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Saturday, December 15, 2012

Microsoft Flops and Failures

Microsoft is one of the most successful companies ever - few people worldwide (likely not including third world...) complete a day of work without touching or using something that is somehow based on Microsoft technology - except maybe a handful of die-hard Apple groupies.

But along the way, as we all know and realize all too well, Microsoft has managed to fail miserably, again and again - and to fail in market spaces it should have understood better than anyone else on the planet...

Here are some "nostalgic" :-) examples of Microsoft flops and failures:

1) 1982-1990 - Windows 1.0, all versions up and leading to Windows 3.0 (for a brief history of the Windows O/S - click here)
2) 1995 - Microsoft Bob...According to Fast Company: "Childish, convoluted, ridiculous, despised." Yup. Part of an entire strategy called "Microsoft Home" that flopped badly at the time; IMHO it was also before its time, and before the hardware to support Redmond's vision existed - or was commercially viable...
3) 1997 - Clippy aka "Office Assistant" - probably the most ridiculed tech product in history.
4) 1998 - the infamous "Blue screen of death" - now, is that any way to treat a customer??
5) 2002 - Mira Smart Display - personally, had never even heard of this one...
6) 2003 - Windows Mobile - I was invited to and attended the Silicon Valley launch in San Jose. Looked exciting, the launch certainly was... But it was deathly, deathly slow... Quickly crushed by a slew of more advanced and better designed operating systems from RIM and Apple (and later also Android from Google). Killed in 2010.
7) 2006 - Zune. Brought out their own MP3 player only about eight years after the RIO MP300 (a device I had bought at Fry's, used for a couple of weeks and foolishly returned. With only about 60 minutes worth of music it wasn't practical - but I wouldn't mind owning it for history's sake...). For a history of MP3 devices check out Wikipedia - actually harks back to 1981!!
8) 2007 -Windows Vista....yikes....

Of course there was also Win95, Win NT...and if we dig deep we'll be sure to find a handful of additional flops.

Microsoft will soon be celebrating four decades of tech leadership, believe it or not.

Just goes to show you that to create a legacy of success - you have to try and try and try, and inevitably you will fail. Many times over, if you try hard enough. The important thing is to know to pick up the pieces, learn your lessons, and keep ploughing forward.

Comments? Hit the comment button below, or, better yet - join the conversation on the Linkedin Anatomy of Failure group.

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Wednesday, December 12, 2012

A Collection of Quotes on Failure and Success

"A Quote-a-day keeps failure away..." :-)
Erik A. Steiner, Innovator and Entrepreneur

Oct 23, 2013

"Failure isn't fatal, but failure to change might be."
John Wooden, American Basketball player and coach

Oct 22, 2013

"Success is never permanent, and failure is never final."
Mike Ditka, former American football NFL player, television commentator, and coach

Oct 21, 2013

"Make failure your teacher, not your undertaker."
Zig Ziglar, Motivational Speaker

Oct 20, 2013

"Failure is a detour not a dead end street."
Zig Ziglar, Motivational Speaker

Oct 19, 2013

"I am always doing that which I cannot do, in order that I may learn how to do it."
Pablo Picasso, Artist

Oct 16, 2013

"Failure is the price of excellence."
Leonard Pitts, Jr., Pulitzer prize winning commentator

Oct 12, 2013

"We learn from failure, not from success!"
Bram Stoker, Author (Dracula!)

Oct 11, 2013

"When I was young, I observed that nine out of 10 things I did were failures, so I did 10 times more work."
George Bernard Shaw, Playwright

Oct 10, 2013

"Our greatest fear should not be of failure, but of succeeding at something that doesn't really matter.”
Dwight L Moody, Evangelist

Oct 9, 2013

"I thrive on failure. I thrive on things that are not perfect. It sends me back into the ring to get it right.”
Tom Ford, Designer

September 8th 2013

"Persistence can change #failure into extraordinary achievement."
Matt Biondi, Olympic Athlete, Swimmer

Dec 19, 2012

"Many people dream of success. To me succes can only be achieved through repeated failure and introspection. In fact, success represents the one percent of your work that results from the ninety-nine percent that is called failure."
Soichiro Honda, Engineer, Founder of Honda Motor Company (aka "Honda")

