When do you shut down or pivot?

Question

Curious to hear from founders, how do you know when to shut down or pivot? 👀

Do you stick it out till the end or succumb to shiny object syndrome?

For me, it would be a lack of revenue growth even after doing everything for marketing

Krishna Kumar · Accepted Answer

Lack of revenue growth is not the right indicator. What if you have stable revenues and great profits, but no revenue growth?

Decliniing profitability or consistent losses would be a better indicator, in my opinion

Jonayed Tanjim · Answer

An investor once advised me, "Keep building as long as you don't run out of ideas." It helped me to some extent to better understand when I should stop or pivot.

Jordan Shlosberg · Answer

@kkumarkg Start-ups don't typically have much revenue and definitely no profitability.

Jordan Shlosberg · Answer

@uma_venugopal I'm actually going to disagree with that (respectfully of course). It's mathematically proven under binomial distributions (with 5% error) that 30+ is good enough for a focused population.

I've built a large business and know personally many more founders that gave built businesses larger than mine.

Not one has tried to survey 1,000 users.

No doubt the insights will be better BUT
1. Surveying 1,000 users costs $20-$50k through a quantifiable survey and a full-time job if you want to do it yourself
2. The incremental information from the additional 950 has a very low incremental value.

Finally, my first company (proSapient) actually does exactly this line of work and I can tell you that after 20-40 interviews, it's extremely clear where to go next

Krishna Kumar · Answer

@jordans That is the wrong definition, no? Startups need to be profitable, and can be profitable

Jordan Shlosberg · Answer

@uma_venugopal 1,000 users????? If 30-50 conversations don't yield any interest, why do another 950?

maryam sh · Answer

Do it while you're on your pick performance

Richard Gao · Answer

@realjordanellis If there's no cost leaving it up, it might be better to do so

André J · Answer

Shut down when you're out of money. Pivot when your bet didn't pan out.

MARIZSA · Answer

Look and listen to your analytics; what story are they telling you. What is the user base telling you? Do you have an researcher? If not, take your products to the streets and do raw and authentic research live with the people you are targeting.

Peyt Spencer Dewar · Answer

@realjordanellis how long after you noticed it wasn’t getting any sales did you remove?

Answer

Knowing when to stop or change course can be difficult. Revenue growth, client comments, and market tendencies are just a few of the indicators that need close examination. When all other marketing avenues have been explored without success, it may be time to change course. Be cautious of succumbing to the allure of a new and flashy thing. Keep your sights on the prize, but be flexible enough to seize new possibilities and learn from your mistakes. Finding a happy medium between tenacity and flexibility is essential.

Valorie Jones · Answer

pivoting has be based on data otherwise it is shiny object syndrome.  Build quick tech prototypes, getting real customer/market data.   I prefer to think of it as a constant series of micro adjustments as you continue to aim towards your goal.

Jordan Shlosberg · Answer

If your product doesn't resonate.

If you work hard enough you can usually find initial clients.

How long do those clients stick around

How many referrals come from those clients

Do your customer conversations inform you that you have some edge or not

When do you shut down or pivot?

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