8 essential steps to pivot your product easily and effectively
Contxto – Last Friday, we launched our very first podcast episode of the Entre Titanes series.
In this segment, we interviewed Gerardo Ruiz Dana and Guillermo Gonzalez from Fanbot who discussed how they managed to transform their startup from a gum dispenser into a highly gamified sticker (of course, I’m oversimplifying their products here).
Spoiler alert: Fanbot’s vision always remained the same although the product has changed completely thanks to savvy pivoting skills.
After talking to the company, doing some research and observing what I’ve experienced first hand, these are my top eight tips for pivoting a product within a startup.
1. Marry the vision, not the product
I asked myself some existential questions a couple of days ago.
What defines a startup? Is it the team? The product? The name? Well, after some thinking, I’ve concluded that startups represent a vision. Generally, startups try to solve a “pain point.” That’s to say, improving inefficiencies at all costs.
Team members may come and go, while sometimes companies go through corporate makeovers. In this regard, at times products are just the means to an end. Nonetheless, a startup’s vision and pain should always remain well-defined.
Be flexible, humble and smart enough to recognize when your current product may not be the best solution for your particular pain point. Also, be passionate about the problem you’re trying to remedy.
This way, you’ll be mentally and hopefully financially prepared in case you need to change products someday – even if you have invested loads of money, time and sweat into it.
2. Act on data
“Listen to your customers.”
How many times have we heard this? Well, it’s true to some degree. Sometimes when it’s out of context, though, it can do more harm than good.
When founders listen to their clientele’s pains and desires, they should also be aware that everyone has different personalities, tastes, and ultimately, expectations. Honestly, those variables are almost impossible to control.
Before I launched Contxto, I asked friends, professors, ex-coworkers, and customers for their opinions. Everybody thought differently, so I segmented everyone’s feedback into different categories.
Based on the classification, I identified every group’s aspirations, motivations and perceived reason behind the feedback. Then I would scrutinize whether that advice was worth following or not.
I’ve come to realize that (even within the same customer segment) that if you add or remove a specific feature, you will both irritate and satisfy different people. The reality of the situation is you must decide which piece of advice you find most valuable.
How do you do that? Don’t modify your product after the first negative customer review. Rather, gather more data, identify a pattern, dig deeper into the customers’ rational, and then act on it. Listen to the buyers, but know which ones to listen to. Test, fail and repeat is a great yet simple recipe for ultimate success.
3. Do it fast
We’ve heard it before, especially experts like Tuto Assad who writes about the importance of speed for fundraising. The same goes for pivoting. Momentum and speed are crucial to any startup’s success.
Slow pivoting is like a silent killer. Not only can it leave your startup in limbo, but it prevents you from focusing on a customer segment in time. Even worse is absorbing too many resources (also known as burn rate) while running your experiments, not profiting in the process.
To prevent this, I’d recommend creating an extensive spreadsheet before even considering to pivot. Write down any hypotheses you may have as well as the underlying problems alongside solutions you’re proposing. Lastly, rank and prioritize these hypotheticals with a balanced mix of gut feeling and data.
Note: I mention gut feeling because sometimes users don’t even know what they desire. In this regard, it’s your job as an entrepreneur to observe consumers’ actions rather than just listening to their words.
Maybe you can conduct a quick pivot experiment and document changes until you have enough data to make a permanent decision to shift the ship’s course.
4. Pivot independently
This relates to the point above. If you’re just now conducting an experiment, don’t erase all of your past progress and build your pivot MVP on top of it. That’s a crucial mistake.
Rather, try to keep your previous progress and separate products as much as possible. Running individual experiments also isn’t a bad idea. This can save you a lot of technical and marketing nuisances.
We test different types of content or features by running distinct experiments. What’s ideal is creating landing pages, running A/B Tests and building a separate MVPs to test whether a pivot is appropriate. MailChimp is a great tool for doing some easy, non-complex tests.
5. Competitive Minimum Viable Product (CMVP)
I don’t believe in MVPs, at least not as they’re normally portrayed. Wait, what? You just said we need to test MVPs before committing fully?
Obviously, it depends on what type of product you’re developing as well as what type of market you’re trying to penetrate. For existing markets (representing the majority of the markets most startups are vying to enter) most of the time MVPs are ultra-minimum.
When you enter a proven market with some competition (but with enough space for an enhanced alternative), the customer is already used to a certain baseline or minimum base of features. No ifs, ands, or buts – consumers won’t go back to the old version of a product.
Andrew Chen addresses the Minimum Desirable Product here. My concept of CMVP is somewhat different, I think MDP goes a little bit beyond. For me, CMVP has to have the basic features all other competitors already have in order to be a proper, trustworthy experiment. Otherwise, people won’t even bother to try it.
6. Communicate with the whole team
Try to communicate openly with the team and prove why pivoting matters, especially if your startup is small. If not, members may feel out of place or not have a goal in mind. Not everybody likes taking risks, though, which is something that founders sometimes forget.
Although not everybody thinks like a startup founder, you also don’t have to get everybody’s approval. That might even slow you down, but at least let them know about the benefits of experimentation.
7. Get mentorship
Hopefully, this doesn’t sound like I’m suggesting mental therapy. Trust me, it’s far from that. When it comes to pivoting, mentors provide firsthand insights into the world you’re trying to enter. They also often possess an objective, unbiased perspective with experience and knowledge to back it up.
This step is a tough one, though. Over time, I’ve realized that connecting with someone as an “apprentice” is a long process. Therefore, I’d still advise being on the lookout for a role model, yet open to networking with other founders.
Being able to reach out to people you admire on social media is also a great way to receive valuable advice. Many often give honest feedback – for free. Yes, you’re going to bump into people who either won’t reply or may charge, but don’t sweat it. Obviously, the point is to get yourself a good mentor, not a charlatan or an Instagram business guru.
8. Have the courage to recognize when it’s just not working out
I believe pivoting can present a limited scope of possibilities. Sometimes it may be better to kill an idea fast and just move on to the next. In retrospect, maybe you’ll realize that the market just wasn’t big, deep or profitable enough for your original good or service.
Perhaps the problems you were trying to fix weren’t even true pains, so your solution only represented a “nice to have” product. Pivoting can do very little once you’ve bumped into these data-backed conclusions. This can be a hard pill to swallow, of course. But the longer you postpone it, the harder it will be.
As Zynga’s founder, Marcus Pingus, said, “I’ll try anything, and I’ll kill anything. And I’ll kill it quickly.”
There you go – these are my top eight tips for pivoting – or not – effectively while optimizing the response and action time.
Check out our podcast to learn more about Fanbot and their pivoting strategies.
-VC
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