All entrepreneurs fail. All entrepreneurs fail. Entrepreneurs aren’t the only ones to fail, either. In the startup world, you have to be honest with your team. Checking your emotions, examining your failure, and taking the time to gain perspective will help you to find the positive aspects of the problem. What does this failure mean to me and my business? Successful entrepreneurs use that failure to their advantage. And without failure, there can’t be a success. If you never become an entrepreneur or start the business that you’ve been dreaming of, you’ll never fail. Have you failed as an entrepreneur?
All entrepreneurs fail.
Let that sink in.
All entrepreneurs fail.
If you’re an entrepreneur, at some point you will fail. It’s inevitable. Whether that failure is large or small, there’s something to be gained.
Failure is often considered the other “F” word in the startup and entrepreneur sector, but it shouldn’t be.
Failure isn’t an all-out loss — you can use failure to your advantage.
Entrepreneurs aren’t the only ones to fail, either. Forty percent of all businesses will fail in the first three years they’re open. That’s a lot of failing businesses.
For entrepreneurs, the risk is even higher. Entrepreneurs intentionally begin their businesses to disrupt an industry. This raises their risk of falling on their faces.
Furthermore, the longer a business is around, the more likely it is to fail at some point.
The riskiest time period for a new business is the first 3-5 years, where you can see that there’s a sharp decline in the number of businesses.
Successful people fail. And no, that’s not an oxymoron.
Failure is an option
Failure is often viewed as an ending, but that doesn’t have to be the case. For most entrepreneurs and their businesses, failure is just the beginning.
If you find your business failing, it’s time to pivot and find a solution to the problem. Just know that failure is an option.
Maybe you need to start over from scratch. If so, that’s OK. My own first business failed, but I’m still standing (and then some).
Why? Because I examined the problems with my first business and made sure that what I learned informed my future decisions.
This is especially important for small businesses. One study conducted in Australia found that the size of a business correlated to its survival rate.
Failure is a stepping stone on the pathway to success. You pick up new pieces of information along the way that help you to avoid mistakes.
And businesses fail for lots of reasons. An NSBA study asked participants about the biggest obstacles they faced in terms of keeping their businesses afloat.
Nearly half of the respondents felt that economic uncertainty was at the top of the list.
However, you’ll also note that only 5 percent of respondents felt they faced no significant challenges.
If you’re struggling to stay on your feet, you’re clearly not alone.
But here’s the thing: You can’t control the economy. No one has a magic wand that can guarantee economic growth.
You can’t control regulatory boards, either, or the cost of health insurance benefits.
That’s why successful entrepreneurs focus on the things they can control.
If you can pivot from your existing direction and find a solution to the problem that’s causing your business to fail, your failure will quickly turn into a success and a lesson learned.
Accept failure
Failure is part of the process of starting a business and being an entrepreneur.
You might hear about lots of “overnight successes.” In most cases, these stories don’t reveal the missteps behind the eventual achievements.
For instance, researchers and doctors often invent thousands of failed vaccines before they finally make one that works.
Similarly, entrepreneurs sometimes start several businesses before they find a formula that results in profits.
Some business owners, on the other hand, are so scared of failure that they’re debilitated with fear. This fear stops them from acting, pivoting, creating, and founding.
If you find that you’re scared of failure, try to find acceptance.
As I said before, you’re not alone.
There are many reasons that startups fail. According to a poll conducted by CB Insights, business founders stated that their businesses most often failed because of a lack of market need.
In other words, businesses often go under because the founders neglected to conduct some basic market research. And you know how I feel about data-driven decisions.
If nearly half of businesses break down because there’s no need for the products or services they provide, there’s an easy way to reverse the trend.
Entrepreneurs can automatically learn from these failures and conduct the proper research before they ever launch their businesses.
It’s common sense, but many entrepreneurs are so in love with their ideas that they don’t consider the other side of the equation.
The second most common reason behind businesses that flop boils down to cold, hard cash. Almost 30 percent of business owners reported that their businesses never took off because they ran out of money.
Inadequate cash flow could trace back to lots of causes.
Maybe the business didn’t collect on accounts receivable aggressively enough.
Perhaps the business failed to leverage PPC ads correctly.
Whatever the case, there’s almost always a reason behind the reason. If you can accept failure and learn from it, you’ll know how to avoid making the same mistake twice.
Be honest
Let’s say that your business or a specific product doesn’t work out. In the startup world, you have to be honest with your team.
If your company is beginning to lose momentum, or if you’ve made some grievous error, own up to it.
Entrepreneurs often feel alone in building their business and alone in their failure. But you’re not. Your team and your partners are behind you whether you’re successful or falling apart.
The sooner that you can admit to them that there is a problem, the more likely they are to want to help you solve the problem and stick it out to make the business successful.
Lots of entrepreneurs and business owners feel uncertain about their future.
If you don’t admit to your failure, someone else will eventually point it out. If someone else has to point out your failure or mistake, it’s going to look a lot worse.
It’s much better to upfront and honest when you make an error or even if you run your business into the ground.
Of course, you also have to be honest with yourself.
Don’t lie to yourself that there isn’t a problem when you know that there is one. Catching a failure early can mean you’ve got plenty of time to turn it around.
The alternative means a big mess on your hands.
Answer questions
If you’ve failed in some way, it’s not only your skin in the game — it’s your team’s. After you’ve admitted to your failure, you can offer explanations, but not excuses.
If you own up to the failure and examine it publicly, you can learn more about what went wrong.
Furthermore, part of examining your failure is asking and answering questions. You should also feel comfortable answering any questions that your team might have.
Instead of hiding in your office, call a team meeting. Instead of pretending that you’re raking in the dough, show your team a profit-and-loss sheet.
Your honesty and willingness to answer questions will also build a stronger team…
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