15
15
Gini Dietrich

Failure In Entrepreneurship: Is It Okay?

By: Gini Dietrich | September 8, 2011 | 
87

It’s Facebook question of the week time (clap, clap, clap!).

I’m coming to you today from a social media day that Porter Novelli is putting on for one of their clients. It’s a pretty cool concept; I’ll let you know how it goes and if I think it’s an idea some of you should adopt (er, steal).

Christopher Barger and I are both speaking. I finally got to meet one of my brain crushes in real life…and he’s just as smart as I imagined. Be jealous.

Now on to the question of the week.

Autumn Thompson asks:

I am working on my masters degree in entrepreneurship and we talk a lot about failure and how it should be embraced. I guess my question would be…do you agree? Failure in your own business can catastrophic to your whole life. What are your thoughts.

Oh boy do I have some thoughts! This is a really good topic. One that we’ve talked a bit about here before, but it’s worth repeating over and over and over again.

My thoughts are in the video below (if you can’t see it in your RSS feed, click here and it’ll magically appear). I’d love to read your thoughts on failure…and I know Autumn would too. Who knows? Maybe she’ll use us in a paper or something.

Before you go to the comments, don’t forget to head over to Facebook and leave a question on the wall. You, too, can have fame and fortune. Well, really, just a mention in a coming video.

Go ahead! We’ll wait.

OK. On to to the comments!

About Gini Dietrich


Gini Dietrich is the founder and CEO of Arment Dietrich, a Chicago-based integrated marketing communications firm. She is the lead blogger here at Spin Sucks and is the founder of Spin Sucks Pro. She is the co-author of Marketing in the Round and co-host of Inside PR. Her second book, Spin Sucks, is available now.

70 comments
mariat144K
mariat144K

Hi Gini, I have had successes and failures 3 of each. My biggest hit financially was in 2001,10 years ago today. I opened a large gallery and studio in the heart of the wine country on Sept. 1, 2001. After the crisis of 10 years ago the news told everyone 10 times a day not to cross a bridge or go anywhere. I could have closed the doors then and been ahead. I tried to keep it a float for a year, but no one would come in for days at a time. A loss of over 150,000. and bankruptcy. What did i learn, somethings can't be foreseen! But reinvention was the key to starting over. I took my art to NY found someone to licence my art onto kitchen products to be sold nationwide in several department stores.(it took 2 more years to accomplish) No it didn't fix my financial problems but I gained what i needed to keep moving forward through the largest opposition I had ever faced in my business history. Here we are today I am once again reinventing myself.I'm just starting a new business in a different industry. I am not as afraid to take chances and do new things. Failures are a chance to grow.

marashorr
marashorr

@ginidietrich , as a new business owner, I love following your tips. Thanks for always providing such great insight! (And on a side note, 1-2 tablespoons of LOCAL, SEASONAL honey each day should help your allergies clear up in the next few days :) It works for me during Orlando's horrific season!

Ameena Gorton
Ameena Gorton

Failure is subjective. Admitting defeat is not failure. Making it open doors means it was a cross roads. Not failure.

delwilliams
delwilliams

Failure to me is when a business KNOWS things are changing and refuse to change to stay profitable. Failure to me is not changing course when all signs point to it. Failure is taking the easy way out when a little more elbow grease could turn it around. Failure for a lot of online businesses seems to be having all their eggs in one basket or running after the new shiny thing instead of sticking with what works. Failure is not the end, though it may feel like it, especially if we are heavily emotionally invested in what we are doing, which if you have worked hard and given birth to something, is bound to happen. The biggest failure, bar none, is sitting down and doing nothing out of fear or having to know every variable. With that logic no one would ever do anything and we would all be sitting in the dark if Edison had held to the idea that if something doesn't work then I am a failure.

ExpatDoctorMom
ExpatDoctorMom

Great little video Gini! You didn't sound stuffed up!

I think through failure you learn, quickly of what not to do. So although you didn't technically fail Gini, you did things different from 2009 on. The first group I join: failed after being open for more than 30 years. There were some things in the contract that allowed for distribution of the debt in an unfair way. So I have learned what not to do.

I read any work contract thoroughly, have my attorney read it and then simply don't sign if the contract is not kosher. This allowed me to walk away from a second group immediately after the first without signing as they had a disasterous contract. Thankfully I did as they ended up an incestous bunch :)

As @bdorman264 said: am stonger and tempered!

autumnmthompson
autumnmthompson

What great insight from everyone! I'm honored to be the FBQOTW. Thank you Gini! Can't wait to write a paper and use all of your opinions. It amazed me to be taught how to fail at your business and adjust. We have studied numerous companies and their complete failures and their successes. It has made me think long and hard about what I want to do and how to make it succeed.

