Illustration: Eniola Odetunde/Axios
Spaces CEO Brad Herman had an early warning about COVID-19 because his startup supplies VR attractions to a number of theme parks in China. Realizing that the business he spent the last few years building was going to evaporate, Herman quickly found a new way to apply his team's know-how: helping companies host Zoom teleconferences in VR.
Why it matters: Many startups are rethinking the viability of their core businesses in the wake of the coronavirus. Spaces' move is one of many such pivots likely to crop up in the coming months.
There's a variety of reasons companies are now pivoting (credit to Bloomberg Beta's Roy Bahat for much of this list):
- The previous business was never going to work.
- The idea could have worked before, but won't work now given the economic environment.
- The industry the company was looking to transform has itself been demolished.
Pandemic-era pivots have so far taken a couple of different approaches:
- Trying to do a different version of the same thing that doesn't require in-person meetings.
- Augmenting what the company was doing before with additional offerings that are more relevant in this moment.
Here are a few companies that have already managed to shift gears:Allset initially was focused on enabling a quick "dine-in" experience by letting customers make a reservation, order ahead and then pay directly through the Allset app.
- Given social distancing, they quickly shifted with their restaurants to offer contactless take-out, and have seen strong usage for the new service.
Hoovie is a Vancouver-based startup that lets people host movie screenings in all sorts of venues including homes and restaurants.
- In an era of social distancing, the company quickly added a way to virtually host screenings, including a post-film discussion over Zoom.
- The digital experience isn't the same as in a theater, but it does make the movie-watching everyone is doing a lot more social. "Everyone starts the film at same time," CEO Fiona Rayher told Axios.
Augmented writing startup Textio got its start helping companies remove bias from job listings and other corporate communications, but it is adding services around writing even for companies not doing a lot of hiring at the moment.
- "Reputations are going to be won and lost at this time," CEO Kieran Snyder told Axios.
Enrich is designed to give up-and-coming executives a peer group. It had been focused on in-person gatherings, starting in the San Francisco Bay Area, but realized a need to go all-digital once the coronavirus hit.
- "At first I was like 'Oh no,' " CEO Jordan Stein told Axios. "Then I realized people are hungry for these connections. That exists whether we are virtual or in person. We just have to be creative on how we deliver that."
Spaces, as mentioned above, is now focused on its VR workspace, which has been downloaded more than 3,000 times, Herman said.
- With only 13 employees, the firm has had to move lots of people into new roles. For example, two who had been installing VR systems at theme parks are now running the Discord server and support.
The big picture: In this crisis, every company is pivoting in ways large and small. Even those that aren't changing the goods and services they provide are having to do things differently than they did pre-pandemic.
Our thought bubble: Pivots can pay off, and some great products and companies were born from them.
- Twitter, which began life as a podcasting company, certainly comes to mind, as does Slack, which started as a game maker.
- But many companies are making such moves out of necessity, and in plenty of cases, money will run out much faster than ingenuity.