Serial entrepreneurs are well known for their resilience and ability to overcome business mistakes – Suggesting there is no need to fear failure. Matt Smith, Director at the Centre for Entrepreneurs, discusses why serial entrepreneurs are less afraid of failure than one-time founders.
Can unfortunate professional experiences, or even business failure, lead to success?
Certainly, according to a research report we recently completed in partnership with Coutts – Beyond the first business: the myths, risks and rewards of being a serial entrepreneur.
We found that a number of entrepreneurs enjoy multiple business successes after experiencing closure in their first few businesses.
What’s more, our research shows that negative past experiences in the workplace provide important lessons for business success.
Often failure is feared, and viewed as something to be avoided – But our findings show that the experience of failure can actually help drive success.
What matters is ‘how’ entrepreneurs deal with their mistakes and experiences of business closure.
Indeed, serial entrepreneurs are often more confident in their abilities than one-time founders, due to the very fact that they have tested them repeatedly.
Serial entrepreneurs are clearly less afraid of business failure. According to our survey data, only 13% of serial entrepreneurs reported fear of failure, compared to 40% of one-time founders.
The report confirms that successful serial entrepreneurs absorb these experiences, learn from them, and go on to found further businesses that are less likely to fail.
Serial entrepreneur Shamus Hasheer – who has started various companies in the chemical, medical, instrumentation technology, finance, and fashion sectors – has experienced multiple business exits and closures.
Reflecting on his experiences of closure, Shamus maintains that if a business is inadequately profitable, “you should get out instead of chucking more money at it.”
While giving up on an idea might be difficult, closure means “understanding that sometimes the market just isn’t what you think.”
Shamus’ first business grew out of his undergraduate research and taught him that proven academic research is not always commercially viable.
“The technology we developed would have saved the chemical industry millions, yet they simply weren’t interested,” he explains.
He also experienced another closure in the fashion industry and further explains that: “Although we hired a successful model to head our marketing, and tests had demonstrated the effectiveness of our technology, the sector wasn’t ready.”
Certainly, failure in the appropriate way and for the right reasons is nothing to be ashamed of.
But failing due to human factors, conflicting personalities, and arguments, for example, is when entrepreneurs should be concerned, since, as Shamus explains, “you know that if you had done things differently, success might have been possible.”
A Learning Curve
Dealing with human factors in business is something Rachel Bell – an award-winning serial entrepreneur – has learned to prioritise.
Treating people the right way and placing them at the heart of a business is important to success. And Rachel’s continuous business successes can be partially attributed to her focus on people power.
Before becoming an entrepreneur, Rachel took on job roles where she felt unrewarded and unvalued.
But such experiences provided important lessons, as Rachel explains: “Without those experiences, I’m not sure I would have felt so passionate about Shine’s values, so I can’t say I regret them.
“I am focussed on delivering the antithesis of that.”
This has encouraged Rachel to treat employees in the way that she wanted to be treated in employment – Placing high importance on cultivating long-term relationships, providing opportunities for career progression and ensuring that her employees feel appreciated.
She says: “I set out to give people a place where they could do their best work, where they could feel valued and heard.”
Growing from your own experiences, both good and bad, is part of the learning curve.
A Rite Of Passage
Experience of business failure is a fundamental rite of passage on the path to success and could actually be the key. If you never make mistakes, you don’t learn from them.
So perhaps failure isn’t something to fear after all.