How to deal with startup failure. A personal story

I have failed in as many startups as I have been successful.

Since I tend to tinker a lot, I have also failed at many of my side projects. In fact I have the distinction of not having succeeded in any of my side projects in the last 4 years (4 side projects).

If however, you count the lessons learned, I have been enriched.

The first project was an idea that was going to provide “price transparency”. The site was registered as I had a team of 2 build it, got a prototype ready, did a lot of leg work to understand the products the site should give your pricing information about. But I never launched it. I realized that building stuff is rather easy, but I feared it was too small a feature for people to take notice. 6 months later Priceonomics was launched. I am not privy to how they are doing but its a good start.

Ship early. Your product will have a lot of bugs. Ship early. It wont be perfect. Just ship the product. You will feel miserable about the fact that its not “quite ready”. Ship it already. Get people to use it or at least give you feedback. Ship.

I also failed at an eCommerce company. Technically it is still going, but I was a miserable failure at it. I just was not prepared for the rough and tumble of both managing real “inventory” or lots of blue collar suppliers. I hired too quick, did not manage expectations well, and had negotiated a very poor deal with the investors. The capitalization table was so messed up, that no new investor was willing to fork up money for the company. There were way too many lessons I learned but the most important was work with people you like and trust.

These are recent (last 1 year). Let me tell you about my first failure.

I left Univ of Maryland, (Baltimore County) in 1994 to head to California for a startup. Fresh out of college, I was not quite a rockstar programmer that I thought I was. The first project required me to get up to speed on a language (Visual C++) that I was unfamiliar with and a functional area (procurement) which I did not comprehend. 4 months into a “delivered” prototype, the client kicked us out. The entire project had to be rewritten because we built a very buggy prototype. The company failed. I was not even sure what I learned at that point. Except maybe I needed more experience and I needed to be a better developer. That experience colored my judgment on services companies though. I never wanted to build a consulting company after that.

For all the young, newly minted graduates who are going down the entrepreneurial journey – Celebrate your first failure. Take your friends out for a lunch or drinks. Share what you learned. After that dinner / lunch forget about that failure but write down what you learned. Email it to yourself but leave it unread. Archive it. Open it after 2 years. If you dont laugh at that email you sent to yourself, I will send you a free t-shirt. Get a job at a startup where you can learn from someone else making mistakes.

If I could tell you one thing I wish I knew now that I did not know when I failed at those things, it would be: I am happier I failed. Not when I failed, but much later. I felt awful after each failure, but moved on.

Nobody cares that you failed. Except you.

Think about the last time anyone at an interview asked you if you got an F in school.

38 thoughts on “How to deal with startup failure. A personal story”

  1. Awesome article. Thanks for sharing it. One must take a leap of faith and get going. If you succeed you increase wealth and if you fail you add to your wisdom.

    Back in highschool (2001) a couple of friends and I started working on an educational portal (basic education ERP) during our summer break. We approached school principals and spoke to them about our portal and how it would help both teachers and students. Everyone said comeback after the break was over. After the break we went on to do our graduation (in diff streams) and when the principals called we said we had abandoned our project. Lesson learnt if you have an idea execute it or else you will always regret when someone else does it :).

  2. Excellent points, Mukund. Great lessons for all of us! Especially the ones about shipping early and managing expectations. Many of us are guilty of not doing those well enough…

  3. Excellent points, Mukund. Great lessons for all of us! Especially the ones about shipping early and managing expectations. Many of us are guilty of not doing those well enough…

  4. Hi,

    I like to seek an advice from you :). I left my job last September to join my buddy in a startup. Things wasn’t going too well at the initially stage, but we strives to go on. But to keep ourselves a life, we took on part time jobs. Now we are still with the part time jobs and our startup is moving slowly even thou there are expressed interest in our product. 3 more months it would be a year. I do not want to drag on yet at the same time how can I let me buddy know that we are slowing down?

    Thank u!

      1. hi mukund,

        it was real eye opener to read your article..main also same story of bryan lee…..need your inputs….confusedddddddddddddddd………………………..

  5. young entrepereneurs(read after toling for 2 years straight after college) have no where to go in India..its a taboo..deserted by famliy.booed by friends and they cannot even get a job coz they do not have so called relevant “work ex”.Their sprits are demoralized. 😦

      1. Sadly we never made one sir ,the headers are scary work experience, responsibilities(we did every thing market research,fund raising,marketing, networking et al).

  6. Good Post.. Every one faces failure at some sort of entrepreneur Journey some in initial stages, some in middle and some fail to release product and some fail to market and some fail to do business. Out of all its all how Entrepreneurs take Failure. Your post clearly presents how to take failures as learning lessons rather than taking failures as failures and get into negative thoughts. and Finally with out Failure , we cant define ” Success ”



  7. ever step taking for or in a startup venture is lucid with fact of what to do when !
    but as said it is also necessarily imp to know quickly on what not to do when !

