3 Things Every Entrepreneur Can Learn From Failure In Business
By Jesse James
When it comes to the entrepreneurial journey, learning is the pathway to success. That learning usually comes from failure. No entrepreneur likes to fail, but the fact is most do.
Some very successful entrepreneurs of yesterday and today experienced failure and learned from it on their way to success:
- American inventor Thomas Edison tried thousands and thousands of times to invent the electric light bulb before eventually succeeding.
- Walt Disney’s first animation company, Laugh-O-Gram Studio, went bankrupt, but Disney went on from there to create an entertainment empire.
- Steve Jobs, cofounder of Apple, was fired from the company in the mid-1980s but was hired back in 1997 and led the company to meteoric growth.
- Author J.K. Rowling submitted Harry Potter and the Philosopher’s Stone to 12 publishing houses, which all declined to publish it—now more than 120 million copies of this book have been sold.
These are just a few examples of famous entrepreneurs who experienced failure on their way to success.
Statistics bear out that failure and setbacks are common on the road to business success. Consider that data collected by the SBA from 1994 to 2019 shows that approximately 68% of new enterprises survived at least two years, and after five years the new business survival rate dropped to less than 50%.
While failures may be a given in the entrepreneurial journey, failure is not fatal. Successful entrepreneurs learn from their mistakes and apply these learnings to the pursuit of their dreams. Some of the most important things these and other entrepreneurs learned from failure in business include how to be resilient, fearless, and adaptable.
What we can learn from failing in business
Failure teaches entrepreneurs the capacity to recover quickly from difficulties, which is the definition of resiliency. With every failure, entrepreneurs can learn tenacity and perseverance (think Thomas Edison), two key characteristics of resiliency that are critical for pushing through missteps and fighting the urge to quit.
Research shows how important resiliency is to business success. A study conducted by researchers at Smith School of Business at Queen’s University followed first-time entrepreneurs over a period of two years as they developed, launched, and operated new enterprises. The study found that resilient entrepreneurs viewed business setbacks as puzzles they were fully able to solve and tackle. The researchers noted that entrepreneurs who had this “challenge appraisal” mindset “were more motivated and able to be proactive in identifying ways to improve business processes and outcomes, and to adjust them on the fly.”
The study also found that resilience was a crucial skill that helped entrepreneurs respond to unexpected challenges and that businesses owned by resilient entrepreneurs were more likely to survive than other businesses.
Embarking on a journey of entrepreneurship is a risky proposition and is full of uncertainties that often elevate fear of failure and rejection. These fears can stop aspiring entrepreneurs from facing risk and pursuing their dreams.
A Zapier-commissioned Harris Poll survey found that approximately three in five Americans (61%) have had an idea for starting a business, and about a third (34%) have had more than one. The survey revealed that an overwhelming majority of those people—92%—did not turn their ideas into a business. For 33% of survey respondents, fear of failure is what stopped them from pursuing their dream of entrepreneurship.
Entrepreneurs who have failed learn firsthand what Winston Churchill meant when he said, “Success is not final, failure is not fatal: it is the courage to continue that counts.” With this perspective, entrepreneurs no longer allow fear to stop them in their tracks. Instead, they view failure as an opportunity to learn from mistakes and use what they learned from failure in business to move forward despite their fears.
Learning from adversity is what helps take the fear out of failure. Devoting time to analyzing what happened, why it happened, what worked, and what didn’t provides the clarity and insight required to determine what changes need to be made to achieve success. The knowledge and practical experience that comes from failure inspires a fearlessness and confidence in entrepreneurs that drives them to try again and again.
Additionally, the fear of rejection often prevents entrepreneurs from even trying. Jia Jang’s 100 Days of Rejection Therapy challenge truly puts this into perspective. Without even trying, many will simply write something off as impossible because they’re scared of being told “no.” However, Jang’s experiment showed that the worst thing that an entrepreneur can do isn’t asking for something they might not get—it’s not trying at all.
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Failure is also a lesson in adaptability. When one idea or approach fails, entrepreneurs must be able to adjust to new conditions and be willing to experiment and test new ideas. Embracing change, staying nimble, and pivoting are part of the adaptability that helps entrepreneurs overcome obstacles, learn, and innovate. When industries, markets, and customer preferences change, this adaptability also helps entrepreneurs navigate these new situations and problem-solve to make an idea work or come up with a new one.
Netflix is a good example of a company that adapted its way to success. Founded by Reed Hastings and Marc Randolph in 1997, the company’s first business model centered on allowing consumers to rent and buy physical DVD movies. In 1999, the company added a subscription offering that allowed people to rent as many DVDs as they wanted, receiving rentals in the mail. The company adapted its business model again in 2007, moving away from physical media to take advantage of new technology that made it possible to stream content instantaneously via the internet.
Sometimes you need to fail in order to succeed
Of the more than 31 million entrepreneurs in the United States, many have experienced failure on their road to success. They have tried and failed, and likely failed a few more times during their journey. These failures are far from fatal. Entrepreneurs who learn the lessons of resiliency, fearlessness, and adaptability from failure in business are able to conquer obstacles and setbacks to achieve success.
Michael Jordan captured this idea well when he said: “I’ve missed more than 9,000 shots in my career. I’ve lost almost 300 games. Twenty-six times, I’ve been trusted to take the game-winning shot and missed. I’ve failed over and over and over again in my life. And that is why I succeed.”
About the Author
Jesse James is Director of Strategic Partnerships and Solutions at VizyPay. He is 15-year veteran of sales, sales leadership, and entrepreneurship. He was previously Director, Recruitment Services at DHI Group, Inc and Chief Revenue Officer at FiQore Technologies, Inc. Connect with him on LinkedIn.