Startup success stories are funny things. <\/p>\n\n\n\n
Journalists writing them and audiences reading them always want to know one thing: what\u2019s the secret to success?<\/p>\n\n\n\n
Among cliched responses to this question you\u2019ll find such soundbites as \u201csheer determination\u201d, \u201cworking our asses off\u201d, \u201cbeing perfectionists\u201d, and \u201cnever giving up\u201d. <\/p>\n\n\n\n
UK Love Island contestant and millionaire influencer Molly Mae caused explosive outrage<\/a> in the UK with her comments about everyone having \u201cthe same 24 hours in the day as Beyonce\u201d.<\/p>\n\n\n\n Actress and Goop founder Gwyneth Paltrow is another serial offender<\/a>. And she may be hardworking. But she was also born to a noted film producer and an award-winning actress. <\/p>\n\n\n\n Gwyneth does have the self awareness to note that some people find this mentality \u201cannoying\u201d. But it\u2019s probably not for the reasons she thinks.<\/p>\n\n\n\n By the very nature of what they do, everyone who tries to \u201cmake it\u201d, whether in the arts or in business, is determined and hardworking. If they weren\u2019t, they\u2019d settle for a paid 9-5. <\/p>\n\n\n\n There\u2019s an extremely high likelihood that the 90% of startup founders who fail were just as hardworking as their peers who didn\u2019t. It\u2019s all very well to \u201cwork hard\u201d when you have continual access to funding, well-connected parents, a chance meeting with a life-changing investor, or when some arbitrary social media algorithm makes your product go viral. <\/p>\n\n\n\n It\u2019s all very well to \u201cnever give up\u201d when you don\u2019t have to.<\/p>\n\n\n\n So when we ask the 1 successful founder out of 10 for their \u201csecret\u201d instead of the 9 founders who failed, we\u2019re left with serious blind spots. This is known as survivorship bias.<\/p>\n\n\n\n Failory<\/a> does an amazing job of asking a slightly different question to \u201cwhat\u2019s your secret to success?\u201d. In its glossary of business failure stories you won\u2019t find in the mainstream media, the line of enquiry is more like, \u201cwhat\u2019s the secret to your failure?\u201d<\/p>\n\n\n\n And when we\u2019re told as entrepreneurs to \u201cfail fast and fail often<\/a>\u201d, this is a question worth asking.<\/p>\n\n\n\n ToyGaroo founder Phil Smy speaks of the all-too common pain point<\/a> faced by young companies that led to ToyGaroo\u2019s demise: \u201c\u200b\u200bbecause of our new partners, we were under close scrutiny and high pressure to \u201cgrow, grow, grow\u201d. <\/p>\n\n\n\n ToyGaroo (the Netflix for toys) put a huge green tick in the \u201cdoes your product solve a problem?\u201d box. Parents tired of spending hundreds of dollars on toys only to have their children discard them after a week could subscribe to rent a certain number each month, and send them back when the kids were bored. <\/p>\n\n\n\n ToyGaroo appeared on the US franchise of SharkTank, and secured investment from sharks Mark Cuban and Kevin O\u2019Leary. But postage costs were outsized and unpredictable, there were disagreements over scrapping the free postage model, and the sharks refused to invest more cash when bankruptcy loomed. <\/p>\n\n\n\n The thing is: ToyGaroo is far from a cautionary tale.<\/p>\n\n\n\n There are so many good things to learn from its story. The idea was perfectly timed for the rental phenomenon. They had an excellent marketing team, were conscious of consumer concerns (at one point installing a cleaning service to counter hygiene issues), and had national exposure (both through SharkTank and even appearing on Good Morning America before that).<\/p>\n\n\n\n So why don\u2019t these valuable, wisdom-rich founder stories hit the headlines? Do we feel that collapse is contagious? Or do we feel a reluctance to relate to them because \u201cthat could never be us?\u201d<\/p>\n\n\n\n The reason we place such a focus on successful startups is not really anyone\u2019s fault. Our brains are built to seek reason. X succeeded so they must\u2019ve deserved it. Y failed so they must\u2019ve done something wrong. <\/p>\n\n\n\n When we observe success, we search for compounding evidence to explain it. Likewise with failure. It\u2019s how we attempt to learn and grow. The problem is we\u2019re so good at looking for patterns that prove our theories, we often see them when they\u2019re not there.<\/p>\n\n\n\n This phenomenon even occurs from first-person perspective. Once we\u2019ve made it, with each nostalgic trip down memory lane, we romanticise those 18-hour days and makeshift garage offices and muse that we knew exactly what we were doing all along, and that we were always destined for the big time.