Failure is a fact of life in the business world, and it provides indispensable lessons for entrepreneurs. Let’s take a look at the rise and fall of five important failed companies in history.
Did you know that 90% of start-up companies fail?
That may seem like a scary fact, but in fact, it’s a motivating one.
Wouldn’t it be amazing to be one of the 10% who comes out on top? Who builds an empire?
Who takes the tricks and tips from others and turns them into a concept that lasts?
You can do that. Someone’s gotta do it!
Eleanor Roosevelt once said, “Learn from the mistakes of others. You can’t live long enough to make them all yourself.” Instead, you can learn from these failed companies. They failed so you don’t have to.
Use their mistakes as a What Not to Do. Be the 10%.
If you’re an entrepreneur who can’t get enough business advice, then this one’s for you.
What do you need to do to get there? Here’s what 5 companies have to tell us.
1. Don’t Resist Change
Don’t fail to be innovative.
Blockbuster and Toys”R”Us learned this lesson the hard way. Along came Amazon and Netflix and away went the DVD-rental shop and the toy store.
Both companies were approached by the companies that put them under. Blockbuster thought Netflix was a tiny, niche product that wouldn’t last. It’s now worth $8.8 billion.
And after leaving a deal with Amazon, Toys”R”Us opportunity to thrive online was over.
Here’s another scenario to consider.
Why did Borders fail when Barnes & Noble hasn’t? Because they don’t resist the change that technology is bringing into their environment. They got on board with Nook, placing tablets in their storefronts nationwide.
2. Don’t Spread Yourself Too Thin
This can mean many things. Let’s look at Borders bookstores again.
After opening too many stores too soon, the company began to acquire a debt it couldn’t pay off.
This debt is one reason why they weren’t able to innovate and jump into the tablet game. Lack of funds led to lack of modernization.
Entrepreneur and blogger Neil Patel can attest to this one. Before co-owning two Internet companies, he struggled with doing too much at once. This ruins focus and passion for a specific project.
He tells us that focusing on one business is the surest way to make it successful. Splitting your time and energy is the recipe for failure.
3. Consider the Worst That Can Happen
That way you can prepare for it.
Yik Yak didn’t consider what their anonymous texting service could turn into. Reports of bullying, threats, and more came from their app. In an attempt to fix this, they took away what made it Yik Yak: anonymity.
Failing to think ahead cost them time, money, and reputation. The company closed.
Another example: crowdfunding websites? Kickstarter and Indiegogo didn’t prepare for the number of fake calls for help. “Indiegogo scams” on every headline made people fear to donate money or use the site.
Consider the worst. Think about failing. Then take the proper precautions to avoid those scenarios.
Let These Failed Companies Stand for Something
At the very least, they’ve taught the rest of us a lesson.
We can take the business advice of the failed companies and combine it with the upper tier knowledge. Then use it to our advantage and build a successful, thriving company.
There are real-world examples all around us. Companies that are going under every day because of failure to be contemporary. If you’re spread too thin, your message won’t pack the same punch.
A true entrepreneur will never stop trying to learn the business. They’ll be passionate about a product that can change lives. And they’ll know how to recover if things go wrong.
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