You're listening to Business English Pod, the business English podcast for professionals on the move.
Hello, and welcome back to Business English Pod.
My name's Edwin and I'll be your host for today's lesson on English for startups and discussing a pivot.
There are lots of business ideas and tech innovations that sound like good ideas.
But the real test of an idea is the marketplace.
People might like your idea, but will they buy it?
Will enough people buy it to make the business viable?
Even if you've done your market research, sometimes consumer feedback tells you it just won't work.
This happens all the time with startups and the smart ones don't keep throwing good money after bad.
Nor do they give up altogether.
Instead, they pivot.
When you pivot, you shift your business model or strategy based on the feedback you get from the market.
That's how Odeo, a podcasting platform, became Twitter.
And that's how YouTube gave up on video dating and became a massively popular video sharing site.
Pivoting, well, isn't easy.
It takes some tough conversations about new goals for the company and new needs.
And one of the toughest aspects of the pivot is sacrificing some of your old ideas.
You also have to remember it's not just about you and your idea.
When you pivot, you need to consider your team and your investors as well.
In today's dialogue, we'll listen to a conversation between a young entrepreneur named Quinn and his mentor, Kira.
Quinn has been working hard to get his online payments business going.
Now he sees that it would be wise to pivot his focus from individual consumers to business customers.
As you listen to the dialogue, try to answer the following questions.
1.
What does Quinn say is the company's most pressing need?
2.
What is the old idea that Quinn needs to sacrifice to pivot his business?
3.
What does Quinn say his investors need to understand?
So, where's your head at, Quinn?
Numbers add up?
Does this really make sense?
I know there was a bit of back and forth, but it definitely makes sense now.
If we go B2B, our cost of sales is far lower.
With just 100 companies, 100 customers, by year-end, we can double revenue.
It's a stretch, but doable.
Okay, well, you sound really sure about it, so I say go with it.
Pretty much every successful startup has to execute a pivot at some time.
And in your case, I know the consumer market is enormous.
But the work involved... Tell me about it.
Chasing that market hasn't really paid off the way we were expecting.
Right.
So let's talk about what it's going to take to make this happen.
Is this a major pain for the developers?
That side is pretty straightforward, actually.
The biggest and most pressing issue is marketing.
It'll take a new team to pull this off.
B2B just isn't the same game as consumer.
Yeah, a different deal altogether.
I've got some contacts who might be able to help you out, though.
I'll put you in touch when we're done here.
Super.
Very open to ideas.
The whole narrative has to change.
It can't just be about evil little micropayments anymore.
We need to leave that behind.
And get ready, because not everybody likes change.
Even people who like to talk about disruption.
They don't like being disrupted.
Especially people who are emotionally invested.
Managers.
Charlie and Nina, for example.
Yeah, it's not that we haven't talked about it, but not everyone's in love with the idea.
I need to make sure everyone understands the rationale.
We all need to be moving in the same direction.
So, it's a tough balance between being deliberate about this and making it happen quickly.
Just make sure you keep the lines of communication open.
Watch out for water cooler gossip.
Will do.
And I've been thinking a lot too about other stakeholders.
Mason, in particular, want to make sure we're up front with the investors.
They need to understand this is good for them, that it's optimizing their investment.
Good way of putting it.
I think they'll come around.
They invested in you, after all, and your decision-making and leadership abilities.
So yeah, I think they'll get it.
Now let's go through the dialogue again and look at the language and techniques Quinn used in his conversation with Kira.
We join the conversation after Quinn has presented his idea of pivoting from individual customers to business customers.
So where's your head at, Quinn?
Numbers add up?
Does this really make sense?
I know there was a bit of back and forth, but it definitely makes sense now.
If we go B2B, our cost of sales is far lower.
With just 100 companies, 100 customers, by year end, we can double revenue.
It's a stretch, but doable.
Kira is asking Quinn to assess the situation and see if the numbers add up.
She means, does it make financial sense to switch the focus to B2B or business-to-business sales?
In assessing the numbers, Quinn has come to think that the pivot is a good idea.