As quoted in The Power of Failure: 27 Ways to Turn Life's Setbacks into Success

Dec 15, 2012

"Failure is the foundation of success, and the means by which it is achieved."
Lao Tzu, Philosopher

As quoted in The Power of Failure: 27 Ways to Turn Life's Setbacks into Success

Dec 14, 2012

"The Achilles heel of failure: hindsight is 20/20."
Erik A. Steiner, Innovator and Entrepreneur

Dec 13, 2012

This time, a poem... IF by Rudyard Kipling

IF

If you can keep your head when all about you
Are losing theirs and blaming it on you;
If you can trust yourself when all men doubt you,
But make allowance for their doubting too:
If you can wait and not be tired by waiting,
Or, being lied about, don't deal in lies,
Or being hated don't give way to hating,
And yet don't look too good, nor talk too wise;

If you can dream---and not make dreams your master;
If you can think---and not make thoughts your aim,
If you can meet with Triumph and Disaster
And treat those two impostors just the same:.

If you can bear to hear the truth you've spoken
Twisted by knaves to make a trap for fools,
Or watch the things you gave your life to, broken,
And stoop and build'em up with worn-out tools;

If you can make one heap of all your winnings
And risk it on one turn of pitch-and-toss,
And lose, and start again at your beginnings,
And never breathe a word about your loss:
If you can force your heart and nerve and sinew
To serve your turn long after they are gone,
And so hold on when there is nothing in you
Except the Will which says to them: "Hold on!"


If you can talk with crowds and keep your virtue,
Or walk with Kings---nor lose the common touch,
If neither foes nor loving friends can hurt you,
If all men count with you, but none too much:
If you can fill the unforgiving minute
With sixty seconds' worth of distance run,
Yours is the Earth and everything that's in it,
And---which is more---you'll be a Man, my son!

Rudyard Kipling, short-story writer, poet, novelist



Dec 12, 2012

"Only he who does nothing makes no mistakes."
French Proverb

As quoted in The Power of Failure: 27 Ways to Turn Life's Setbacks into Success

Dec 9, 2012

"He that is overcautious will accomplish little."
Friedrich von Schiller, Poet, Philosopher, Historian and Playwright

As quoted in The Ten Commandments for Business Failure

Dec 8, 2012

"For this is the tragedy of man-circumstances change, but he doesn't."
Machiavelli, Historian, Politician, Diplomat, Philosopher, Humanist and Writer

As quoted in The Ten Commandments for Business Failure

Dec 2, 2012

"In order to succeed, your desire for success should be greater than your fear of failure."
Bill Cosby, Comedian


Dec 1, 2012

Referring to every well-educated person, Charles Kettering, one of America's greatest inventors and innovators of all time, said, "...it is not a disgrace to fail, and that he must analyze each failure to find its cause...must learn how to fail intelligently. Failing is one of the greatest arts in the world. One fails towards success."
Charles Kettering, Inventor
Quoted in Whoever Makes the Most Mistakes Wins


Nov 12, 2012

"Being successful is kind of dull."
Nolan Bushnell, founder of Atari
Quoted in Whoever Makes the Most Mistakes Wins
Nolan Bushnell


Nov 11, 2012

Tom Crouch writing about the Wright Brothers...
"They were as excited about failure as they were by success."
(from The Bishop's Boys: A Life of Wilbur and Orville Wright)
The Wright Brothers
Tom Crouch

Nov 10, 2012

"One must be God to be able to distinguish successes from failures and not make mistakes."
Anton Chekov

Nov 9, 2012

"Good men are still liable to make mistakes, and are sometimes warmly engaged in errors, which they take for divine truths, shining in their minds with the clearest light."
John Locke

Oct 29, 2012

"If there is a single tragic flaw that mars our biggest enterprises, it is conservatism - the failure to fail, and fail big, in an era of unprecedented volatility and ambiguity."
Tom Peters Oct 17, 2012

"Failure in Innovation - it's a price worth paying."
Tim Harford (from: Adapt: Why Success Always Starts with Failure . New York, Farrar, Straus and Giroux. 2011)

Oct 15, 2012

Man has been writing of failure since biblical times. Here we go back to the time of Aristotle, to a controversial quote that I do not believe does justice to reality:

"It is possible to fail in many ways...while to succeed is possible only in one way."
Aristotle, Nichomachean Ethics, II, 6

Oct 14, 2012

"I was never afraid of failure; for I would sooner fail than not be among the greatest."

