As I was going through my morning information routine, I noticed a number of articles that I’d put in the “how to not fail” bucket.  I read a few of these and noticed a consistent tone of “failure is bad – here’s how to avoid it.”

Throughout my life and career I’ve failed at many things, large and small.  I view failure as a fundamental part of every entrepreneurial endeavor, whether it’s a failed project, hire, partnership, relationship, lead, customer, or even the entire business.  One of the great things about entrepreneurship in America is that failure is an accepted part of the cycle.

I used to say something like “one of the great things about America is that failure is acceptable.”  When great people fail, they acknowledge it, learn from it, get up, dust themselves off, and get back at it.  If you accept reality, you can fail gracefully and hopefully learn something from it.  It’s never fun – and it can be really stressful / painful / emotionally hard – but it’s a part of learning, evolving, and growing stronger and better.

While I fail at stuff regularly, I’ll never forget the deepest cycle of failure I’ve been in to date.  As the Internet bubble popped exploded, company after company that I was an investor in failed.  As I grappled with this, I felt like I had been run over by a truck.  After I got up, a steamroller came and flattened me.  As I was peeling myself off the ground, the steamroller backed up and smushed me again.  Then, I realized I was lying on top of a hole and the top fell in and I tumbled down to the bottom.  As I was looking up at the sky, some jerk came into view, poured gasoline onto me, and then dropped a flaming stick on top of me.  By the summer of 2001, I realized that ever day had been worse than the previous day.  I no longer got up in the morning and said “ok – today will be better than yesterday”; instead I resolved myself that every day would be worse, until it eventually got better.  Then 9/11 happened.

I hung in there, kept getting up every day and doing my best, working hard to make informed and intelligent decisions, and helping all of the companies I was an investor in however I could.  A few more failed, but a nice number survived and ultimately thrived.  Things eventually got better.  And I learned a lot.

In my world view, the best leaders understand that failure is an integral part of things.  The cliche “fail fast” is one of my favorites.  When things aren’t working, deal with it.  Another is the famous line from Atlas Shrugged “Nobody stays here by faking reality in any manner whatever.”  Denying that failure is part of our existence is akin to faking reality.

While I accept “the experience of failure” feels “negative / crappy / depressing / hard / sucky”, I don’t believe that “failure is bad.”  Deal with it, learn from it, pick yourself up, and try again.

I’ve made a large number of mistakes in my life.  My goal when I make a mistake is to understand what I did wrong, learn from it, pick myself up, and move forward.  When I’ve made the same mistake for the third time, I usually finally figure out what I’m doing wrong.

While I’ve also had plenty of success, I never get confused about where most of my lessons come from.  In case this is ever ambiguous from my writing, I learn the vast majority of my lessons from my failures.  I also have learned what I don’t know, and have figured out that I shouldn’t venture into areas where I’m clueless unless I am willing to spend a lot of time up front researching them – at least to the point where I’m no longer completely clueless.

Matt McCall points us to a great essay by James Montier from Societe General titled Mind Matters: An admission of ignorance; a humble approach to investing.  I thought it was right on and was nicely reinforced by Matt’s very personal post titled Ignorance and Humility.

Alex Muse has a long, detailed post up about How [He] lost $20,000,000+ in 18 months.  It’s the story of his experience with LayerOne – the first version and the second version.  It’s a useful story on failure that harkens back to 2001 with a nice redemption twist at the end.

It’s unusual for a founder to write a long thoughtful post on the failure of his company.  Roger Ehrenberg – the co-founder of Monitor110 – which shut down earlier this week, did just that on his outstanding post titled Monitor110: A Post Mortem.  The post is oriented around Roger’s "seven deadly sins":

1. The lack of a single, "the buck stops here" leader until too late in the game
2. No separation between the technology organization and the product organization
3. Too much PR, too early
4. Too much money
5. Not close enough to the customer
6. Slow to adapt to market reality
7. Disagreement on strategy both within the Company and with the Board

Every person in every company that I’m involved with should read this post carefully.  Every entrepreneur should also.  Failure is part of the entrepreneur experience – Roger has done us all a great service by being willing to be deeply introspective and share his thoughts on what went wrong at Monitor110 in such a direct way.

