This is a super challenging decision that can reveal several different thought patterns. But in essence, Elizabeth sees funding for startups as a series of experiments. 

You try something, it seems promising, so you get a little bit more capital and resources. You continue the experiment, and it continues to do well, and you get more capital and resources. And so on. 

However oftentimes along the way, the business stops working. So what do you do? It’s completely normal to pivot with an adjacent product or sell to a different audience. Most of the successful companies Elizabeth has backed did not look the way they do when they first started. 

The founders learned from their experiments and made a meaningful change. This is a very natural course of what it means to build a startup. 

However a pivot is very different from a jump. A jump is when you scrap the first idea or the space entirely. And you start from zero trying to do customer development in a totally new space. 

Imagine a dating app jumping into crypto. Or companies in crypto jumping into an AI company for social media. 

In those cases, you’re not applying the learnings or insights from the experiments that you’ve done. So if you’re basically starting all over, Elizabeth thinks it’s best for you and everyone to shut the company down, return whatever capital you have, and start fresh. 

We have a LOT more to say on this topic. So if you’d like Elizabeth to expand on her thoughts, reply back and let us know.