“Failure is not an option!” How many of us have been told that, or thought it, or even said it ourselves? The quote was made famous for an entire generation by Gene Kranz’s character in the movie Apollo 13. Yes, I just dated myself, but go see the movie anyway. It will teach you a lot about persevering, overcoming long odds, and being incredibly resourceful; skills that will serve you well as an entrepreneur. It’s a phrase that’s likely been said by countless business, political, sports, and military leaders throughout history.
Ask yourself, what’s the worst thing that could happen to you as an entrepreneur? The worst thing is that your venture fails, right? Wrong! We’ll concede that the worst thing for your venture is usually (although not always) its own failure, but the worst thing for an entrepreneur is not failure. In fact, failure may be a beneficial outcome for an entrepreneur for several reasons. First, it frees up your workload and time, allowing you to work on another project that might have a higher potential for success. Second, if you’re smart, you’ll go back and examine the reasons why your last venture failed and the warning signs you missed along the road to that failure. That leaves you better equipped to detect those warning signs and prevent future failure. Third, as long as your company doesn’t completely crash and burn, your reputation as an entrepreneur come out largely intact. (A complete crash and burn would be if you were accused of criminal wrongdoing, for example). Having a failed venture in your past won’t automatically keep you from attracting a new business partner or acquiring funding for your next venture.
In fact, failure has become such an acceptable part of the business lifecycle, especially in the start-up world, that #HarvardBusinessReview, the official magazine of #HarvardBusinessSchool dedicated an entire issue to failure in April, 2011, splashing the word in big bold letters across the cover. Inside the magazine, a multitude of well respected business leaders discuss their experiences with failure. Included in the magazine is an article by A.G. Lafley, former CEO of #ProtorandGanble and a #HamiltonCollege alumni. While P&G isn’t a start-up, they launch as many new product lines in one year as some companies launch in a decade. Lafley explains that P&G learns more from its failures than its successes. He discusses why some of P&G’s past mergers and acquisitions have failed and how they put those lessons to work in the nearly seamless integration of Gillette. Without the lessons of those past failures, the Gillette acquisition could easily have been a failure too. To further highlight the point that failure teaches more than success, look at Polaroid. They created a camera film that could be instantly developed and they did it almost 25 years before digital cameras became widely used in the late 1990’s. Polaroid was the market leader in their niche for decades and was synonymous with instant photography the same way that Kleenex is synonymous with facial tissues, but their success blinded them and they failed to see the obvious application of digital technology to their product line.
The same concept of learning from failure is even more true in the start-up world. If entrepreneurism was a college, its mascot would be the mythical Phoenix; a bird that rises from the ashes of its own destruction. This couldn’t be more true than for #Rovio, the makers of Angry Birds. Rovio failed over 50 times before coming up with a huge success. While Rovio didn’t go out of business 51 times, their previous games weren’t considered successful. There are plenty of other well documented examples of repeated failure turning into success. #WD-40 got its name because it was the 40th formula scientists tried when creating their water displacement (WD) solution. Max Levchin of #PayPal founded no less than 3 ventures that failed prior to starting PayPal. Vinod Khosla helped found Daisy Systems which eventually declared bankruptcy before he helped found #SunMicrosystems.
Clearly, a venture’s failure isn’t a stake in the heart of its entrepreneur. Failure to learn from mistakes can, however, be a death sentence for any entrepreneur.