Every success book, seminar or life coach out there can tell you that failure is just a stepping stone towards success. And they’re right. It is. But that simple piece of information won’t help you. Information is power only when applied in real-life situations. In this case, that means being able to view failure for what it really is: feedback.
You then simply extract different lessons from that feedback and you’re on your way to success. That sounds easier than it really is. Everybody gets caught up in the day-to-day drama of work, family or friends. It’s easy to forget the basic rules and feel like a failure after something doesn’t work out, especially in business.
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Failure Beats You Up
It’s the habitual first ‘instinct’ to feel disappointed in yourself when the start-up you’ve invested so much in fails. After such a defeat, you couldn’t care less about the mantra failure equals feedback that those ‘success gurus’ keep chanting. It’s understandable. But let me show you some real-life examples that will actually prove that that very mantra is true.
Here are 5 giant entrepreneurial figures (whose net worth in total comes in at around $90 billion or so) who didn’t succumb in the face of early failure, but rather enjoyed and appreciated it for the lessons heeded. And they aren’t afraid to admit it.
FunBug – Nick Woodman
Net Worth $1,750,000,000
Nick was a ‘B student’ during college and an avid surfer, a hobby which often times interfered with his studies. He wasn’t born a billionaire. Before creating the now wildly successful brand of wearable cameras – GoPro, he failed in great style with two online startups during the crazed dotcom bubble of 2000.
First, he created EmpowerAll.com, an e-commerce site aimed at a young demographic which sold very cheap electronics. The company didn’t make any profit, so it was quickly shut down. That didn’t drive our future billionaire out of the business arena; it drove him to try harder, so in 1999 he set up FunBug, an online marketing company.
The site gave users the chance to win cash prizes in return for participating in sweepstakes. It was marketing through games. He even managed to raise $3.9 million in funding from different investors. The company was on the rise, but by 2001, Nick had to admit failure once again. He wasn’t able to create a sustainable user base from which to drive profit via the companies he was marketing.
Here’s what he said to Forbes about failing the second time and losing almost $4 million dollars:
“I mean nobody likes to fail, but the worst thing was I lost my investors’ money and these were people that believed in this young guy that was passionate about this idea… you start to question: are my ideas really good?”
After losing the second company, Nick cleared his head by going on a surf trip, a long one. Once back, he started working on a prototype for a camera which can be used by athletes: GoPro.
‘I was so afraid that GoPro was going to go away like Funbug that I would work my ass off. That’s what the first boom and bust did for me. I was so scared that I would fail again that I was totally committed to succeed.’
Only this time, there was no bust, only the boom. GoPro made him one of the youngest billionaires in the world, and the owner of the fastest-growing camera company in America.
Traf-O-Data – Bill Gates
Net Worth $72,700,000,000
Before being the richest person in the world and owning Xanadu 2.0 (the ‘Bill Gates House’), a computerized residence with real-time adjustable temperature, music and lightining for each pin-wearing guest, Bill Gates was a failing entrepreneur.
His first company was Traf-O-Data, the objective of which was ‘to read the raw data from roadway traffic counters and create reports for traffic engineers‘. In this way, the company would optimize traffic and end road congestion.
The company’s product was the Traf-O-Data 8008, a device which could read traffic tapes and process the data. They first tried to sell the processing service to the local County, but their first demo failed because the machine ‘didn’t work’, recalled Gates.
His partner, Paull Allen, summarised the experience for exactly what it was: ‘Even though Traf-O-Data wasn’t a roaring success, it was seminal in preparing us to make Microsoft’s first product a couple of years later’
And happily, that’s exactly what they did. They kept on going and Microsoft became the largest personal-computer software company in the world. But it’s still nice to know that even the richest philanthropist in the world can make business blunders.
Dyson – James Dyson
Net Worth $3,000,000,000
Most people think inventors are born inventors, with some special talent or gift. Their genetic makeup must be different than that of us mere mortals. But in fact, the opposite is true. Inventors are created; they’re ‘grinders’.
Sir James Dyson’s company is now a worldwide success, selling bag-less vacuum cleaners in over 50 countries. It made him a billionaire. But he had to fail a lot of times before he can get to that winning formula.
In fact, he created 5127 vacuum prototypes, all of which could be considered ‘failed attempts’. He spent 15 years perfecting his product before taking the DCO1 to market in ’93. The vacuum works on his own patented principle of cyclonic separation, that’s why it doesn’t need a bag. This innovation took a lot of dedication:
‘There are countless times an inventor can give up on an idea. By the time I made my 15th prototype, my third child was born. By 2,627, my wife and I were really counting our pennies. By 3,727, my wife was giving art lessons for some extra cash. These were tough times, but each failure brought me closer to solving the problem.’
