10 signs it’s probably time to pivot your startup
African startups’ pivots are proof of the dynamic landscape of entrepreneurship, where adaptability is not a luxury but a necessity. African startups exist on a playing field where the path to growth and sustainability rarely follows a straight line. Successful startups aren’t just built on product-market fit; they’re sustained by timely reinvention. And their ability to recognise when to pivot and adapt spells the difference between success and failure.
Worthy of note is, African startups’ pivots we have witnessed in witnessed in recent times aren`t all bad news. On the contrary, pivots are adapted as a strategic tool to rapidly scale and stay ahead of the curve, depending on economics, consumer or market demands. However, such pivots are heralded by signals.
Here are 10 such signals your startup might need to change course, with real-life examples of African founders who did just that.
#1 Your revenue keeps declining
If your numbers are dropping quarter after quarter, it’s not merely a slow season; it’s a signal. When your product stops converting, the market may be telling you something.
One decisive startup that listened and acted on revenue dips is Kobo360, a Nigerian logistics startup focused on connecting truck owners with cargo companies. In 2020, the startup started facing profitability issues, and it seemed its ambitious growth plans were hitting a wall. The problems it was facing around logistics, operational costs and market competition began to take their toll. A lot followed after—employee exit, difficulty in fundraising, insufficient working capital and market inefficiency.
Soon, the company knew it wasn’t enough to scale back offerings. A pivot was needed. In 2018, Kobo360 pivoted by expanding its model to focus on fleet management software and a broader logistics ecosystem, enhancing its service scope and stabilising revenue streams. If your sales figures are consistently dropping over time, it might not just be a bad month; it may indicate that your product or service no longer meets market needs and demands.
In the same vein, when customers are no longer buying, it suggests that your services are no longer compelling or relevant. Rather than wait for the patronage numbers to bounce back on their own, reassessing business focus might be more strategic, especially when thinking of pivoting.
“Highlight: When revenue dips, don’t just cut costs — cut friction. That might mean rethinking the model itself.”
#2 Growth has stalled — no matter what you try
When growth plateaus despite consistent efforts to market and improve operational efficiency, or you find yourself working twice as hard for little to no results, it’s a red flag that your current approach is exhausted, and it’s time to change gears and move!
Slack wasn’t originally a communication platform; it began as a gaming company but shifted its focus to a communication platform, ultimately becoming a leader in the field. Slack’s story is a classic example of pivoting from a failed product to a successful one. Initially, the company —formerly named Tiny Speck— was focused on creating a multiplayer online game called Glitch. But Glitch struggled to gain traction, and during the process of building the gaming app, the team developed a strong internal communications tool.
Recognising the effectiveness of this tool and that there was a market for a better way to communicate, they shifted from Glitch to Slack, focusing on the communication tool they had built. This shift happened in 2013, and since then, Slack has been a leading communication tool used by a lot of businesses, especially because of its simple and user-friendly interface.
Just like Slack, your company might be struggling with gaining traction in your chosen field. Innovations are not meant to be easy, but they’re not meant to be impossible either. If it seems like your input is more than your output, and there are no changes in the growth or market acceptance for your services, then it might be time to sit down with your team and plan a change of direction.
“Highlight: Stunted growth is evidence that your model is not working. Find the problem, a pivot might just be what you need to fix it!”
#3 Too many competitors and low visibility
Lori Systems was originally launched as a digital logistics platform in Kenya, but it soon found itself competing with newer entrants and international players. To retain market leadership, it pivoted from only being a tech marketplace to providing integrated logistics solutions, including supply chain analytics and financial services.
Lori Systems’ pivot story indicates that, while competition is always healthy in any industry, it’s a serious concern if your competitors are gaining market share with better solutions. If they’re offering improved services, pricing or customer experience, it may be time to rethink your strategy. Staying relevant in the game sometimes requires repositioning your business to fill the gaps your competitors have capitalised on, like Lori Systems did.
