14. January 2013–
Being an entrepreneur or an investor often means setting out on a career filled with soaring highs and depressing lows – and considering that Startup Genome found only eight per cent of startups are actually successful, dealing with failure is something most entrepreneurs have to get used to. But before you get depressed, jump ship and go work for McKinsey (or McDonalds), VentureVillage is here to remind you that even the greatest of entrepreneurs have had their career flops…
Just to take one example, Branson’s condom brand didn’t exactly take off. Potentially because he chose to brand them as Mates, effectively missing out on all the brilliant puns he could have made using the Virgin brand.
His “Virgin Brides” idea also failed to bring in the cash. The reason, according to Branson? “We couldn’t find any customers!” And don’t forget his miserable academic record – he dropped out of school at 16, though considering he went straight into entrepreneurship, in retrospect this seems like a pretty smart move.
The founder of a company worth so much that it has sparked blogs solely dedicated to describing the things that Apple is worth more than didn’t always enjoy legendary success. Steve Jobs couldn’t even make it through his undergraduate degree – he dropped out of college after a six-month effort.
And being ousted from your very own company has got to come as a heavy blow, which is exactly what happened to Jobs when the Apple Board of Directors agreed to ditch him in 1985. Luckily, he was able to pull himself out of the slump and go on to lead a company loved by hipsters (and Stipsters) worldwide – even if it does provoke some parody…
It’s safe to say that wasn’t a bad choice. How many other startups can boast luring in over one billion users from every continent, introducing terms like “defriend” into every day vernacular and inspiring a Hollywood feature film?
On the topic of Facebook, the social network’s first institutional investor was Peter Thiel, who can also add founding PayPal, the most successful online payments system, to his resume. Pretty impressive. But the investor and business man wasn’t always so lucky; his hedge fund Clarium Capital lost out big (90 per cent of their $7billion assets, to be exact) in investments on the stock market, currencies and oil prices. This obviously didn’t effect him in the long run – in 2012, his worth was valued at $1.5billion.
Morten Lund can spot a good thing when it’s coming. The Danish entrepreneur and investor was one of the earliest to invest in Skype – which went on to sell to eBay for a not-too-shabby $2.5billion.
His life hasn’t been all rainbows and billion dollar exits, though, Lund shocked the world when he filed for bankruptcy in 2009 after making some less-than-perfect investment decisions, funding Danish newspaper Nyhedsavisen, which was forced to close $100million in debt.
In an interview with Mixergy, Lund had this to say about the exit: “It’s not that it doesn’t feel bad. It’s the worst thing. You’re sure that everyone can see that you’re a failure.. It was really tough, but then again, that’s what I do and that’s what entrepreneurs do. You will sometimes fail.”
He’s now running two successful startups – Everbread and Haystack, so he’s clearly not letting his past hold him back.
The founder of Twitter and biggest US mobile payment chip service, Square, faced a heavy blow when he was kicked out as CEO of the microblogging site for his poor management style.
While he is now back on board as Chairman, splitting his time between Twitter and Square, the very idea for Twitter came from a failure. At the time, Dorsey was working at Odeo, a podcasting company, which was in a rut. During a brainstorm on how to improve the startup, Dorsey had a simple but brilliant idea – and Twitter was born.
The social network now hosts more that 200 million monthly active users, proving his point that “Twitter was not started because we had a good idea. It was started out of a failure. And that can happen today.”
Oh, and Dorsey didn’t finish college either. Education is clearly overrated.
The man who revolutionised the music industry, launching Spotify – now worth an impressive four billion dollars – didn’t always sail through life. While it’s no secret that getting a job at Google isn’t a simple task (it was ranked the 8th hardest company to get a job at by Forbes), you wouldn’t expect someone like Daniel Ek to fail to wow HR.
But fail he did, and it inspired him to work harder on creating a company that he was truly passionate about.
The Samwer Brothers
VentureVillage wrote about their rapid withdrawal from Turkey, when 400 staff were let go as the Rocket ventures were not well adapted to the Turkish market.
Online shopping club Bamarang was also a flop; the Samwers closed down the site after just six months online. But these failures haven’t left the brothers in a pit of self-loathing – they can comfort themselves with the runaway success stories of Zalando, Home24 and Dafiti.
While he’s slipped from his post as the richest man in the world, Bill Gates is still kind of a big deal. But even the man behind Microsoft and the “PC revolution” of the 90s isn’t immune to failure. While still at high school, Gates and pal Paul Allen (his Microsoft cofounder) launched Traf-O-Data, a traffic counter, which they marketed to local governments.
Unfortunately, the business went bust when the state of Washington started offering counters to cities for free. Plus, Gates was arrested in New Mexico for traffic violations. Just sayin’.
The founder of Amazon and one of the figureheads of the eCommerce movement, Jeff Bezos displayed striking talent at building and creating things from a young age. However, even the man ranked as the top CEO in the world can’t escape a place on the famous fails list – he too had some difficulties along the way.
It took years before Amazon started bringing in profits from the millions of funding the startup received, plus ideas like Amazon Auction were dropped pretty quickly when the leadership board realised they didn’t stand a chance against eBay.
To give Bezos credit though, he has some pretty wise words on the topic of failure: “If you get to a point where you look at it and you say ‘we are continuing to invest a lot of money in this, and it’s not working and we have a bunch of other good businesses,’ and… ‘we are going to give up on this’. On the day you decide to give up on it, what happens? Your operating margins go up because you stopped investing in something that wasn’t working. Is that really such a bad day?”
Image credits: Flickr user amboo who?
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