With such relentless drive despite failures and hardships, how could Dyson not be a billionaire? I dare say, no matter what other business he would have started, he’d be successful. That’s what dedication gets you.
True inventors are the biggest failing lot you could encounter. And that’s a compliment. Failing is the only way through which you can create something new. But real inventors, they don’t even call it ‘failing’. As Thomas Edison famously put it:‘I have not failed. I’ve just found 10,000 ways that won’t work.’ Sir James Dyson, the founder of the Dyson Company really took this principle to heart.
So if you want to create anything, the way you view your failed attempts will decide whether or not you’re going to succeed.
Apple – Steve Jobs
Net Worth $10,200,000,000
We all know Steve Jobs as the Guru entrepreneur, the genius behind best-selling products such as the iPod, iPad, the iPhone or the MacBook. He is the most influential business figure of our time and he’s going to be forever reminded as the Da Vinci of our tech-world renaissance.
What we know less of is Steve are his nothing-burger creations. Believe it or not, Apple was producing exactly that at one time. Remember the Lisa? Of course not. Steve managed to waste millions of dollars in development to create such mass amnesia. It would have been cheaper to simply hypnotize every customer out there.
He had a track-record for this sort of thing, considering that in the previous Apple dud episode, he and partner Steve Wozniak invested their savings and time into the Apple I, which sold a not-so-impressive 175 units. But it was the Lisa development fiasco which got Steve Jobs kicked out of the company he founded.
Applying the principle ‘failure is just feedback’, Jobs went on to create another company: NeXT. That company also met its demise, due to hardware issues in the product. Eventually the software division was sold to Apple, and Steve returned to his starting point.
But now, armed with so many failures, Jobs was more determined than ever to succeed. His dream of creating ‘a company that will still stand for something a generation or two from now‘ just like ‘Walt Disney did, and Hewlett and Packard, and the people who built Intel‘ was finally going to manifest.
Ask yourself this: What if Steve had stopped? How would the world be different now?
Virgin’s Richard Branson
Net Worth $4,600,000,000
Richard Branson really cashed in on the ‘failure principle’. He made it work to the point where he’s one of the most well-known entrepreneurs in the world. The Virgin Brand is one of the most recognizable brands out there, carrying a lot of weight, especially thanks to Richard’s charming persona and televised adventures.
But if you were to meet him in his teens, you wouldn’t really bet on his later success. Branson had poor reading and math skills, dropped out of high-school and is proud to admit he’s dyslexic all his life. Not really your first choice for a billionaire philanthropist knight and worldwide media icon.
But this guy, with his perfect 59-year old blonde hair and dazzling mumbling charm didn’t always have a hold over an empire of 400 companies. His first business endeavor, the Student Magazine which he started when he was 16, had difficulties with, believe it or not, the UK’s law enforcement agencies. Richard almost went to jail for publishing remedies for veneral disease in the magazine.
It didn’t stop there. His Virgin record shops, in the midst of cash-flow problems, almost put him in jail again. This time it was for something more serious: tax evasion. After spending one night in prison, the plea bargain for £60,000 was paid.
The experience, as he recalls, had a big impact on him: ‘I vowed to myself that I would never again do anything that would cause me to be imprisoned or, indeed, do any kind of business deal that would embarrass me.’
The trend of failures however kept on going for him for pretty much his entire life: Virgin Cola (for which he drove a tank in Times Square), Virgin Vodka, Virgin Vie, Virgin Brides (for which he dressed up as a bride), Virgin Clothing, Virgin Cars, Virgin Digital all failed. And the list could go on for a long time.
I guess you could say Branson is the king of the entrepreneurship club, according to his definition: ‘Learn from failure. If you are an entrepreneur and your first venture wasn’t a success, welcome to the club!’
So, Failure is Feedback!
The fact of the matter is most of the people you see in Forbes’ list of richest people in the world had to take enormous risks to get there. That almost always means a lot of failing. I know it’s easy to put on tag on the rich and say: They had it easy. It’s their parents. They were lucky. It’s probably secret societies or reincarnation. Or maybe alien control.
You can find a dozen reasons to internalize somebody else’s success as ‘luck’ or ‘special access to information’. The reality is 73 out of the first 100 billionaires in the world are self-made. That’s a Bloomberg fact. There’s no conspiracy going on. They just work harder than you did.
Those self-made billionaires simply applied some core, fundamental knowledge everybody else has access to. They did what everyone only read about. But knowing and doing are very different things. Failure and success are very similar in that they’re both spiral staircases. Once you get on, inertia keeps you going, and adds some dizziness to the process. Stop failure’s spiral by seeing it as feedback or you’re going to go deeper and eventually crash and burn.
So what are you going to do next time you fail? Give up? Or become the next billionaire?