In the SmartUp methodology, the critical factor in evaluating a pivot is timing. Yonatan Stern argues that many pivots happen too late, after a company has already hired a large team and created rigid monthly expenses. In these “vulnerable pivots,” companies may already be burning hundreds of thousands of dollars per month. When founders realize the product does not sell at this stage, the pivot occurs while the company is racing toward financial collapse, often after millions have already been wasted.
SmartUp advocates inverting the traditional process. Instead of building a product and then pivoting after failure, founders should brand and sell first. If the market does not respond, the pivot can happen immediately, at minimal cost. In this approach, the cost of a pivot is measured in time and small testing expenses rather than massive R&D and hiring costs.
The lectures provide several pivot case studies. Iridize executed a market pivot by shifting from selling to startups, who lacked budget, to selling employee training solutions to large enterprises, which led to acquisition. IntellyChain executed a business model pivot, moving from selling software licenses to selling knowledge, consulting, and paid pilots first, generating revenue and trust before scaling software sales. In the Metaverse/AllSeated case, the pivot was a use-case shift, narrowing from a broad enterprise metaverse concept to a specific HR onboarding and training solution after analyzing real customer behavior.
SmartUp contrasts this approach with the Lean Startup methodology, which promotes building an MVP and then pivoting based on feedback. SmartUp argues that even an MVP is too expensive as a first step. Instead, it promotes achieving Market-Product Fit first—identifying a responsive market through branding and sales—before investing in product development.
