Written by Jonathan Richter
Top 10 Tech Pivot Examples:
1. Twitter – Odeo
2. Pinterest – Tote
3. Flickr – Game Neverending
4. Instagram – Burbn
5. PayPal – Confinity
6. Groupon – The Point
7. YouTube – video dating site
8. Android – camera operating system
9. Nokia – paper mill
10. Nintendo – trading cards
What does pivot mean in the tech and startup culture?
Very few tech startups get everything right the first time they launch a new product or service. Even when you find a way to tap into the market, you may discover that you need to pivot because customers have different wants or needs than you expected.
A tech startup pivot means a shift away from your original product or offering to something new that you think customers, clients, or app users will be more interested in (or more willing to pay for).
A tech pivot doesn’t necessarily mean your whole system or business will need an overhaul, or need to be restarted from scratch. In some cases, you might just need to rebrand, change some language, and/or some parts of your user storyboard or feature set.
If you’ve read our guide on how to create an app, then you’re already aware of the benefits associated with creating a minimum viable product (MVP), and how the MVP process can allow you to adjust your core feature set in an agile way.
Top 10 Best Tech Startup Pivots in History
Tech and startup pivots may sound scary or intimidating, but in reality it’s not uncommon at all!
In fact, some of the most used platforms today started out as something completely different before rebranding or restructuring their offer.
Let’s start off with some of the most well-known tech pivots that also rebranded:
1. Twitter was originally called Odeo
Twitter has established itself as the dominant social network for relatively short, up-to-the-minute news updates, so much so that often times tweets will show up as the top result on Google when searching for a current event.
Twitter started out as a Web site called Odeo, intended as a place where people could download podcasts from all over the world.
However, as Odeo struggled to keep it’s head above water and retain users, Odeo founders (including Noah Glass and NYU undergraduate at the time Jack Dorsey) came up with a rough idea of an individual using an SMS service to communicate with a small group.
They called the limited micro-messaging service “twttr” before purchasing the full domain name for “Twitter”six months later.
After a successful showing at the 2007 South by Southwest Interactive event which created a surge in tweets (from 20,000 to 60,000 tweets per day), Twitter took off.
Twitter went public on 11/7/2013 at a price of $23 per share, solidifying it as one of the best examples of a tech pivot in history.
2. Pinterest was originally called Tote
In 2009, m-commerce app Tote was published on the app store with the aim of making shopping faster, more fun, and localized.
They had difficulty making direct sales of the featured products, so what did they do? Redesigned and rebranded their platform as a visual-focused social networking platform loved by so many today–Pinterest.
Their early struggles to gain traction as an m-commerce platform, and their motivation to pivot primarily to something they recognized their users were enjoying allowed them to create a network that was not only profitable, but also helped establish the “Pinterestification” of Web page design with their dynamic tile-based format.
3. Flickr was originally called Game Neverending
Flickr, generally associated with high-quality online photography available for sharing via a Creative Commons License, started off as something completely different–an online role playing game called Game Neverending.
The massive multiplayer RPG from Ludicorp allowed users to navigate a map in real time, make and create items, and share photos with one another.
Noticing that the latter feature was overwhelming the most popular feature in the game, Ludicorp decided to shift their focus solely on the photo-sharing tool.
The pivot from a multiplayer game with an overload of features to the simplified Flickr platform resulted in so much attention and new business, they were acquired by Yahoo! in 2005 for $35 million.
4. Instagram was originally called Burbn
Of the estimated 112.5 million Instagram users (as of 2020), only a handful likely remember the app’s origin–an HTML5 app called Burbn that included a mix of confusing check-in and gaming features.
In an effort to separate themselves from Foursquare, another popular location-based app at the time, founders Kevin Systrom and Mike Krieger whittled down their feature set to the point of just becoming a place to post, like, and comment on photos.
In what could be considered one of the most impressive pivots in tech history, Instagram gained meteoric success and was acquired by Facebook on April 9, 2012 for $1 billion in cash and stock.
5. PayPal was originally called Confinity
In 1998, Max Levchin, Peter Thiel, and Luke Nosek created Confinity, a software development company that would focus on building security for handheld devices–or so they thought.
Over the course of the next couple of years, Elon Musk took an interest in the money transfer part of the business Confinity was developing. At the time Musk was CEO of an internet banking company called X.com, which merged with Confinity in 2000.
Following the merger and some rocky transitions, X.com decided to abandoned everything else and focus only on the PayPal operations.
The X.com/Confinity hybrid was renamed PayPal in 2001, and filed their IPO in 2002.
6. Groupon was originally called The Point
In 2008, Groupon introduced the concept of daily deals only being activated when a certain number of users signed up.
The daily deals method took the U.S. by storm, but it wasn’t born out of thin air. In fact, Groupon started as a consumer activism site known as The Point in 2007.
