In a perfect world every business would succeed, but in reality that is not the case. In fact, more businesses fail than succeed, so chances are if you do take that leap of faith in creating a business, there is a good chance that your business just won’t make it. Like anything worth doing, there is inherent risk in starting a new business venture and even with perfect planning, some things just don’t work out.
While I am not trying to discourage you from starting a business, I just wanted to put the facts on the table. You will hear many publications speak of businesses failing, but what happens to the entrepreneurs after their business fails? You don’t hear a lot about those situations, but we’ll talk about it today.
So, your business has failed, so now what? Chances are that you are suffering from a potpourri of emotions including disappointment, anger, fear, sadness and maybe some depression. While I speak so much on this blog about keeping emotions out of the business equation, when your business fails you will be feeling a whole bunch of them. Realistically no one likes to lose and in these cases you didn’t win, right?
Recovering from a business failure can be a long or short road depending on many factors including:
- Length of time that you were in business
- Magnitude of the failure
- Circumstances of the failure
When I look at the instances where my businesses have failed, I really have used the time to learn about the events that lead up to the failure, changes I could have made and signs that I missed reading. I look at is as an educational experience where I had the opportunity to really dig into what happened and extract some nuggets of knowledge. From my own experience there are five steps to recover from business failure.
Just like losing a loved one there is a grieving time for a business. Sure, we don’t have a funeral to commemorate the great times we had, but the truth of the matter is that you had a lot invested in your business. If you are like most entrepreneurs chances are you poured your heart, soul and life into the business to make things happen. It was something that you had on your mind whether you were working, at home or on vacation. In many respects your business would have been as important as any other family member and I bet it was hard to see it go.
So take some time to grieve over the loss of your creation. This might mean taking a break, getting away from home, or just having some time to reflect on your life. By taking this time you give yourself the opportunity to digest what had happened and how you will move on in your life without your business.
Take as much time as you need but I would also advise that you don’t take a long time for the grieving process – you will still have a life that needs your attention.
2. Learn from your Mistakes
The one positive thing that you will benefit from because of your failure is the opportunity to learn from your mistakes. By examining your business and what lead up to the failure you can gain some valuable insights as to how you can run a successful business. The experience gained from this process will be invaluable as you move forward and create your next business, though reflecting on what happened can be tough.
In order to get the most you can out of this experience you should try to stay emotionally detached. Ideally we want to analyze things as mechanically as possible and emotions will just cloud the wisdom you could gain from this process.
It is also important that you go through this process as a means to learn and not an exercise to blame circumstances or people for the failure. Placing blame is not going to benefit you at all and irrespective of why the business failed pointing a finger at someone or something isn’t going to benefit you at all.
3. Pick Yourself Up
Many people who have failed at business have had their faith in their abilities shaken. This can put them in a position where they feel scared to try again. But I suggest that you take a look in the mirror. Do you see what I see? The entrepreneur that has a passion to succeed. Sure, your last business venture didn’t quite work out, but that doesn’t mean that there isn’t another opportunity out there that you will excel at.
The truth of the matter is that I can’t tell you that you can do it again – you need to believe it. For myself all I had to do was look at some job wanted ads to remember why I chose to be an entrepreneur in the first place – I wanted the freedom to choose my own destiny and provide for my family in a way that didn’t make me a slave to a 9-5 job.
So take a look in the mirror and do what you need to do to remind yourself why you went on the crazy journey of being an entrepreneur in the first place – when you do remember, you will be charged up for your next venture.
4. Try, Try Again
I suppose the last step here is pretty obvious, but take your new found wisdom and drive and start something new. This doesn’t mean that you have to start a huge business, but get out there and just do something. The ideal project would be something where you can have some kind of measurable milestones that are attainable. Each time you achieve one of your goals you will find that your confidence will increase and your drive will as well. For myself, each goal I achieved only fueled my drive that much more and reminded me that running a business can be fun and rewarding.
As entrepreneurs we are driven to succeed in business but sometimes those businesses fail. But in these instances we can find opportunity to grow and gain experience to help us on our future endeavors. The recovery process takes time as we grieve, learn from our mistakes, remind ourselves why we are in business and strike out to try again. In the end these failures can be positive milestones in our entrepreneurial careers – they are not the end of the road as they are merely speed bumps on our journey.
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