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Most theories of strategic change focus on how large, established firms recognize or fail to recognize the need for strategic change. Little research examines how early‐stage entrepreneurs decide when and how to change their strategies. With a longitudinal field study of seven entrepreneurial firms developing innovations in energy and cleantech, we examined 93 strategic decisions at risk for change. We found that decision‐makers chose to change their strategies only after new information conflicted with or expanded their beliefs. Furthermore, a pivot, or strategic reorientation, was not achieved with a single decision, but by incrementally exiting or adding strategy elements over time, accumulating into a pivot. We contribute a grounded definition of what constitutes a pivot and explain when and how entrepreneurial firms pivot.

The term “pivot” is used extensively by …