A little over a year ago, I burned a business into the ground.
People tend to look at me funny when I talk about failing in business. They seem to still believe what we’re all taught in school – that failing in work or in a relationship or in a business means that the person failing is a failure themselves. However, I was fortunate enough to grow up with family and loved ones that didn’t believe this. They taught me that failure is simply a step on the way to success.
It was with that in mind that I decided to dig through the ash of my business and condense the lessons into the presentation I gave last week. Being surrounded by people who were all much smarter than me, I was worried it’d be a waste of everyone’s time. But much to my surprise, it actually went over fairly well – even got voted third best presentation of the conference. A couple folks suggested I talk about my lessons here as well, for the benefit of all (and by all they meant my two readers.)
This is the first in a series of posts about my hard-earned lessons in entrepreneurship. It’s about the thrills and pitfalls of starting a new venture. It’s not about the ‘business plan + venture capital = success’ formula that you often learn in school, but rather the ‘group of guys get together, pool their savings, and proceed to live off of Kraft Mac & Cheese for the next 6 months trying to build something worthwhile’ formula. It’s the formula that most people end up needing to pursue, and frankly, the only formula I know anything about.
I hope you find this at least marginally useful, and I’d love to hear about your own adventures.
Stop Stalling
Lesson #1 is to stop stalling, stop worrying, stop keeping one foot out of the water, and jump in.
The fear, the hesitation is understandable. The small business administration says that 9 out of 10 businesses fail during the first 5 years of operation. They also say that of those that make it, 9 out those 10 will go out of business during the next 5 years. Not very good odds, but you wouldn’t want it to be easy, right?
My stepfather is a business consultant in Colorado, has spoken around the country to small business lenders, and is generally a pretty smart guy. In high school he told me that 9 out of 10 business failed. He said that to him, that meant you have to start 10 businesses. Then he told me to do the dishes.
Those words framed a lot of my perspective. I was compelled to start a painting company my first year in college – managed to rack up $50,000 in sales, and then watch it all crumble around me. I failed, but learned valuable lessons about management, about the pros and cons of hiring one’s friends, about the right and wrong way to stand on a ladder, and about what happens when one stands on a ladder the wrong way and falls into a window well.
When my most recent business went down in flames, my worst fears about starting a business were confirmed. This time the stakes were much higher – I was out of school and trying to provide for myself. I had blown everything taking a risk, while my friends had opted to get jobs with agencies and consulting firms and real estate brokers. They weren’t making a ton of money, but they seemed to be living like kings compared to me. I bet subconsciously, I ended up leaving Colorado to get away from the situation. I felt like I had failed someone somehow, couldn’t bear facing them.
The day before I left I got lunch with my mentor from college. And she told me that I should feel really fortunate, because I get the opportunity to confront the fear that most of us never get to face. I get to face it, and then overcome it. And I didn’t really know what she meant at the time, but I do now.
Failure doesn’t kill you. It doesn’t hurt that much. In fact, there comes a point where you realize that if it weren’t for failure you wouldn’t know half the things you know now. You begin to embrace failure as a vital and necessary step on the path towards success. And so you stop worrying about failure, because you recognize it for what it is – an opportunity to learn and improve.
The consequences really aren’t that dire. Sure, your ego takes a hit, but as anyone who’s read this site for any length of time knows, my ego was certainly in need of a little whipping. Your friends and family still love you. Even the financial hit isn’t as bad as you’d think. I got into some serious debt, and it took 12 months to get out. But I dug out, got back in the black – even managed to save some money and buy a ring. I realized the worst thing that can happen in a failed business is you can lose money. And money isn’t nearly as big a deal as I thought.
So, since failure isn’t that big a deal – since failure gives you priceless lessons that help you the next time around – since failure is the next best thing to success – what in the world are you waiting for?
There has never been a better time to get into the world of business, especially if you’re a techie. There’s certainly been a lot of hype about the whole Web 2.0 thing. But it has never been easier for the little guy to compete online. You can start a business for far less than you used to – the barriers to entry are just about nonexistent. You can build a prototype quickly, and it’s actually COOL to not have everything worked out yet. You have an amazingly talented group of early adopters at your disposal who will be more than willing to help you refine (or define) your offering.
If you want to be an entrepreneur, the worst thing you can do is sit around waiting for a sign from God to tell you that the time is right. Waiting until you have the right idea, the right amount of money, the right team in place. The fact is that the timing is never going to be right. One or two, or all of those pieces will be missing. Someone once told me that starting a business is like jumping out of a plane, and your goal is to build a parachute before you hit the ground. The difference is that while it may hurt if you land without building the chute in time, you usually are able to get up and try again.
The point is to start. Today. How hard would it be to learn to ride a bike if you didn’t have a bicycle? How hard is it to learn how to start a business…without starting a business? Even if it’s part time, get out there and start something.
What can you start today?
