Pivot decisions in startups: a systematic literature review

Entrepreneurs' pivot decisions are poorly understood. The purpose of this paper is to review the existing literature on pivot decisions to identify the different conceptualizations, research streams and main theoretical building blocks and to offer a baseline framework for future studies on this phenomenon.,A systematic literature review of 86 peer-reviewed papers published between January 2008 and October 2020, focusing on the pivot decision in startups, was performed through bibliometric, descriptive and content analyses.,The literature review identifies four research streams concerning the pivot concept – pivot design, cognitive, negotiation and environmental perspectives. Building on previous studies, this paper provides a refined definition of a pivot that bridges elements from the four research streams identified: a pivot comprises strategic decisions made after a failure (or in the face of potential failure) of the current business model and leads to changes in the firm's course of action, resource reconfiguration and possible modifications of one or more business model elements. This study proposes a framework that elaborates the pivot literature by identifying four stages of the pivot process addressed in the existing literature: recognition, generating options, seizing and testing and reconfiguration.,This study provides a comprehensive review, enabling researchers to establish a baseline for developing future pivot research. Furthermore, it improves the conceptualization of pivots by summarizing prior definitions and proposing a refined definition that places decision-making and judgment at its center. That introduces new contextual and behavioral elements, contributing to a better understanding of how entrepreneurs assess alternative courses of action and envision possible outcomes to redirect a venture after failure.