The Point’s original concept was campaign-driven for socially good causes. The campaign would only receive funding if a “tipping point” was met, or if enough people signed up/pledged to contribute.
The “tipping point” concept was then later applied to discounts on local services and activities, and thus Groupon was born.
For more info on the “tipping point” concept, check out the popular 2000 book by Malcom Gladwell, The Tipping Point.
There’s also several notable tech companies that pivoted without fully rebranding:
7. YouTube was originally a video dating Web site
Today it’s the most popular video sharing platform, but in its inception YouTube was set up to be an online video dating site. Launched on Valentine’s Day 2005, the unofficial slogan “Tune in, Hook up” didn’t exactly reach worldwide appeal.
The YouTube team noticed that people were beginning to upload videos other than dating profiles, such as planes randomly taking off and landing. This led to co-founder Jawed Karim posting “the first video on YouTube” titled “Me at the zoo“.
His silly, yet honest video inspired others to post their funny videos on the site, thereby providing proof of concept that people uploading videos of themselves online could be profitable.
YouTube was eventually purchased by Google on 11/13/2006. Today, YouTube uploads often show up as the top content for Google search results when applicable, further establishing it as one of the most important online platforms of all time.
8. Android was originally a camera operating system
In 2005, Google acquired a little-known company called Android that developed an operating system for cameras.
According to co-founder Andy Rubin, Android’s initial vision was to create an ecosystem of smart cameras that could connect to PCs and link to Android data centers (cloud storage).
However, recognizing that individual camera sales were on the decline, Rubin and team decided to pivot from cameras to focus on developing for mobile handsets.
This transition is what attracted an acquisition from Google, and today Android phones make up over 86% of the smartphone market worldwide.
9. Nokia was originally a paper mill company
Nokia is widely considered a classic case study in the art of the pivot. Since 1856, Nokia has reinvented itself time and time again to adapt to new and emerging market trends.
What started as a single wood pulp paper mill later pivoted to making rubber boots in 1898. Over the course of the next 70 years, the company continued to diversify by producing electricity generation and cables.
Nokia continued to innovate, launching their first smartphone in 1987, nicknamed “the Gorba” for former Soviet leader Mikhail Gorbachev, who was photographed using the phone on a trip to Helsinki.
Nokia eventually faltered as they became usurped by Samsung, Apple, and Google, and was purchased by Microsoft in September 2013 for $7.6 billion.
Although they suffered a decline in the market, Nokia is still an exceptional case study demonstrating how a company can pivot again and again to find success.
10. Nintendo originally manufactured playing cards
Almost everyone today knows of, owns, or has played a Nintendo gaming console. In fact, Nintendo is one that our company founders shared since childhood, so this pivot is near and dear to our hearts!
Prior to video game development in the 1970s, however, Nintendo was engaged in a wide array of industries. In 1889, Kyoto based Nintendo established itself as a maker of handmade trading cards called Hanafuda (“Flower cards”).
In 1959, the company started successfully selling trading cards with Walt Disney characters printed on them, a move that proved just how big this consumer market could be.
Nintendo then pivoted to the toy and gaming market, and later to electronics.
Conclusion: to pivot or not to pivot?
In reviewing these case studies, we see several pivot trends emerge:
- Companies realize what they set out to create doesn’t fit the market or intended audience
- Companies discover that people are using their technology or product in an unexpected, or simplified way
- Non-tech companies recognize changes or advancements in the consumer market over time, and pivot to an entirely new tech-based approach to seize the opportunity
Today, tech companies are uniquely positioned to be able to build, measure, and learn faster than ever before. The concept of “Fail fast, fail often” comes to mind.
Whether or not you believe in the “fail fast, fail often” mantra popularized in the tech industry over the past decade or so, understanding how to analyze your system and measure your results is crucial to making difficult decisions about your business.
Familiarizing yourself with the principles described in our app development guide and the case studies above may even help you face the difficult question that could change the entire course of your life and your business: to pivot or not to pivot?
What are some signs you may need to pivot? Here’s some questions that may help you answer that question:
• Are you having difficulty getting traction with your business? Perhaps you should conduct more interviews to ensure you’ve targeted the right customers or problem.
• Can you identify one customer segment that is especially excited about your product or service? If so, pivot your product or brand to focus more them.
• Is there one particular offering that all your customers or users love? Sometimes a simple feature or product can unexpectedly become the most popular part of your whole operation.
• Are there trends in the market that indicate your business may need to shift its approach, or explore additional monetization methods? Stay up to date with your customers demands and with your competition to stay ahead of the curve.
Whatever the case may be, Winnona Partners is here to help you evaluate and execute your plans as needed. We’ve helped companies of various sizes rebrand and restructure to meet new or shifting market demands, and are prepared to do the same for you!
Want to learn more about app creation, customer research, and developing Minimum Viable Products? Check out our Essential Guide to Developing Mobile Apps here.