Risk is inherent in the definition of an entrepreneur. The risk of business failure might not make the list of favorite topics among aspiring business leaders, but it is nonetheless vital to think about when entering the battlefield of high-stakes competition.
In the world of entrepreneurship, it is essential to recognize that failure is possible — it’s a common experience for business leaders. According to Statistic Brain, more than half of U.S. companies fail within five years. CB Insights lists the top three reasons for startups shutting down as no market need, running out of money, and not having the right team.
What sets successful entrepreneurs apart from those who fail is the ability to evaluate mistakes and overcome them. To avoid becoming a cautionary statistic, entrepreneurs must learn from those experiences.
Failure Is Not the End
My career had humble beginnings. I started working an entry-level office job at my parents’ company, which allowed me to learn skills and perspectives that have helped me manage and relate to people with similar responsibilities.
While entrepreneurship definitely can be a rollercoaster — my own experiences support this — successful leaders must find ways to weather the highs and lows of business. Anxiety and depression are common among entrepreneurs, even when their startups are performing well. And when their companies fail, the fallout can be devastating.
Leaders in business have recently begun sharing their own experiences to break the stigma surrounding depression and anxiety. Former MySpace VP Sean Percival shared an incredibly personal message on his website: “I was to the edge and back a few times this past year with my business and own depression. … If you’re about to lose it, please contact me.”
Every person processes emotions differently, but it’s universally crucial to take the time to recover after a business failure. When you do make a mistake, learn from your experiences. Decompress from the situation, be honest with yourself, and find ways to proceed down a more fruitful path.
The Good, the Bad, and the Successful
What distinguishes good entrepreneurs from bad entrepreneurs is how well they’re able to cast a critical eye toward their missteps. Business leaders must be willing and able to learn from their errors — even fatal ones.
Thankfully, you don’t have to do it all by yourself. Technology can be an incredible asset, particularly when entrepreneurs need help taking stock of what went right and wrong. Here are five useful tools that can help you learn from even the hardest of hard knocks:
- Organization software
Calculated risks are a vital component of business success. Free organization software applications allow you to remain organized and understand which risks are worthwhile. They can also help you maintain an orderly and efficient schedule.
- Idea management
As a leader, you need to maintain a team focus on the ideas that are most profitable so you don’t waste energy and resources. Tracking business goals can make you 80 percent more likely to achieve them. Make sure they are shareable and accessible for multiple users, which is easy thanks to tools like Google Drive and Evernote.
- Money management
When it comes to money management, the bottom line is to go online. Comprehensive accounting software, online invoicing services, and online tax services can all help you cut costs dramatically.
- Collaborative tools
Communication is critical in any company, and new technological tools allow you to bring your team together in creative ways. Webinars and online business training enable your team to stay on top of material without the need to travel. Teleconference calls, messaging platforms, and cloud storage all ensure streamlined communication and file access — unaffected by distance or remote working.
- Pricing your product
Many small businesses regret charging too little in the beginning. While some people assume more expensive products will attract needier clients, the opposite is true. Customers who monopolize support resources are often the ones looking for lower prices. The best way to research different conversion rates and pricing options is by using a tool like VWO or Optimizely.
By using these tools to identify and avoid missteps, you can correct any issues before they sink your ventures. During the process, remember that business setbacks are natural. The difference between those who succeed in the long run and those who do not is the ability to learn from those mistakes. Resiliency and self-care — along with using the best tools available — can earn you a substantial and sustainable business career.
David Disiere is the founder and CEO of QEO Insurance Group, an agency that provides commercial transportation insurance to clients throughout the U.S. He is a highly successful entrepreneur who has launched business endeavors in the real estate, oil and gas, agriculture, and automotive sectors. David is equally passionate about philanthropy, and he works to help underprivileged children through the David & Teresa Disiere Foundation.