Should you pivot?

We have been entrenched in numerous conversations with business leaders about “pivoting”; finding a new business model that can piggy-back on an element of their pre-COVID-19 business.  It’s not always so straight-forward as to whether you should pivot or hold steady.

Here are some guidelines when thinking about pivoting:

1. Resources – do you have all the resources you need to make the pivot? For example, if you are a shuttle service company and you want to pivot the use of your vehicles to be a supply delivery company, do you have the ability to transform your shuttle buses into cargo vehicles?
2. Relationships – if you currently serve professional millennials and you want to serve first responders, do you have the relationships with hospitals, government officials etc. to introduce your new offering and get them on board?
3. Market Insight – because of the shifting landscape, the reliability of data is not what we are used to. Look for multiple data points to help determine if the demand is truly there and ascertain just how much demand there is.
4. Capital – this might seem obvious but pivoting vs. staying the course requires financial modeling to really see how your capital can best be deployed. If you take your remaining operating capital that you might use to hold still for the next 6 months and redeploy it into a pivot of your current business, do you have enough reserves to pivot back when this ends?  Do you have enough runway to perfect your new business model if you don’t “hit it out of the park” on your first go?
5. Talent – is your team knowledgeable, skilled and available to support you in your pivot? Will you need additional talent/skills?
6. Urgency – is the urgency you are feeling truly urgent or just drafting off the environment? No opportunity is worth risking it all. Slow down, do your due diligence, seek outside advisors and plan your move with forethought and precision.

We will be deluged with amazing stories of entrepreneurs who made it big by solving a need in this crisis. A few in the minority will just get lucky. The rest had many of the aforementioned resources at the ready to fuel their success. Be sure you are properly fueled before pivoting.