Being an entrepreneur is hard, and the reason for this is the daily choices entrepreneurs have to make. There’s a lot of talk about being passionate about what you do as an entrepreneur. While this is true, becoming a successful entrepreneur is not all about doing what you like or are passionate about but what you do not like as well.

Qichao Hu, or Dr Hu, is the founder and CEO of SES AI, a company that develops and manufactures Lithium-Metal batteries with the help of AI. His work is impressive, no doubt about that, but what entrepreneurs may find fascinating and even learn from is his immense experience in pivoting.

Moving from academia to entrepreneurship and again transitioning his company from a traditional battery manufacturer to a more innovative AI-driven company has taught him many lessons. Before we dive in, here's the golden rule; if you want to pivot, do it fast.

Pitfalls and challenges

Hu faced several challenges as a founder but the one he “hates” is having a “bad” board. As a Startup, your board will consist mainly of investors, and one bad investor can ruin everything. Typically this can be someone with little or no knowledge of the industry but who has a specific timeline in mind perhaps to exit the company.

They apply pressure on you as the founder, and in a bid to satisfy them, founders may have to accelerate their pace and eventually run into trouble. Hu’s advice is to be very selective when it comes to choosing investors. A big-name investor is good for a startup but if they are too controlling, then it can be bad for the company. According to Hu, a dollar from a well-known investor is the same as a dollar from a lesser-known investor. What matters is the value of the dollar.

Next is making clear your terms and conditions to your investors as to what powers they have and what powers you have as the founder or CEO of the company. This requires a direct approach. Without clearly defining the powers of the CEO and investors as a founder, you could face resistance when pivoting your company.

The fall of an American Hero and how it shaped Hu’s decisions

Qichao Hu was in MIT when A123 was at its prime. A123 manufactured lithium-ion batteries and Hu considered them an American hero when it comes to battery manufacturing. But despite being so advanced, A123 soon filed for bankruptcy and soon, the company was no more. What happened to them will always be a lesson to Hu who has drawn on that lesson to ensure his company doesn’t meet the same fate.

First, understand the difference between a professional CEO and a Founder CEO. The latter in most cases has more technical knowledge needed for the company to grow especially in its early stages. Unlike the professional CEO who may have much experience in running a company but lacks the technical knowledge to take key decisions that could make or break the company.

Secondly, never expand too fast. This is another issue that led to the fall of A123. The company, under the leadership of a professional CEO, focused more on expansion than the core of their business, which was the batteries they made. Losing sight of what got them to where they were is the second reason they fell. The rapid expansion soon backfired after the company lost several deals due to defective batteries.

The fall of A123 remains a critical lesson to Hu who has vowed never to let it happen to his company, SES AI.

Advice for founders who want to pivot

Hu’s advice for founders who want to pivot is to do it fast and while at it, here are three things you should always remember to do.

1. Let go of emotional attachments

A major challenge you'll encounter when pivoting, surprisingly, has nothing to do with finances or your investors losing faith in you. However, it has everything to do with you as an individual and how much control you have over your emotions. Letting go of established relationships, past successes, key company personnel, and sometimes, letting go of one’s dream idea of the company is difficult and easily one of many reasons why so many founders linger on the decision to pivot. That is why it is the first decision you have to make when pivoting is to put your emotions aside. If you can do this, then pivoting becomes a lot easier.

2. Don’t sacrifice quality

Pivoting shouldn’t be done at the expense of your products, which is the reason you’re in business. Hu learned this lesson from the fall of A123 Systems, an American Lithium-ion battery manufacturer, once a leader in the industry. The company built massive facilities and hired thousands of employees in the space of three months, but while focusing on growth, the company neglected the core aspect of its business, the PRODUCTS. This eventually led to its fall.

3. Leveraging new technologies when pivoting

With the help of technology, you can do in two years what will usually take 5 years to achieve. Take SES AI, for example, the traditional process of validating a new battery chemistry can take over a decade due to rigorous safety and performance testing. However, the company can accelerate the process using AI models to predict battery behavior over time. This saves time and cost while improving efficiency, a win-win for everyone.

Conclusion

Sometimes, changing the direction of your company is necessary for its survival. But what is even more important is getting it right. One right decision can secure the future of your company, and one wrong decision can guarantee its fall. On that note, here are key insights in this article that founders/entrepreneurs should note when pivoting;

• Pivot as quickly as possible
• Be selective when choosing investors
• Clearly define your powers as a CEO/Founder
• Don't let emotions hold you back
• Don't sacrifice quality for growth
• Use whatever leverage you have, especially technology.

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Further reading: This one skill helped her build a 6 billion dollars worth company with just $1000