by Staff | August 7, 2019Business Entrepreneurs
Every entrepreneur will face failure at one point or another, just as there is no way to avoid every single mistake in life. If you are going to start a business at any level, you need to prepare and accept that and overcome it.
No companies have ever been majorly successful upon the first iteration and without any issue – regardless of those started with huge funding or lack thereof.
As most businesses will fail within 5 years, the statistics are not in the favor of entrepreneurs, With such a high ratio of failure, it’s imperative to learn from the other’s mistakes, as experience is the best teacher.
Here are the best failures to go through.
1. Going Bankrupt
The biggest cause of death to any company is the lack of profitability. Period. Money makes companies thrive or fail, and failing to rise to a profitable level leads to bankruptcy.
Going bankrupt is not the end of the road and doesn’t mean the end of business. It could mean restructuring is needed. It’s an experience that teaches about money management, budgeting, and how to organize business.
2. Getting Sued.
Every company will get a cease and desist letter eventually, especially if you’re in the high tier raking in huge profits. Getting sued is a learning experience that every entrepreneur needs to navigate. This involves either hiring a lawyer or responding directly to inquiries.
Whatever the case may be, getting sued can teach a lot about business law, and how to deal with letters that may be predatory in nature. Settlements, court cases, and much more become easier to handle down the road once you experience at least one lawsuit.
3. Hiring The Wrong People.
How do you know if an employee will be good or not? Hire bad ones. That’s right, hiring bad employees will allow you to create a checklist of what you don’t want.
Obviously, no one wants to hire the wrong person, but the experience will reveal holes in your hiring process as well as business plan, leading to modifications, and eventually the right people will apply and get on board with the company’s vision.
These failures aren’t going to necessarly collapse any businesses. Entrepreneurs just need to fail to experience the joy of success. Without failure, learning becomes stifled.