The Pivot to Product-Market Fit: How Plaid, Clay, Lattice & Other Startups Broke Out

For many startups, the secret to finding product-market fit lies in the pivot. Here’s how these founders knew it was time to change directions.

Problem

Vanta hunted for solutions before asking what customers needed

Founders tend to fall into one of two camps: those who set out to solve a problem they’ve felt firsthand, and those who’ve always known they want to start something — long before they know what to solve.

Christina Cacioppo was the latter, and she ran into a classic entrepreneurial pitfall before stumbling on the idea for Vanta: building something no one wants.

After a few unsuccessful paths, Cacioppo resolved to stop building — and start talking to people. She turned to the startup folks she knew to pick their brains. “We decided we weren’t allowed to build anything at all. We had to just talk to people, and talk to them until we had a lot of confidence and a mental model of customers, their jobs, the problems they might have and how we might solve them.”

To find the most pressing problems, she turned to everyone’s most precious resource: time. So she asked people about their daily routines. “To find a good problem to solve, we really focused on what the customer’s day-to-day was like,” she says. “For discovery, the best thing we did was ask people to pull up their calendar. What were the best parts of those past weeks? What were the worst parts? That finally got us to a problem worth solving.”

The moral of Cacioppo’s story: Talk to plenty of people to find a problem worth solving before writing the first lines of code.

Shippo realized how broken shipping was while exploring e-commerce marketplace ideas

Shippo co-founders Laura Behrens Wu and Simon Kreuz started a business so they could stay in San Francisco. They began ideating in an area they thought would be easiest: e-commerce.

The first thing the co-founding duo built was a Shopify store that was supposed to be a marketplace showcasing independent designers. After a few early orders, the founders became immersed in the ultra-complex world of shipping.

When they decided to focus on shipping as a broad problem area, they toyed with a series of iterations before landing on the right solution. “Shipping was the least fun part of that experience,” says Behrens Wu.

An aha moment arrived when drawing inspiration from Stripe’s API model. “The Stripe model is API first, and we thought that model could work for the shipping industry as well.” Shippo rode the rising wave of the Shopify App Store to gain its first few customers.

Lattice realized people leaders had a bigger problem than OKR planning

Lattice co-founder Jack Altman initially tried to tackle a problem he experienced firsthand at his previous company, Teespring: quarterly OKR planning was a painful process. But it took pitching a solution for that problem to prospective customers to realize no one wanted to pay for it.

He learned that OKR software was more of a nice-to-have. “It was really hard to get people to actually pull out their credit cards and pay us.” He pivoted to a new problem and found that performance management rose to the top of the list.

More often than not, if you're working on something that is not getting great traction, you’re probably not a 10% adjustment away — you’re probably a 200% adjustment away.

GOAT found a much better problem to solve from a serendipitous personal snafu

Co-founder Eddy Lu and his former roommate and co-founder Daishin Sugano tried all kinds of entrepreneurial endeavors before landing on the idea for a sneaker marketplace. Amid these panicked attempts to pivot, there was a bit of bad luck that turned into an unexpected lightbulb moment when Sugano received a fake pair of Air Jordans from eBay. This led to the realization that a marketplace specifically for authenticated sneakers was necessary.

Persona

Clay focused on GTM teams after building for everyone

Clay co-founder Kareem Amin spent six years working on a data enrichment product before figuring out who needed it most.

The original idea for Clay was incredibly broad. “When you narrow the scope, it feels claustrophobic. Why are we doing something that’s smaller?” They realized that this approach wasn’t netting customers. To gain traction, Clay fully committed to the ICP of outbound salespeople and stopped selling wide, confirming that customers were actually using the product.

Plaid took a bet on an enterprise solution after spinning off a consumer budgeting app

Plaid co-founder Zach Perret transitioned from focusing on a consumer budgeting app to an enterprise solution when realizing that their consumer products were not gaining traction. He had to take a leap of faith with the pivot, leading to early signs of product-market fit when they started getting interested customers.

Promise

Ironclad sharpened its positioning after hanging out with enterprise legal teams

Ironclad co-founder Jason Boehmig started tinkering with automating parts of his own practice. It was spending time in person with their initial customers that helped narrow their product’s focus. “We realized we had to go all in on these corporate legal teams — particularly legal operations.” From there, Ironclad repositioned as a Contract Lifecycle Management platform.

Product

Alma moved a brick-and-mortar business online when the pandemic broke out

Harry Ritter had already found product-market fit for his original vision of a co-practicing space for therapists when the pandemic hit and 70% of revenue disappeared. Ritter saw an opportunity to pivot toward facilitating providers’ shift to virtual care. Despite initial board meetings being difficult, the pivot proved advantageous as they opened applications for providers from across the country.

Rupa's focus on root cause medicine didn't change — but its product had to

Tara Viswanathan, co-founder and CEO of Rupa Health, had started with a marketplace that didn’t gain traction. After realizing that a different approach was necessary, she pivoted to a lab testing platform. “Insights and feedback from that first product helped us get to where we are today.”

To get conviction on the right path, validate your gut feelings with logic and research.