“Highlight: Too many competitors means more work for you to get recognition. Don’t be shy to rework your focus, a pivot might bring you out of the crowd.”
#4 Unfavourable feedback—unhappy customers
Feedback is invaluable, but when it only reports consistent complaints, low satisfaction ratings or unmet expectations, it is a sign that your product isn’t delivering value as expected. Every product and service that a company renders has an intended user, and sometimes, your saving grace might come from your users’ reviews. Regardless of the overall functionality of your products and services or user experience, repeated complaints should not be overlooked.
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In June 2012, Gloo.ng was launched in Nigeria and considered one of Nigeria’s pioneering online shopping platforms. The e-commerce startup was successful at first, pulling in revenue as expected. Unfortunately, it started facing challenges like logistics difficulties and a lack of a strong market for its services.
Seven years after its launch in 2019, Gloo.ng exited its initial platform and instead, at the request of its clients, became an online business-to-business e-procurement service known as Gloopro, thereby pivoting from its former e-commerce business to focus on B2B e-procurement. The shift worked well and kept the company from completely shutting down. What’s more, they got to keep most of their clients.
As seen in Gloo.ng’s case, for startups, especially African startups, analysing customers’ feedback could guide a necessary pivot that would ensure users’ expectations are met as promised.
“Highlight: Your customers are the most important link in the success of your business, if they’re unsatisfied, then it’s probably time to remodel your business.”
#5 If your focus market keeps changing
Sudden or gradual shifts in market demand, trends or consumer behaviour can render your original business model obsolete. If you’re noticing these shifts are affecting your market relevance and it’s becoming prevalent, then it’s time to reevaluate your direction.
An example of a company whose proactiveness helped was KOKO Networks. The Kenyan company, launched in 2014, was initially focused on providing clean cooking fuel (bioethanol), but in 2021, the startup pivoted to a business-to-business grocery platform. Its expansion into a broader retail platform was more out of necessity and a need to adapt to changing consumer needs.
By diversifying its offerings, the startup has gained a larger customer base and is experiencing increased revenue streams. Being proactive in responding to changes can be the difference between staying ahead and being left behind. In one word, stay on the trends.
“Highlight: When the market changes, find a way to make it work for your business. Sometimes, the only way to combat a change is to reinvent new ways—a pivot can certainly do that.”
#6 Cash flow issues
Consistent financial strain is a loud and clear signal that your business model is unsustainable. If you’re struggling to cover operational costs and relying heavily on external funding and loans just to stay afloat, then something isn’t working. And let’s be honest, a lack of financial stability often signals deeper structural issues in a business and should prompt immediate reassessment of the model.
Crowdyvest faced a similar situation in 2021. Originally a crowdfunding platform focused on the agricultural sector, it pivoted to a digital savings platform due to financial challenges related to its crowdfunding model. The pivot was a success too, and the startup was able to broaden its user base and offer a wider range of financial solutions to its customers. This implies that as a startup founder, a pivot could help realign your efforts towards a more profitable and sustainable business.
“Highlight: The end game of every business is to make profit, if yours is the opposite, then it’s probably time to switch to a more profitable venture.”
#7 If your business model is too rigid
Sometimes, the most innovative ideas or technologies in your company may remain inaccessible because your current model doesn’t support them. If you realise that your company has a game-changing potential but your current situation constraints you, it might be time to pivot.
Instagram started as a location-based check-in app before transforming into the famous photo-sharing platform we know today. In 2020, Burbn, which later became Instagram, was launched with different features, including allowing users to share their whereabouts and connect with friends.
However, it struggled to gain traction and was running out of cash. As the founders analysed users’ data, they discovered something: of all the features the app had to offer, the users were primarily interested in one thing—the photo sharing feature. They discovered that users loved the stylised feature of posting pictures of what they were doing.
