Aspiration & Struggle
How to Bounce Back From Failed Businesses
There’s no shortage of generic entrepreneurship advice. Something along the lines of “take a leap—quit your job and start a business” is fairly standard. But this doesn’t paint a realistic picture of entrepreneurship. In fact, it ignores a harsh reality: failed businesses are very common.
Is Entrepreneurship Right for You?
It’s easy to lust after the idea of having the freedom, flexibility, and potential to create wealth. But what about the long nights, the big risks, and the uncertainty?
To do it right, you have to understand what you’re getting into. Starting a business is hard, and you could fail. This warning does not mean that you shouldn’t consider entrepreneurship, but it does point to the necessity of knowing what you’ll do should your plan flop.
Lessons Learned From Failed Businesses
Toni Husbands has wise words for aspiring entrepreneurs, but she gained this insight after traveling a tough road. She purchased a laundromat, thinking it would be a turnkey: cost-effective to run and a way to work in her community.
“The business required more time and money to run than expected,” she explains. It closed after gas leaks were discovered and the repair costs were too high.
Toni, who now serves as a financial coach and runs Debt Free Divas, recommends starting small if you want to get into entrepreneurship. If you’re purchasing an existing business, she also stresses that you should get advice from professionals who aren’t affiliated with the transaction.
Despite the failed business, Toni encourages others to give their ideas a chance. “Don’t be afraid to try,” she says. “[This business] didn’t work out, but we have so much more experience now. Rather than experiencing shame, I’m bolstered by what we were able to accomplish in those 10 years. Our next venture can only be improved by the knowledge that we gained.”
Starting Over With a New Business
“My business was an online consumer electronics store,” says Grayson Bell. “During the holiday season, I would rarely sleep and just worked through the night to get orders out and fix issues. This not only hurt my health, but also my relationship with my wife. I didn’t eat well and didn’t spend time with my friends or family.”
Looking back, he says he should have hired someone to help him run the business—and he shouldn’t have funded the venture with his credit cards. He wrote about his “$10,000 mistake” on his blog, Debt Roundup, and says that the business was mostly responsible for the $50,000 in credit card debt he accumulated.
Grayson shut down that business, but he’s still an entrepreneur. He created a service-based business, iMark Interactive, that provides WordPress maintenance and support. “This business is a passion of mine, and I’ve grown it with completely grassroots marketing,” he says.
Grayson champions a take-it-slow approach. “If you’re not sure of the viability of the business, then start it on the side. This can help you prove the model and tweak it for the time you want to go full time.”
Know When to Call It Quits
Everyone makes mistakes. One of the most important skills to develop is the ability to know when to keep trying and when to let something go. No one wants to give up, but you may find yourself in a situation where you’re hanging on to a business that is clearly going nowhere. If that’s the case, then it’s time to fail—followed quickly by picking yourself up and trying again.