A reader (thanks Austin) sent me two great failure links today.  The first is from BoingBoing and is titled J.K. Rowling on the power of failure.  It’s an excellent short segment from her excellent Harvard Commencement Address titled The Fringe Benefits of Failure, and the Importance of Imagination.

The next is a sign made entirely out of push pins that says "Fail Harder".

I spent the afternoon at TechStars meeting with five of the ten teams.  They are all dynamite, although some of them will fail at their current incarnation.  Just remember – fail hard, fast, and then get up and try again. 

Great, inspiring video on failure.

(thanks Scott).

I just finished reading Bounce!: Failure, Resiliency, and Confidence to Achieve Your Next Great Success by Barry Moltz.  I think Barry was originally introduced to me by Matt McCall, one of my co-investors in FeedBurner and a Chicagoan like Barry.

There are very few good business books about failure.  Most of the ones I’ve encountered in the past use failure as an early part of the "rags to riches" process of the classic Horatio Alger parable.  Dull.

Barry takes a different approach – he uses failure as a theme throughout the book and describes it as an integral part of a long term business experience.  Just like the cliche "you haven’t really been in business until you’ve been sued", I think the cliche "you haven’t really become an entrepreneur until you’ve failed at least one" applies.  Barry does a good job of weaving a variety of individual stories (including his) around his philosophy and theorizing.

Like most business books, it is about 50% too long.  Long ago I concluded that "editors" believe the hardcover business book needs to be around 200 pages.  As a reader, I think there should be a 100 page limit – that would force the writer (and editor) to get to the point and be less redundant.  While this doesn’t detract from the book too much, there are a few sections that are skimmers.

If you are an entrepreneur – especially one early in your career – this is a very worthwhile book to read. 

On the failure theme, Andrew Hyde has a post up titled Startups Fail that includes news about a handful of recent Boulder failures: Nau, Organica and Falling Fruit.  Andrew reminds us that failure is an integral part of entrepreneurship.

Rejection isn’t failure.  I’ve been back from vacation for five days (including the weekend) and I’ve send out around 100 50 (if felt like 100, but I went back and counted and it was slightly more than 50) rejection emails to deals that came into my inbox while I was on vacation.  It’s part of my job – and I try to always at least give a little context as to why something isn’t interesting to me.  But 50 in five days (really 10 days including the vacation) starts to be a little discouraging. 

I remembered a great email from a close friend recently in response to one of my previous posts on rejecting plans.  My friend is a writer and has completed several as yet unpublished books.  Following is her riff on rejection.

"Your post made me smile a little because it could so easily have been a post by a literary agent. One big parallel is that literary agents are inundated with people wanting their services (probably a lot more than you are – believe it or not!). A good agent, and there are a lot of them, receive an average of 1,000 unsolicited query letters a month. Surely, some get much more. These queries are equivalent to the pitches or emails you get. Like you, agents often won’t take on more than 6-8 new clients a year – if that. So, there are a lot of people (like me!) who receive a lot of rejections. It doesn’t necessarily mean the product is "bad", but as you say… if it doesn’t fit with the agent is working on, interested in, thinks the industry/market can carry at this particular time, it’s a "ding" a.k.a. "rejection." I’ve received hundreds of rejections that are postcards or sometimes, literally, a thin two inch strip of paper that has clearly been copied until it’s almost unreadable saying something like: "Thank you for your submission. Due to the number of submissions, we cannot reply specifically to everyone, but your writing is not right for us. The publishing industry is a very subjective one, and you should not take this to mean that it might not be right for someone else. Best of luck." -"blah blah agent name here" Sometimes, not too infrequently, if an agent allows electronic submissions, their website indicates: "we’ll only reply if we’re interested." That always seemed a little rude to me, that they couldn’t even find the time to send a form email. But, it is what it is… sometimes you’ve just gotta let these things go.

