segment pivot involves a startup changing the customers it targets. The product or service remains, but members of the startup discovers their product or service meets the needs of a group they originally did not realize.
A customer need pivot involves a startup addressing the needs of its original customer base, but addressing different needs that were at first unrealized. In his book, Ries describes an antique store that pivoted to selling sandwiches, now with over two-hundred stores.
Ries cautions, “the ability to pivot is no substitute for sound strategic thinking.” Although it is not important for entrepreneurs to define the changes they make to their businesses, understanding that startups can change in a variety of ways allows entrepreneurs to adapt to changing markets and customer discovery experiences.
To learn more about pivots and the startup landscape, check out The Lean Startup.