Failure can be a great thing, visiting entrepreneurs say
Alumni , Areas of Study , Entrepreneurship , Entrepreneurship Society , Event Recaps , Stories Student Organizations & Clubs | Nov 30, 2011 | Nicole Gesualdo
Walk around your class tomorrow and ask who wants to fail the final. You won’t find any takers, of course. Nobody wants to fail. But entrepreneurs who visited Fordham during the Gabelli-sponsored TrepCon — a week-long entrepreneurship conference — argued that when it comes to launching and developing a business, failure can be priceless.
Here are the gems these entrepreneurs mined from their failures, as retold by GabelliConnect journalist Faye Kulik (GSB ’13):
1. The first day is sometimes the worst day
Colin McCabe and Tony Shure, founders of Chop’t Creative Salad Company, recalled the opening day of their first restaurant in Union Square. As Colin was behind the counter making salads and Tony was processing orders at the register, suddenly the entire computer system shut down. In a moment of panic, Tony decided they had to give away the salads for free. Colin tried to negotiate with him and sell the salads for half price, but Tony was firm on his decision to give them away for free. Though the two businessmen didn’t earn much revenue that day, they created a major buzz throughout the neighborhood and became known as “the free salad place.” People began coming back to their restaurant. Colin and Tony have repaid the favor to the community by giving away free opening-day salads at 15 restaurant locations they have since opened.
Bigger fail = bigger lesson learned — which sometimes means a bigger reward
Melody Stevens started as a part-time employee at the music academy she now owns. While she was a good piano and voice teacher, she quickly discovered when she took over the business that she didn’t know enough to run the company successfully on her own. She made mistakes — but she learned from each one. For example, she signed a 10-year lease on her academy’s space that turned out to include rent increases every two years. Experiencing this financial loss made her smarter: She negotiated each specific clause in her new lease and, as a result, has not incurred any extra expenses. Ms. Stevens has since launched at least three additional companies, acquiring more skills and learning from her failures, and now says she “absolutely loves being an entrepreneur.”
3. Think small, not big
Charlie O’Donnell, principal at First Round Capital and a Gabelli alumnus, encouraged students to learn from any failures they may have experienced in the job-application process: He suggested they find and apply for jobs at 15 to 30 small companies. There is more growth among smaller and start-up companies, he explained, compared to larger firms such as major investment banks.
4. Start with the end in mind
Sabina Ptacin advised anyone considering starting a business to have a method to deal with a potential failure, in the form of a solid exit strategy and what she called a “business pre-nup.” She also offered some guidance on how to avoid failure in the first place, by always knowing exactly how much overhead you’re spending and how much you have left in the bank. It is also crucial to know what is “enough” for your business and when to say no, she said. Ms. Ptacin is the co-founder and “chief excitement officer” of ’PRENEUR, an online showcase for small businesses, and the co-founder and chief brand strategist at Red Branch Public Relations.
5. Failure is necessary
The panel of entrepreneurs agreed that entrepreneurship is a skill, and that failure is necessary to improve this skill. Failure presents opportunity: Once an entrepreneur hits rock bottom, his or her desperation to turn things around triggers a beneficial hunger to learn. The entrepreneurs embraced the idea of failure in general in their conclusion, saying that “perfection is an impossible goal, but fun to strive for.”