John Keats, one of the greatest and most important poets in the history of mankind - born in 1795, he died so so young, only 26. One hesitates to think what Keats would have accomplished in a full lifetime...the following are ruminations from a letter written to one James Hessey on October 8, 1818:

"The Genius of Poetry must work out its own salvation in a man: It cannot be matured by law & precept, but by sensation ad watchfulness in itself - That which is creative must create itself - In Endymion, I leaped headlong into the Sea, and thereby have become better acquainted with the Soundings, the quicksands, & the rocks, than if I had stayed upon the green shore, and piped a silly pipe, and took tea & comfortable advice. I was never afraid of failure; for I would sooner fail than not be among the greatest."
John Keats

Oct 13, 2012

Mark Zbaracki, at the time a professor at NYU, wrote a nice little piece titled "Success, Failure and the Race of Truth" for the Journal of Management Inquiry back in September of 2006. Thought I'd pull a nice quote from there:

"...those moments when life sends us sliding along the pavement or tumbling over the handlebars are gifts, opportunities for clarity..."
Mark J. Zbaracki

Oct 12, 2012

Here's John Adams writing on failure in 1755 (!):
(I received this newest volume from the Library of America today - the man was only twenty years old when he inferred and wrote the following and much more. Incredible. The strange spelling, capitalizations etc. as in the original text)

"If we look into History we shall find some nations rising from contemptible beginnings, and spreading their influence, 'till the whole Globe is subjected to their sway. When they have reach'd the summit of Grandeur, some minute and unsuspected Cause commonly affects their Ruin, and the Empire of the world is transferr'd to some other place. Immortal Rome was at first but an insignificant Village, inhabited only be a few abandoned Ruffins, but by degrees it rose to a stupendous Height, and excell'd in Arts and Arms all the nations that praeceeded it. But the demolition of Carthage (what one should think would have establish'd it in supream dominion) by removing all danger, suffer'd to sink into debauchery, and made it att length an easy prey to Barbarians."
John Adams, Revolutionary Writings, 1755-1775

"There is the greatest practical benefit in making a few failures early in life."
T H Huxley, On Medical Education (1870)

Oct 10, 2012

"83 percent of Chief Executive Officers fail."
Lucy Kellaway, writing for the Financial Times Oct 9, 2012

"Failure is good. It's fertilizer. Everything I've learned about coaching I've learned from making mistakes."
Rick Pitino, NBA Coach

Oct 8, 2012 - Today I've decided to start up a compendium of my favorite quotes on failure - I'll be making a valiant attempt to post one-a-day (A quote a day keeps the failure away?? :-)

Here's the first one for you all - from the creator of Peter Pan no less:

"We are all failures - at least, all the best of us are."
J. M. Barrie

Just came across this on Gotham so here's another one for today:

“Ever tried.
Ever failed.
No matter.
Try again.
Fail again.
Fail better."

Samuel Beckett

Monday, December 3, 2012

Sunday, December 2, 2012

In an excellent NYT article from January 2011 Jay Goltz lays out his top 10 reasons for small business failure.

The short list (for the even shorter list just follow through the underlined phrases...):

  • Business is mathematically challenged - i.e. insufficient demand, too much competition.
  • Owners do not step down when time comes.
  • Sometimes less is more.
  • Poor accounting.
  • Cash flow (btw #1 reason businesses fail overall...).
  • Operational mediocrity.
  • Operational inefficiency.
  • Dysfunctional management.
  • Lack of succession plan.
  • Declining market.

    For a deeper analysis, head over to Goltz's excellent article + bonus insightful comments from his readers.
  • Thursday, November 29, 2012

    The late Zig Ziglar on Failure

    Zig Ziglar died yesterday, November 28th 2012, at the age of 86. One of the greatest sales leaders and motivational speakers of all time, Zig built a following of millions anchored in a publishing and speaking empire that spanned continents. I hear he was a pretty good guy all around.

