Thursday, August 8, 2013

10 Principles for Startup Success Through Failure

Thomas_Alva_EdisonIf you can’t deal with failure, then the entrepreneur lifestyle is not for you. Don’t believe that urban myth that all you need is a good idea, a little fun work, and the money will start rolling in. When you are pushing the limits, nobody gets it right the first time, or even maybe the tenth time. That’s why the term “pivot” was invented, so you don’t have to call every change a failure.

Thomas Edison called every failure an experiment (now it would be a pivot), and each one told him successfully what didn’t work. Mistakes are more insidious, and should be avoided at all costs (use your advisors and other resources). Mistakes are things you do on purpose, with negative consequences already known by many others, because you didn’t do your homework.

Failures and pivots come in all shapes and sizes, but entrepreneurs need to adhere to a common set of principles for failing productively, leading to ultimate success:

  1. Don’t allow the same failure twice. This is called the “fail forward” strategy, or learning more about your business from each failure, as well as developing the confidence and commitment to make decisions and take responsibility for them regardless of the results. Repeating the same failure, or the common failures of others, is a huge mistake.

  2. Keep the cost of failure survivable. Keep the key elements in your strategy and rollout small enough and tested early, so that a single failure will not bring down the rest of your startup. This is often called the “fail fast” strategy, with the ability to adapt and iterate to success, based on learning.

  3. Make each move forward a planned experiment. Don’t rely on random opportunities and default decisions to set your strategy. The idea is that there is a right way to go wrong, and “failing smart” allows you to learn something from each pivot. Overt decisions, based on rational thought and real data, will always trump no decision.

  4. A credible failure makes an entrepreneur more investable. Emanating from Silicon Valley, there is a culture of “fail often,” and you’ll succeed sooner. But be aware that failures are analyzed as closely as successes, to see if they represent real innovation, real learning, and a rational decision process, indicating success potential.

  5. Actively seek and don’t ignore critical feedback. Successful entrepreneurs assume some adaptation and change will be required, so they actively seek feedback, spot failures and fix them early. They avoid the instinctive reaction of denial, or the stubbornness of charging straight ahead despite evidence that a strategy is not working.

  6. Determine not only what went wrong, but also how to do it right. Avoid random trials and errors. If you don’t learn from a specific failure, it becomes a mistake that is destined to happen again. Every failure deserves a root cause analysis, so that you end up fixing the real problem, and not just a symptom.

  7. Document and update business processes after each failure. Too many failures in startups result from key business processes not being documented at all, or being non-functional. Failures should result in better processes and better documentation, or they become mistakes destined to be repeated.

  8. Blaming bad luck, poor timing, or misjudgment is a mistake. These are most often excuses, rather than reasons for a failure. There will never be a perfect time to launch a startup. There will always be uncertainty, and we will always be humans, using judgment calls in lieu of knowledge and real information. Explore the root cause of every failure.

  9. Listen to conventional wisdom and advisors, then chart your own path. New paths are the key to success for an entrepreneur, but unless you listen and do your homework, you will be unable to recognize the old proven paths to perdition. Blindly following old paths, or ignoring known dangers, are unforgivable mistakes.

  10. Resilience is the best antidote to failure. Thomas Edison had resilience, bouncing back after 1000 failures on the light bulb alone. Many experts believe that the primary cause of startup failure is not running out of money, but quitting too early. If you accept failure as learning, it’s not discouraging to keep adapting until you find success.

Success may not really always start with failure, but the wise entrepreneur should expect it, embrace it, and capitalize on the learning opportunity. In reality the difference between success and failure in a startup is very small – for example, being acquired in the throes of a bad experiment might be seen as a success or a failure, depending on your perspective. In the entrepreneur lifestyle perspective, every learning experience is a success, so failure is not an option.

Marty Zwilling


Share/Bookmark

2 comments:

  1. Resonates perfectly ! thanks for this confirmation-i needed it.

    ReplyDelete
  2. Has anything ever bothered you in life? Do you
    have any problem you need to solve? A pending
    court case you want to resolve in your favor?
    Health, relationship and finance. Welcome to
    the world of miracles and wonders, there are
    supernatural treasure and power to liberate
    mankind from all afflictions. Why cant you live a
    life of your dream? Why must you work so hard
    and yet earn so little? Why cant you be happy
    with the one you love and desire or why cant the
    one you love reciprocate and appreciate that
    love? Why would the doctor tell you there is no
    solution or cure to your problems? Why would
    your lawyer say you stand no chance, that your
    case is hopeless? Have you been cheated by
    anyone or those owing you money refuse to pay
    back? Do you need a rapid job promotion in
    your place of work? You want to venture into
    politics? Now I understand certain things are
    hard to believe and comprehend, but all I ask
    from you is only 3 days and if you will follow my
    instructions and use the items you will receive, I
    promise your life will never be the same
    again.If you find no relevance in the help I offer
    I solemnly appeals do not be vindictive and go
    in peace. And if your intentions are to take
    advantage of the powerful nature of our items
    for the purpose of evil, I will not have any
    business with you please be advised. May
    angels guide you. All inquiries should be
    directed to the Priest Abija email below Email:
    spirituallighthealing101@live.com or
    you can sent a text message to this number:(518) 303-6207!

    ReplyDelete