YC
Dalton Caldwell - All About Pivoting
@ Y Combinator
08/30/19
Takeaways
DC
Dalton Caldwell
08/30/19
@ Y Combinator
A pivot simply means changing your idea, especially when you're at the earliest stages of your company. It should feel lightweight and is a normal part of the process, particularly pre-launch or shortly after launch.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
The main reason to pivot is opportunity cost; if you're working on something that's not working and you have evidence of it, you're missing out on the potential gains from pursuing other alternatives.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
If you've been working on an idea for months without success, that's a strong signal that you should consider pivoting to something else.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
Good reasons to pivot include feeling unhappy working on the idea, lack of growth, or realizing you're not the right fit for the project.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
Relying on external factors outside of your control, like mainstream virtual reality headset adoption, can be a sign that you should pivot if your startup's success depends on those factors.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
If you're out of ideas on how to make your current project work, that's usually a sign you should pivot.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
People often take too long to pivot due to loss aversion, where they struggle to let go of something they've invested in, or because they misinterpret politeness as traction.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
Fear of admitting weakness or defeat can prevent founders from pivoting, as they may feel that doing so means giving up.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
Having a little bit of traction can be a trap; it can lead talented founders to stick with a failing idea for too long instead of pivoting to something more promising.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
Ultimately, the decision to pivot or not is the founder's responsibility. It's important to take accountability for your actions and not rely on authority figures to make that decision for you.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
Product-market fit is crucial; you know you have it when growth is not your biggest problem, and when you pivot, you get another chance to succeed, increasing your odds of achieving product-market fit by taking multiple high-quality shots at it.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
Finding a better startup idea involves choosing something that excites you and makes you optimistic about your work, rather than settling for a less inspiring option.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
It's crucial to assess your strengths and weaknesses honestly when searching for a new idea to pivot to, ensuring you play to your strengths.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
When pivoting, aim for ideas that can be quickly built and validated, rather than those requiring extensive research and development.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
It's acceptable to pursue ideas that don't require venture capital, as most businesses don't need it to succeed.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
Evaluate your startup idea based on its potential scale, such as whether it could generate significant revenue and if it aligns with venture capital expectations.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
If you feel hopeless after launching and trying to gain users for an extended period, it's likely time to pivot.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
Founders often know when their idea isn't working but may try to maintain a facade of success; if you can't convince yourself, it's a good time to pivot.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
Pivoting too frequently can lead to whiplash, which demotivates founders and can ultimately harm the company more than working on a less-than-ideal idea.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
It's better to work on an idea that may not be the best if you're enjoying the process, rather than becoming disheartened while pursuing a startup.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
Adding team members should only happen once you have a clear, working idea; otherwise, it can slow down progress and create confusion.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
Ideas that are easy to start are highly recommended, as many good ideas fail because founders struggle to get them off the ground. Additionally, changing your startup idea is essential, and the sooner you do it, the better, due to opportunity costs and the need for multiple attempts to succeed.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
Brex pivoted from a VR hardware headset idea to a credit card for startups, achieving product-market fit quickly and raising hundreds of millions in just two years.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
The founders of Brex had prior experience in fintech, which contributed to their success after pivoting, demonstrating the importance of founder-market fit.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
Retool, a tool for building internal management pages, is highly recommended for YC startups due to its effectiveness in creating internal tools.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
Magic pivoted from a blood pressure coaching app to a more successful product after realizing their initial idea wasn't gaining traction.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
Segment started as a classroom feedback tool but pivoted to a data collection tool, which became successful due to their expertise in analytics.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
The early market feedback for Segment was decent, as professors liked the product, leading to successful sales despite initial doubts about its potential.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
When considering a pivot, especially in the early stages, it shouldn't feel like a big deal; you should be open to changing ideas frequently.
DC
Dalton Caldwell
08/30/19
@ Y Combinator
Following best practices when pivoting is recommended, and being scientific about the process can significantly increase the chances of your startup's success.