    Zig Ziglar wrote, "Remember that failure is an event, not a person."

    Doesn't that just capture the whole essence of failure??

    Zig Ziglar obituary at The Examiner.

    Tuesday, October 23, 2012

    Tom Peters thought for the day

    "At every Exec Group meeting, set aside a 15-minute block to discuss a "dumbest thing we've done lately" item—insist that members bring a case along for discussion." See the original post here.

    Monday, October 22, 2012

    Friday, October 12, 2012

    Shades of Failure

    "And what color is the sky?" I ask my three-year old* in that cutesy voice parents reserve for their children. "BLUE!!" comes the unequivocal reply.

    We've all been conditioned to see the world in unequivocal terms. The sky is blue, trees are green, roses are red… I was not surprised to find that a majority of people associate failure with the color - think about it for a moment - yes, black. Success is most often associated with the color white. We wear black to attend funerals. Brides wear white dresses to their wedding. But are things really that simple? No. Consider that in many cultures the dead are dressed in white. And grooms often wear a black tuxedo to their wedding. Bridal gowns are not always white. And not everyone dons a black suit to a funeral.

    Black and white are extremes. Just like the sky isn't blue, there is an infinite spectrum of shades and colors between black and white.

    So what color do you most associate with failure now? Is there really such a thing as complete and utter failure, a failure so grave that we could only color it in solid black?

    Tell me, I'd love to hear from you.

    *My daughter is now 16...this was written back in 1999 while I was still at Stanford.

    Thursday, October 11, 2012

    More on VC Failure - The Kauffman Foundation Report

    A reader recently shared the Kauffman Foundation report, and it's quite an incredible piece of testimony against the VC industry...

    The Kauffman Foundation is a $2 billion foundation and one of the 30 largest philanthropic foundations in the United States. Kauffman focuses on two goals: advancing entrepreneurship and improving the education of children and youth.

    Over the past 20 years the foundation had invested in approximately 100 different VC funds, and therefore has a unique set of statistics on the performance of the VC industry. The results of Kauffman's analysis are staggering in their implications:
  • Since 1997, investors poured more cash into VCs than VCs had distributed to investors (!)
  • Only 20% of venture funds managed to beat the market by more than 3% annually
  • 62% of funds failed to exceed average market returns (!!)
  • The average VC fund FAILS to return investor capital (!!!)

    There is a lot more of interest in this report to anyone that has anything at all to do with start-ups, entrepreneurship, innovation and investment.

    To access the full report, click here.

    To view a video explaining the foundation's findings, click here and then click on the video link.

    As could be expected this report received widespread coverage, here are some of the more prominent analyses and discussions:
  • Geekwire
  • cnet
  • CNN
  • Monday, October 8, 2012

    Can Apple keep churning without Jobs? Will Apple fail?

    From the Guardian:

    The post-Jobs Apple has a different flavour under Tim Cook
    A year after Steve Jobs's death, the replacement for the seemingly irreplaceable co-founder has made the company more ethical – and yet more profitable

    A Compendium of Quotes on Failure

    Dec 9, 2012

    "He that is overcautious will accomplish little."
    Friedrich von Schiller, Poet, Philosopher, Historian and Playwright

    As quoted in The Ten Commandments for Business Failure

    Dec 8, 2012

    "For this is the tragedy of man-circumstances change, but he doesn't."
    Machiavelli, Historian, Politician, Diplomat, Philosopher, Humanist and Writer

    As quoted in The Ten Commandments for Business Failure

    Dec 2, 2012

    "In order to succeed, your desire for success should be greater than your fear of failure."
    Bill Cosby, Comedian


    Dec 1, 2012

    Referring to every well-educated person, Charles Kettering, one of America's greatest inventors and innovators of all time, said, "...it is not a disgrace to fail, and that he must analyze each failure to find its cause...must learn how to fail intelligently. Failing is one of the greatest arts in the world. One fails towards success."
    Charles Kettering, Inventor
    Quoted in Whoever Makes the Most Mistakes Wins


    Nov 12, 2012

    "Being successful is kind of dull."
    Nolan Bushnell, founder of Atari
    Quoted in Whoever Makes the Most Mistakes Wins
    Nolan Bushnell


