Entrepreneurs enter the cauldron of business to succeed. But it’s never a smooth ride. According to an article published in Forbes magazine, ninety percent of the start-ups fail. “This is a hard and bleak truth, but one that you’d do well to meditate on,” said Neil Patel, author of the article. Now, are you afraid of startup failure?
- 90% of new startups fail.
- 75% of venture-backed startups fail.
- Under 50% of businesses make it to their fifth year.
- 33% of startups make it to the 10-year mark.
- Only 40% of startups actually turn a profit.
- 82% of businesses that fail do so because of cash flow problems.
- The highest failure rate occurs in the information industry (63%).
If you feel that you are afraid, I would just reassure you that you are not alone in this journey. Failure is critical to innovation entrepreneurship. Thomas Eddison has rightly said that “failure is the stepping stone of success.” This maxim says that if a person fails once, he should not lose heart. He must observe the mistakes that led to the failure and try to overcome them in his next attempt. Repeated efforts lead to success. Failures give a better point of view through which we can march our way onto success. So we should always regard failure as the first step or stepping stone to success.
Now let me confess my failure and the learnings I take away from it.
The biggest mistake was becoming an entrepreneur with neither skill nor knowledge. In 2001 (at the age of 21), I completed a basic tailoring course and wanted to start my own business. The only work experience I had was 2 years of work at Bank of Maldives and 1 year at the Ministry of Finance and Treasury. Nothing relevant to the field.
On my request, my then-husband made a huge commitment to me. I am forever grateful for all the wonderful things he did for me and my family. My humble prayer to Almighty Allah SWT is to bless him with prosperity and happiness in abundance, Aameen.
He rented a land, built a shop, and invested for an entire set-up. We traveled to Bangkok and brought machines and related stuff worth $6000 and started the shop “Savio Collection.” I had a business plan in my mind and wanted to make it one of the leading brands. We made a tag “Savio” (an Italian name, meaning clever) that would go with each piece of cloth and establish our brand.
However, the moment I had to sit behind those huge industrial machines, I realized that I didn’t know a thing about tailoring and making dresses that made others outstandingly beautiful. My sister was my back up and she helped me in big times. After sometime brought the Maldivian staff to work with us, yet it became a nightmare. They did not come on time, nor arrived to work for 6 consecutive days. With the challenges, we brought five tailors from India but the agents lied and brought people who couldn’t stitch on a straight line. After that hired an Indian who had 7 years’ experience in the Maldives.
He was very efficient at his work and attracted a lot of customers, but he had another agenda. Although we created the standard for finished products, he was in such a hurry that he never could adhere to it. He started cheating on us, taking money from customers, and recording lower amounts on the register. We had to hire another staff to be on the premises to monitor his behavior. Yet, he never stopped. He went to customers’ house to take orders during lunch break, stitched the dresses staying awake, and delivered the next lunch break. During the working hours, he was tired, exhausted, and created complete chaos.
The day he left the Maldives, after working for us for three years, he handed $1500 to the airport checking officer (he sends his monthly paycheck home). This was no surprise for me, as his boss. He never had time to stitch my dress because he was so busy, but at the end of the month, we received a profit of between Mvr 1000 to 2500. Never got a profit more than that.
After 18 years when I look back, my learnings from the failure are;
- Never start your own business until you become a pro on the required skill.
- If you try to learn while earning, you will simultaneously lose your reputation and potential cheques for your business. Therefore, fine-tune your art by adding value to your customers without any expectations. The paying customers will automatically come to you.
- Before asking an investor for venture capital, have a complete written business plan. You might have an idea in your head, but the idea fades just like a shooting star disappear into the darkness. Follow the experts who had succeeded in your area of interest and research about their failure stories. Do not start until you have 90% of the business plan curated. A husband, an uncle, or an investor is leaving his hard-earned money on the table, just to see you excel in your dreams. Just for you. So never make the person regret on it.
- Have a Plan B and Plan C, before investing a single dime. By this, you would have thought about all the reasons you may fail and a plan to stand out from the shit.
- Employees should be well taken care of, but never let them breach the standards from day 1. The idiom by Thomas Fuller, “a stitch in time saves nine” should always ring at the forefront of your mind. From the Maldivian Literature “ނަރެއްހާ ތަން ދޫކޮށްލިއްޔާ ކެނބެއްހާ ތަން ދަމައިގަންނާނެ.” speaks all about adhering to SOPs created by us.
- To succeed in any business you should live a disciplined life and be consistent and persevere. Because you are the boss, if you can’t be at the office on time, your employees will not do it either. Be the employee you wish to see in your business.
About the Author: Hawwa Shaheena Mohamed is a Certified Executive, Team & Life Coach, Corporate, and a Living Value Education trainer. Currently, she is developing her business as the CEO of Career Vitamin International Pvt ltd and contributing to society through the Career Vitamin Society.