Men's Journal - - THE ART OF THE FAIL -

IT’S IM­POR­TANT TO KEEP a pos­i­tive at­ti­tude when run­ning a fail­ing startup, lest your em­ploy­ees, cus­tomers, or part­ner get a whiff of where things are head­ing and de­cide to bail. That leaves 4 a.m. as an ideal time to stare wide awake at the ceil­ing and give panic and de­spair free rein.

Where did I go wrong with this can’t-miss idea? (Ev­ery­where. Re­ally.) How can I save the com­pany? (Zero ideas.) How will I ex­plain this to ev­ery­one who trusted me? (Uh.) How will I bounce back? (I can’t think about that dis­as­ter un­til this one is done.) Is to­day the day I throw in the towel? (No—just sweat­ing it seems far less daunt­ing.)

It wasn’t sup­posed to be this way. Just two years ear­lier, a suc­cess­ful health-care ex­ec­u­tive asked me to part­ner with him to launch a web­site aimed at help­ing com­pa­nies ex­pand over­seas.

The of­fer sur­prised me: I was a jour­nal­ist, not a busi­ness guy. But af­ter years of cov­er­ing in­no­va­tive en­trepreneurs, how could I re­sist the chance to ac­tu­ally be­come one my­self? Plus, here was a chance to make some se­ri­ous money.

I did my home­work and picked the brains of founders, in­vestors, would-be cus­tomers, even com­peti­tors. All of­fered sound, mostly en­cour­ag­ing ad­vice. Then I talked with a high­pow­ered ven­ture cap­i­tal­ist: “Don’t do it. You’ll be mis­er­able. And you’ll fail.” The only peo­ple who should start a com­pany, he said, were those who were so ob­sessed with their idea that they were in­ca­pable of do­ing any­thing else. That didn’t de­scribe me, but I plunged ahead any­way.

I hired five smart young staffers, and we built a great web­site. Soon we had hun­dreds of in­flu­en­tial read­ers at ma­jor or­ga­ni­za­tions. They loved our work. Now we just needed to turn them into pay­ing cus­tomers. But no one wanted to pony up, and we were burn­ing through fund­ing.

It was a mis­er­able death spread over half a year. I was let­ting a raft of peo­ple down in slow mo­tion: my in­vest­ment part­ner, who sunk money and pas­sion into the ven­ture; my wife, who was noth­ing but sup­port­ive as our sav­ings dwin­dled; my em­ploy­ees, who worked hard for less than they de­served. The physics of com­merce let you de­lay pulling the plug on a dy­ing com­pany for only so long. Then, sud­denly, it’s over. You can sleep again. You can start to ap­pre­ci­ate what a wild ad­ven­ture it was, and what your team pulled off un­der, or in spite of, your guid­ance. You can marvel at all you learned, even if it came too late. Then you can get back to do­ing some­thing—any­thing—else. —David H. Freed­man

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