How to pivot: The tech giants that changed to survive

Some of the most simple but effective advice I’ve ever been given is ‘If you don’t like where you are now, then just move.’ But in business, movement is forced upon you from things not entirely within your control.

A pivot is a fundamental change a business makes when their offering isn't meeting the needs of their intended market. You can pivot customer segments, channels, pricing, and many other smaller factors, but the largest pivots come when the product must change. With that, everything else changes with it. 

Some businesses have had near-disaster pivots, and others, like Blockbuster or Sears, are corporations that missed golden opportunities to pivot and consequently were washed away with the tide.

However, some of the biggest companies in the world have managed to turn everything around, thanks to the drive, ambition, and skills of its people. We’ll take a brief dive into the Wayback Machine and old podcast interviews to explore 5 companies with extreme pivots, who became some of the world’s biggest successes. 

Youtube used to be a dating website

Now worth $40 billion and with 1.9 billion users a month, Youtube is now the ultimate time-suck, replete with fail vids, dashboard cams, and Hell’s Kitchen highlights. 

But when it started in 2005, Youtube used to play online cupid. Dating, according to founder Steve Chen, was the ‘obvious choice’ back then for its video platform. Five days after their big release, no one had uploaded a single video. With the smart video infrastructure already in place, they decided to open it up without a niche, and the YouTube we know today was born. 

Twitter was going under thanks to Apple Podcasts

Before Twitter became a micro-blogging platform and the US President’s plaything, it was Odeo⁠—a podcast platform. But when iTunes started to dominate podcasting, the company was going sideways with 14 people working full time. Odeo’s had to develop a new idea to save the company and fast. 

Fortunately for them, Jack Dorsey and Biz Stone pitched the concept of Twitter, with Noah Glass leading the helm to push the idea until it became a reality. They shifted from podcast app to the status-updating platform used by 321 million monthly users and worth $4.4 billion today. 

Airbnb was providing houses for conferences… and was funded with cereal 

Airbnb began as a simple idea⁠: house-sharing for the South by Southwest tech conference. And the solution was often actual air mattresses⁠—hence the brand name. The founders then pivoted when asked, ‘Why does it need to be for a conference when someone needs a place to stay?’ 

Airbnb had many iterations to turn into the huge brand they are today. Investors were initially hugely put off of the idea, one even stating ‘That’s weird’ during a pitch. Lacking investment and in a phase without product/market fit, Airbnb entered what is known as ‘the trough of sorrow’ in the startup scene. And this is the time where people often quit. 

Their wacky solution was to raise funds by producing election-themed breakfast cereal, and take professional photographs of the properties, and thoroughly test how users navigated their website. Now it’s worth $35 billion with 6 million global property listings worldwide.

Slack was a failed video game venture

Before it became an amazing way to send gifs to colleagues, Slack was a massively multiplayer video game venture called Glitch. 

The team landed on the concept because of the messaging system already developed in-house while working on Glitch. The game failed to attract a sufficiently large audience, but the communication platform, according to Slack founder Stewart Butterfield, was making the team ‘very efficient in being unsuccessful’.

After its public release in February 2014, the tool grew at a weekly rate of 5 to 10 percent and is now worth $20 billion with more than 10 million daily active users. 

Instagram was a confusing app called Burbn

Before it hit a net worth of $100 billion with 1 billion monthly active users, Instagram was Burbn—a confusing app that let users check in at particular locations, make plans for future check-ins, earn points for hanging out with friends, and post pictures of the meet-ups (like I said… confusing). 

After it failed to take off or attract any key investors, co-founder Kevin Systrom took some time off to reflect on the product. A trip away eventually triggered the idea of slimming down the app to a simple photo-sharing infrastructure. Within a single day of re-launching, Instagram attracted more users than Burbn had acquired over its entire existence.

Lessons on how to pivot

There a few lessons that can be taken from these monumental business pivots:

1. Be self-aware on the strengths you have.

If one aspect of the product is clearly shining above all else, you have to be ruthless with the others. If there is a gap in the market for the key feature bringing users back, double down on it and build the entire infrastructure around it. Less is more.

2. Realise when the best time is to pivot

Surfing is a fantastic analogy when considering when to pivot. You have to sense and feel your position in relation to the wave as it is always changing. Much of this comes from experience, but a lot of it will come from listening closely to the marketplace and optimizing momentum for the most positive outcome.

3. Listen to your audience

When Airbnb’s website was failing, the founders took the decision to research how hosts would list the homes on the website, realising their user interface was needlessly complex. You need to hear feedback from the right people. ‘Validated learning’ through both feedback and data are key to a successful pivot.

4. Test the waters before diving in

Before you decide to scale up and change the world with your new idea, try an inexpensive, fast way to test your hypothesis. Set up landing pages, paid campaigns, early access groups, and a survey. See if there is real potential in this change before maxing out a binder of credit cards. 

The false start

Making your business take off is about going through “false starts," said Instagram founder Kevin Systrom. "Burbn was a false start. The best companies in the world have all had predecessors. You always have to evolve into something else."

The very best businesses weren’t just driven by an idea. But rather, people who were not afraid to embrace change driven by intelligent design, and evolve their idea into something better.