My favorite part of the Nintendo story is that back when it was a playing card company, the heir to the family business took a trip to America that included a meeting at the largest card company in the world.<p>He had expected it to have a luxurious, palatial campus… but its entire headquarters turned out to be like the fourth floor of a single building in a generic office park. He was like, “This is the absolute pinnacle I can ever hope for if I succeed beyond my wildest dreams running the playing-card company. I need a new idea.”<p>You can read all about it in an outstanding book called I Am Error that, beyond extensive interviews with the historic key players, also takes an incredibly deep dive into the technical details.
> Netflix had considered offering movies online, but there were speeds and bandwidth problem in mid-2000.<p>One of the more interesting things I learned from the (outstanding) documentary "Enron - The Smartest Guys in The Room" [0] was that Enron planned an online movie streaming service together with Blockbuster in the late 90ies (to start in 2000), but failed for the same reasons.<p>> Enron would store the entertainment and encode and stream the entertainment
over its global broadband network. Pilot projects in Portland, Seattle and Salt Lake
City were created to stream movies to a few dozen apartments from servers set up
in the basement. Based on these pilot projects, Enron went ahead and recognized
estimated profits of more than $110 million from the Blockbuster deal, even
though there were serious questions about technical viability and market demand [1]<p>But of course Enron "pivoted" to outright fraud some years before that.<p>[0] <a href="https://www.youtube.com/watch?v=rDyMz1V-GSg" rel="nofollow">https://www.youtube.com/watch?v=rDyMz1V-GSg</a><p>[1] <a href="https://pubs.aeaweb.org/doi/pdfplus/10.1257/089533003765888403" rel="nofollow">https://pubs.aeaweb.org/doi/pdfplus/10.1257/0895330037658884...</a>
There are a few of these that don’t really feel like pivots to me. For example Netflix changing from delivering things via DVD to doing it by streaming just feels like evolving to suit the market. Would we consider a publisher as pivoting because they now sell ebooks and run news websites instead of printing books and magazines?
Twitch started out as Justin.TV, where Justin Kan wore a camera on his head 24/7 and livestreamed the results.<p>Then they expanded to a small handful of streamers, then anybody could stream, but it never really took off and they were running out of runway.<p>Then they noticed that the one area growing faster than any other was videogame streaming, and rebuilt the whole company around that.
A classic non-pivot is the Prodigy service, created as an IBM spinoff in the 1980s as a sort of proto-Amazon. To their great annoyance, instead of shopping, users insisted on chatting with each other all day.<p>They could have embraced this and beaten AOL to the punch, but instead they issued an edict that from then on, users would only be allowed to send 30 messages a month, and after that, they would cost 25 cents each. This was the start of the company’s death spiral.
Century old example showing pivoting is as old as business:<p>“ When 3M began in 1902, the five founders had a simple goal: to mine for corundum, a mineral ideal for making sandpaper and grinding wheels. Turns out, what they thought was corundum was really another low-grade mineral called anorthosite.”<p>3M pivoted to selling sand paper without the sand, I.e tape, and that helped them survive long enough to try again at sand paper. (Transparent tape, invented by 3M, helped them grow during the Great Depression because people fixed stuff instead of buying anew.)<p>Funny to see sandpaper still being improved upon after 100 years: <a href="https://youtu.be/NZDCRFi8dKY" rel="nofollow">https://youtu.be/NZDCRFi8dKY</a>
Not sure if the original business needs to be dead for it to be considered a successful pivot. You could include amazon with aws. Or Dassault (planes) with Dassault system (CAD). And all the big asian conglomerates. You could even include the east india company which started as a trading company before becoming a colonial administration! My point is that these pivots are quite common.
