Thursday, March 27, 2014

When all else fails, Pivot.

Tyler  Hansbrough, pivoting like a champ!
In case you didn't know I went to a startup weekend two weekends ago and I am slowly recapping some of my experiences, starting with the vocabulary of startup people. You can read part 1 about creating the MVP. Today is about pivoting. It seems that the startup world is just borrowing terminology from the sports world because when I was growing up, pivoting was something you did in basketball. When you picked up your dribble you could pivot on one foot. If you moved your pivot foot you traveled and turned the ball over. Once again I had to fake it till I learned the meaning of the word pivot in the startup world.

When starting a new business, failure is expected. Not only is it expected but in some ways it is encouraged. Obviously you want to hit on a good idea that will make money but it just so happens that the people who are good at failing are the people who hit on the good ideas. The real trick is to fail as fast as possible.

Here is how the starting a company in a weekend works. You start with a premise for a business. I'll use the one my brother came up with today:

Corporations have nasty fridges and need an impartial service to come clean them out and organize them once a month. 

Now you need to prove that this will make money as quickly as possible. So you send out polls to business owners and go door to door and see if someone will let you clean their fridge. You also need to see how scalable your models is if people liked it.

You come to the conclusion that, yes, this is a problem but not very many companies are willing to pay for your services. Not only that but if they did want to pay for your service it wouldn't scale very well since there is no element for exponential growth. If this took three weeks to realize, you failed too slow. If this took 4 hours, congratulations, you failed fast!

One important piece of information you found: dirty fridges are a problem in corporations. You now have validated that there is a business there to be had but you just failed to get it right. This is where you pivot meaning you tweak your solution a little to better solve the problem. Next you try to come up with a web camera system that displays on people's computer wallpaper. That doesn't go over too well, pivot. Fridge dishwasher combo? Pivot. Robots? Pivot. Public shaming? Pivot.

Finally you design a cubby style fridge with a glass door and a special squeegee that is the perfect size of a cubby so they can be cleaned with one swipe. Each cubby has a dry erase label for a name and a date. You get 100 companies that say they would buy it if it existed. It's production is easily scalable once you get the money to get it off the ground. So you kickstart it for 100,000 and tons of companies jump on board.

That's the gist of it. Failure is not bad unless you are not willing to part with your idea. If you can't adjust, it can be disastrous because you will spend hundreds of hours working on something that nobody wants. When you fail, learn what you can and move on. This idea is very central to developing a process over a goal. The process of pivoting allows you to move on where the goal of starting your business might have had you beating your head against the wall trying to make your idea work.

So remember when all else fails, pivot.

No comments:

Post a Comment