Let’s dissect Failure!

“In Silicon Valley, the fact that your enterprise has failed is actually a badge of honor.”

Sitting idly in the cafeteria of your college, thinking of the long lost buddies, the doomed love, finding it difficult to close your ears to the derisive remarks of peers, your parents bugging the dormant giant within you, asking yourself what next and where am I going ? Celebrating the rejection of your so called B-Plan or just watching it sustain its last few days? Then this post is for you!

Failure and success are the bread and butter of an entrepreneur. But what is important is to analyse your failure,to learn from it. What is challenging is to spot success in you failure. Done this and you are through!

What failure means to you ? :O

• Liquidation of all your assets with your investors losing all the money they put in?
• You got no return on investment?
• Declared your project, got all customers but failed to keep your promises?

If the last one is the case, your chances of failing are 90 to 95 percent, says Shikhar Ghosh, a senior lecturer at Harvard Business School.

But you don’t need to worry. Do some research and you’ll find very few companies achieve their initial projections.

Why start-ups fail?

Three words- Planning, Implementation, Analysis- that’s what your B-Plan stands on. Any of these pillars struck down, lead it to failure. Planning is essential to create a roadmap between your initial stage and the target. Implement it in short leaps to see if it works. Don’t forget to analyse it regularly- it can turn many blunders into small break points if done wisely. Always leave the margin to accommodate change. An example is the failed dot-com-era grocer Webvan, which bought warehouses all over the United States without knowing that there was not enough customer demand for its grocery delivery service.

Too much of funding can be another cause of start-up failure.Wondering how?

• The time required to raise an amount of money increases with the amount. It may cut short the time you spend for above essential steps.
• Funding may serve as a veil to cover your mistakes, the loopholes in your employees which may eventually accumulate to trouble you.
• If VCs fund you, they’re not going to let you just put the money in the bank and keep operating as two guys living on ramen. You’ll probably hire more people, get a better office space but they’ll be more of employees now with lesser commitment towards customers.
• The more stakeholders you have, the more difficult it is to change your plan later in case you feel the need for it.

It’s personal failure sometimes!

Remember not to get too greedy even if you are the founder. Because although you have proposed the idea, there are others who have worked also.

Ghosh says, “In a start-up, if a company is doing well, and a founder gets greedy and takes more than his fair share, people sort of forgive him. But when a company is going down, when you protect your own interest it’s always at the cost of someone else. People don’t forgive that.”

But if personal failure has been due to non-ethical reasons, it can be a blessing in disguise. Statistically, VCs tend to hire people who have failed more than the ones who have always been in the comfort zone. Henry Ford, Steve Jobs, and Desh Deshpande experienced multiple failures before achieving success.

It may also happen that sometimes you try to save the company and in the process get your own self tarnished. That case may eventually work in the affirmative .

“One of the truly big differences between growing economies and economies that stagnate is the acceptance of failure.” If you don’t allow the old flower to shed, how will the new one come up? How will the plant always look beautiful? Failure can be a boon if accepted in the right spirits and dealt with discerningly.