Startups, by design, must grow and evolve quickly. In times of global uncertainty, that means having to learn to pivot on the back foot. Thankfully, recent data shows that most ventures are pivoting successfully, with long term sustenance in their sights.
The Art of Pivoting
A recent study from Station F shows that 80% of small firms polled made daring changes to their regime. In their poll, the vast majority of companies set to ring in 2021 took bold initiatives this year.
Pivoting is crucial for startups when impossible blockades get in the way. For example, Station F’s data shows that 24.7% of polled companies altered their markets. More interestingly, 16% of poll takers cemented their positions through creating new deals. The smallest pivot category, however, shows that companies were willing to rethink their pricing.
This data overwhelmingly proves, small firms are willing to make sacrifices for long term success. This is a model that all businesses should follow. However, with young ventures at the mercy of investor funding, the need to change quickly is always salient.
What are the Impacts on Investments?
It is worth considering how pivoting is affecting investments and venture capital firms interest. From the same poll, Station F proposes that funding is back on the increase for ventures after a few months of uncertainty. Impressively, innovators in Israel lead the way, with at least 75% of those polled continuing to receive funding.
Station F’s poll leads with the promising statistic that 94% of those companies polled will likely continue to innovate well into 2021. That, arguably, is partially thanks to daring pivots, and positive impressions made on VCs.
Sifted’s recent interview with select VCs indicates that investors are likely to find any move to pivot impressive. In recent times, according to their findings, investors are perhaps slower to risk money on innovations. However, it is clear – and from the horse’s mouth – that interest is building in resilient, daring ventures.
Startups and the History of Pivoting
This data shows us that pivoting is if anything, a growing trend. However, you only have to look at some of the biggest brands on the planet to see how worthwhile even a small pivot can be for business.
For example, many are unaware that Twitter started life as a podcast library. Nokia, the cellphone giant, started life milling paper. Even the smallest of businesses are primed to evolve.
Recent examples of innovative pivots include that of the Auction Collective, which has moved its gallery service to a wholly online customer base. Club Vino, a wine tasting service, now offers taster gatherings via video link.
The most successful startup companies will continue to network and change shape regardless of global tectonics. For example, many investors and startups are continuing to come together through startup company databases such as Fundz.
Data is unclear how successful big pivots will be in the long run. For now, at least, even the smallest of startups can look towards 2021 with positivity.
SOURCES
https://sifted.eu/articles/startup-funding-coronavirus/
https://www.visualcapitalist.com/these-8-pivots-by-startups-changed-the-world/
https://www.microbizmag.co.uk/startup-statistics/
https://www.statista.com/topics/4734/startups-in-north-america/
