Getting Back Up After A Failed Venture

There is no denying that the chances of failure for startups are high. With 50% of startups failing in their first three years of work, many people who haven’t even started their business yet are forced to be extra careful and take into consideration all the elements that can hinder their success, like lack of experience in the field of entrepreneurship, management, and business. While it’s great to start a business with a foolproof plan for your business and a clear vision for your future expectations, you’ll also need to be prepared with contingency plans for when things don’t go as planned. 

If your business venture failed, or if you want to be prepared just in case it does, here are some ideas that will help you get back up.

Know the Actual Reasons for Failure

Right after the crisis strikes, your thoughts and emotions can be quite overwhelming, which can lead you to misread the situation and not understand what has led your business down into the rabbit hole. Thus, acting upon any contingency plan may have adverse effects and may even worsen the situation. You should be able, for example, to identify the factors that caused your business failure, like poor management skills. In that case, you will have to follow methods that will enhance these skills to avoid any mistakes on your part in the future. Also, if your business does not comply with your customer’s needs, then you’ll have to acknowledge this as well and do research on what customers want, what was wrong with your products, and how to maintain an effective customer relationship management (CRM) in the future. 

You should also be mindful of the fact that 40% of small businesses make a profit, 30% will come out even, and the last 30% will lose money. So, if you’re one of those unlucky remaining 30%, your best course of action would be to follow a contingency funding plan if you have one. But even with a contingency plan, many businesses are failing today due to the global economic stress caused by the coronavirus pandemic. If that is the case, another option would be to consult an expert, preferably a bankruptcy attorney who knows the ins and outs of handling financial crises. They will be able to read your financial situation quickly and suggest effective solutions that can save your business. Sometimes, filing for bankruptcy can be your best option and protect you from any potential lawsuits from creditors.

Don’t Take it Personally

Many business owners take their business failures very personally; however, considering the statistics mentioned above, business failures are anything but personal. It’s a common occurrence for startups to not succeed and the mistakes that led your business to fail have already been done by multiple business owners before you. So, all you can do after you analyze your business failure is to adapt to the new circumstances and accept the changes that are going to happen both to your business and your life. That’s right, failure doesn’t mean the end of your business. Many bankruptcy attorneys would argue that failures and filing for bankruptcy can be the grounds for a new start for a business and a chance to improve your strategies and avoid mistakes. 

Think of a New Business Plan

In the aftermath of a failure, you’ll need to take time to think of a new business plan. For example, what many novice business owners miss is that not everyone is cut out to be an entrepreneur and will proceed to try to make progress without any notable successes. One of the early signs that you are in the wrong business is a lack of inspiration. While it’s common for entrepreneurs to go through phases in their lives in which they don’t feel inspired, it isn’t a permanent state of mind. Another sign that indicates you’re in the wrong business is that your business is based on someone else’s ideas. Sure, it is good to follow the example of your predecessors at the early stages of running a business, which will allow you to be successful for a while, only for your success rates to drop later because your business lacked passion.

Finding what you’re passionate about is what you should start with when you think of a new business plan. Due to it being the crux of success to any type of business, passion will let you establish long-term success, as you will be offering a service or selling products that you are passionate about. It will also make you believe in your marketing strategies, which is one of the main pillars of success and a great tool to grow a network of customers. While it is ill-advised to imitate your competitors to the letter, you will need to be aware of the marketing strategies of your competitors as well as the type of products they’re selling. This can give you clues on where to start and how to make your products different from the ones on the market. 

Consider Working with Other Entrepreneurs

Sometimes, it’s better to gain experience from the experts first. Learning about their experiences and understanding their journeys toward success can also help you avoid making mistakes in the future. You can do this by attending events relevant to your business, connecting with other entrepreneurs from social media, or simply by introducing yourself to them. You should also note that making contacts with successful entrepreneurs early can be beneficial to you in the future. So, even if your first venture has failed, the new insights of professionals might just be what you need for your new business to succeed.

After everything is said and done, you’ll have a chance to think about future prospects. The real challenge will be channeling your efforts into one purpose, which is answering the question: what next? Whether your answer is having another go at a different business endeavor or venturing into something that deviates from entrepreneurship altogether, you will find this to be quite challenging, mainly because overcoming such negative emotions is a difficult task. However, that doesn’t mean it isn’t achievable. Some experts say that business failure will cripple a startup, but how you react to this failure is the true determinant of future successes, so focusing on accepting failure and moving on should be the first step you take to get back up.