The term “pivot” is widely understood in the startup world to be a drastic change in the direction of a company. In fact, pivoting can be used to describe any significant shift in strategy, from focusing on a new set of customers in a different market to turning one feature of the product into the product itself. In many cases, startups pivot multiple times as they gain new insights about their market, realize that their initial hypotheses aren’t quite correct, or discover new or bigger opportunities with stronger economics than their current business model.
The core ethos of Bus.com, initially launched as Sharethebus, was to provide seamless and fun group travel experiences for attendees of music festivals and sports events. Their focus on quality and ease of movement had the company transporting 50,000 fans per year to events like Coachella and Electric Forest within a couple of years of launching. But when founders Wolf Kohlberg and Kyle Boulay reached out to student organizations to spread awareness of their shuttle services to events, they discovered that instead of groups of individual ticket buyers, student organizers were actually looking to rent entire buses and struggling to find suppliers.
While the Sharethebus team had set out to solve a problem for a specific set of people (large-scale event organizers), they realized that they could help anyone looking to rent a bus. In this highly fragmented market, they had the potential to create a bus rental marketplace that would help any event planner — from a festival production team to a student leader — to mobilize their communities, and any bus owner to have a new and reliable flow of business. This was a massive opportunity. It was aligned with their mission. But pivoting from something that was working toward something that might be a bigger opportunity—yet was only anecdotally proven—was still a nervous bet to make.
Thinking it through
While doubling their market size was an exciting proposition, before taking on the challenge, it was crucial that the team did their homework.
“We always knew there were three to four different opportunities and ways of navigating the space,” Kyle says. “Ultimately, running a startup is about constant learning and growth, and the insights we developed from our first hypothesis led us to an idea about how to address the second one.” In effect, the original value proposition for the business would now simply be thought of as one of a number of go-to-market channels.
Pivoting a company — whether it’s an evolution or a sea change — requires a great deal of forethought. You have to think it through from every angle. This means analyzing every aspect of the idea, from customer acquisition to value proposition to unit economics to scaling to see if this new direction truly has merit.
The pivot from Sharethebus to Bus.com not only required a complete shift in strategy but also necessitated new software and a new org chart. They would be rebuilding the startup into something with the potential to grow bigger faster. If they were to go ahead with this pivot, they had to be sure.
“Every strategic decision at an early-stage startup comes with many opportunities for second-guessing,” Kyle says. “We questioned it [the pivot], our board questioned it, there was even questioning for some time after we made the change. The important thing is to follow a scientific process of testing your hypothesis and committing to the outcome. We believed we tested well, so we had the confidence to stay on our new path.”
Building the plan
While thinking it through and conducting thorough research is crucial, what your board wants to see is a solid plan. During the research/discovery phase, you will be speaking with customers, advisors, mentors, team members and others to help you clarify your idea. You and your team will be digging deep into your market, competitors, customer acquisition strategies, scalability, potential roadblocks, etc.
For instance, Bus.com’s research phase on the customer acquisition side involved mapping out a hypothesis of their customer’s journey, then challenging it with internal data, customer surveys, and customer interviews. The resulting deliverable was a framework that allowed the company to understand customer behaviour, and where in the journey they could have a positive impact and bring added value.
Matt Litwin, Senior Digital Strategist, shares: “The more we learned, the more it became clear that there are a few key places in their journey where we could position ourselves so that customers would be able to find us rather than us having to find them.” This meant that Bus.com would be able to acquire new customers much more efficiently, leading to exponential rather than incremental growth.
“By leveraging both paid and organic search, we could capture our target audience at the right time: when they were looking for group transportation. Identifying what matters most to our customers also helped us to figure out our key differentiators and value propositions. Our combination of placement and customer-centric messaging has now made us easy to find and a highly attractive option,” Interim Head of Marketing, Sarah Jampen Almazan says.
Further, their research didn’t just give the company clarity as to how to plan their transition from outbound to inbound customer acquisition, it also engendered confidence for their stakeholders that this change in strategy was the right move.
Forging a new path
Getting your board and team members onside is absolutely crucial for the successful growth of any company. It’s doubly important when the startup is making a major strategic change. This means presenting a clear and cohesive plan backed by relevant data to all of your major stakeholders. Transparency is key.
“You have to present when you’ve had your discussions, you’ve done the discovery, you’ve done the planning and now you have a strong reason for people to believe,” says Real partner, Sam Haffar. “If you’ve thought the pivot through from every angle and have a clear path ahead, you’ll go into what may be a tough transition with support and conviction.”
If your plan is unclear or you seem uncertain, anyone from employees to board members may lose faith in the business. Don’t leave room for uncertainty: it’s your company and your job is to make gutsy decisions and convince others that you’re making the best choices for the future.
“As we grow and mature, accepting this new business model has really been a journey in acceptance,” Kyle says. “At the end of the day if you’re measuring and tracking well in terms of progress and the data says that then you’re going to convince a lot of people.”
Bus.com is transforming the way people plan, book, and experience bus travel, across different lifestyles and industries. Interested in joining their team? Check out their open positions.
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