    Also has i have noticed that after taken a startup know how (after college) people or rather entrepreneurs ready take you in, if you can present them with relevant parallel thinking

  8. Hi Mukund,

    Again a piece of gem from you!!! . Failure is the new Success :-). I would suggest to put FB ‘Like’ Button so that people can openly ‘Like’ your posts 😀

  9. Hi Mukund.. great post like always, what is your view on learning from others mistakes, lean startup, risk minimization and blah blah blah.

    my first start-up tanked very badly mostly because we did a classic mistake of not talking to customers first and focusing on the product only. wish someone who had done this mistake earlier told us about it.

    1. Learning by reading about a mistake made – 5% value.
      Learning by listening to another person telling you about their mistake – 10% value.
      Learning by watching and seeing another person make a mistake – 50% value.
      Learning by making your own mistakes – priceless and invaluable.

  10. Great article mukund
    this week it seems my startup(the one i work for) might wind off.. it was a small two months affair where we built the prototype and it is going down..
    for just out of college fresher, i can totally relate to your post.. 🙂
    -keep writing

  11. Thanks for sharing your failures. Very few people does that.

    My question is:When does one know that their startup has failed? Entrepreneurs don’t give up easily.

    For example, me and my partner started working on an idea in feb 2011. We launched the prototype in June 2011. By Aug we realized it’s not going to work out the way it is. We either have to add more features or pivot. we decided to pivot by narrowing down our customers. From “for anyone who loves to cook” to “housewives who take cooking classes n take cake orders from home”. By Dec next prototype was ready. We didn’t launch it but have been showing it to selected customers. 2/10 are interested 2/10 are interested only in the store(just a part of the product).

    Its June again and we still don’t have 10 paying customers. I feel like accepting failure(though i strongly believe in my idea) and moving on to another idea. But my partner isn’t comfortable with failures n wants to keep working.

    Should we keep working?

    1. A startup has failed when the entrepreneur gives up. That’s its according to me. Giving up on doing the startup is different than giving up on your original idea. Its normal for an idea to not have traction quickly or for the original idea to have flawed assumptions. If you give up on your startup that’s failure, but if you keep changing the idea to keep going (or pivot as its fashionably called now), you are technically still going at it and cannot be called a failure.

  12. You should check out
    I use it to send myself emails on my future birthdays.

  13. Hi: This made a good read. We live in a culture that reveres success and the “F” word is taboo. Failure as a reality is never dealt with, mentioned, or learnt from. Its as if it doesnt exist. Its funny how in organizations – due to the fear of taking a hit on performance ratings – meeting after meeting we find people who are crowing about the fantastic things being accomplished. I believe this is so unrealistic. First and foremost, not everything is equivalent to launching rockets in space – so a little perspective is needed to attribute only as much greatness as is warranted – for the job that has been accomplished. A reality check if you will.

    Second of all – its so blindingly obvious that even with simple tasks – people stumble and fumble their way through work/life. I live in anticipation and eternal hope that eventually a day will come when people are comfortable enough, honest enough, to simply admit – “hey I goofed up, I didnt see that coming”. Am absolutely certain a bolt of lightening will not strike the person down!!!

    The day this begins to happen in organizations – where just as accomplishments are listed out, in the same manner when people are able to speak about failures so that it becomes a learning for the rest – without fear of reprisal, a new breed of organization/teams will be born. A new kind of thought leadership that does not exist today will be born.

    Failure is like a medal that one needs to wear – a medal thats awarded for having fought hard, the scars of battle if you will. In the dramatic words of Robert Browning “Ah, but a man’s reach should exceed his grasp, or what’s a heaven for?”

    If we never took risks, if we never lost, if we never experienced failure, if we never picked ourselves up after a fall – we wouldnt be the multi-dimensional, awesome beings that we are. And not speaking about failure – is to box the rich experiences that have made us who we are and ensure it never enriches another on their journey to their destination. Its like throwing away the key to a treasure. What a shame that would be. And a colossal waste of a teaching point of view!!!

      1. Sorry, didnt mean to ramble on. Didnt realize how much i had to say on the topic 🙂

  14. My question is that anytime in your experience did u feel that u shud not b a programmer nd something else ??
    I mean any failure which made you feel all your learnings are not useful

  15. Sir,I want to humbly ask,in your opinion is an entrepreneur there to prove to himself or to the world ?coz in the begning when we start we have bringing the next revolutionary product but if things do not materialize towards the end we soothe our selves by saying “its my failure only”.

  16. Everyone fails at something or the other. Entrepreneurs only more so. People think that successful entrepreneurs are perfect in everything, but they are only good at hiding their failures.Of course, they are not afraid of failures either. Failure teaches us a lot. It sort of handhold’s us. I am happy to see your attitude on the most important thing in this world.

Comments are closed.