PS...I have a brain crush on several people and I am jealous you got to meet one of yours!

bdorman264
bdorman264

It's ok, but not necessarily good. Of course it can be very traumatic if it occurs and especially when people are counting on you for the roof over their head and food on the table.

Fortunately I have never had to experience it, but I do have a friend who was been bankrupt twice and it wasn't because he did anything wrong per se. However, he rose from the ashes both times and from all outward appearances, he is doing extremely well.

Some of these life lessons can be very hard, but like I commented at @TheJackB place today; if it can't eat you, it can't kill you. More times than not you do come out stronger and more tempered.

Lisa Gerber
Lisa Gerber

You made me realize, after listening to you, that's it's all in how we react to it. If we choose to learn from it and turn it into an opportunity, then it's not a failure at all. But it does suck in the midst of whatever that failure maybe. It is debilitating, keep-you-in-bed kind of stuff. and it's all the more strengthening and character-building when you overcome it.

John Fitzgerald
John Fitzgerald

Awesome question. Awesome answer. My two cents:

Failure is a numbers game - if your business fails, it isn't something you should take personally. But it's still a very very bad thing. It can destroy your life, ESPECIALLY if you take it personally.

Fear of failure is much worse than failure itself. Fear of failure seems to (usually) consist of a variation of three components: lack of understanding of what failure really is, being unfamiliar with the far-reaching ramifications of failure (it really does destroy you for awhile, regardless of how you ultimately climb out of it) and an inability to to manage your aspirations (biting off more than you can chew). In other words, if you've failed, if you're unfamiliar with what failure really is and if you are prone to overreaching with your goals and vision, your flank is wide open for some good-old fashion fear of failure-induced anxiety. Research is your friend...

My advice: Be open to failure and keep your eyes/ears open so you will learn from it if it happens. Just do it in a manageable way. Don't embrace the concept of failing spectacularly just because you think you'll learn more from that. You might. But the collateral damage on your life is not worth it. Better to assess the situation, talk to alot of people and find a way forward that is sustainable - even if it is risky. This way, you'll get back on your feet quicker, you'll learn something, and you'll have a story to tell and experiences to move forward with.

KevinVandever
KevinVandever

Great comments below and much along my line of thinking. For me, failure provides an opportunity to learn and grow as an entrepreneur. I realize that failure is not a necessity for growth and I also realize that just because an entrepreneur experiences failure does not guarantee he or she can or will learn and grow from it; however, if dealt with correctly and handled with the proper attitude and perspective, failure can become a vital step in entrepreneur's growth. I agree that it should be embraced.

jeanniecw
jeanniecw

Here's the thing about what feels like failure: the most painful, heart-wrenching times in life are often the ones rich with lessons. But it can be hard to see that at the time. Perspective, time, reflection and good friends can help us when we fail to see the next chapter that awaits us. Nicely done, Gini!

wagnerwrites
wagnerwrites

Gini, of course, none of us would ever wish bankruptcy on everyone but I've known several people who have gone through it and are thriving now. (They all recommend getting a good lawyer, of course). I've never been through that but have shut down my freelance business to take full-time jobs a few times when times got tough. I remember feeling like a failure when that happened but now I really question the idea that making a necessary change in my career should be considered a "failure." It was just an ending. I think all of us could stand to re-frame our thinking about failure, and maybe we could even eliminate the word altogether.

Howie Goldfarb
Howie Goldfarb

There is a misnomer on 'Failure' because in Silicon Valley VCs are more likely to invest money in start ups with people that have failed vs people who have never tried. And that is what people zero in on. Of course they leave out if you succeed you are even more likely to get investors!

But forget starting a business. If you are afraid to try new things you will never know if they work. And until you fail or succeed you don't know the answer. And @johnfalchetto will confirm you can not be paralyzed by fear of trying. And you can lean what not to do.

To make this easier a wise person once told me: Observe those people who are successful, see what they do, learn and try to use what fits your career and use it. Observe those people who are not successful, learn why, because you can learn from other people's failure.

TweetShannonNow
TweetShannonNow

This is great advice! I guess I've never really thought about failure being an option but that is unrealistic of me and can sometimes be very dangerous. This broadened my horizons and opened my eyes. Thanks for posting!

glenn_ferrell
glenn_ferrell

My sympathies for your '09 experience. Having to lay that much of the staff of your own company has to be really demoralizing. I went through a similar experience in '04, having to layoff almost all of our developers, designers, & engineers after a merger -- many of them good friends. However, had that been my own company, I can imagine how much more difficult that would have been.

