What role does failure sometimes play in entrepreneurial success? What can an entrepreneur gain from failure?

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Thomas Edison famously noted, in reference to the many times he attempted to develop the incandescent light bulb but came up short, “I have not failed. I’ve just found 10,000 ways that won’t work.” Similarly, the late senator and former Attorney General of the United States Robert F. Kennedy commented that “Only those who dare to fail greatly can ever achieve greatly.”  Edison and Kennedy, as well as the others throughout modern history who strove to excel in life, were making the point that, without failure, success was sometimes impossible to achieve.  The process of trial and error has lied behind most of history’s greatest achievements. It is the rare individual talent who can succeed on the first try without having to have first experienced failure.  Principles of business are no different.  Entrepreneurs, by definition, assume considerable risk in the pursuit of their dreams.  By accepting greater levels of risk, they are gambling on greater rewards should their business pursuits prove successful.  Edison understood that great discoveries or inventions did not come easily; otherwise, everyone would be routinely making such discoveries or succeeding in inventing better mousetraps.  It was only through a protracted period of trial and error that he was able to perfect the invention that revolutionized the way people illuminate their surroundings.  History’s greatest entrepreneurs all knew at the outset that they were launching themselves down uncertain paths, and that financial ruin could result.  That they were willing to accept those risks and persevere was testament to their personal fortitude and determination to achieve their goals.  The most successful entrepreneurs do not penalize their research and develop staffs for failing to prove concepts; they reward their initiative and help to redirect those personnel when warranted.  Only through the willingness to accept failure as part of a learning process can objectives be attained.  Henry Ford, racial attitudes aside, was a brilliant entrepreneur without whose efforts the automotive industry may not have developed into the colossus it eventually did.  As Ford himself stated regarding the willingness to risk failure and accept it as both inevitable and beneficial, “The only real mistake is the one from which we learn nothing.”

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Even business schools tend to value applicants who have tried and failed in a business venture over those who have tried and succeeded.  So failure is valuable not just conceptually but even in reality as well.

A failed venture in business often yields valuable and painful lessons that are very difficult to forget for those who started the enterprise.  Because failure is so instructive, it helps the future businessman or woman to understand exactly what they shouldn't do the second time around.  This knowledge is immensely valuable in later efforts.

So this learning that takes place more effectively in a failure leads to future success in helping entrepreneurs to avoid previous mistakes and to focus on what worked rather than on what didn't.

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