He's not just working on intuition.
He has actually identified new goals for the business based on the new model.
He believes that they can double revenue with just 100 business customers.
A good pivot takes planning, and when you identify new goals it's important to balance stretch or ambition with how feasible or doable those goals are.
Let's try more ways of identifying goals like this.
I think we should aim for a million in revenue from California.
What we need to do now is build a stronger online presence.
With this new focus, I say we try to sign up 100 schools by summer.
We'll need to establish a base in France and expand from there.
Now let's hear what Kira has to say about Quinn's decision.
Okay, well, you sound really sure about it, so I say go with it.
Pretty much every successful startup has to execute a pivot at some time.
And in your case, I know the consumer market is enormous.
But the work involved... Tell me about it.
Chasing that market hasn't really paid off the way we were expecting.
As you can hear, Quinn's idea for the pivot comes from feedback from the marketplace.
Specifically, trying to sell to individual consumers hasn't really paid off or been profitable.
So now that it's clear Quinn needs to make this pivot, what's Kira's biggest concern?
Right.
So let's talk about what it's going to take to make this happen.
Is this a major pain for the developers?
That side is pretty straightforward, actually.
The biggest and most pressing issue is marketing.
It'll take a new team to pull this off.
B2B just isn't the same game as consumer.
Kira wants to know how the business has to change to execute the pivot.
According to Quinn, the most pressing, or urgent problem, is marketing.
The business model is changing, so the marketing focus will have to change too.
You might be tempted to think that you can just take everything you have and apply it to your new business model, but that's not always the case.
You're going to need new people, new technology or new facilities, and it's important to identify what those needs are and to prioritize them, as Quinn has done.
What are some other ways of identifying new needs when planning a pivot?
Let's run through some more examples.
It's going to take an extra three months to scale up for the launch.
I'm thinking we'll need another half million dollars for prototypes.
At this point, it seems really important to hire a chief financial officer.
Let's get back to the dialogue as Quinn continues talking about what needs to change.
Yeah, a different deal altogether.
I've got some contacts who might be able to help you out, though.
I'll put you in touch when we're done here.
Super.
Very open to ideas.
The whole narrative has to change.
It can't just be about evil little micropayments anymore.
We need to leave that behind.
As part of the change in marketing, Quinn says the narrative has to change.
A narrative is a story, and good marketing is all about storytelling.
Now that the business model is changing, the story has to change too.
If you listened to our earlier lessons on Quinn's startup, you heard him talk about the challenge of handling micropayments.
These are the small online transactions that are relatively expensive to process.
The story of these evil micropayments can't be the focus of the business or its marketing efforts.
After the pivot,
That idea needs to be left behind.
This is one of the biggest challenges of a pivot. sacrificing old ideas.
But it's necessary if you want to succeed.
So, when discussing ideas that need to be sacrificed, be clear what the idea is and what new focus will replace it.
Let's practice a few more ways to do this.
Let's be clear.
We're not talking about traffic anymore, but engagement.
We need to give up on this idea that we only do hardware.
We're not just a games company anymore.
We can't keep thinking like gamers.
This whole idea of retail has to go.
Now it's about wholesale.
It's good that Quinn understands he needs to leave old ideas behind.
But there are more people involved in a pivot than just the founder, as Kira notes.
And get ready, because not everybody likes change.
Even people who like to talk about disruption.
They don't like being disrupted.
Especially people who are emotionally invested.
Managers.
Charlie and Nina, for example.
Yeah, it's not that we haven't talked about it, but not everyone's in love with the idea.
I need to make sure everyone understands the rationale.
We all need to be moving in the same direction.
So, it's a tough balance between being deliberate about this and making it happen quickly.
Kira is a wise mentor and she's raising an important point that many of the other people involved might not like change.
Startups are full of passionate or emotionally invested people.
It's not easy to just change the company's focus in one day.
For this reason, Quinn is showing careful consideration for his team.
He acknowledges that not everyone likes the idea of the company's pivot, so he's identified a few things that are necessary, including making people understand why this is happening.
