The failure of a business venture can be an extremely disheartening experience for an entrepreneur. But as clichéd as it sounds, failure is often a great teacher. Entrepreneurs who have faced the bitter taste of defeat and moved on are often among the best business leaders out there, in various fields of work. These people understand the value of failure and how to channel it into success in future endeavours. They know that while they cannot change the past, they can learn from their mistakes and make better decisions going forward. Whether you’re at a crossroad after failing to build your startup or are simply interested in leading a team someday, learning from these five entrepreneurs who experienced unfortunate failures first-hand is essential for your future success.
The story behind the creation of Facebook is now widely known and has been depicted in various films and documentaries. However, people often forget that Mark Zuckerberg’s initial venture, a website called “Thefacebook” failed miserably as a social networking site. In a Harvard dorm room in 2004, Zuckerberg created a site where people could connect and share information on various schools. Thefacebook was the first social network to gain critical mass and popularity in the pre-Twitter and pre-Facebook era. However, Mark Zuckerberg failed to monetize the website, and it eventually shut down in 2005. But this did not stop Zuckerberg, who was determined to succeed in what he loved doing—building communities. Two years later, with a new team and fresh ideas, he launched another social networking site that would eventually become the largest online community in the world: Facebook.
Starbucks, the coffee chain that has expanded to almost 30,000 stores across the globe, has grown into one of the most recognizable brands in the world. Yet, it almost never happened. In 1971, Howard Schultz, then a salesman at a coffee bean farm in Seattle, persuaded his butterscotch-drinking bosses to try coffee. Schultz and his partner, the late Jerry Baldwin, opened their first coffee shop across from the Seattle’s Pike Place Market in 1971. The venture, called Starbucks Coffee, Tea and Spices, was a flop. It was a time when coffee was seen as a beverage for “coffee snobs” and the “eclectic mix of characters” of the city refused to drink coffee at a coffee shop. For a year, the owners struggled to keep their shop afloat. In September 1972, Schultz and Baldwin decided to sell their coffee shop. But Schultz had a vision, which he shared with Baldwin. He wanted to expand Starbucks beyond a small coffee shop and create a global brand. Schultz and Baldwin decided to sell only the name of their shop to the new owners and keep the brand name: Starbucks.
The Virgin Group, founded by Richard Branson, is one of the most famous business empires in the world. But the first venture created by Branson, Virgin Records, was a failure. In 1970, Branson, then a student and a DJ, opened the first Virgin Records store in London, England, to sell records by independent artists. Branson hoped that this would help him break into the music industry. Soon, Branson’s store became the hub for local artists, who performed at the store. But the business was a disaster: The rent for the studio was more than what Branson’s small record store earned in a month. Branson’s friends, who had invested in Virgin Records, threatened to sue him for the money they had put in. He had to either close his store or ask record companies to extend more credit to him. At this point, Branson decided to sell records that his competitors had rejected. He signed up artists who, according to him, “otherwise would never get a chance to make a record.” Branson’s move paid off, and Virgin Records became a famous label.
Oprah Winfrey’s journey from a poor girl in rural Mississippi to the richest self-made woman in the world is a fascinating story. However, Winfrey’s first venture as an entrepreneur, a cable TV show called “People Are Talking,” which ran from 1978 to 1982, was not successful. Winfrey started the show as a way to connect with her audience, particularly people from the African-American community. People Are Talking was the first African-American syndicated daytime talk show on cable TV. However, the show was not rated high enough to continue with the network. After the show ended, Winfrey’s career was in jeopardy. She had been making plans to leave the show and start a new venture. But now, with no job and no friends in the TV industry, Winfrey decided to start her own company: Harpo Inc., a production company that would focus on making TV shows. Thanks to Winfrey’s determination, her company grew from strength to strength and became one of the largest producers of talk shows in the world.
Broadcast.com, an audio and video streaming platform, was created by Mark Cuban in 1995. The site was the first Internet streaming company to offer users audio and video content from ABC, NBC, and ESPN among others. As a result, the company saw a huge spike in its valuation. Cuban sold Broadcast.com to Yahoo for $5.7 billion in 1999. However, the dot-com bubble burst soon after the deal was signed, and Broadcast.com’s value plummeted to $1 billion. In 2000, when the dot-com bubble had burst, it became difficult to find investors who would fund Broadcast.com. Cuban had to provide the company with $100 million in funding. Despite the huge setback, Cuban continued to run the company. He managed to turn the company’s fortunes around, and Broadcast.com became Yahoo! Audio.
Failure is inevitable in life, especially for entrepreneurs. Entrepreneurship is a risk-taking journey, and it is typical to find yourself in situations where you have to go back to the drawing board and try again. However, it is important to remember that even the world’s most successful people have had their fair share of failures. Instead of letting the past hold you back, learn from your mistakes and make better decisions moving forward.