Entrepreneurs enter the cauldron of business to succeed, but it's never smooth. According to an article published in Forbes magazine, ninety percent of startups fail. "This is a hard and bleak truth, but one that you'd do well to meditate on," said Neil Patel, the article's author. Now, are you afraid of startup failure?
To elaborate more on this fact, let us look at some more statistics published in Review 42
- 90% of new startups fail.
- 75% of venture-backed startups fail.
- Under 50% of businesses make it to their fifth year.
- 33% of startups make it to the 10-year mark.
- Only 40% of startups turn a profit.
- 82% of businesses that fail do so because of cash flow problems.
- The highest failure rate occurs in the information industry (63%).
If you feel afraid, I would just reassure you that you are not alone in this journey. Failure is critical to innovation entrepreneurship. Thomas Edison has rightly said that "failure is the stepping stone of success." This maxim says that if a person fails once, he should not lose his heart. He must observe the mistakes that led to the failure and try to overcome them in his next attempt. Repeated efforts lead to success. Failures give a better point of view through which we can march our way to success. So, we should always regard failure as the first step or stepping stone to success.
Now, let me confess my failure and the lessons I took away from it.
The biggest mistake was becoming an entrepreneur with neither skill nor knowledge. In 2001 (at 21), I completed an introductory tailoring course and wanted to start my own business. My only work experience was two years at the Bank of Maldives and one year at the Ministry of Finance and Treasury- nothing relevant to the field.
My then-husband made a massive commitment to me at my request. I am forever grateful for all the wonderful things he did for me and my family. My humble prayer to Almighty Allah SWT is that He blesses him with abundant prosperity and happiness, Aameen.
He rented land, built a shop, and invested in an entire set-up. We traveled to Bangkok, bought machines and related stuff worth $6000, and started the shop "Savio Collection." I had a business plan and wanted to make it one of the leading brands. We made a tag, "Savio" (an Italian name meaning clever), that would go with each piece of cloth and establish our brand.
However, the moment I had to sit behind those huge industrial machines, I realized that I didn't know a thing about tailoring and making dresses that made others outstandingly beautiful. My sister was my backup, and she helped me a lot. After some time, we brought Maldivian staff to work with us, yet it became a nightmare. They did not arrive on time or at work for six consecutive days. With the challenges, we brought five tailors from India, but the agents lied and brought people who couldn't stitch on a straight line. After that, we hired an Indian with seven years of experience in the Maldives.
He was very efficient at his work and attracted a lot of customers, but he had another agenda. Although we created the standard for finished products, he was in such a hurry that he never could adhere to it. He started cheating on us, taking money from customers and recording lower amounts on the register. We had to hire another staff to be on the premises to monitor his behavior. Yet, he never stopped. He went to customers' houses to take orders during lunch break, stitched the dresses, stayed awake, and delivered the next lunch break. He was tired and exhausted during working hours, creating complete chaos.
The day he left the Maldives, after working for us for three years, he handed $1500 to the airport checking officer (he sends his monthly paycheck home). This was no surprise to me, as his boss. He never had time to stitch my dress because he was so busy, but we received a profit of between Mvr 1000 and 2500. at the end of the month, We never received a higher profit.
After 18 years, when I look back, my learnings from the failure are;
- Never start your own business until you become a pro in the required skill.
- If you try to learn while earning, you will lose your reputation and potential cheques for your business. Therefore, fine-tune your art by adding value to your customers without any expectations. The paying customers will automatically come to you.
- Before asking an investor for venture capital, have a complete written business plan. You might have an idea in your head, but the idea fades just like a shooting star disappears into the darkness. Follow the experts who have succeeded in your interest, and research their failure stories. Do not start until you have 90% of the business plan curated. A husband, an uncle, or an investor is leaving his hard-earned money on the table to see you excel in your dreams, just for you. So, never make the person regret it.
- Have a Plan B and Plan C before investing a single dime. By this, you would have thought about all the reasons you may fail and a plan to stand out from the shit.
- Employees should be well taken care of, but you should never let them breach the standards from day 1. The idiom by Thomas Fuller, "A stitch in time saves nine," should always be at the forefront of your mind. From the Maldivian Literature "ނަރެއްހާ ތަން ދޫކޮށްލިއްޔާ ކެނބެއްހާ ތަން ދަމައިގަންނާނެ." speaks all about adhering to SOPs created by us.
- To succeed in any business, you should be disciplined, consistent, and persevere. Because you are the boss, if you can't be at the office on time, your employees will not be either. Be the employee you wish to see in your business.
With these six points, let me finish this article. In Sha Allah, my next article will be on the confession for my next endeavor, "A" Star Zone.
Do you have a related experience? How did you tackle the situation? What would be your advice to a youth going through a similar experience>
