How to pivot your business during lockdown

Recently I’ve been revisiting the launch and pivot process in my research, in an effort to help founders and innovators change strategic direction in their business. Here is an old piece I wrote that should give you concrete metrics to track your progress. These were specifically chosen to be relevant, independently of what budget is available (and thus hopefully make it more relevant nowadays.

VCs and startup investors often say they’re looking for hustle in early stage founders. But that feels vague. And honestly, on its own, it’s not particularly useful feedback. More of a sophisticated way to end a pitching session they don’t want to be hearing.

Until now.

There are a few leading indicators you can use to keep yourself accountable, and to make sure you actually are hustling (and you’re not falling for your own PR).

The following four operating metrics say a lot about an early stage startup’s chance for success.

1. Number of pitches

A critical leading indicator metric of early stage success is how many pitches are you making each day (even if you aren’t trying to sell)? By “pitch”, I mean any attempt at asking someone for something, even if it’s just information. For example, this could mean approaching prospects for customer discovery or customer development interviews.

If you are making them, then you are learning more about your audience and iterating towards something that is likelier to work. Also, you are converting some people, which means that you can then continue to build on that as time goes on. This includes:

  • both outbound pitches, whether for sales or for customer interviews,
  • inbound marketing, such as free content you create which you need to put in front of your target audience.
  • advertising (impressions)

With inbound, unless if you already have an audience, usually requires some form of gatekeeper pitching or payment. You to pitch media owners, journalists, editors to get coverage. Or you create content and just pay for advertising.
And then pay attention to any response you get.

At some point after you’ve done this for a while, you’ll know what people want and how to reach them and roughly how to sell them. At that point do it yourself a little bit and then it makes sense to delegate it to a professional salesperson to improve your closing ratios (if you need one).

That’s actually a pretty good metric, because it’s a leading indicator for all learning. And learning is the #1 goal of startup, in order to stop being a startup, and to discover a business model which works.

Notice how I’m not really including the “number of failures” or “failing fast”. That’s repeated so often in tech circles it’s become hollow and meaningless. I think being able to deal with rejection is possibly more important than being able to deal with “failure”, certainly in the tech startup world. Because even in technology the most important decisions that affect your startup or are made by people (customers, prospective co-founders, prospective employees).

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To be fair, not every founder is a natural salesperson. But every serious founding team needs to be willing and able to face lots of rejection in order to go after their vision. In fact, the number of rejections a founder is willing to take is a good measure of how strongly they believe in their vision, product, or goal. If you have a goal you believe in, but you’re only willing to be rejected 10 times before you give up on it, you can easily end up being a genius in your own mind but giving up almost immediately once you start doing anything related to marketing.

2. Number of experiments

Another related metric is how many experiments are you running each week? If this is not at least 1, you are not going to get very far. Or other startups who are will run circles around you. Or you are trying to cram too much into one test, not really telling you anything useful.

Create an explainer video for your complicated new product. Make sure your audience understands it, without being overwhelmed by technical details.

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This is more of a product or operational metric. Basically, the more thorough and organized you are with this, the faster you will learn what you need to know. It never ceases to amaze me, how documenting my own hypothesis and metric before running an experiment is very useful, when interpreting the result. Because it’s so easy to twist the results into what you want them to mean.

Most of the major technical breakthroughs result from lots and lots of experiments. They explore an area or technology with a lot of unknowns, including “unknown unknowns”. That’s why they’re surprising for everyone outside the founding team. Here’s a breakdown of roughly the number of experiment trials required to create a certain type of invention, based on patent filings.