    Nov 11, 2012

    Tom Crouch writing about the Wright Brothers...
    "They were as excited about failure as they were by success."
    (from The Bishop's Boys: A Life of Wilbur and Orville Wright)
    The Wright Brothers
    Tom Crouch

    Nov 10, 2012

    "One must be God to be able to distinguish successes from failures and not make mistakes."
    Anton Chekov

    Nov 9, 2012

    "Good men are still liable to make mistakes, and are sometimes warmly engaged in errors, which they take for divine truths, shining in their minds with the clearest light."
    John Locke

    Oct 29, 2012

    "If there is a single tragic flaw that mars our biggest enterprises, it is conservatism - the failure to fail, and fail big, in an era of unprecedented volatility and ambiguity."
    Tom Peters Oct 17, 2012

    "Failure in Innovation - it's a price worth paying."
    Tim Harford (from: Adapt: Why Success Always Starts with Failure . New York, Farrar, Straus and Giroux. 2011)

    Oct 15, 2012

    Man has been writing of failure since biblical times. Here we go back to the time of Aristotle, to a controversial quote that I do not believe does justice to reality:

    "It is possible to fail in many ways...while to succeed is possible only in one way."
    Aristotle, Nichomachean Ethics, II, 6

    Oct 14, 2012

    "I was never afraid of failure; for I would sooner fail than not be among the greatest."

    John Keats, one of the greatest and most important poets in the history of mankind - born in 1795, he died so so young, only 26. One hesitates to think what Keats would have accomplished in a full lifetime...the following are ruminations from a letter written to one James Hessey on October 8, 1818:

    "The Genius of Poetry must work out its own salvation in a man: It cannot be matured by law & precept, but by sensation ad watchfulness in itself - That which is creative must create itself - In Endymion, I leaped headlong into the Sea, and thereby have become better acquainted with the Soundings, the quicksands, & the rocks, than if I had stayed upon the green shore, and piped a silly pipe, and took tea & comfortable advice. I was never afraid of failure; for I would sooner fail than not be among the greatest."
    John Keats

    Oct 13, 2012

    Mark Zbaracki, at the time a professor at NYU, wrote a nice little piece titled "Success, Failure and the Race of Truth" for the Journal of Management Inquiry back in September of 2006. Thought I'd pull a nice quote from there:

    "...those moments when life sends us sliding along the pavement or tumbling over the handlebars are gifts, opportunities for clarity..."
    Mark J. Zbaracki

    Oct 12, 2012

    Here's John Adams writing on failure in 1755 (!):
    (I received this newest volume from the Library of America today - the man was only twenty years old when he inferred and wrote the following and much more. Incredible. The strange spelling, capitalizations etc. as in the original text)

    "If we look into History we shall find some nations rising from contemptible beginnings, and spreading their influence, 'till the whole Globe is subjected to their sway. When they have reach'd the summit of Grandeur, some minute and unsuspected Cause commonly affects their Ruin, and the Empire of the world is transferr'd to some other place. Immortal Rome was at first but an insignificant Village, inhabited only be a few abandoned Ruffins, but by degrees it rose to a stupendous Height, and excell'd in Arts and Arms all the nations that praeceeded it. But the demolition of Carthage (what one should think would have establish'd it in supream dominion) by removing all danger, suffer'd to sink into debauchery, and made it att length an easy prey to Barbarians."
    John Adams, Revolutionary Writings, 1755-1775

    "There is the greatest practical benefit in making a few failures early in life."
    T H Huxley, On Medical Education (1870)

    Oct 10, 2012

    "83 percent of Chief Executive Officers fail."
    Lucy Kellaway, writing for the Financial Times Oct 9, 2012

    "Failure is good. It's fertilizer. Everything I've learned about coaching I've learned from making mistakes."
    Rick Pitino, NBA Coach

    Oct 8, 2012 - Today I've decided to start up a compendium of my favorite quotes on failure - I'll be making a valiant attempt to post one-a-day (A quote a day keeps the failure away?? :-)

    Here's the first one for you all - from the creator of Peter Pan no less:

    "We are all failures - at least, all the best of us are."
    J. M. Barrie

    Just came across this on Gotham so here's another one for today:

    “Ever tried.
    Ever failed.
    No matter.
    Try again.
    Fail again.
    Fail better."

