WhoBuilt

Startup Experts Reveal Their Favorite Pivot Stories

Jul 21, 2023· 21 min· 166K views·Watch on YouTube

Speakers

Y Combinator partners and founders share pivot stories, including Dalton Caldwell and Harj Taggar on Brex and Goat, and Tom Blomfield on GoCardless with Michael Seibel.

Brex and Goat found better-fit ideas

Brex applied to YC with a virtual reality headset idea, but the founders recognized they lacked hardware expertise and returned to payments, a field they knew from an earlier business in Brazil. Goat began as Grubwithus, a group-dinner service with poor retention, then shifted to a sneaker marketplace after its founders recognized their own interest and a growing market. Dalton Caldwell says some strong pivots are ahead of conventional wisdom.

GoCardless moved from consumers to businesses

Tom Blomfield describes applying to YC with Groupay, a bill-splitting product that struggled to retain users. After cold-calling hundreds of UK sports-club treasurers and gaining one user in two weeks, the founders repurposed their bank-payment technology for businesses collecting recurring payments. That company became GoCardless.

Clipboard Health found the problem through customers

Clipboard Health started as a hiring platform for nurses, but its founder, Wei Ding, learned through hospital sales conversations that facilities needed nurses to cover sick calls. She manually coordinated nurse placements before building software to support the service. The example shows how customer contact and hands-on work can reveal a more specific problem.

Avoid pivot hell and validate real demand

YC partners describe pivot hell as repeatedly switching to entirely new ideas before testing one seriously; perfectionism and the search for a flawless idea can keep founders in that loop. Another founder says early interest in an augmented reality product came from marketers being polite, while game developers showed stronger fit when the team began selling to them. Founders should test whether customers will pay and learn directly from users.

Use a clear metric to judge progress

Brad Flora says Colour Lovers grew to more than a million members but spent about a year and a half trying non-repeatable ways to make money without a main KPI. After pivoting to Creative Market, the team tracked marketplace purchases as a clear measure of progress. Flora recommends choosing and regularly checking one key metric that indicates whether the business is working.

Takeaways

  • Treat a pivot as a change to the idea that builds on what you have learned.
  • Talk directly with customers to find out which problem matters enough for them to use or buy a solution.
  • Try solving the problem manually before building software around assumptions.
  • Commit to testing an idea instead of switching whenever you discover a drawback.
  • Choose a main KPI and track it consistently to judge whether progress is repeatable.

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