A decade back I co-founded a startup. My cofounder, a brilliant product manager, had what seemed like a great idea. Great enough that he quickly got a fat check for the whole seed round. We could have just started building, but both of us were big fans of using user testing to guide product development, so we instead did a lot of user tests.
Six or eight weeks later, we were down at Sand Hill Road for our first board meeting. At this point, according to our VCs, normally they'd just hear about plans. But my co-founder got up and explained that of the 6 key assumptions in our product, 2 and maybe 3 were false. The thing they'd given us money to build was a bust. The room was very quiet. Then he went on to explain the next idea we'd come up with and got them excited about that.
Something we learned later is at the same time we'd raised a seed round, two other companies raised large A rounds to go after basically the same idea. They spent the next 18 months (and north of $10m) trying to make it work.
Not only did that make us feel a lot better about having pivoted, but it was an important lesson to me: the best failures are those with the smallest craters. We bought the same knowledge for less than 1% of the money spent.