    Samuel Beckett

    Sunday, October 7, 2012

    A Case of Collossal Failure - Premier Cigarettes, $325 million "burned"

    Up until the 1950s cigarettes were not generally deemed to be unhealthy - during the Second World War, soldiers routinely received cigarettes as standard issue...

    But by the late 1970s and early 1980s, the outcry against smoking, led by US Surgeon General C. Everett Koop, was reaching new highs daily... (interestingly Dr. Koop sported his own failure in the dot.com boom days of the late '90s with "drkoop.com," one of the first decent sites to provide health information to the masses - sold for fractions of a penny and now part of healthcentral.com, but I digress...). In his most controversial commentary Dr. Koop actually compared the addictiveness of cigarettes to heroine and cocaine!

    Needless to say tobacco companies, not knowing yet that smokers will continue smoking even when death stared them straight in the face from the packaging, nor aware of the vast opportunities awaiting them in eastern Europe and in Asia - well, they panicked. And panic makes the smartest people do the dumbest things.

    In 1982 RJR began research on a new type of smokeless cigarette - Premier. The idea was to quiet the outcry by eliminating second-hand smoke - Premier was supposed to burn discretely based on an internal heat generator, and therefore produce no smoke if at all (see picture, and for greater detail visit "Premier - The 'smokeless' cigarette").



    The device was "based on a superheated piece of carbon. Sucking on the cigarette pulled hot air from the glowing carbon through a filter of tobacco and around an aluminum "flavor capsule" that released nicotine and smoke taste, which then passed through a regular filter and into the smiling, satisfied mouth of the consumer." (Steinberg, 1994, A Complete and Utter Failure, p. 23).

    As Steinberg delineates beautifully in his entertaining treatise, Premier was very problematic or several reasons:
  • Premier couldn't be lit with a regular match or even with a regular lighter - one needed to purchase special butane lighters, not typically readily available
  • Enjoying Premier required reading through and understanding a 4-page instruction booklet...
  • Even when properly lit, it was extremely difficult to draw anything out of the cigarette, which required Herculean sucking capabilities
  • They tasted bad...and smelled worse - as reported by users, who said it reminded them of burning plastic...
  • They presented a fire hazard...since it was difficult to tell when the Premier stopped burning, it was dangerous to discard...
  • Premiers cost more...
  • Perhaps the biggest problem was that, since RJR - or any other tobacco company, really - could not and would not admit that smoking represented any kind of health hazard whatsoever... - it could not advertise that it was "healthier," or indeed that it lacked the smoke that causes cancer... (RJR repeatedly used the word "cleaner" hoping that smokers would subconsciously substitute "healthier...")

    The product was introduced in October 1989. Surgeon Koop immediately pounced on it as a "drug delivery system" sending the FDA after RJR... Reportedly RJR executives were hoping that "health advocates would embrace Premier as a healthful alternative to real cigarettes." (Steinberg, 1994, A Complete and Utter Failure, p. 25)

    Premier was discontinued in February 1990, barely five months after their introduction, leaving RJR with a $325 million bill...

    Did RJR execs, or anyone for that matter, learn anything from the Premier failure?

    A last quote from Steinberg, because it's too good to leave out: "Maybe they (RJR exeutives) learned that consumers might be interested in a cigarette that wouldn't kill them, provided it didn't taste like shit and you could light it with a match." (Steinberg, 1994, A Complete and Utter Failure, p. 26)

    Read more about the Premier fiasco and other entertaining and educational consumer product failures and flops in Steinberg's excellent and often hilarious book, A Complete and Utter Failure: A Celebration of Also-Rans, Runners-Up, Never-Weres & Total Flops
  • Monday, October 1, 2012

    Top Ten Reasons "Green" Entrepreneurs Fail

    Startup Pro, an award winning blog run by Martin Zwilling, has published an interesting list of the top ten reasons first time entrepreneurs fail. I don't necessarily agree with everything Zwilling writes, but it's definitely a lot of food for thought!

