Why Failing Fast Is the First Step Towards Success

If at first you don't succeed, you're right on schedule.

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By Dan Blacharski

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Thomas Edison once said "I have not failed. I've just found 10,000 ways that won't work."

Entrepreneurs who have failed should take heart as they are in good company. And some of the largest companies in the world -- who you would think might know better -- have failed and failed big.

When Coca-Cola tampered with their classic formula and created "New Coke" in 1985, the public outcry was so enormous that the original formula was restored after just 79 days. There's no doubt that New Coke was an epic fail -- but out of the ashes of the soft drink industry's biggest failure rose a market for many new Coke flavors that still exist today. Still, New Coke was such a monumental disaster that to this day, whenever any company suffers a product launch fail, they refer to it as their own "New Coke."

When SellMax, a company that purchases used cars with locations throughout the United States, came up with the idea of providing a centralized service for people to sell their used cars quickly, they started out in 1990 buying about 15 cars a month, and they were fully self-funded. Today, they buy between 800 and 1,200 cars a month. SellMax co-founder Tony Porter attributes the company's phenomenal growth to "failing fast and scaling fast." At the beginning, funding was a major issue for Porter and his partners, who were each putting in over 80 hours a week. They learned from their failures and mistakes. "We weren't afraid to try different marketing strategies, many of which turned out to be unsuccessful," said Porter. "But, when we found a strategy that worked, we scaled it quickly, ramping up the volume very fast."

Related: 4 Career Failings You Should Forgive Yourself For

When the fail is out of your control.

Those failures may come from unexpected sources which are out of your control, and often halfway around the globe. When SellMax first started out, their focus was on buying junk cars and recycling them for scrap metal. "But after the Chinese market dropped, the scrap metal prices went down drastically, so we had to pivot and push into the direction of buying nice newer cars," said Porter.

Home Depot also made a major mistake in China when they wanted to expand the homeowner Do-It-Yourself market to the People's Republic. The shop does well in the U.S., where fixing things around the house is a common hobby, and fixing and installing one's own household fixtures and appliances is even seen as a sign of manliness. In China however, it is seen as a mundane task of the lower classes and a sign of poverty.

Mattel made the same mistake in their epic fail in China, when in 2009, they sought to introduce Barbie to little Chinese girls with a 36,000 square foot Barbie emporium, as well as a Barbie-themed bar for adults in Shanghai's retail district. Chinese parents, who tend to focus more on educational and skills building toys, failed to see the value in blond-haired, blue-eyed dolls, and the thrill of sitting in a Barbie-themed boozery drinking pink "Barbie-tinis" just didn't capture the Chinese imagination the way they thought it might.

Related: The Path to Big Success Is Giving Your Team Permission to Fail

Building failure into your business model.

Former Apple Chief Evangelist Guy Kawasaki famously said, "don't worry, be crappy." By that, Kawasaki was not advocating the manufacture of a new crop of Edsels and New Cokes, but rather, an environment in which innovators are free to fail as part of the discovery process. The concept of "Minimum Viable Product" (MVP) is one firmly rooted in innovation, and on building stronger and more successful products by examining the failures, limitations and flaws of current ones.

Related: Why Experience Makes You Fearless

After Edsel, Ford kept on making cars. After Mattel's flop in China, they kept making Barbies. And after the scrap metal market killed SellMax's original business model, they pivoted and came up with a new concept that led to record growth. A NASA flight controller said "failure is not an option" during the mission to bring Apollo 13 back to earth, and the catch phrase has been used by ambitious businesspeople ever since. But starting a business isn't like a NASA space mission, and not only is failure a valid option, it is almost a necessity to recognize it as part of your own evolution. Those who have never failed haven't done so because they are great businesspeople -- they have never failed because they have never taken a risk.

Success in business isn't measured by a ratio of losses versus wins, with those who win all the time coming out ahead. In reality, business failures are just a basic fact of life, and a steppingstone to a winning strategy.

Dan Blacharski

Author of

Dan Blacharski is a thought leader and PR counsel to several Internet startups. He is author of the book "Born in the Cloud Marketing: Transformative Strategies for the Next Generation of Cloud-Based Businesses."

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