As with most of the world, my kids have been surrounded by the spirit of the Rio games. Who wins, how many medals Australia scores and what the leader board looks like. Just as much as we celebrate the wins, I also realise how important it is to talk to my children about failure, getting back on your feet, trying harder next time and possibly doing things different.
If anyone can teach us about overcoming failure and inculcating a sense of reinvention, it’s elite athletes who get back up every time and keep pushing the boundaries. Similar rules apply to start-ups.
Last month, while in the US, I met Naveen Jain, who was famously credited for starting the dotcom bust about a decade ago. Recently, the billionaire entrepreneur’s company Moon Express became the first private startup to receive US government funding for a space exploration to look for minerals.
When we met, Naveen talked about nothing being impossible. In a Forbes article from a while ago, he highlights the importance of failure and how successful organisations have encouraged failure. According to him, “In a struggling economic climate, failure is what separates mediocre companies from businesses that break through and astound us with their creativity.”
As an angel investor supporting high-risk startups, I’ve always maintained that to harness a truly entrepreneurial culture, in addition to innovation, jobs, ideas and disruption, we need to give failure and reinvention equal limelight and importance.
But how does it happen in Australia where, according to the Global Entrepreneurship Monitor, a significant 39.2 per cent of people say that fear of failure would prevent them from setting up a business?
At a Google Hangout session with both Elon Musk and Richard Branson, one point they concurred on was that although starting a company is hard work and it’ll most likely fail, people should to it anyway.
What does it take to overcome the fear of failure?
What entrepreneurs or would-be entrepreneurs need to remember is that while the risk is high, so too can be the rewards. Like an athlete, it is important to aim high, get into a winning mindset and treat failure as a learning experience.
In the US, the entrepreneurial community wears their start-ups that failed to take off as badges of honour. It’s not surprising then that the fear of failure in the US, according to the Monitor, is under 30 per cent.
But to embrace and respect those who give their best shot, we all have to enable our people to try new ideas without fear of repercussion.
In the past, Naveen has talked about how, under pressure to deliver to investors and losing jobs, business leaders have the inherent expectation to deliver perfect track records of product launches and expansions. This attitude indirectly passes on to employees who then don’t try new initiatives that are likely to fail. Like with sport, we need to create a culture where failure is seen as a potential for improvement and reinvention.
Businesses in Australia can take a page of out Nikki Durkin’s book and share more honest stories about failure as she did, post the collapse of 99Dresses. Creating a culture that embraces failure also cannot happen in isolation to focusing on reinvention.
Like Naveen Jain who came back from the dotcom bust and Nikki who went on to start another startup called CodeMakers and even Apple that picked itself up from multiple failures, we need to draw on our experiences and reinvent ourselves.
A brilliant quote from Shikhar Ghosh, a senior lecturer at Harvard Business School sums up the situation perfectly saying that, “In any natural system, failure is the engine that causes growth, that causes new birth, that causes anything to happen,” he says. “One of the truly big differences between growing economies and economies that stagnate is the acceptance of failure.
If you don’t let forests burn, if you don’t let the old trees die out and the new trees grow, you don’t get a healthy forest. The ability to manage failure so that enterprises fail but people can still succeed becomes one of the tricks of how you build a society that can reinvent itself as the world changes.”
In the entrepreneurial community, as in our sports, let us be known as a country that encourages punches above our weight.
Renata Cooper is the CEO of Forming Circles Global