Investigating around the whatsapp pivot, I found their old blog.<p><a href="https://web.archive.org/web/20110927080704/http://whatsapp.wordpress.com/2009/11/19/a-few-things/" rel="nofollow">https://web.archive.org/web/20110927080704/http://whatsapp.w...</a><p>>So first of all, let’s set the record straight. We have not, we do not and we will not ever sell your personal information to anyone. Period. End of story. Hopefully this clears things up.<p>Heh... :-)
The one I never really quite understood was Slack. Who builds an internal chat client, while building an online game, and then decides to build a b2b business around that chat client?<p>The rest at least have some logic to them. You build something, people use it for something else, so you generalize. Or you pursue a neighboring market or use-case. But the Slack one just seems so random.
I run a small business, and know others who do the same.
Honestly, I think pivoting is the norm rather than the exception.<p>Many of the people I know started in a similar place, but their businesses evolved into all kinds of weird and wacky enterprises.
I'm thinking of Epic Games and their game Fortnite. The game was some kind of tower defence at the begining. They swithed to battle royal and made one of the most played video game of all time.<p>Ok, it's a small pivot, but it changed the company and gave them so much money that they were able to create their own game store (and fight Apple in court).
There's always Wrigley's that went from offering gum as an incentive to buy soap to just selling the gum... "Make something people want"<p>> In 1891, 29-year-old William Wrigley Jr. (1861–1932) came to Chicago from Philadelphia with $32 and the idea to start a business selling Wrigley's Scouring Soap.[14] Wrigley offered premiums as an incentive to buy his soap, such as baking powder. Later in his career, he switched to the baking powder business, in which he began offering two packages of chewing gum for each purchase of a can of baking powder. The popular premium, chewing gum, began to seem more promising, prompting another switch in product focus. Wrigley also became the majority owner of the Chicago Cubs in 1921.<p>-- <a href="https://en.wikipedia.org/wiki/Wrigley_Company" rel="nofollow">https://en.wikipedia.org/wiki/Wrigley_Company</a>
I recently learned from a loading screen message that Discord has almost the same origin story as Slack. They were making a mobile MOBA called Fates Forever but pivoted when they realised how poor the current systems for communicating in games like MOBAs are. Unlike Slack though, I don't think code was shared between the projects.<p><a href="https://toucharcade.com/2015/09/14/ex-fates-forever-developers-making-discord-a-voice-comm-app-for-multiplayer-mobile-games/" rel="nofollow">https://toucharcade.com/2015/09/14/ex-fates-forever-develope...</a>
MP3.com was initially a search engine.<p>The nice thing about running a search engine, even if it only ever gets a trickle of traffic and could never compete with the big players, is that you can look at the logs and spot trends early. The founder noticed people were searching for something called “mp3”, saw the domain was available, bought it, and then looked up what it was and eventually rebuilt the company around it.
Nokia is incorrect (afiu the tire/rubber business was span-off some years ago Nokian), even the source cites it better "The company has operated in various industries over the past 150 years. It was founded as a pulp mill and had long been associated with rubber and cables, but since the 1990s has focused on large-scale telecommunications infrastructure, technology development, and licensing."
Nintendo existed for nearly one hundred years before they started making video games. Saying that all they did up until then was not successful is ridiculous - you do not run a company for an entire century by not being successful.
Another example is Unsplash.<p>Unsplash was originally a marketing attempt by a company named Crew, a marketplace startup trying to connect businesses with freelance designers.<p>After Unsplash took off and the talent marketplace didn’t, the company became Unsplash.
This was really interesting, a lot of these I never knew about, like Segment was originally pitched to YC as a classroom tool.<p>Related, though, perhaps it's just a bit of semantics, but in general, I consider a "pivot" to be where a company hasn't found traction with their current product, so unless they switch they're going to die.<p>Like another commenter who mentioned Netflix, that feels very different than some of these companies that were just evolving or growing with the market. I mean, in one sense, since technology is always changing you <i>better</i> evolve at some point or you're guaranteed to die. Moving from DVDs by mail to streaming was a pretty obvious switch, and not something that really took Netflix by surprise (though they famously had some major hiccups as they tried to make that switch).<p>In general, though, lots of interesting and cool stories here!