On a lighter (?) note, if you collect enough of these "Success through Bankruptcy" stories, you could have an instant best seller :)

EricaAllison
EricaAllison

As Autumn well knows from working with me, failure this past spring is what helped me grow and helped me refine my business. Had I not felt that, in a very painful way, I would not have a better understanding now of how to move forward, how to make it work with less and how to better attract and screen my clients so that we work well for the long term. I think every business owner must experience some level of failure (catastrophic sounds so finite!), in order to be a better business owner.

Lori
Lori

Augh Gini - I didn't know your story - what a horrible Christmas that must have been (all failure-is-good-stuff put aside for the moment!) And then to have to lay off staff! - Yikes!

is failure Okay? Failures is the sign-post that says, "You're going the wrong way!", at least it has been for me! Sometimes this has meant doing something different within that business, and sometimes it's meant starting a different business! There's no adventure quite like the adventure of being an entrepreneur, is there?!

TheJackB
TheJackB

I am the guy who thinks that we need to teach our children how to fail gracefully so that they can develop coping skills to deal with adversity. So my answer is that even though failure can be quite painful it doesn't mean that life is going to end or that success will never be found again.

ginidietrich
ginidietrich moderator

@delwilliams Failure, to me, is walking away from $6B and then violating your quiet period so the SEC pulls your IPO.

ginidietrich
ginidietrich moderator

@ExpatDoctorMom We were talking about failure among today's kids because they're not really taught it in school anymore. They all get trophies, even if they didn't win. I think that's doing them a HUGE disservice.

ExpatDoctorMom
ExpatDoctorMom

PS, I worry about my children's failures... No one wants to see their children suffer but know that they too will be stronger because of it. @bdorman264

ginidietrich
ginidietrich moderator

@autumnmthompson I just saw an email floating around that had 10 people who have failed. The guy who invented FedEx? He presented the idea in a business class and got an F that semester.

ginidietrich
ginidietrich moderator

@bdorman264 By no means do I think it's OK to go bankrupt. But, to me, that used to be the ultimate business failure. And then I experienced it by watching my friend and I realized, as much as it really sucks, it's not life-ending.

glenn_ferrell
glenn_ferrell

@Lisa Gerber I guess a lot of this has to do with how we define failure. Bankruptcy implies you're out of business, but Gini laying off half her staff still left her to fight another day. Gini defined that as a failure but changed her behavior as a result of it -- which made it a great learning experience.

I used to like the old "fail but don't crash and burn" saying. But that only makes sense if you can actually limit your risk in business. 2009 made it clear that sometimes the outcome is something that no one expects -- like the bottom dropping out of the housing market -- an investment almost everyone thought was safe. Sure gave us a lot of opportunity for character-building.

ginidietrich
ginidietrich moderator

@John Fitzgerald Another thing that this makes me think of is the idea of getting too much advice. I think that is debilitating, as well. Sometimes I find it harder to take risk and make decisions when I know of EVERY pro and con. Ignorance truly is bliss in some cases.

John Fitzgerald
John Fitzgerald

*CORRECTION:

"In other words, if you've NEVER failed..." (left out the word "never" and it's an important one!)

ginidietrich
ginidietrich moderator

@jeanniecw Time is a great point about helping us get to the next chapter. When you're in it, it's not fun. But time definitely helps you get over it.

ginidietrich
ginidietrich moderator

@wagnerwrites I like the idea of eliminating the word. But I also think some of the best lessons are in the mistakes we make. Perhaps we frame it as mistakes, instead of failures.

ginidietrich
ginidietrich moderator

@HowieG Not only VCs, but banks, too. When we were looking for funding for Spin Sucks Pro, it was very important they saw I'd been running, and growing, a business for nearly six years. Of course, in this economy, we still didn't get the money. But I don't think I would have gotten the meetings without the past six years.

ginidietrich
ginidietrich moderator

@TweetShannonNow I had an advisor who once said to me, "Have you ever failed at anything in your life?" Sure, I have! But his point was that, I'm a perfectionist and what I think is failure isn't at all. So I totally get what you're saying about failure not being an option.

ginidietrich
ginidietrich moderator

@glenn_ferrell It was really awful because I was friends with a lot of them. The lesson I learned, from a personal aspect, is I can't put myself through that emotional trauma again. I've learned how to separate business and personal. I'm still not fantastic at it, but I'm getting there.

ginidietrich
ginidietrich moderator

@EricaAllison Perhaps it's not failure as much as it is mistakes...at least in this case. We can learn from our mistakes, too. In a big way.

ginidietrich
ginidietrich moderator

@Lori Yeah...I got the certified letters right before Christmas. And, of course, the office was closed so I had to sit with it for two weeks. And then, the week everyone is back, I had to let them go. It really, really, really sucked.

