So there I was; my first board meeting as the CEO of the company I co-founded was going to start in about 45 minutes and I was still in my car in the parking lot reviewing my presentation one more time. Actually I was splitting my time between reviewing my slide deck and frantically flipping through Finance for Dummies looking for the page on how to understand a balance sheet!
You see, the company I had co-founded two years prior was on the verge of failure and we had just undergone what is affectionately referred to in the high tech world as a “restart”. This is a simplistic way of saying you made way too many mistakes and it’s time to press the corporate reset button, promote anyone left standing and try again.
We hired too fast, missed critical customer feedback, failed to learn how to sell the product before building a worldwide sales channel and failed to deliver customer critical features. By all rights we should have turned out the lights, closed the doors and walked away. But we didn’t.
Instead, we took stock of what we had learned, swallowed our pride and started to rebuild. We systematically looked at each of the things that had gone wrong and tried to learn from them as we started to put the pieces back together. The result was that we built a terrific organization that was leaner, faster and more successful at delivering the right product, in the right way to the right customers. The lessons learned from our early failures fundamentally shaped the path we went from that point forward.
Fail fast, fail often is more than a catchy phrase; this is the way of life for an entrepreneur. In the span of the last five days at the University of Michigan we had three very successful and respected entrepreneurs repeat this phrase in one way or another: Rick Snyder mentioned it during his speech at the first Distinguished Speaker Series of this semester last Friday. So did RJ Pittman, Director of Search at Google in his presentation the day before. Even Marissa Mayer, VP of Search Product and User Experience at Google repeated it in her fantastic presentation she gave on Monday of this week.
A key point, however, to keep in mind is that failure as an entrepreneur does not always have to be the near-death experience that my early stage company encountered. It can, and should be part of the natural consequence of risk taking that leads to rapid innovation.
I just left a great meeting with a great group of early stage companies incubating in a basement in downtown Ann Arbor. These early stage companies have in a very short amount of time achieved very early success in both commercialization and customer validation and some are even ramping towards significant revenue! You might ask: “Doesn’t this violate the model?” “What happened to fail fast, fail often?”
The answer is simple… they fail all the time… you just don’t see it. They are constantly adjusting their business and technology to react to what they learn. They are not afraid to try a new approach to solve a problem and if it doesn’t work out? They learn from that and try again. Sometimes all within the same day!
The end result is they are building very good companies and learning at a rapid pace. Look out Ann Arbor, there is a whole new generation of seasoned entrepreneurs coming your way – ones that are not afraid to take risk, to try bold ideas and yes, even to fail!