That list I think is a good lesson/motivator that the "golden" product youre developing may not become the product defining your company but instead a side project.
To be fair, Netflix's DVD via email business model was very successful before they pivoted to streaming while many of the others initial idea was ... <hrm><p>In the case of Netflix, here goes a company that smartly and efficiently adapted to changing market conditions rather than "pivoting".
Mentions Western Union but no mention of American Express (express mail -> financial services)? Western Union hardly even counts as a pivot because their original money wiring service operated entirely through their telegraph network, which is where the term "wiring" came from.
> Segment - Classroom lecture tool - When the product was deployed in the classroom, all the students opened their laptop and went straight to Facebook instead of using the program.<p>There is an excellent YC podcast featuring Segment's founder that walked through this pivot. Excellent listen: <a href="https://www.ycombinator.com/library/6B-on-finding-product-market-fit-at-segment-yc-s11" rel="nofollow">https://www.ycombinator.com/library/6B-on-finding-product-ma...</a>
Apple. Went from being an unprofitable 1990s personal computer manufacturer like IBM, Dell, Compaq, etc. to being a high end AV consumer electronics company like Sony.
I founded a company called Milo (<a href="https://www.getmilo.com/" rel="nofollow">https://www.getmilo.com/</a>) - we started as a “One Medical For Pets” modern veterinary clinic and actually had 3 hospitals before realizing that the real value was in the software we had built to make our teams more efficient. Now we’re pure SaaS<p>It is definitely challenging to pivot and fighting sunk cost bias is massively hard
Apollo GraphQL (which just raised a $130M Series D) pivoted from Meteor, a company built around supporting the frontend framework MeteorJS.<p><a href="https://softwareengineeringdaily.com/2020/01/17/apollo-graphql-with-geoff-schmidt/" rel="nofollow">https://softwareengineeringdaily.com/2020/01/17/apollo-graph...</a>
I am not sure Shopify belongs to the list. It didn’t exactly pivot, Tobi Lutke made a website with Rails to sell snowboards, and realized there is an untapped market for SaaS e-commerce product, so he generalized the framework powering the website.
Foursquare comes to mind. They were the "location check-in app" hotness for a while. They abandoned the app and now are a significant player in the surveillance ^H^H^H "location-based experiences" space.
It might be interesting to classify the various kinds of pivots. For example, one that gets covered from time-to-time is the one where customers start using the product differently than the founders intended. The examples here are WhatsApp, Yelp, Flickr, Groupon, Play-Doh, Segment. But there are a lot more like that.<p>If you had a language for talking about pivots and why they happen, it might be possible to avoid (or induce them) more deliberately.
I think at least for me, before working at an early start-up, the wrong idea is that pivots are exceptional.<p>No, pivots are what startup do.<p>They are born out of pivots, since the founder(s) could not find a way to implement their ideas in other venues.<p>So all startups pivots, and all successful had pivoted successfully.
While reading that list, I had a realization that many good 'pivots' arent so much pivots as upgrades of a successful feature into a product. I wonder if anyone had tried to formalize that into a product development methodology.
Oh man, I didn't know that Groupon started as The Point, a tool to help people organize to work towards a goal. The biggest goal ended up being to save money..<p>Does anyone know of a service today for helping people organize around a cause?
Very nice, never too late to pivot<p>p.s. you could also add FanDuel to the list
<a href="https://en.wikipedia.org/wiki/FanDuel#History" rel="nofollow">https://en.wikipedia.org/wiki/FanDuel#History</a>
Some of those are so unrelated I'd hardly call them pivots. More like currently successful companies that used to do something completely different under same brand name
And of course the pivot to end all pivots:<p>APPLE!!! Which started as a company that made computers, then became a company that made mobile music players, and now is a company that makes phones.