

A pivot too far? - alcoholanon

What do you guys think of start-ups who take public funding but then &quot;pivot&quot; beyond all recognition?<p>I see this happen a lot, I think it&#x27;s wrong, and it&#x27;s really starting to irritate me.<p>Where I live there are a lot of tax payer funded, or jointly funded in association with private investors, incubator and accelorator programs.<p>In just about every intake of every such scheme, there seems to be at least one company who after securing the funding dramatically change direction. I don&#x27;t mean changing focus, I mean changing product.<p>The most extreme example I&#x27;ve seen was a company in my program which pitched themselves as poised to disrupt an industry through hi-tech and innovative web and mobile apps. They maintained this for only the first 3-4 weeks of the program, and then suddenly began to aspire to nothing more than becoming an online magazine.<p>Had they pitched their magazine and been funded on it that would be fair enough. But they did not. To my mind the sold a pup.<p>My complaints are that such companies<p>a) deny a deserving start-up a place in a program with the funding and support that that brings, and
b) have effectively obtained their funding under false pretenses.<p>I guess most such companies don&#x27;t plan this in advance, I mean I&#x27;m not crying &quot;fraud!&quot;, but I ask HN, if you completely change the nature of your company, should you be obliged to drop out of your program and return the remaining money? If not, why not?
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pedalpete
First of all, I wouldn't be too upset about it if I were you. I assume that
these start-ups have some oversight from the incubator/investors, and
therefore before they pivot, much discussion is going on about why they are
giving up the product they initially pitched and why the new product is a
better one.

Pivoting happens, the danger is when it is happening as an excuse not to
launch.

Using your example of the company that was going to 'distrupt an industry
through hi-tech and innovative web and mobile apps' and then became an 'online
magazine', these two things may not be as different as you're thinking. The
first idea seems huge and maybe not possible in the near term. The second
seems simple, and is maybe just a foot in the door to something larger.

In the end, the companies aren't receiving investment just because of the
idea. It's also about the team and their ability to execute. The team didn't
change, the ideas do. It happens.

As an example, I know of somebody who created a great business in online
photos. They sold the company, and went to have another go and raised funding
to make a camera that was easy to download photos from over wifi (this was in
the late 90s). The camera became too much of a pain to make, so they went and
created another very successful photo company. That's a huge pivot. From
getting into hardware to mostly just making software, but it worked out better
for their investors than had they stuck to the original plan, which wasn't
going to work.

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rl12345
By definition, a pivot that went too far is not a pivot anymore. They are
probably starting from scratch.

Also, 3-4 weeks is not nearly enough time to experience validated learning, so
zero insights gained.

Chances are in another 3-4 weeks they will "pivot" again.

Those guys look like they are still in brainstorming mode. At this stage,
money can do more harm than good.