<\/p>\n\n\n\n There\u2019s another reason certain individuals don\u2019t like to associate with failures and flops. <\/p>\n\n\n\n Founders are pretty good at confessing their cock ups. For some, a failed startup or two under their belt is a badge of honour. The world is getting better at rewarding effort as much as success. <\/p>\n\n\n\n Investors: less so.<\/p>\n\n\n\n Those in control of vast sums of money must present expertise at all costs. To admit fallibility is to lose client confidence.<\/p>\n\n\n\n One notable exception is Bessemer Venture Partners\u2019 \u201cAnti-Portfolio<\/a>\u201d – a collection of hugely successful startups they didn\u2019t<\/em> invest in, and aren\u2019t ashamed to admit. The corporate cosmos is in desperate need of more of this. More transparency, more humility, and less toxic positivity.<\/p>\n\n\n\n For many, FOMO can be crippling. <\/p>\n\n\n\n Ronald Wayne is forever \u201cthe guy who sold his 10% Apple stake for $800\u201d (which would\u2019ve been worth USD $95 billion today<\/a>). He\u2019s often referred to as the \u201cforgotten third co-founder\u201d. You\u2019d probably be, well, richer than Ronald Wayne if you had a dollar for everytime someone screeched \u201cwhat an idiot!\u201d upon hearing his story. But the truth is, he wasn\u2019t<\/em> an idiot. <\/p>\n\n\n\n Wayne made a rational business decision to step out of the then-struggling and debt-laden business. Because Apple happened<\/em> to become what it did, he\u2019s spoken of as a pariah, an object of pity. A walking manifestation of the investor\u2019s worst nightmare. <\/p>\n\n\n\n Victoria\u2019s Secret founder Roy Raymond is famous for his Golden Gate Bridge suicide. He sold the near-bankrupt lingerie company for USD $1 million in 1982, and mass market retail magnate Leslie Wexner had turned it into a USD $1.9 billion brand by 1995. <\/p>\n\n\n\n Through the distorted lens of our ideas of success, we see the sale of a dying company for 1 million dollars as a failure<\/em>. And tragically, Roy Raymond did too. <\/p>\n\n\n\n Through the lens of survivorship bias, the media reported on Raymond as a sad, sorry figure who let billions slip through his fingers, despite the fact he was a Stanford MBA who made half a million in his first year of business and revolutionised the way the world buys underwear. <\/p>\n\n\n\n Through that same lens, Wexner becomes a shrewd and enterprising genius who turned the fate of Victoria\u2019s Secret around – not just a guy in the right place, at the right time, with the right purchasing power.<\/p>\n\n\n\n Too many startups encounter ruinous debt trying to save a sinking ship. Why? Because they\u2019re terrified of the shaming rhetoric of survivorship bias – the \u201cthey didn\u2019t work hard enough\u201d and \u201cI guess they didn\u2019t want it that bad\u201d. <\/p>\n\n\n\n Giving up doesn\u2019t have to mean throwing a lit match into an oil-soaked office. It might be reorienting to the point your original concept is unrecognisable. It might be admitting to your partner you got it wrong and are ready for a new direction. It might be overhauling your product, price point, or brand positioning. It might be selling. <\/p>\n\n\n\n What you might\u2019ve considered a \u201cfailure\u201d at the start might be the thing that keeps you afloat.<\/p>\n\n\n\n More importantly, one of the most valuable things we can do as aspiring founders is to look at the unpublished data. The promising failures. The almost-made-its. The startup cemetery<\/a>. <\/p>\n\n\n\n There are pearls of valuable wisdom to be found from the ones who did everything right but missed that make-or-break bit of luck. Not just learning from their failures, but from their small victories that got forgotten or overshadowed by the negative. <\/p>\n\n\n\n Finally, we need to remember that anecdotal evidence is not scientific evidence. And every startup story is an anecdote. <\/p>\n\n\n\n Star Wars, Lord of the Rings, Harry Potter, and countless other epics all follow the \u201cmonomyth<\/a>\u201d: a replicable formula for success on the silver screen (although let\u2019s check our survivorship bias and remember those filmmakers who followed it and still didn\u2019t succeed). The hero goes through 17 set stages to achieve glory. The stages are always the same, and are always overcome in the same way (usually through courage of some kind). <\/p>\n\n\n\n But startup culture isn\u2019t Hollywood, and there is no monomyth to follow. Imitating our peers doesn\u2019t just bring in models that might not suit our unique operation, it also ignores whatever intangible luck or happenstance actually got them to their position of success. <\/p>\n\n\n\nFailure is still a dirty word<\/strong><\/h2>\n\n\n\n
Spotlighting winners, shunning failures<\/strong><\/h2>\n\n\n\n
Failing by association<\/strong><\/h2>\n\n\n\n
Fear Of Missing Out\u2026 or of missed opportunities<\/strong><\/h2>\n\n\n\n
How do we overcome our survivorship bias in startup culture?<\/strong><\/h2>\n\n\n\n