Outside of Silicon Valley, you only hear about the startups that make it — the Facebooks and Snapchats, the so-called “unicorns” founded by twentysomething college dropouts turned billionaires. It can start to feel like those stories are the norm, and that falling flat only happens very rarely. But 90% of startups fail.
As any entrepreneur working away on a business will tell you, not only is failure in this sphere entirely normal, it’s also a kind of rite of passage. When things don’t go right, you get to learn a lot. As one former founder told us, “With success, it’s not ever any one person, it’s always sort of a bunch of magical factors. But with failure, you can usually more clearly pinpoint what still worked and why something lasted as long as it did.” Failure can be an eye-opening experience. It can teach you things and change your perspective in radical ways. And, most importantly, it’s not the end of the world when your company ultimately doesn’t make it. We talked to four Silicon Valley women who survived failed startups and discovered that what they learned from the experience shaped both their careers — and their lives — for the better. Here's what they had to say.
Photo: Courtesy Sarah Kunst.
Sarah Kunst Kaleidoscope, an Instagram-like fashion app that allowed you to tap outfits and find out where to get different variations of each piece in the photo. Former Startup: Venture Partner at Future Perfect Now: The biggest thing you learned: "Nothing in startups is very permanent. Success doesn’t last, failure doesn’t last, office space doesn’t last. But remembering that on a daily basis, when it’s your whole life and all you do, is really hard." When did you start to see issues arising? "We got to well over a million downloads, which is good for a niche category, but we were having trouble figuring out a way to make money, and were running out of money at the same time. There were also some ideological differences, and some of the cofounders weren’t necessarily getting along that well toward the end." Was there difficulty in letting go of something you really believed in? "Every single person who’s been at startup that’s run out of money will never tell you this, but everyone does it: There’s just a period where it’s literally like a breakup. You spend a week in bed drunk on whiskey. It’s usually when everything is way beyond the point of repair, but you haven’t told anybody yet, and you decide that the best, most logical thing to do is hide."
Photo: Courtesy Jessie Baxter.
Jessie Baxter I AM., a social enterprise business that took hand-woven textiles from indigenous communities and created goods/a market for their craft Former Startup: Founder of My Endless Wardrobe Now: The biggest thing you learned: "I’ve had to reframe my perspective on failure itself, and I actually think we should come up with another name for it, because we’re taught at a very young age in the education system that failure is just this awful thing. I look back at that and, yes, I failed, but it was the best learning experience of my life. I am a completely different person and have an absolutely new perspective on everything because of it." When did you start to see issues arising? "Before we secured funding, we raised about $50,000 on Kickstarter, which was one of the largest campaigns at the time in the fashion category. That was a challenge, though: We ended up having to pull this media stunt at the end to secure the last $30,000. Looking back, we should have known then there was something amiss, but we were so focused on our mission. We shouldn’t have had to do this media stunt to raise money." What was the moment you knew that it just wasn’t working? "I remember the moment that I decided to let go, and that was fueled by the struggles we were having, but also by my relationship with my cofounder, who was my brother. I made a decision at that point in time, but it wasn’t like this revelation. It was just the feeling of slamming your head against a brick wall so many times that after a while you start losing faith. Then you start envisioning what would come after, and that’s part of the acceptance phase, as well." In the end, would you label the whole enterprise a failure? "Absolutely it was a failure. But I think this brings up the idea that failure is this horrible, horrible thing. I don’t believe it is… Anything that teaches us to challenge our assumptions, validate our assumptions, and grow should be chased hard and fast. So, yes, it was a failure, but to me, it doesn’t bring up negative emotions. I actually find it empowering."
Photo: Courtesy Mandela Schumacher-Hodge.
Mandela Schumacher-Hodge Tioki, a professional network exclusively for the education community, dubbed the "The LinkedIn for Teachers" Former Startup: Global Director of Education Entrepreneurs at Up Global Now: The biggest thing you learned: "Too often we modify our own decisions and what we want to do with our lives because of what other people tell us, and of what society tells us. Finding a space where you can be honest with yourself and tap into what makes your heart sing is a very important thing, whether you’re shutting down a startup, or just in life in general." What was the moment you knew it just wasn’t working? "It was the moment my cofounder and I had a real heart-to-heart. I can remember the pivotal conversation where we opened up about how the business was going. We had just come out of one of our strongest sales cycles, but we were still struggling with becoming a year-round solution for people, and finding product-market fit. We asked ourselves, 'We’ve been doing this for two years — do we want to do it for another year?' We started to bring some of our other founding team members in. Then we sat around a table and started talking it out. And it was really to ask the question, 'What if we officially shut down?'" Was there difficulty in letting go of something you really believed in? "It comes down to asking the passion question: Is this your life calling? Are you willing to do things that nobody else is willing to do to make it happen? It can be hard to admit it to yourself, that this isn’t what you want your life calling to be. But it’s more so because of what you think everyone else will think. You’ve made a huge deal about your new company, you raised money, got some press, you’re putting it everywhere. The biggest and scariest part is letting people know that you’ve changed your mind."
Photo: Courtesy Liane Thompson.
Liane Thompson NewsUp, a platform that aggregated on-the-ground news video footage for media outlets Former Startup: Co-CEO of Aquaai, a startup working on robotic fish to clean rivers and seas Now: The biggest thing you learned: "It’s a two-way street. Your investors are going to do due diligence on you, but do your due diligence on your investors, too. It’s all about the atmosphere and energy you’re creating in your company, and who ends up as your investor matters for fostering that. Make sure you do due diligence on your team, as well, because at the end of the day, it’s going to get ugly, and you have to know if these are the types of people you can stick together with, because that’s what’s really going to matter once you get going." When did you first see issues arising? "I think it was a case of not being able to raise the equity that was necessary to bring life into the project. We were all adults that had families to support, so that brought a lot of pressure. We didn’t get to the level of Series A because we were bootstrapped and still in infancy and not taking salary, because that’s kind of the mindset among investors in Israel (where we were based), that that’s what companies should go through first." Was there difficulty in letting go of something you really believed in? "It was more, what a pity we weren’t able to hold it together, because of the team dissonance that resulted from the stress over lack of finances. It was more sorrowful after the fact because for a year afterwards, I was looking at other companies that did what we did and got sold. And we were ahead of them, or were equal to them, and these were different companies that were doing essentially the same thing. So, in the end it was more, too bad we couldn’t pull this one off."