It can be a good idea to pivot, but as Quinn says, you can't do it too quickly.
When considering your team, you need to be deliberate or careful.
Let's try some more examples of showing consideration for your team.
It's going to be an adjustment for the staff, so we need to support them.
I'd like to know how everyone sees their role changing during our transition.
Does everyone have what they need to make this happen?
Kira's got another bit of advice before Quinn discusses another important group of people.
Just make sure you keep the lines of communication open.
Watch out for water cooler gossip.
Will do.
And I've been thinking a lot, too, about other stakeholders, Mason in particular.
Want to make sure we're up front with the investors.
They need to understand this is good for them, that it's optimizing their investment.
Kira warns Quinn about water cooler gossip, which is basically when people talk informally in the staff room or at the actual water cooler about what's happening in the company.
Preventing this with good open communication is an important part of any change process.
And Quinn carries this concern for communication to another group of people, the investors.
As he says, he wants to be upfront or open and honest with them.
Of course, you don't want your investors to misunderstand what you're doing or why you're doing it.
For Quinn, his messaging to investors is all about how this will optimize their investment or help them make more money.
It's important to show consideration for investors and acknowledge their concerns, as we can hear in the following examples
We've got some great backers, and I value their input on this.
I think they'll get it, but I'll talk to them first to keep them in the loop.
This is a big change, so we need to make sure our investors are on board.
Now let's hear how Kira finishes off the conversation. good way of putting it.
I think they'll come around.
They invested in you, after all, and your decision-making and leadership abilities.
So yeah, I think they'll get it.
Kira is confident that Quinn's investors will support the pivot, since they support him as a business leader.
And as a good business leader, Quinn has planned this pivot very carefully.
In his conversation with Kira.
He understands what the company needs to do and who he needs to consider when doing it.
Now let's practice some of the language we learned in today's lesson.
Imagine you are the founder of an online company.
You're talking with your mentor about pivoting your business to become an e-commerce platform.
You'll hear a cue from the mentor, then I'll give you a suggestion for what you can say in response.
We'll guide you through each step in the practice and provide an example answer for each response.
Ready?
Let's give it a go.
Okay, so tell me what you're hoping to achieve with this move.
Start by saying your new goal is to get a million users of your e-commerce platform.
Answer.
Well, we're aiming to get a million users for our e-commerce platform.
That sounds great.
But what do you need to make that happen?
Now say that you need more designers and a good social media strategy.
Answer.
We're going to need some more designers and a good social media strategy.
Social media?
Won't that mean a big change to your marketing?
Next, agree and say the pivot will mean a shift away from traditional media.
Answer.
For sure.
This pivot is going to mean a shift away from traditional media.
Well, I think that's a smart move.
But how does the team feel?
Now say you're in close touch with a team and they are all very supportive.
Answer.
I'm staying in close touch with everyone and they're all very supportive.
And how about the money people?
Your investors know what's going on?
Finally, say that you're talking with your investors regularly about the transition.
Yeah, I'm talking with them regularly about the transition.
Now let's practice some of the vocabulary we've covered in this lesson.
In a moment, you'll hear a series of sentences with a word replaced with a beep.
Repeat each sentence, including the missing word.
For example, if you hear, You can say, It's not uncommon for startups to have to execute a pivot.
After each response, we'll provide the correct answer.
Let's begin.
Hey Glenn, could you put me in with Julie?
Answer.
Hey Glenn, could you put me in touch with Julie?
It's important that everyone on the team is moving in the same... Answer.
It's important that everyone on the team is moving in the same direction.
For the bookkeepers...
Answer The change to a new accounting system is a major pain for the bookkeepers.
After a bit of beckon, we finally decided to relocate our main office.
Answer After a bit of back and forth, we finally decided to relocate our main office.
We've reached the end of this lesson, the fourth in our series on startups.
We've learned how to identify new goals and needs during a business pivot and how to sacrifice old ideas.
We've also looked at showing consideration for both your team and your investors.
Thanks for listening and see you again soon.
