Why You Can't Win Without Losing
Founding a company is an amazing journey filled with excitement, dreams, and aspirations. As entrepreneurs, we strive to achieve success while avoiding failure at all costs. We meticulously plan, strategize, and pour our hearts into our ventures, aiming for perfection.
However, what if I told you that failure, rather than being something to fear, is actually the catalyst for growth and learning? In this article, I’ll explain to you why failing is a necessary step on your way to success and how to fail the right way. 😉
As perfectionists, we have an inherent desire to do things the right way, please others, and provide the best possible experience to our customers. Failure is often seen as a hard pill to swallow, a blow to our ego and reputation. I, too, walked the path of perfectionism when I embarked on my journey as an entrepreneur. However, I soon discovered that the more I tried to evade failure, the more it seemed to find me.
A personal story of failure that really hurt
Let me share a story with you: In 2020, I founded a vegan food startup, driven by the belief that there was a massive demand for semi-convenient products. I immersed myself in startup classes, sought guidance from mentors, and joined networks where fellow entrepreneurs supported one another.
With unwavering determination, I meticulously orchestrated every aspect of my business, striving for flawless execution. From hiring a professional storage service to automating the entire process, I aimed to create a seamless experience for my customers.
I sent out hundreds of emails and made countless sales calls to sell the product. In short, I did everything that was recommended. However, in doing so, I was depriving myself of the opportunity for "early failure," which is an essential aspect of every startup. I actually failed to recognize that delivering true value should be the cornerstone of any successful business, not the “succeeding” itself as a founder and setting up perfect processes.
Delivering true value to customers is the key to any successful business and I am pretty sure you’ve heard that a thousand times before. At the same time, it is not enough to offer a great product or service; it must genuinely meet a need and solve an existing problem to be able to even provide value!
In my case, I believed that providing vegan cooking options would save people time and offer convenience. However, I failed to consider whether this solution was actually a desired solution for my potential customers. Value is subjective, and you can never know if the solution you think is amazing, is actually something someone would use. Unless someone is willing to pay for your product, it remains untested and potentially irrelevant to their needs.
Here lies the power of early failure. By embracing the opportunity to test assumptions, we can identify shortcomings and adjust our strategies accordingly. Entrepreneurship is a constant cycle of hypothesis and validation. By accepting failure as an integral part of the process, we can avoid catastrophic failures down the road.
It's crucial to understand that everything you think you know about the market, product demand, and statistics are mere assumptions. Market research and customer feedback are valuable tools, but they only paint a partial picture. The true validation lies in customers paying for and utilizing your offerings. Allowing yourself to be wrong and humble enough to learn from failures will save you precious time and resources.
The price for failing late
My personal journey has taught me a valuable, if expensive, lesson. By ignoring the early signs of failure, I lost over $200,000! Looking back, I had to realize that it would have been much more convenient to recognize my wrong assumptions earlier.
It is through failure that we gain invaluable insights and can recalibrate our approach to align with market realities. So if I had tested demand more realistically before producing actual mass products, I would have found that there was almost no demand for the product at all, even if people told me differently and I saw products in the supermarket that seemed to proof it. Instead, I believed in the product so much, that I ignored all the red flags along the way.
At that time, I was participating in a startup acceleration program, and the mentors told me, "If you're not willing to put all your savings into it, you don't believe in it enough," and today I'm so thankful I didn't listen to that foolish advice. There are a thousand things that can happen when you are building your business. Yes, you try everything to be successful, but the market you are in is driven by so many economic events that you can never be absolutely sure if you will succeed! Please do me a favor and don't invest your entire savings or even retirement funds into your start-up. Rather, start small and grow your business gradually by reinvesting your earnings.
Embracing failure
Failure is not the enemy; it is a necessary stepping stone to entrepreneurial success. As entrepreneurs, we must overcome our perfectionist tendencies and embrace failure as an opportunity for growth and learning. By testing assumptions early on, delivering true value, and remaining flexible in our approach, we decrease the risk of large failures later. The risk is so little if you start small. This doesn't mean you shouldn't believe in your idea and dream big; you must be absolutely certain that you're willing to find a solution, but remain flexible in your approach along the way. Trust your intuition when it comes to your vision and goal but constantly challenge your approach along the way together with your future customers.
