Every entrepreneur knows that you have to fail at least once before you hit it big. Right?
Well, if it is indeed a prerequisite, I can check that particular box with a big, fat black Sharpie.
Yes, X marks the spot of my big failure. You might even say my spectacular failure, although I am taking steps to reclaim the word spectacular back to its original positive meaning.
Even though it was now 7 years ago and the statute of limitations should have worn off, the experience will stay with me forever.
I don’t mean that I’m bitter and still upset about it. Quite the contrary. I wear it as a badge of courage and after all, I have earned that right.
At age 49, after 11 years of having my own strategic consulting firm, I raised over $7 million for my first entrepreneurial venture.
Not bad you say. Well, $7 million seems like a lot, until you realize that you needed $10 million to get past launch and to retool from the early learning and then sign your next major client(s) and then lather, rinse and repeat until you break even.
The company’s name was LeisureLogix and we were building B2B technology for the road travel market.
We had everything right, or so I thought (famous last words….).
The Building Blocks
The market was humongous. That is bigger than big. Out of all overnight trips taken in the US (there are 1 billion), 85% of them are by car. And the rest of the multi-billion dollar travel industry in the US was laser focused on the air traveler. That’s right, they were focused on the 15% solution, leaving the 85% ripe for the picking. Home run number one.
Before we wrote one line of code, we had an agreement to launch our product on Travelocity. In fact, they agreed to placement that included four different pages on their website. Score!
We hired the former GM of Travel for a major media site as COO, the head of travel for a major technology company as CEO and the head of marketing and development for one of the only organizations focused on road travel in the US as our CMO. Home run number three.
While they ran the company, getting us ready for launch, I was working with a major technology company to get our product embedded in the dash of automobiles around the globe. Of course it would be the 2012 model year, but it was still amazing.
We were in hog heaven and no wonder we were so bullish when talking to investors.
We had a dedicated team, who had worked together for a number of years and many of whom had worked for many months on this venture for sweat equity. Home run number four.
The Investor — My Angel
I found a local investor in Tampa. Although he hates being referred to as an angel, he was both my angel and my lead investor. He believed in me and my vision and kept putting in money to move us past each milestone. So far so good.
We went together to his “lynchpin” investor (my term) and he agreed to match my investors investment to date, which at the time was $2 million. Score again.
Until two weeks later when I got a call that the lynchpin had dropped out. Truly I didn’t understand the significance of that. I just thought we’d do another road trip and get more. Silly me.
The problem was that I didn’t really understand the concept of a “syndicated investment”.
But what I didn’t understand was that if HE didn’t invest, none of my investors other syndicate members would follow. And true to form, none did. In fact, my investor knew not to ask.
The Bubble Breaks
So less than 45 days after launch on what was then the #2 online travel site, getting that coveted Wall Street Journal article and winning a prestigious innovator of the year award at a top industry conference, the dream ended.
While I was on a cruise for my 50th birthday, the company was officially shutdown for lack of operating capital. I found out when we landed back in Miami 14 days after we had left. And no, the Operating Agreement didn’t allow that to happen without my consent. But happen, it did.
From idea to build to launch to shutdown was just over 15 months. So I guess we did “fail fast”. Where is that Sharpie marker? I think I should get another check mark for that.
My investor lost $6 million, and my husband and I lost nearly $1 million. Not that we ever “had” $1 million. Through this whole experience, I learned the word “leverage” was more than an engaging television series. We put everything on the line. And we lost.
But we rolled the dice. Some people never get to do that. And trust me, it is a thrill or we wouldn’t become serial entrepreneurs!
The Rest of the Story
But you know what? I am still friends with that investor and have done another venture with him. And while that one failed REALLY fast, there was more valuable learning.
I changed my Facebook profile to say I got my degree from the School of Hard Knocks. My teenage kids still wonder where the campus is. Some days I feel like it is following me around. ☺
And now I am 18 months into my latest venture. This time I am tackling the 67% of travel that is NOT vacation and it is NOT business travel. And we contribute 10% of our revenues to the charity of choice of our clients. We are changing the world, one trip at a time.
You will want to stay tuned to this one.
Failing fast? This time I’d rather not fail at all. And I won’t. Just watch!
Chicke Fitzgerald is the CEO of Solutionz Holdings and is the founder of Solutionz Technologies. She refers to herself as a philanthropreneur. She lives in Tampa, Florida with her husband and two children. She hosts a radio show on blogtalkradio.com/solutionzlive and has written three books on global travel distribution and was a co-author in Bootstrap Business, co-authored with Tom Hopkins, Jack Canfield and John Christensen. She writes a popular blog called Managing Mischief.