You’ve known me through this entire writing/publishing quest/process, and I have grown through it. After years and years of these rejections and hearing agents say that "it’s not personal," I actually "get" it. (This only happened a couple of years ago.) It really isn’t personal. Just as I am looking for an agent and publisher, these folks are truly looking, searching, and hoping for the next successful writer. They *want* to find something they love. They *want* to make that call to tell a writer that they’ve sold their book at auction… Unless I am incorrect, you are looking for "the next big thing" within your world, too. Something that will be successful for everyone, on many levels.

I know you asked "entrepreneurs" how they’ve felt, being passed on, I thought I’d chime in anyway, since I am quite familiar with this type of rejection, I believe. I think the perception varies depending on where the person is in life. Are they confident? Do they understand that it is, in fact, NOT personal? It took me years and years and years to understand that it’s not personal. I tried to understand before, but didn’t. I’d cry sometimes, for sure, and feel sad and gloomy under the sheer weight of these rejections. Then, I started not allowing the "weight" of these rejections to be so big. Remember that I am still unagented and unpublished and still trying to get successfully over those hurdles. But, my reaction to these rejections now is "oh well. I’ll just keep going."

I have also learned to listen when I get feedback…or when someone likes my writing, but doesn’t think they can sell a particular book….they are telling me something. Sometimes I get explicit invitations to "please send us a query of anything else you write" and sometimes it is more subtle, but I am reminded that there are things for me to learn from these "rejections." I’m sure the same is true – sometimes at least – from people you decide not to go with.

Maybe you like the people, think they’re great, but if they had a different idea, you’d love to work with them. There are always possibilities to create something new."

As I sit here in the San Francisco International Airport (they announce that so proudly over the PA when they tell me that the thread condition is orange every few minutes) I’ve been pondering the unexpected Frontier Airlines bankruptcy.  My Frontier flight is now an hour late so I’ve had plenty of time to surf the web and try to figure out how / why this happened so suddenly.  I’m also almost brain dead from my 10 day trip so it’s hard to actually do anything productive at this point.

I’ve determined that the bankruptcy filing is simultaneously a smart survival move for Frontier and an example of the classic "unintended consequences" (which my dad also taught me result from "complicated mistakes.")  This one is a doozy.  I have no idea what the actual facts are, but the WSJ asserts that the Chapter 11 filing by Frontier was in response to their credit card processor (First Data) increasing they amount and length of time of their holdbacks for credit card receipts.

Let me get this straight. I’m a customer.  I charge a Frontier ticket on my credit card.  First Data processes it but now holds the money until they decide to release it to Frontier.  As a result, First Data effectively controls Frontier’s cash flow (since almost all customer purchases are made on credit cards.)  All right, I got it.

In one of the articles I read, it was stated that First Data increased the holdback percentage from 45% to 100% and the time duration until "the flight was taken."  That strikes me as completely unreasonable on First Data’s part – they now control the float from the moment of purchase until the moment of flight completion confirmation (which I expect is a non-trival reporting process for Frontier.)

Frontier’s response – "Dear First Data: Bullshit.  We are filing for Chapter 11 and invalidate your ability to change the holdback terms.  See you in bankruptcy court."

All the chatter I heard today while waiting for my plane was whether Frontier would be going out of business and whether our plane would arrive.  The fact that is was an hour late didn’t help.  Nor did the fact that the electronic scoreboard announcing the flight time was not working and the gate agent wrote all the info on a piece of paper taped to the wall.  Everyone at Frontier is keeping their chins up and saying "no problem – this is just a technicality."

Hopefully I’ll get home today.  As one of my twitter friends told me – "at least I’m not on American Airlines."

I haven’t written much in the Failure series lately, but I’ve got a doozy or two coming soon.  In the mean time, Chip Griffin has a good post up titled Don’t Fear Failure, Learn from It.  Definitely worth a click through to hear about his three different kinds of failure (Spectacular Collapse, Death of a Thousand Cuts, and The Land of Lost Opportunity) as well as some lessons from his failures.

Alan Shimel has a fantastic post up titled Do they have to grow up?  As I read it, I thought of some of the great lessons my dad taught me when I was a little kid and how hard they must have been for him to carry out.

