What can cause a new business to fail?
The way to success? Fail!
As I write these lines, I am considering starting a new business. And think of failure from a theoretical and practical point of view. Not that this hasn't happened to me yet: I had a startup that stole half of my wealth, and I have a company that consumed the other part - and maybe didn't pay back any income. So why take the risk of possible failure again?
If you look at popular literature, it's simple: many successful people had to fail before they achieved their professional goals. If Howard Schultz had given up after 244 bank rejections, there would be no Starbucks today. Walt Disney, who had problems with a lack of creativity at school and was therefore fired from his first job, received 302 no before someone said yes to the funding of Disneyland. Colonel Sanders, founder and logo figure of Kentucky Fried Chicken, had to fail 1009 times before someone found his fast food concept worth promoting. Illustrious minds like James Dyson, who claims to have built 5,216 prototypes before his vacuum cleaner worked, are fighting for the record for failure. Or Thomas Alva Edison, who always proudly proclaimed that he had found 6,000 ways in which a light bulb did not work (other sources even speak of 10,000).
After these (successful) stories, failure is part of the learning concept. And in fact, successful people are likely to learn only from failure - because successful people were often successful before. Just think of the story of Steve Jobs, who brought Apple to the stock exchange at the age of 30, was a multiple billionaire - and then went terribly wrong with the Macintosh strategy. And again with Next Computer - a company for which I was trying to get representation rights at the time. And got it too. We sold fewer than a handful of these expensive devices (today's price would be over $ 10,000), and no one made a profit from Next.
Obviously, success in the past is no guarantee of success in the future. Success in the sense of growth, achievement of ambitious goals or the fulfillment of expectations (investors, business plans) will increasingly come from innovations in the future, especially in the area of new business models. But nobody has tested this before, there are no empirical values. That is why innovators have to try these business models - and there is a high probability that they will fail. Because innovative business models don't work the first time, often not the second time, sometimes never. PayPal co-founder Max Levchin put this in a nutshell: "The first company I founded failed with a big bang. The second a little less bad, the third failed again properly. The fourth company already survived. That the fifth was PayPal. "
People who are the first to break new ground can only rely on themselves. Nobody has yet followed their path. Therefore they have to try and look for new solutions. It would be presumptuous to assume that these paths always lead directly to the goal or enable the desired solution. To call this a failure is simply wrong: They are learning experiences and the results of experiments. Really, only those fail who do not even try. The experimenter learns, he gets smarter and smarter and finds the prototypes that don't work - until, hopefully, the right solution emerges at some point.
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