    The Power of Failure

    Charles C. Manz is a professor at U Mass who focuses on the study of leadership. In 2002 Profesor Manz published a nice little book on The Power of Failure: 27 Ways to Turn Life's Setbacks Into Success - while the book is more of a motivational treatise and not an academic, research-based analysis of the subject, Manz emphasizes a lot of important and valuable lessons, as one would expect from a tenured U Mass prof.

    Old world, old economy failure used to be all about not performing, falling short, being inept, forgetting, neglecting - "A bad, bad thing that should be avoided, mourned and punished."

    How refreshing that failure in the new economy has come to mean something altogether different! Today failure is seen as "a stepping stone to success, an opportunity for learning and development, an opportunity for creative change and innovation."

    Go forth and fail as in failure you will find the seedlings of your next successful venture!

    Saturday, September 29, 2012

    Why big companies fail to innovate...

    This goes straight to an old argument my father and I always get into. He comes from a VERY BIG company backgroud (Emerson Electric, Norden, Rafael), and I'm an entrpreneur who has worked mostly with small, nimble, innovative companies. The argument - in case you're wondering - is about why large companies almost never come up with the really big innovations.

    A nice new blog series from HBR, Why Big Companies Can't Innovate, provides some good rationale in my support.

    How frequent is bank failure?

    Marketwatch reported on September 28th 2012 that First United Bank is the 43rd bank to fail in the US this year!!!

    First United Bank is 43rd 2012 U.S. bank failure

    However, if that sounds like a lot, turns out that on average 70 banks fail in the US annually... Problem Bank List does us all a favor and track all bank failure news.

    One can pull practically any and all bank failure data from the FDIC database, as an example see this table displaying all US bank failures from 1990 to date.

    The FDIC maintains and regularly updates a failed bank list

    The St. Louis Fed issued an interesting report on bank failures, analyzing bank failures between 2007 and 2010 but providing extensive graphical analysis of bank failures more or less from the beginning of the 20th century to date. The report is titled The Geographic Distribution and Characteristics of US Bank Failure (download).

    BigThink ran a nice piece on Why Banks Fail—And Why They Fail on Friday back in 2010.

    The Failure of Government Programs

    If there is one entity that fails to learn consistently, it's government.

    The crux of national policy for most if not all western governments over the past century has been to improve equality among their citizens (aka "voter base...").

    Yet almost without fail... (pun intended...) - the result has been the exact opposite.

    Paul Ormerod, in his terrific analysis of failure across all segments of government and industry, Why Most Things Fail: Evolution, Extinction and Economics , provides some telling statistics on the progress - or lack thereof - of government policies worldwide:
  • The role of the government and direct involvement in the economy has grown considerably in every western country from 1950 to 2000
  • In 2000, Subsidies for the poor, welfare, tax breaks etc accounted for almost 20% of EU countries' national income
  • Even in the uber-capitalistic US of A approximately 10% were spent on such items
  • Overall, in the EU gov't spending accounted for as much as 48% of national income - 36% in the US

    Yet equality in western nations is on the decline!

    In other words, billions and trillions of dollars are being spent on programs that are failing.

    Does it look like western governments are drawing the necessary conclusions from such failures? Are they LEARNING? Not that anyone can tell, as widely accepted economic equality indices such as the Gini coefficient continue to increase.
  • Friday, September 28, 2012

    Why Start-ups Fail

    Back in mid-2000, as the first dot.com bubble was imploding, Philip J. Kaplan wrote a wonderful little book called F'd Companies: Spectacular Dot-com Flameouts (highly recommended, and not just for the educational content, it's an amusing read!!)

    In his introduction Kaplan delineates, sarcastically - as he does so well...a paragraph full of reasons why companies fail:
    "Why'd They Fail?"
  • too early...
  • too late...
  • too expensive...
  • too cheap...
  • too big...
  • too much competition...
  • to much supply...
  • not enough demand...
  • management...

    I love Kaplan's description of management...pick up the book to find out more.

    In the next few posts we'll be going more in depth into each of the reasons above. Would love to hear more from you.

    Although fuckedcompany.com is history (why??), you can still follow Philip J. Kaplan masquerading as @pud on twitter.
  • Thursday, September 27, 2012

    WSJ Reports on the top 50 startups - let's start tracking!!

