12 Lessons from My 7 Failed Startups

Being an expert at failure pays handsomely.

If you think I was born to have my own business, you’d be wrong.

When giving my ten-second spiel about how I got to today, one line that is always present is this: “There were seven failed startups and one relatively successful business.”

That’s right — seven huge failures and only one success. And that success doesn’t pay the lease on a Lambo and buy a house in the Hollywood Hills either. The failures were unintentional.

I got into business with stupid people, got lied to, was cheated by many, and even had plenty of people steal from me. You could say I was naive.

Nativity in business is key, though. It’s the muscle that says, “I’ll try and compete with hotels even though I’ve never owned a hotel.”

Not knowing how a business or industry works is sometimes the greatest advantage you can have.

So after seven failed startups, here’s what I’ve learned that might help you create a business or run a profitable side hustle.

Jump in before you’re ready

I was never ready to be in business. The first day running a business was scary as hell. There was no CRM, inventory control, or employees to do the heavy lifting. Everything was manual and brand new.

The business plan didn’t exist either. We pivoted consistently. Our pivots were based on what would pay the rent on our office, not some mythical customer persona that we’d never met.

I remember buying a list of phone numbers and then cold calling them. The first step was to get them on the phone, then keep them on the phone, and then understand if anything our business did would actually result in them spending money with us. The rawness of the approach was powerful.

You’re never ready to be in business. You just hit go on your website and go from there. The idea you start with is rarely the idea you end up with when the business is profitable.

Choose a business partner you actually like

I totally screwed this one up — several times!

If you have a business partner or major shareholder, you better make sure you pick one you like. I often describe my experience as the clash of two leaders: one who acted like Hitler and one who practiced the teachings of Buddha.

The second consideration, which I also screwed up, is to choose a business partner you can trust. In the early days, everybody is your best friend. When the money comes piling in, people change and that can be bad for your business. Trust and likability are key in a business partner.

Have content front and center of everything you do

Creating content is how you show a potential customer how you can be useful. A business teaches people. What are you teaching?

A fashion label teaches us how to dress.

A bakery teaches us how to enjoy comfort food.

A car company teaches us how to drive safely.

A furniture company teaches us how to decorate our home.

A hotel teaches us how to relax.

Treat business like teaching and you’ll go far.

Content is how you teach — through audio, video, writing, images.

If you don’t decide to teach then your business just becomes commoditized and therefore, the lowest price wins, and your held ransom to supply and demand.

Acquire practical skills, not education

I have zero business education in the traditional sense. My business knowledge comes from being on the ground and learning the hard way.

Here are a few of the skills I learned along the journey:

• Cold calling
• Forklift driving
• Understanding the basics of web design
• SEO and digital marketing
• Barista skills
• Sales and account management
• Packaging and shipping

These are not the traditional skills you see on the summary of an MBA course in business. But these are the skills I used to learn business and be in business. Focus on practical skills that are needed to make money — everything else is fluff and useless strategies.

Expect chaos

A new business is chaos. There’s no systems or structure in place. If you hate chaos then you may want to reconsider starting a business. Chaos is not for everyone and that’s why there are traditional jobs.

Watch your ego like a hawk

My out of control ego killed more business deals than a lack of customers ever did. Your ego in startup land can destroy your potential.

You got a business, so what? You’re not better than the next person because you started a business. Starting a business is not a badge of honor that comes with a gold World War 2 medal. Pipe down your ego. Resist the urge to put “founder” and “entrepreneur” on everything you do as if you went through Elon Musk College as part of your business journey.

Your entrepreneur brand has nothing to do with business or making money. It took me years of PR, social media training, and StartupGrind events to get this insight. Lower your ego and the barrier to the relationship that can help your business thrive will be lifted.

Nobody wants to deal with an asshole.

Have a digital option

It pains me to say this, given how far into the internet journey we are.

You need a digital option in case a mystery health crisis causes everybody to be locked in their homes again.

Can I buy your product or service without leaving home and have it delivered to me? Or, can you still add value to our lives from the comfort of our home? These questions explain your digital strategy. Because digital just means business, and it’s how you stay in business.

Hire people way smarter than you

The best people I’ve hired over the years are far smarter than me. The business owner doesn’t need to be the smartest person in the room.

Find smart people who have niche skills and leverage their expertise, rather than try to be a jack of all trades, master of none.

Own a mailing list

I was late to the party on this one. The platforms you market your business on are not owned by you. Your social media accounts can be taken away from you at any time and you don’t own your customer’s contact details.

A follower is an unknown person you can never contact.

An email address is a prospect.

An email address can turn a prospect into a customer.

Partner early on

When I started my first online business, I didn’t have much. Pooling resources was key to getting started.

For example, you can pool your mailing list with like-minded business owners instead of waiting years to build up a large list to sell to.

The worst thing you can do is *not* collaborate.

Business is really slow without collaboration — plus, collaboration is fun because you meet other people who can end up becoming lifelong friends.

Learn how to lead people

People are at the heart of any business. Even if you are a one man band in business, you will have to work with people at some stage, even if they are not employees and act as freelancers.

I didn’t learn to lead people until much later in my business journey. The question that helped me lead people was this:

What’s in it for them?

If you know what motivates people, you can link the outcomes of their work to who they want to become. Human interaction is one of the hardest things to learn in business. People have biases, beliefs, issues, and mindsets that prevent them from being effective.

A simple business task should be easy to do but once you involve people, it gets complicated.

People make decisions not based on business logic. People act as an x-factor. That’s why it pays to understand people so you can lead them.

Going big is overrated

A close friend of mine went big with his business. He already had plenty of money and a stable income through his property portfolio. But the allure of having a big business became his downfall. His business got big and then a lockdown ended it after a 15-minute speech.

He’s now realizing that going big in business is overrated. The bigger your business gets the more stress you take on. If you’re making enough money to cover what you need, why risk it all to go big and potentially be left with nothing? It’s a question worth asking. How big is too big?

In my case, going big is just not worth it. I like being able to relax and not having Venture Capital firms beating down the door of my home office, demanding unobtainable growth.

It’s cool to be unknown and go about your business quietly without all the unicorn talk.

Final Thought

Being an expert at failure pays handsomely.

You might think seven failed startups is a lot — and it is. It’s only through doing, though, that you learn about business the hard way. You have to know what not to do before you learn what to do. After so many experiments and business ideas that didn’t work, you eventually find a path that works.

The idea is not to win or lose in business; it’s to learn, and learn as quickly as you can.

If you want to increase your productivity and learn some more valuable life hacks, then join my private mailing list on timdenning.net