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4 Moves that make your failure unforgivable.

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.

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3 thoughts on “Fail Horribly or Gracefully? Your call!

  1. Good post Arnold!
    I agree with your four moves to avoid failing miserably. One more move that I would add to your list is: “Blaming other people or external factors for your failure”.
    Entrepreneurs tend to attribute successes for internal factors and failures for external ones, that are not within their control. Although luck has a lot to do with an entrepreneur’s success, one very important step an entrepreneur should take is reflect on what he or she did wrong and could have done differently and then share those thoughts with their employees, investors and family. Although this is much easier said than done, taking responsibility for their actions and being transparent about it help entrepreneurs earn respect, trust and credibility from their stakeholders, which would be willing to work with them again in the future.

  2. Strong post, Arnold! I totally agree with you on your view of transparency.

    Regarding ego, I agree that one has to check their ego at the door – but how much is the key question. If you were an investor in a start-up wouldn’t you want a founder/CEO with a little bit of ego/moxie? One that is not afraid to follow his/her instincts and pursue choices that they deem best for the company? I do agree that an ego can be a detriment if not controlled and properly managed. Take a look at some of the best companies in the United States – Apple, Amazon, Burger King JPMorgan, etc. – many of them have CEOs with big personalities and egos but that is what makes them so effective. Desire, fire and passion are typically tightly wound to a person’s ego level – we have to be careful we don’t extinguish the flames that power the engine.

  3. I like this post, Arnold. A central thesis surrounding several of your tips is “maintain perspective” especially on ego, withholding information, and waiting for the next deal. I agree with your point when you’re “waiting for the next deal” that sometimes you need to have the foresight to ask your self, is that check really going to make it for our company? Or is there something fundamentally wrong with this business? Because some checks have made companies (Jessica’s deal with the Nigerian government to purchase the soccer balls brought in just enough cash for her to keep the company going. Rather than avoiding some of the moves, as you suggest, I would want founders to maintain perspective and know when to wait on that next deal or withhold a fatalistic viewpoint if it means saving the company in the long-term.

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