ExtremelyAvg
ExtremelyAvg

@TheJackB I grew up playing lots of sports and failure is part of the game, but it isn't the end of the world. I have failed plenty of times and after a mourning period I move on, usually wiser. I agree with Jack that failure shouldn't be eliminated by giving everyone trophies, because that isn't how life works.

I set a goal of selling 400 copies of Henry Wood Detective Agency my first month. I sold 84. Failure. But I learned what didn't work too. I will do better with Henry Wood 2, 3 and 4.

Success is built on the shoulders of failure.

EricaAllison
EricaAllison

@TheJackB Yes! I look for ways for my oldest to fall down or make a mistake so that we can have something to learn from. It's hard, but it's best!

ginidietrich
ginidietrich moderator

@glenn_ferrell@Lisa Gerber It's funny you say that, Glenn, because Lisa and I just had that conversation. We were talking about when we'll add staff and I commented that we're going to run super lean. I'm a little skittish about hiring, especially when my current staff isn't at full capacity. So I've changed the way I manage the business to accomodate.

John Fitzgerald
John Fitzgerald

@ginidietrich Ah... Good point. I was actually suggesting to talk to people about their experiences with failure, fear of failure and managing risk. You're absolutely right about too much advice being debilitating.

Let me rephrase: Go outside your field and talk to every entrepreneur or leader that you can find. Ask about their motivations, fears and failures/successes. You'll be able to keep a fresh perspective. The sun will come up tomorrow. Just don't screw up too much, ok?

Lori
Lori

@ginidietrich It sounds like a nightmare. I"m guessing that the letters arrived one or two at a time :-(

ginidietrich
ginidietrich moderator

@ExtremelyAvg Isn't it funny what we determine our level of success to be? Why did you choose 400 as your number? Did you have anything to base it on?

John Fitzgerald
John Fitzgerald

@ExtremelyAvg@TheJackB Those are good failures. Your result (84 sales) wasn't what you wanted, but you still sold 84 books. It doesn't take much effort to see that you were successful by selling 84 books.

Had you put yourself in a position where you HAD to sell 400 books or else you were facing financial disaster, well, that's a much different story. I did that once (actually, twice)... It's all about managing your expectations and failing gracefully... and then learning from it.

And I think you're right - sports is a huge part of learning to deal with failure.

TheJackB
TheJackB

@ExtremelyAvg Success is built on the shoulders of failure. I like what Edison had to say:

"If I find 10,000 ways something won't work, I haven't failed. I am not discouraged, because every wrong attempt discarded is another step forward."

TheJackB
TheJackB

@EricaAllison It is better for them to learn under our guidance when we can manage things. I want my kids to experience failure so that they can appreciate what it means to get back up. I just don't want their self esteem to be destroyed in the process.

That balance is important.

ginidietrich
ginidietrich moderator

@Lori They did. And I was at my in-laws that year so I had a really hard time holding myself together. Of course, I didn't talk about it either. So I was trying to keep myself happy for them while dying inside.

ExtremelyAvg
ExtremelyAvg

@ginidietrich I chose 400 because Amanda Hocking had 400 sales her first month. In her 8th month she had 1.5 million. I wanted to try to follow her path. I didn't succeed, but that is okay. I'm still proud of what I have done thus far.

ExtremelyAvg
ExtremelyAvg

@John Fitzgerald@TheJackB You make a valid point and I do feel very proud of getting the sales. I am quite sure that the 2nd Henry Wood will build upon the 1st one. :-)

autumnmthompson
autumnmthompson

@TheJackB We have also studied Edison and all of the patents he holds. His failures are massive but he never let it bother him. If he failed, he learned something and how to better his inventions. If I remember correctly, he has the 32nd patent for the lightbulb. He didn't invent it, he invent how to make it affodable.

Trackbacks

  1. [...] life deals us a terrible blow. Other times you realize that you have to cut your losses and move [...]

  2. [...] Failure In Entrepreneurship: Is It Okay? (spinsucks.com) [...]