Thinking about adjusting your original big idea? Lots of companies have made BIG pivots — if they hadn’t, Twitter would still be called Odeo and unsuccessfully publishing updates longer than 140 characters.
We asked 15 young entrepreneurs about the big pivots their companies made early on in their careers.
I was always under the impression that to be an entrepreneur and own a business, you need to get funding, open up a brick-and-mortar space, and devote all of your waking hours to it. I wanted to travel. Early on, I realized just how much is possible via the Internet. So I ditched the idea of staying in one place and built a business that allows me to travel whenever and wherever I want.
In the first days of my marketing agency, we were only doing performance-based deals with clients. We took all the risk and spent our own money on ads, and we’d only get paid if we could deliver results. This approach made it really easy to attract clients, but we got lots of clients we couldn’t help. Our first pivot was to define our ideal client, and today we focus on quality over quantity.
We initially targeted local mom-and-pop businesses with RewardMe. We quickly realized that although small businesses can benefit from a rewards program, they are not sophisticated enough to care about the unique product data that we capture. We pivoted our target market to nationwide franchises because they have the money and resources to take advantage of the unique data we collect.
When I started out, I was a run-of-the-mill freelance writer who would take any project she was offered. It was only after I really narrowed my focus, both in the types of projects I would do and the types of clients that I would work with that things started to boom.
We targeted contractors from the start but quickly noticed we had an overwhelming number of other people asking if they could use our website as well. Turns out, fewer contractors use the site — it’s businesses all across the board. Never discount a group or audience that you might appeal to, because you might just miss out on some great potential members and/or customers.
About a year into our business, we discovered that our celebrated up-sells were our clients’ pet peeves. We pivoted our focus from driving revenue to understanding and better serving our clients’ needs. Despite slightly decreased revenue per sale, total revenue has skyrocketed along with customer satisfaction and loyalty. Giving up some short-term revenue was ultimately a profitable decision.
We started our business as theKbuzz, an offline word-of-mouth marketing company, and in 2007, the first year of our business, as social media exploded, we pivoted. We realized that social media was a much more efficient way to generate buzz than mall events and other guerrilla marketing. We pivoted our business model and changed our name to Likeable. We haven’t looked back!
My service menu was too large when I first started. I had to pare it down to ensure that what we provided was quality, 100 percent of the time. I found I couldn’t do everything and be successful. Finding our unique niche and staying the course led to less stress and much better profit.
Offering Paid Memberships – Nicolas Gremion, Foboko.com
I stepped out of my comfort zone and took the advice of a new team member, which was to offer paid memberships on our free eBook website. This, to me, didn’t seem right, but it quickly became our biggest source of revenue, allowing us to not be dependent on advertising alone.
A big pivot we made was understanding the need to diversify revenue streams. If your business is purely retainer and/or driven by a one-time commission, a macroeconomic shift can be devastating. We’ve focused on creating more residual and royalty-based revenue models to maximize our long-term financial sustainability.
For years I was a consultant and message architect to big brands. I made a good living but it wasn’t a scalable platform. In 2009, the business imploded amidst a divorce and I lost everything. Forced to start over, I reinvented my business with a range of online infoproducts devoted to the business of storytelling. This allowed me to expand and reach a market of thousands instead.
When I started my time-coaching and training business, I thought that my clients would primarily be females. Accordingly, I choose pink as my site’s color and marketed to women in business. Despite my total lack of effort to reach out to a male audience, I found that men started finding my business and asking if they could participate. Now my business is gender-neutral.
We moved to a pay-for-performance model. This pivot defined our business and rapidly increased our client base. Trust is built when clients know you’re only charging them for the results they can see.
Come Recommended started off as an exclusive online community for interns and entry-level candidates, but it’s now a digital PR and content marketing firm focused on helping companies with products for job seekers or employers. We’re still able to help job seekers and employers connect, just in a different way from where we originally started.
When I started the business, we tried unrolling too many peripheral services all at once. It ended up being too much too fast and didn’t work out. We were forced to scale back operations and focus on our core service offerings. I learned that sometimes, it’s the pivot you don’t make that matters the most.
[Top image credit: 140proof/Flickr]
The Young Entrepreneur Council (YEC) is an invite-only nonprofit organization comprised of the world’s most promising young entrepreneurs. The YEC recently published #FixYoungAmerica: How to Rebuild Our Economy and Put Young Americans Back to Work (for Good), a book of 30+ proven solutions to help end youth unemployment.