This Startup Failure Story Is All Too Common. How I Finally Turned Mine Into a Successful Exit

Each entrepreneur has a failure story like this. About 12 years in the past, I based a startup referred to as ExitEvent. I used to be within the early levels, however the thought was strong: Create a multi-sided market for the startup ecosystem.

I had already began two profitable corporations, one in all which I used to be nonetheless operating. The ExitEvent thought wasn’t a brand new one. It was one thing that I had been constructing and reshaping for years, ready for the precise second when all of the items got here collectively to show it right into a scalable enterprise.

When that second occurred, I knew precisely the place to go. I introduced the thought to a possible companion, a corporation that will be an ideal preliminary backer. The pinnacle of that group acquired it instantly. Or a minimum of I assumed they did.

What occurred subsequent is a narrative about enterprise failure, but in addition about methods to flip failure into success. Sure, failure could be a good factor. And whereas lots of people discuss studying from failure, they by no means let you know methods to do it. Here is my story a couple of failed enterprise deal and the way I acted on the teachings I discovered.

Over the following few months, the strategic companion and I hammered out a deal framework, and I constructed the infrastructure for {the marketplace}.

After I arrived on the ultimate negotiation session, with the deal paperwork in hand, the temper was totally different and there have been new folks within the room. My abdomen instantly sank to my sneakers. I knew immediately.

“Not once more. Not this one,” I stated to myself.

However sure, once more. And sure, this one.

This one which I spent method an excessive amount of time on. This one for which I had put my present enterprise in danger, going as far as to show down new enterprise, as a result of my time can be taken up by this new, shiny factor.

I acquired instructed the partnership deal wasn’t going to occur. I acquired instructed what may occur can be a advertising and marketing partnership, and one that will solely serve the very best pursuits of the companion whereas I scratched out income by myself.

It was not the primary time this occurred to me. However this time, I lastly discovered methods to flip a slammed door into an “open window.” How? I got here up with a three-step course of that I nonetheless comply with in the present day with each failure to not solely salvage and study from errors but in addition to make use of that failure as a stepping stone to success. Here is the way it performs out.

I am not making an attempt to persuade you that perception in your thought is 99 p.c of the important thing to success. It is not. It is extra like 1 p.c. Perhaps much less.

However that perception is necessary, as a result of when large fails occur, your religion in your thought  will probably be shaken to the bottom.

You want to get your head again into the place it was earlier than the failure. You are not going to succeed by executing another person’s interpretation of your thought. If somebody does not perceive your thought, do not allow them to change it to suit their mould.

Certain, you possibly can trim your plans to get began or customise to get a proof-of-concept to market. What you possibly can’t do is surrender on what may have been. You may have to have the ability to settle for rejection and stroll away.

I strongly believed that ExitEvent wasn’t meant to be a advertising and marketing machine, so I by no means pursued the advertising and marketing partnership they had been providing.

To study from your individual errors, you may need to have a look at three key options:

1. Your product
2. Your pitch
3. Your market

First, to study what’s unsuitable along with your product, rewind to the place you had been earlier than you bought off your authentic path, and examine your product then along with your product now.

What occurred to me was my very own fault. To get the companion excited, ExitEvent turned an excessive amount of like what already existed, sufficient in order that the companion may take up it as a turnkey answer of their very own.

It turned simple for them to get right into a mindset of, “We’ll both construct it ourselves or purchase a less expensive carbon copy.” All that “further stuff” I used to be proposing was new and distinctive and, thus, dangerous.

I had erred in selecting a companion that was simple to promote into, and I molded my authentic product to work for them. However, if ExitEvent was going to work as meant, I wanted to lean into that new, distinctive, and dangerous stuff.

And pursue a unique type of enterprise companion.

Second, study what’s unsuitable along with your pitch. To do that, I took myself out of my companion’s mindset, so to talk, and put myself of their prospects’ mindset. I spotted that as my product advanced into one thing that will swimsuit the companion, my pitch did too. After which I made a decision that I wanted to market towards the very folks I used to be making an attempt to companion with.

For instance, for example you have developed a model of Coca-Cola that is truly wholesome for you. It seems, smells, and drinks like Coke, however it’s as innocent as water and likewise filled with nutritional vitamins. (Congratulations. You are wealthy now.)

However do you are taking your invention to the Coca-Cola company and inform them you may make Coke more healthy? If they’ve any enterprise sense in any respect, they’ll disappear you earlier than you permit the constructing.

No. You are taking them on. You turn out to be the anti-them.

Third, study what’s unsuitable with the market. Each good product is a brand new and stylish answer to a long-time embedded drawback. The lesson that this failure hammered house was that each incumbent out there goes to struggle that answer till that answer turns into inevitable.

Your answer turns into inevitable provided that you assault the issue the way in which the market views it. The winner is the startup that modifications probably the most buyer minds the quickest.

I took my learnings and picked two new and fully totally different targets.

The primary goal was my authentic companion’s prospects. To them, I marketed onerous towards the established order. That labored, as a result of it performed on the very flaws with the companion that they wanted my answer to repair.

The second goal was a corporation type of like my authentic companion, however one that did not want my answer, as a result of they had been already doing high quality with out it. For now. I did not promote to them, however I allow them to know ExitEvent existed, and that I used to be open to no matter type of advertising and marketing partnership they felt may gain advantage them.

This technique proved two issues:

I did not want a enterprise companion to make my answer attainable, I wanted their prospects. And if my answer was credible, I may get them myself.

The very advertising and marketing partnership that the unique companion dangled was legit, so long as the deal was not one thing that will wind up altering my authentic thought.

The second goal, an even bigger group, acquired ExitEvent three years later.