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Definition of Success and Failure

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What's your definition of success and failure?


How do we define success and failure? It depends on which perspective you take. In the business context, it is pretty straight forward: profit and growth (some might argue growth is not necessary). However, from a founder or employee perspective, success and failure are far more subjective than just financial gains.

Even the success or failure of financial gains is debatable and relative. For example, should we consider Groupon a success if Mason, the founder had accepted a 6 billion dollar acquisition from Google? Similarly, if Zuckerberg had sold Facebook for 1 billion dollars to Yahoo back in 2006, would we consider that a failure because that decision would have left massive amounts of money on the table?

The reality is that everyone has a different definition of success and failure. Some may completely disagree with my definitions but I think it is helpful for entrepreneurs to define their own standards before jumping in the roller coaster ride of starting a business. In this blog post, I will attempt to define my version of success and failure as a founder from 3 perspectives.



  • Stable salary within market rate
  • Equity dividends or exit which will support comfortable living conditions for family
  • $$ bills, Bill Gates money etc in the long-run


  • Personal/company bankruptcy
  • Unable to provide for family
  • Unable to provide employee salaries
  • Unable to realize profits for investors
  • Equity that is worth close to nothing
  • Exiting at the wrong time for less than potential
  • Create meaningful learning experience for all parties including customers, employees, investors
  • Help company grow through perseverance and hard work
  • Make positive impact on community and create value (solve problem for customers, create jobs etc)
  • Source sufficient funding from investors
  • Grow as leader and human being
  • Solve and survive unexpected problems (crisis management)
  • Recognizing faults and mistakes and owning up to them and learning quickly
  • Realizing when to quit/exit
  • Identifying and taking advantage of fortunate events
  • Build positive reputation/brand
  • Gain expertise of related industry
  • Getting fired (?)
  • Learn nothing but self-doubt and a pessimistic outlook
  • Blame outside factors for failure rather than yourself
  • Create little or nothing of value when there is a clear opportunity
  • Negative effect on leadership skills
  • Unable to scale with growth of company
  • Ignore valuable insights/advice
  • Stress without reward for all parties
  • Make decisions based on risky untested assumptions
  • Negatively impact many lives through selfish decisions
  • Go to jail


  • Develop strong relationships with founders, employees, investors, and clients based on respect and trust
  • Build network that you can rely on for another venture
  • Maintain good relationships even though there is financial loss through transparency and goodwill
  • Create conflict between employees /founders
  • Become unfundable to investors
  • Burn bridges between clients/customers
  • Unemployable




Obviously all the definitions listed above are not mutually exclusive and most founders will find that their experience is a mix of success and failure. As long as there is more positives than negatives, I view it as success. There are also weights that can be applied in each category but ultimately it is a subjective assessment that is different for everyone. It is also not as binary as we think it is. We as entrepreneurs are always scared when we read about disasters and the aftermath that follows but we need to take it in with a grain of salt. In an outcome driven society popular opinion is quick to label founders as failures without really knowing what people learned from their experience or what kind of networks they built in the process. In reality, I believe that it’s those “failures” that I consider a success that really sets founders up for more notable success later on.


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