Last Update: 11/6 @ 3:55PM
Simon Newstead started off his with a golden piece of advice – “It doesnt matter how hard you paddle, if you paddle in a place where there is no wave, you will not go far”.
This post is part of the live coverage of Echelon 2012, Asia’s leading tech startup event happening on June 11 – 12. If you spot typos, slight inaccuracies or need more clarification, do leave a comment in the post and we’ll address it in the next edit.
In the beginning
Frenzoo started off with a solid product of creating a virtual world product. It even managed to get a seed round and scored a headline with TechCrunch, saying “Skype founders invest in Frenzoo”. With everything that any startup could wish for, from a solid product, a seed round backed by experienced investor to a launch at Unconference 2009, everything seemed to be perfect. However, the fact remains that Frenzoo only grew to 500k users, and faced problems such as slow organic growth, an expensive paid acquisition and the failure to engage mainstream users. An unspoken truth that made pivoting inevitable. After the pivot, the site saw a 1 million user growth in under 2 weeks, as opposed to its original traction of 1 million users in 2 years.
Examples of successful pivots
Simon shared some examples of successful pivots, which includes Fab.com, which was pivoted from Fabulis, a social network, making it an entirely different pivot from its initial intention. The next example brought up is OMGPOP which was pivoted from Iminlikewithyou, and also DanceDanceRevolution, which pivoted into the familiar Guitar Hero.
How do you know when to pivot?
There are several tell tale signs: When you have users who are no longer excited with your product, a steep retention drop off rate, a mismatch of CPA vs LTV and a small market size. While it may sound fairly gloom and bleak, Simon shared that even if your first idea is not working out, fret not, because you are not alone.
Tips on pivoting
Tip 1: Increase your runway and make sure you survive. This can be done through cost cutting on development expenses or salary.
Tip 2: Learn from your mistakes (UX, tech, market need, distribution, team, unique proposition).
Tip 3: Leverage what you did right, and this could be a number of different things.
Tip 4: Rebrand and show the world your new goal, new product and new focus.
Tip 5: Dont look back, and focus on the future.
Thanks for following the live coverage of Echelon 2012. If you’d like to check out more coverage of the sessions at Echelon 2012, follow this link.