It’s rare for a company to hit upon a perfect revenue model or product without testing and refining it. Innovative ideas come from experimentation and things don’t always work first time. It’s no different when it comes to businesses. Many of today’s biggest companies completely abandoned their original business plans in favour of more successful models. The trick is to decide how long to continue down a particular path of experimentation and recognise the right time to change direction. Here, some of the CEOs from our portfolio companies discuss how they refined their product or service, and offer their advice on letting go of an idea that just isn’t working.
"Our original idea was a good one but we weren't going to make sufficient money from it because we had trouble with the route to market. We had to acknowledge that and change the product and the company strategy. The problem is investors hate it when you do that so you have to be able to persuade them it's a good idea."
"You just need to brutally honest with yourself and have the checks and balances within the organisation. Be able to stand back from it and surround yourself with people that challenge you constantly. It's easy for a small organisation to develop its own belief set and continue on that basis. It's always good to have a catalyst in the works - somebody that will shake you up by the collar. You can spend a lot of time and money chasing the wrong thing so it's far better to catch it early."
"Measure how your product is performing. Are you seeing the same KPIs emerging? Run your business on numbers rather than gut belief you're doing the right thing."
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Nesta Operating Company, a company limited by guarantee registered in England and Wales with company number 7706036 and charity number 1144091. Registered as a charity in Scotland number SC042833.
