Don't be afraid to fail early
I was speaking to an entrepreneur in our portfolio who was going through a major pivot and asked him how he was feeling given the last few months of dealing with the business model change, jittery investors, confused employees, etc. We believe in the entrepreneur and continue to back him.
His reaction was that he is more charged than ever now. He has realised his past mistakes, has learned from it. He believes his BIGGEST MISTAKE WAS NOT PIVOTING EARLIER. He believes that the problem he set out to solve with his earlier company still exists, it is a large problem that needs to be solved. However, the approach to the problem has to be a lot more differentiated and focused. He understands the quality of revenues matter. They should be recurring and profit yielding. Customers need to love the product at a price/cost that allows the company to build a profitable franchise. He has spent time internally speaking to his employees and explaining to them the rational of the pivot and everyone seems to be on board with the new direction the company has taken. While I am hopeful that the new direction will work, but what is clear is that the old business was not working and the faster there was realisation around this, the better.
Many entrepreneurs face the problem of product-market fit. It is the nature of company creation. When I was an entrepreneur, I faced it and had to adapt/innovate very quickly. If I didn't, I wouldn't have survived. Many times, the difference between a failed and successful entrepreneur is not smarts or passion. It is intellectually honesty with themselves and their team early in the company's lifecycle that their current business is hitting a wall, and perception/intuition to figure out a new opportunity that can leverage the companies capabilities to create a sustainable enterprise.
I tell most entrepreneurs I meet - "Don't be afraid to fail early if you think it is not working." Admitting failure sooner can save a lot of time and capital and help direct energies towards potential problems that may be solvable. And even if you cannot think of a pivot, it is better to fail fast and do something meaningful with your life as the scarcest resource we have in our lives is time!
His reaction was that he is more charged than ever now. He has realised his past mistakes, has learned from it. He believes his BIGGEST MISTAKE WAS NOT PIVOTING EARLIER. He believes that the problem he set out to solve with his earlier company still exists, it is a large problem that needs to be solved. However, the approach to the problem has to be a lot more differentiated and focused. He understands the quality of revenues matter. They should be recurring and profit yielding. Customers need to love the product at a price/cost that allows the company to build a profitable franchise. He has spent time internally speaking to his employees and explaining to them the rational of the pivot and everyone seems to be on board with the new direction the company has taken. While I am hopeful that the new direction will work, but what is clear is that the old business was not working and the faster there was realisation around this, the better.
Many entrepreneurs face the problem of product-market fit. It is the nature of company creation. When I was an entrepreneur, I faced it and had to adapt/innovate very quickly. If I didn't, I wouldn't have survived. Many times, the difference between a failed and successful entrepreneur is not smarts or passion. It is intellectually honesty with themselves and their team early in the company's lifecycle that their current business is hitting a wall, and perception/intuition to figure out a new opportunity that can leverage the companies capabilities to create a sustainable enterprise.
I tell most entrepreneurs I meet - "Don't be afraid to fail early if you think it is not working." Admitting failure sooner can save a lot of time and capital and help direct energies towards potential problems that may be solvable. And even if you cannot think of a pivot, it is better to fail fast and do something meaningful with your life as the scarcest resource we have in our lives is time!
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