How to Overcome a Fear of Failure
I find softball in Central Park daunting. I strike out all the time, but I am inspired by the book Moneyball and look forward to my time up at bat. Success at a startup can have similar strikeouts. Prior to launching my company, Lexion Capital, I knew the grim stats. After five years, 39.6 percent of finance, insurance, and real estate companies will be out of business. And it isn’t just my industry; 41.1 percent of retailing companies will close, 47.6 percent of services companies will fold, and 48.4 percent of manufacturing companies will shut their doors.
What is the best way to overcome a fear of failure? Cultivate the confidence to be able to embrace failing and to learn how to pivot when things don’t go your way.
Step 1: Acceptance
Remember when you first learned to ride a bike? No one expected that you would get it right away. In fact, people expected that you wouldn't. That's why there are training wheels (and nowadays, helmets, knee pads, elbow pads, etc). Similarly, there are business plans, beta launches, and feedback before you launch for real.
Accept that you don’t have all the right answers right off the bat. But with time, the training wheels could come off. When you learned how to ride a bike, you learned how to brake and that leaning left or right helped around corners. How? You’d fallen a few times, gotten back on, and figured it out. I don't bike through the pretty trails of Illinois anymore; I'm now on the mean streets of NYC. Like anyone, I do sometimes fear falling--but the key to success is knowing that if I fall, I can simply get back up.
In other words, what goes down does indeed come back up. You will be able work out the kinks in your business. And just like riding that bike, you always need to watch out for cars and other unforeseen business obstacles. The hurdles ahead will constantly change, and you need to remain agile and focused.
Step 2: Adjustment
Sometimes even the best-laid plans need some tweaking postlaunch.
I know a group of entrepreneurs who dreamed of creating the perfect neighborhood spot to meet for drinks. New to the bar business, they focused their enthusiasm and attention on the creative end of their endeavor, the menu planning, styling, and aesthetic details that would comprise their scene. It was amazing--on the surface.
Behind the scenes, their plans were not as airtight. They laughed off some of the tried-and-true tricks of the trade, like measuring bottles of alcohol by weight to prevent employee theft, because at the time, it seemed preposterous that such a thing could bear any significant consequence on their bottom line. They were wrong. Nothing was monitored, and their upscale martini lounge was very popular but not profitable.
Faced with failure, the team members were forced to take a good, hard look at basic business facts. They made adjustments to optimize and reduce expenditures and adopted the standard practice of measuring bottles by weight. Things slowly started to turn around.
Though everything they had focused on had succeeded, the essential foundation of their business failed. But the group managed to channel that failure productively, learning from its stumble rather than letting it trip it up completely.
Step 3: Adaptation
Failure needn’t lead to extinction. Animals use adaptation to survive in their ecological niche or habitat, and so can you.
I have a dear friend who opened a restaurant, totally beating the organic, free-range foodie trends here in NYC. He was a trendsetter, but in some ways, his concept was too early and too costly. On the brink of going under, he examined his books and realized that his most successful aspect was catering, a very minor focus. So he switched focus.
I'm happy to report that as a specialty catering business, his company thrived. Though his initial concept, in restaurant form, was not right for the mass market at the time, he unwittingly tapped into the perfect niche market: early, enthusiastic tribes of organic foodies who proved evangelistic about his farm-to-table fare. Not only is he still in business today in a notoriously fickle industry, he has even expanded as a supplier to restaurants that serve organic specialties.
Did his restaurant fail? Yes. But when he reviewed that failure through a strategic, creative lens, he saw the seeds of a different successful business. One that has grown several streams of revenue and allows him to do what he loves and believes in.
He fell, but he got right back up.
ELLE KAPLAN | Columnist | CEO, Lexion Capital Management
A finance expert and self-made entrepreneur, Elle Kaplan is the CEO and founding partner of Lexion Capital Management, the only 100 percent woman-owned asset management firm in the U.S.