March 29, 2014
When the app I’d spent a lot of time and energy developing didn’t take off, I felt like I’d reached a standstill.
DailyFeats encouraged users to make positive changes, like eating healthy, volunteering, or spending time with family. Although my team had partnered with insurance companies like Cigna and brands like Walgreens to offer rewards, the app wasn’t gaining the type of traction we needed to affect serious change in the world of consumer health. While we had a small, avid user base, most users remained active for a short time after signing up and then dropped off.
We needed to change. Our users needed better incentives and a stronger relationship with our brand, and we saw room for improvement in the consumer healthcare experience. We took a risk, thinking that users would be more likely to engage in behavioral change if it was linked to something as important as healthcare. This turned out to be a great move for us, and with some further tweaking and lots of hard work, we finally hit upon a business plan that stuck.
If your startup is stalling, it might be time to change direction. Pivoting means abandoning your former strategy or product and changing course. It’s not a switch you can incorporate into your current business plan; it’s another idea entirely. Pivoting is harnessing your core mission, your ideas, your team, and the lessons you’ve learned to create an entirely new vision for your company.
It takes planning, research, resources, and, most importantly, courage — it’s just as hard to abandon an old idea as it is to invent a new one.
If you find your business is in need of a facelift, the biggest decision you’ll have to make is whether to toss or tweak your current business plan. Here are four questions to determine whether pivoting your business is the right route:
1. Is your current business sticking?
If you have a small, loyal customer base but you’re having trouble attracting more users, you might have a marketing or sales problem, not a product or business model issue. If your business isn’t attracting loyal niche customers, then consider pivoting.
2. Does research support your idea?
Look into the product/market fit of your pivot idea. If you think you’ve got something, but it doesn’t seem to be the right time or you don’t have the resources to make it a success, it’s best to keep building on what you have while incorporating aspects of your pivot idea. Wait for the right moment to make the change.
3. What do the smart people you know think of your idea?
Run your pivot idea past your advisors and mentors before putting anything in action. Our mentors helped us maintain our enthusiasm and challenged us to ask hard questions. They knew we needed to go through the necessary growing pains.
4. Do you have the right team for the change?
Not every business can survive this type of dramatic change, so having the right people on board makes all the difference. You’ll need flexible risk takers who are willing to take on new roles and develop new skills. You also need to trust and like these people; you’ll be spending a lot of time together.
Making the Change — the Right Way
If you’re confident that pivoting is the right move for your business, here are four ways to make a smooth transition:
1. Plan well: Conduct interviews, and gather all the evidence you can about your new idea before you start working on your pivot.
2. Build a solid business model: When we finally hit upon the right idea, we turned away investors because we had a revenue stream. That’s the kind of idea you’re looking for — one that will start building traction right away. Don’t start until you find it.
3. Let go of your old brand: It’s tempting to hold on to your old brand identity or use it in your new idea, but it’s best to start from scratch. Holding on to an old idea can weigh you down and blur your focus.
4. Make it mission-driven: Don’t let cash be your motivation for pivoting; make sure you’re staying true to your company’s mission. All your big decisions should be driven by your company’s core identity.
We’ve been through a lot of failures and wrong turns to get our company where it is today, and pivoting is by far the hardest thing we’ve done. But it really shaped our team and our product — the elements that are critical to the DNA of our company. The right pivot will bring you closer to your vision — and that’s always worth the extra work.
Guest author Veer Gidwaney is the CEO and co-founder of Maxwell Health. Maxwell Health provides a SaaS platform through health insurance brokers that drastically reduces the headaches associated with employee benefit systems. Maxwell Health is committed to helping both employers and employees reduce healthcare costs through an incentive-based system that rewards people who actively try to be healthier. Tech Cocktail recently named Maxwell Health the “Hottest Startup in the Nation” in 2013.
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