Amy and I have a regular discussion about whether or not it is helpful to tell a child "you can do or be anything you want."  Amy’s reply is that she could never be an NBA center and neither could I.  While the metaphor is a good one (e.g. "don’t let anyone limit your aspirations or dreams"), accomplishing things – especially amazing ones – requires a huge amount of hard work, perseverance, drive, skill, genetics, timing, and luck.  Alan nails it:

"At some level I guess it is part of growing up and realizing that you are not the next Nolan Ryan or Josh Beckett.  It is similar to a truth I come to grips with every day.  That is as I get older with each day, there are going to be some dreams and hopes that are going to go unfulfilled in my own life.  There are going to be mountains I am not going to climb. As I have gotten older I have come to grips with this reality and even accepted it. "

I must be brutal to be a father and have to teach this lesson to your child.  My first reaction to Alan’s approach was probably similar to some of the parents in attendance – namely – "make the madness stop."  But there’s a big part of it that is brilliant.  It’s one thing to be told something, it’s an entirely different thing to experience it.

I’ve just read Alan’s post for the third time and it gets better with each read.

"But I felt I had to do this. I think they had to learn this lesson, I just wish it were not the hard way.  After the game I gathered the team and told them baseball is a team sport.  Each member of the team contributes in their own special way.  They each possess a unique set of talents and skills that allows them to help the team, but not everyone is cut out to be a pitcher or a catcher. I think they all realize it now. Some of the kids accepted this and told me they did not want to pitch anymore.  Other kids said they would practice and try to get better. "

I’ve had my share of lessons I’ve learned the hard way – say Interliant, my biggest failure and the source of some of my greatest lessons, or my first 8.01 (MIT freshman physics) test which I got 20 (out of 100) on.  Failure is when you really learn things.  I just keep practicing and trying to get better.

My long time friend Ben Neumann has a detailed post up titled Network Outage.  Ben is CEO / owner of Globat, a successful web hosting company.  I met Ben through an acquisition in the late1990’s when Interliant bought his previous company Icom (also a web hosting company.)

Ben’s company had a tough day yesterday.  Multi-hour critical failure is a way of life in any rapidly growing SaaS / hosting / web business.  It’s nice to fantasize that it will never happen, but virtually every high growth company has "its moment of fun."  It’s all in how you deal with it, how you treat and communicate with your customers, and what you learn from it. 

Part of dealing with it is being open about what happened and what you are doing about it going forward.  Ben does a nice job of setting an example here of how to do it.

On top of the outage, it was Ben’s wife Andrea’s birthday. Andrea – I hope you gave Ben a raincheck and decided to celebrate your birthday this weekend!  Ben – hint – flowers, chocolate, jewelry, and a trip to Hawaii.

Mitchell Ashley has an excellent post up titled Fail Early, Fail Often.  I’m seeing a little more chatter about failure, introspection about how it feels, and suggestions about how to turn it into a positive (or at least effective) experience making the rounds.

As someone who has experienced a lot of success and failure, I’m glad to see more people talking about failure in the blogosphere.  It’s a key part of the entrepreneurial experience.  It’s also an integral part of life that cannot be denied.  While it’s a lot more fun to succeed, it’s important to understand how to deal with failure.

My partner Seth Levine has a cathartic post up titled Failure where he describes failure from a VC’s point of view.

My friend Dave sent me a hysterical Onion article titled Failure Now An Option.  I hate the phrase "failure is not an option" – of course it is.  Some choice quotes:

• "As failure continues to dominate the American landscape, this mantra must be overruled"
• "We have no choice but to revoke failure’s non-optional status, effective immediately,"
• "Now all citizens … will [be able to say] Fuck that – this isn’t worth it."
• "The only difference is that now Americans can choose, without fear of being ostracized by society, to quit long before getting ahead."

And some data.

"Other data seem to confirm the Interior Department’s findings. A recent CBS News/New York Times poll revealed that 64 percent of Americans are "perfectly comfortable" with coming up just short, 43 percent are content to try only once rather than try, try again, and an overwhelming 95 percent admitted that after falling down, they now prefer to stay down.  Only 4 percent indicated having "some interest" in applying their balls to the wall."

While this is typical Onion satire, the brilliance of it is its underlying relevance.