    WSJ has published its annual list of the top 50 start-ups, I believe for the third year running. Titled Looking for the 'Next Big Thing'? Ranking the Top 50 Start-Ups, the annual list is gaining quite a following, and is proving to be a good predictor of future success. Ten of last year's "top 50" have already managed impressive exits, six through IPO and four through acquisitions.

    "Steiner on Failure" will be following the 2012 list to see how well this year's team fares, how many of these companies fail over time - and what we will be able to learn from their failures.

    Sunday, September 23, 2012

    Israel - Extremely Low Startup Failure Rate Reported

    As many of you know, the start-up scene in Israel is especially vibrant - for example, although it is one of the smaller countries worldwide, Israel is #3 on the NASDAQ after the US and China...

    It should therefore come as no surprise that the failure rate for start-ups in Israel is extremely low. The Israeli Central Bureau of Statistics released data on 2,047 companies operating in the realm of research and development between 2003 and 2008. The data set included companies in the following market spaces: semi-conductors, biotech, medical devices, communications, clean tech and electronic components.

    Of the 2,047 companies analyzed, 1,746 (85%) were categorized as start-ups; of these fully 1,222 started up during the term examined. Five years later, 488 of 547 companies that had ceased to exist were startups. Of the 1,222 companies started up from 2003 to 2008, only 35% had failed!

    As a comparison:
  • In Britain 33% of new businesses fail during the first three years.
  • In the US fully 55% of new businesses are out of business by the end of their fifth year of life

    For more on the success of the Israeli start-up community I highly recommed Start-up Nation: The Story of Israel's Economic Miracle
  • The secrets of my failure: Why ‘winning’ is not our natural state

    Adam Fletcher penned a nice piece on failure for Venture Village, syndicated by VentureBeat - it's titled The Secrets of my Failure.

    btw on the subject of failure in scientific research - less than 5% published - that means more than 95% fails, right? Wrong - because much of the 5% published is manipulated.

    A couple of good books on the subject of error (aka failure) in scientific research and elsewhere are Wrong: Why experts* keep failing us--and how to know when not to trust them *Scientists, finance wizards, doctors, relationship gurus, celebrity CEOs, ... consultants, health officials and more by David H. Freedman or Being Wrong: Adventures in the Margin of Error by Kathryn Schulz.

    Saturday, September 22, 2012

    Seen a good movie lately...?

    I'm sure that just like me - you've all sat through movies and could not believe some producer(s) read that script and actually put real money to have that movie made...

    Here are some thoughts from Paul Ormerod, brilliant British economist, on why movies flop:

    Why do films flop?

    Thursday, September 20, 2012

    Stat to Ponder - Percent of US Businesses Failing Every Year

    Unbelievable - fully 10% of US businesses fail annually. Wow.

    WSJ Publishes Old News on VC-backed Startup Failures

    WSJ published some old news today...according to Deborah Gage, the VC (Venture Capital) secret is that 3 out of 4 startups fail...

    News flash: 1 out of 10 succeeds...

    Rough VC stats are as follows - for each 1,000 business plans a typical VC sees:
    => VC communicates with 100 teams
    ...meets with 10 teams for presentations
    ...invests in ONE single venture

    Success stats are approximately:
    + 5-6 fail ... negative returns
    + 2-3 breakeven - living dead etc. ... zero returns
    + 1-2 minor success ... minor returns, in today's climate barely return VC investments
    + 1 raging success ... major returns, finances the whole deal

    DO THE MATH - for a single raging success a VC team has to review approximately 10,000 business plans, sit through 100 presentations, invest in ten companies and work with them for periods that can stretch out to ten years and beyond.

    It ain't an easy business - even if top firms like Kleiner Perkins and Accel sometimes make it seem like cake.

    Hello World!

    Hello World - launching a new blog on failure. It's about time.

    Here's a first take at the raison d'être:
    It has long been a given that failure is a precursor to success - if you don't try, you won't find success, but if you do try, you will inevitably fail; and you will fail far more than you will succeed. "Steiner on Failure" will allow you to understand the concept of failure, and how one can leverage failure to find more success - in life as a whole, in business, in the arts and in whatever field one may seek to develop in.