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Showing posts with label failure. Show all posts
Showing posts with label failure. Show all posts

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.

    Saturday, November 24, 2012

    Business Failure and Why its Crucial to Success

    "The beauty of epic failures...
    They're painful.
    They're humiliating.
    And sometimes they're exactly what you need."

    ...thus starts a March 2012 article in Inc. magazine.
    Worth a read.
    The beauty of epic failures.

    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

    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, " 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, 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 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 is history (why??), you can still follow Philip J. Kaplan masquerading as @pud on twitter.
  • 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.