In my last post, I said, As long as I am alive and making an effort each day, I have not failed. This is most likely a radical thought for you as it was for me.
After all, I have bills to pay, obligations to fulfill, a life to support. So, how can I say that a failed business is not my failure? If my business fails, my family loses, my bills don’t get paid, my obligations are not fulfilled.
But, while all of this is true, a failed business is not the same as my failure. I can learn from the failed business and the experience of creating and running it. And those lessons are invaluable.
For example, I did have a business in the late 80s and early 90s. With a partner, I founded a non-profit clinic for the treatment of eating disorders and for research projects on eating (both normal and disordered) and body image. We studied and tried many different theories and methods of treatment, finally settling on cognitive-behavioral therapy. We created a program of our own based on what we saw as missing from other programs and what worked best in other clinics.
When we decided to go non-profit, my partner and I hired an expert to help us with the incorporation. It cost us a pretty penny that we didn’t really have at the time, but we knew it would be worth it to do things right the first time. Incorporating required that we have a board of directors, none of whom were responsible for the day to day operations. That was our first problem. We needed five people. It took us 8 months of calls to and meetings with everyone we knew, and lots of people we’d never met before, to get those five people.
Once we got them, and filed the paperwork, we were inspected by the state. No problem there. We were solid on record keeping, followed our bylaws, and ran a ship shape operation.
Our next problem was fund raising. We were as green as green could be. But, we took ourselves down to the local Volunteer Foundation and did some tall studying. And we began applying what all the coaches and seminar leaders there recommended.
To make a long story as short as possible, our board of directors never really caught the vision, we didn’t get the big grants, and our clients were mostly at the end of their mental health insurance benefits and required very low fees. We wrote articles that were published in respected journals and newsletters, we gave seminars and trainings for teams of professionals. In the end, the clinic had an excellent reputation with practitioners and clients world wide (many of the top experts are in England and France), but there was not enough money coming in to support the business. We closed our doors just 5-1/2 years after we opened them.
So, what did I learn?
First, if I’m going to bring someone else in on my ventures in life or in business, they have to catch the vision. If they can’t get excited by the idea, by what the business does, they can’t participate. See, if they’re excited to work with me, or to make money, they’ll only work on that basis. But, if they’re excited to do the work or to make a difference, they’ll give a much better quality performance and make a stronger effort.
Second, quality means that customers/clients/patients will come. They’ll come whether you charge outrageous fees or small ones. Because they want what you offer. So, charge what you need to keep the doors open and the business growing.
Third, offer high value and build both reputation and referrals. Give away some things for free. Sell some at a lower price, sell some at a higher price. And always over-deliver. The customer should walk away thinking s/he got “a steal” no matter what they paid.
Fourth, know when to stop walking down the road you’re on and go another way. I walked away with a little money to my name, lots of bills to pay off, and the ability to get a job and do so. If I’d kept going, I’d have been bankrupted.
Did I fail? No way! With my partner, I kept that non-profit going for 5-1/2 years against the odds. We helped hundreds of clients and trained dozens of professionals. The treatment model we pioneered is still in use in clinics around the world today.
Did the business fail? And how. No funding, no support from the board of directors, no government grants, not enough client fees to keep going.
Was it a bad idea? No. An idea that we didn’t know how to sustain and grow, yes. An idea that would have done better in another place, probably. An idea whose time had not yet come, but which continues to grow now without us.
This is the key to being failure proof on a practical basis. Know the risks going in, know when to get out, have a back up plan that includes working for someone else if needed. Debts can be paid. Finances can be rebuilt. New work can be found. Life goes on.
The only way I can fail is to not try. That’s the only way you can fail, too.