As an entrepreneur, I’ve learned that not all business ideas are created equal. Some ideas have the potential to change the world, while others are doomed to fail from the start. Failure is a natural part of the business process. I’ve also learned that even the best ideas can fail if they’re not executed properly. That’s why I believe that failing fast with business ideas is almost as good as having a successful business idea. In this article, I will explain why this is the case and provide examples of successful companies that have failed fast. I will also provide tips on how to understand when it’s time to “fail fast” with your business idea.
“It can be hard to come to terms with the fact that your business idea may not be successful.“
When starting a business, it can be easy to get caught up in the excitement of your idea and believe that it will be a success. However, not all business ideas are created equal and some will inevitably fail. Rather than spending months or even years pouring time and money into a business that is not going to be successful, it is often better to “fail fast” and move on to a new idea.
The key to succeeding as an entrepreneur is to take risks and be willing to fail. This may sound counterintuitive, but it’s actually the key to success. When you’re starting a business, you’re going to make mistakes. You’re going to try things that don’t work. But that’s okay. In fact, it’s more than okay. It’s actually a good thing.
When you fail fast, you’re able to quickly learn from your mistakes and move on. It’s easy to blame outside factors such as the economy or the competition. However, by failing fast, you can take a step back and evaluate what went wrong. You’re able to take the lessons you’ve learned and apply them to your next business idea. This means that you’re able to iterate and improve your ideas faster than if you were to stick with a single idea for too long.
Additionally, failing fast allows you to conserve resources. When you stick with a single idea for too long, you’re likely to waste resources on something that isn’t going to work. When you fail fast, you’re able to quickly pivot and focus on something that has a better chance of success.
Learn from the best
I’ll want to give you a few examples of companies that know how important to fail fast. The businesses that learned all the benefits to fail fast and pivot to the right direction.
The first example of a company that has failed fast is the company Instagram. When Instagram first started, it was a location-based social network called Burbn. However, the company quickly realized that the location-based aspect of the app was not as popular as they had hoped. Instead of sticking with the location-based aspect of the app, they pivoted and focused on the photo-sharing aspect of the app, which ultimately led to the success of Instagram.
Groupon
The second example is the company Groupon. When Groupon first started, they were a platform for group buying of daily deals. However, they quickly realized that this model was not sustainable. Instead of sticking with the group buying model, they pivoted and focused on providing deals to local businesses, which ultimately led to the success of Groupon.
Netflix
The third one is well known Netflix. The company started as a DVD rental service, but when streaming became popular, they quickly realized that they needed to adapt or risk failing. They quickly pivoted and became a streaming service, and now they are one of the most successful companies in the world. To be fully honest their DVD department still operating and generates huge ammount of revenue. In 2022 it was $100 million, which is 50% less than in 2021 (about $200 million), which proves their decision to go online.
Lastly, the company that I couldn’t forget that has failed fast many times is Google. The company has had several failed ventures, including Wave. Sometimes the idea might be great but the market is not ready, like we had it with Google Glass. However, rather than continuing to pour resources into these projects, Google quickly realized that they were not going to be successful and moved on to new ideas. This has allowed the company to continue to innovate and grow.
When it’s time to “fail fast”?
- Listen to your customers. Look for early warning signs such as lack of customer interest. Listen to feedback from customers, industry experts or even competitors. If your customers are not happy with your product or service, it may be time to make changes or move on to a new idea.
- Analyze your competition. If your competitors are surpassing you in terms of sales or market share, it may be time to re-evaluate your business idea. Pay attention to market trends and don’t be afraid to pivot if you see a better opportunity.
- Keep an eye on your finances. If your business has low sales, not generating the revenue or profit that you had planned, it may be time to “fail fast” and try something else.
To summarise, failing fast with business ideas is almost as good as having a successful business idea. Personally, I believe that failing fast is one of the best ways to succeed as an entrepreneur. It allows you to learn from your mistakes and quickly improve your ideas. It also helps you to conserve resources and focus on something that has a better chance of success. As an entrepreneur, it’s important to be willing to take risks and be willing to fail. Failing fast with business ideas is a great way to do that.
It’s important to remember that failing fast does not mean giving up on your dreams or ambitions. Instead, it means being strategic and recognizing when it’s time to move on from an idea that is not working out.