We need knee pads
Fear of failure is a common emotion when stepping into entrepreneurship. A lot of very good talks share the mantra of embracing failure not as failure alone but as a completely natural part of the learning curve. By failing we learn how not to do things. But there is a big problem in this process. More often than not we fail without having a clue why we failed.
In the past two years I’ve seen dozens of projects and founders completely ignoring experiments and sticking to their feelings, beliefs and confidence in market analysis. When those projects failed, the greatest frustration in my eyes was not failure itself, but the complete and clueless lack of any understanding as to why failure occurred. Unfortunately the founders were not sharing that frustration, they instead stared at failure as if it came out of nowhere.
Failure is a punch in the face. Bill Gross had a fantastic talk summarizing his adventures while starting more than 125 companies over 18 years and taking a shot at explaining what are the key variables that make or break a new venture. In that talk he borrowed a quote from Mike Tyson saying “Everybody has a plan until you get punched in the face”.
The question is not how to avoid the punch, but how to incorporate it in the normal, expected and predictable business cycle. Instead of working hard trying to avoid failure, which in the end turns to lowering risk and making less risky bets, we should work hard to incorporate failure and look at it the same way we look at education. When investing in education, the question is not “will educating our employees raise our revenue by X” but rather “what will happen if we don’t invest in our employees”. With failure the question is not “how much money will we lose if we fail” but rather “how much money will we lose if we don’t innovate”.
The key ingredient for innovation is failure. Every experiment starts with the natural expectation of failure. And entrepreneurship is an experiment. There are no guarantees. No gut feeling or nice wishes. Entrepreneurship is a repetitive punch in the face.
Jerry Colonna talks about surviving the startup life by calling it “Standing still while your hair is on fire”. The questions of “What do I do?”, “What is the right choice?”, “How will I do it?”.
So the main obstacle to embracing failure as a natural business process is the emotion we associate with it – fear. Fear on the other hand is a combination of knowing that a negative result will come upon executing a certain action and the simple yet powerful lack of knowledge of what will happen. Knowledge and experience are the key ingredients that help us minimize the fear of the unknown, leaving only the fear of a certain negative result. By eliminating the fear of the unknown and substituting it with experimenting, we make sure our focus while experimenting is not success, but rather learning – increasing our knowledge and experience.
By incorporating predictable and quantifiable failure in our business cycles, we’re able to to actually measure failure. My thesis here is that failure should eat out the education budget in companies. All the money companies throw into education without any measurable results should instead be thrown into experiments. With each experiment we’re able to create a controllable environment where failure is expected and understood, which in turn makes it an invaluable source of knowledge.
Jeff Bezos has an amazing story from the early days of Amazon.com that summarizes the relentless drive and focus taking over when pursuing a goal. While packing orders is the late hours, working on the hard floor and on their knees, Jeff turned to a colleague and complained about the pain in his knees and back. In what he called a moment of stupidity, he said “You know what we need? We need knee pads!”. His entire talk is available here.