Recent research shows that 75 percent of all startups ultimately fail, many of those within the first year of their existence. Nobody likes failure, obviously, even as we recognize that there are many lessons to be learned when you start a business.
Still, when we’re talking about a failed startup, the cost of failure can be pretty steep — sunk costs that can’t be recovered, hours you can never regain, the opportunity missed by rejecting another, possibly better idea. It can make even the most experience-hardened entrepreneur flinch.
Given those costs, then, why would anyone go to the trouble of creating a business in the first place? Believe it or not, you can find lots of value in the experience of launching your own startup or business, even if failure (however you define that word) is part of the ultimate outcome. Here are a few of the biggest benefits.
1. You learn to “fail better.”
“Fail better.” “Fail fast.” “Fail often.” You’ve undoubtedly heard or read one or all of these expressions online. Even Facebook’s controversial motto for several years was “move fast and break things,” a variation on the same theme.
As a society, we may be a bit too fixated on the concept of winning. When the only thing that has value is a wild success, everything else loses value by way of comparison. Yet that kind of winning is actually pretty rare. It also leads to playing it safe and the tyranny of incremental improvements.
Where do the quantum leaps and truly original ideas come from? To a large extent, they come from people who are willing to attempt the leap. That comes with a risk, however—the risk of falling flat on your face. In other words, the bigger the risk, the bigger the potential reward.
There’s also this to consider: failing better, faster, and more frequently may largely cure you of your fear of failure. This leaves you free to achieve your goals more readily.
2. You figure out how to succeed.
There’s a possibly apocryphal story about famed inventor Thomas Edisonwherein he discloses to a new acquaintance that 10,000 attempts to create a working light bulb ended without achieving the goal. “You’ve failed 10,000 times?” the new acquaintance supposedly asks, horrified. “Not at all,” Edison replies. “I’ve successfully found 10,000 ways to build a lightbulb that don’t work.”
Apocryphal or not, there’s a nugget of wisdom here. There’s true value in defining the negative contours of your goal. That is, it’s important to know what doesn’t work if you want to figure out what does get the job done.
There’s just no substitute for experience. By being willing to fail you learn the lessons you need to make your current idea (or the next one) more successful.
3. You can pivot to ride new marketplace waves.
The business pivot is a time-honored strategy that helps companies stay responsive to trends and shifting realities in the marketplace. However, to take advantage of a well-timed pivot, you must first have an actual business, not just the dream of one you keep in your head.
Pivots involve shifting operations and systems as quickly as possible to ride the wave of a newly recognized market or need. Successful pivots, however, require a bit of momentum to help support the company as it powers through the turn.
So even if your first best idea doesn’t work out, you could still steer your company onto a more profitable track or strategy, as long as you remain alert and keep your business nimble and responsive to changes in your marketplace.
4. You learn who are as an entrepreneur and leader, quickly and with clarity.
You can acquire only so much perspective from the confines of the starting gate. To learn the truth, you need to break through the gate and actually start running the course.
Some lessons and insights can only be learned through actual practice and experience. Are you a hands-off leader or one who works best when you’re more deeply involved in the daily grind at your company? Do you prefer to delegate deeply or broadly? Where do your business leadership talents truly lie? What kind of company do you really want to build?
There’s really no way for you to know the answers to these and other questions with any certainty until you take a deep breath and actually dive in.
5. You might succeed when you start a business.
While the vast majority of startups can and do fail, quite a few of them succeed. Some even go on to dominate their markets. Could your business possibly be one of them?
You’ll never know if you don’t try.