Realising this, they pivoted their focus entirely, stripping away the unnecessary elements of Burbn and rebranded the app to Instagram, concentrating solely on the photo-sharing aspect that resonated with users. Instagram quickly gained popularity—forever changing the landscape of social media.
There’s a truth to be seen from this: creating room for growth might require letting go of what no longer serves your broader vision or restructuring your focus and business model.
“Highlight: Remember that flexibility is key as nothing is certain in the business landscape. A non-fluid business model would crash eventually—make changes today”
#8 If you’re facing pressure from Investors
Investors’ feedback can often be a valuable insight into the health and potential of your business. If stakeholders and investors are constantly concerned about the direction or returns of your company, it shouldn’t be taken with levity. This is not necessarily negative; on the contrary, it could be the prompt your startup needs to re-strategise. Investor confidence is essential for the longevity of any company.
Startups must maintain trust with their backers, and persistent concerns from investors often signal deeper issues. If your day one supporters are pushing for change, it might be wise to listen and explore alternative strategies.
“Highlight: When investors are exiting, you should probably exit that business model too. Because, the truth remains—no business can survive without capital.”
#9 Team burnout
This is a significant concern; startups are dependent on the individuals who constitute them. While it takes one person to have a dream, its realisation requires the effort of many. Consequently, if your team feels disengaged or unmotivated, it may reflect a misalignment between the company’s goals and market realities. Often, burnout stems from chasing goals that no longer match the realities of the market or continuously pouring effort into strategies that deliver little impact.
A pivot, in this situation, can reinvigorate your team by clarifying vision, refocusing objectives and making their work feel meaningful again. Always remember that startups thrive on aligned, passionate teams, so when the spark fades, a shift in direction might be what’s needed to reignite it.
“Highlight: A new model can reignite your business, thereby invigorating the spirit of your team. An uninspired artist is incapable of creativity—fix your business and your team will follow”
#10 Stifled progress
Suppose you find yourself frequently passing up lucrative partnerships or innovative ideas just because they don’t fit your current business model. In that case, that’s a red flag, as these opportunities might be the key to your growth. Groupon is an example of a company that could have lost all if it hadn’t pivoted.
Established in 2006, Groupon initially started as a social activism platform called The Point, but the company didn’t take off immediately and suffered many losses. When it became apparent that users were not engaging with its group-buying discounts services, The Point pivoted and built a billion-dollar business—brand new services, brand new name—and it worked. Gl
Groupon, in contrast to The Point, grew rapidly and became a billion-dollar enterprise, demonstrating the power of adaptability in the face of almost-failure. A pivot could help you reposition your startup to seize new possibilities and move towards a more flexible, opportunity-driven model.
“Highlight: if you’re stuck with the same business model, and your business is not scaling, it might be time to pause and re-strategise”
If your startup is facing all or a combination of these signs, it may be a strong indication that it’s time to change lanes. By recognising these signs early and acting decisively, you can increase your chances of not just surviving in a competitive market but thriving in it too.
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African startups’ pivots aren’t all doomsday
African startups should always remember that a pivot is not a sign of defeat, but a strategic response to new insights, challenges, or opportunities that lead to achieving sustainability, relevance, and growth. Also, understanding market signals and being willing to adjust strategies can be vital for long-term success. These examples serve as a powerful reminder for African startups that, when faced with challenges and declining market interest, the best course of action may not be to abandon the venture, but to pivot strategically. Embracing change and exploring new avenues can breathe new life into a struggling business, opening the doors to fresh opportunities.
As the landscape continues to evolve, startups that remain agile, observant and responsive to market demands and changes will be better positioned to thrive amidst uncertainties. By prioritising adaptability and remaining open to transformation, startups can enhance their position, maintain relevance in the market and ultimately ensure long-term success and sustainability.
Do you have an innovative business (small, mid-scale business or startup) that adds value, creates opportunities or solves bold problems? Then you’ve got a story worth telling! Shoot an email with SUBJECT “Story Worth Telling (+Name of Business)” to [email protected]
