4 Moves that make your failure unforgivable.
9 out of 10 start ups fail. Okay, I know as a committed and confident entrepreneur, you will always believe that you are the 10th one.
But what if your instincts are slightly off? Do you want to let a failed idea burn all bridges and ruin everything in your life like Curt Shilling (the star baseball player who infamously orchestrated the controversial failure of 38 Studios)? Or do you want to be like Bill Gates and Richard Branson who can still build great companies after failed start ups?
Fail Horribly or Gracefully? You can always have the choice, and if you ask any entrepreneurs, I am sure their choice is the latter. But why do some entrepreneurial journey still end with an unforgivable failure?
Here are the 4 moves we should all avoid when dealing with failures.
- Blinding yourself with your EGO
We all know successful entrepreneurs have strong conviction and are extremely persistent, just like Jessica Matthews from Uncharted Play who decided to pursue albeit opposition from her advisors. But one has to make sure you can separate strong conviction from ego, which might blind yourself from constructive advices. You also have to really understand what assumptions your conviction is based on. It is easier said than done, as most entrepreneurs are too close to the “problem” to see it.
- Keeping Everything to yourself
“We just tripled our sales” “With this growth, we are going to be the next Facebook”. Yes, this might be what you told your investors when things are smooth. But when things are going downhill, can we expect the same level of honesty from entrepreneurs?
As a leader of an organization with multiple stakeholders (investors, employees, clients, suppliers…), an entrepreneur really needs to swallow his or her pride and be upfront about the situation. We have seen serial entrepreneurs did not burn bridges with investors despite having failed start up, and in some cases the investors fund their next idea. Not only people will appreciate your honesty, some will also find ways to help.
- “The next financing/big deal is around the corner”
When things are going bad, sometimes people live on hopes. Hopes that a potential big deal or financing could turn things around. But if the problem is within the organisation or business (such as wrong product market fit), a single check will not steer your Titanic from the iceberg.
- Spending the very last penny
The easiest way to burn bridges is to spend the very last penny of your business instead of saving a minimum threshold where you can pay your creditors and employees. As an entrepreneur, you are also a leader and an employer where your employees have bet their career on you, you too have responsibilities to look after for their interests. Sometimes if you have huge loan on your balance sheet, creditors might go after your investors or sometimes even to your senior employees. Imagine what your reputation would be like if this happens.
Again, how to fail is entirely one’s choice. The start up circle is a small world and thus one should always be aware that even if you fail and if you do so nicely, its never the end of the world.