This post originally appeared last week in the Wall Street Journal as part of their Accelerators Program in answer to the question “When and how should you wind down a failing business.”

Some entrepreneurs and investors subscribe to the creed “failure is not an option.” I’m not one of them.

I strongly believe that there are times you should call it quits on a business. Not everything works. And — even after trying incredibly hard, and for a long period of time — failure is sometimes the best option. An entrepreneur shouldn’t view their entrepreneur arc as being linked to a single company, and having a lifetime perspective around entrepreneurship helps put the notion of failure into perspective. Rather than prognosticate, let me give you an example.

My friend Mark’s first company was successfully acquired. After being an executive for several years at the acquirer, Mark decided to start a new company. I was the seed investor, excited to work with my friend again on his new company.

Over three years, this new company raised a total of $10 million from me and several other investors over several rounds. The first few years were exciting as Mark launched a product, scaled the company up to about 40 people, and tried to build a business. But after two years we realized that we weren’t really making any progress — there was a lot of activity but it wasn’t translating into revenue growth.

In year three we tried a completely different approach to the same market with a new product. Mark scaled the business back to a dozen people in an effort to restart the business. Over the course of the year we tried different things, but continued to have very little success.

By the end of the year there was $1 million left. Mark cut the company back again — this time to a half dozen people. He started thinking about how to restart for a third time on the remaining $1 million.

Mark had never failed at anything in his life up to this point. He was proud of this, and the idea that he couldn’t at least make his investors’ money back was devastating to him. But he was stuck and started exploring creating an entirely different business, in a completely different market, with the $1 million he had left.

Mark was newly married and was working 20 hours a day. We were talking at the end of the day during the middle of the week and he was so tense, I thought his brain might explode. I told him that as his largest investor and board member, I wanted him to turn off his cell phone, take his wife out to dinner, have a bottle of wine, and talk about whether it made any sense to spend the next year of his life trying to restart the business with the remaining $1 million.

After resisting turning his phone off, I insisted. I told him that I gave him permission to decide that it wasn’t worth the next year of his life at this point and that as his largest investor it was perfectly ok to shut the business down and declare it a failure. I then said I was hanging up the phone and would talk to him in the morning. Click.

He called me back early the next morning. He was calm. He started by saying thanks for giving him permission to consider shutting down the company. This had never occurred to him as an option. During dinner, he realized he needed a break as he was exhausted. He wasn’t coming up with anything to do to reinvent the business and was just desperate to figure out a way to pay his investors back.

By morning, he realized it was time to shut things down, return whatever money was left, and take six months off to recover from the previous three years while he thought about what to do next.

We gracefully wound the company down and returned five cents on the dollar to the investors. Mark took six months off. He then spent six months exploring a new business, which ended up being extraordinarily successful. And he’s now very happily married.

Failure is sometimes the best option if you view the process of entrepreneurship as a lifelong journey.

When I was in Rio a few months ago for the Global Entrepreneurial Congress, I did a talk called “Day1” that Endeavor puts on. It’s a 20 minute presentation about “your day 1″ – a profound moment that impacted your entrepreneurial journey.

I decided to talk about a number of Day 1′s that I’ve had. I’ve always felt that with the dawn of each day is a new chance to “try again to be the best that I can be.” So my Day 1′s vary a lot – some good, some bad, but all full of lessons for me. They include:

• Me deciding not to be a doctor
• My first real job
• Hating MIT as a freshman and almost leaving
• Deciding to sell my first company
• Having Amy tell me I was a lousy roommate
• Learning they can’t kill you and they can’t eat you
• The power of a random day

I mention plenty of characters – some you’ve heard of on this blog and some new ones. My dad (Stan), Chris and Helena Aves, Dave Jilk, Len Fassler and Jerry Poch, Raj Bhargava, Steve Maggs, my partners Seth, Jason, and Ryan, David Cohen, and of course Amy.

When I give a talk like this I never really know where it will go when I start. I don’t prepare – it’s 100% extemporaneous. I was the second person to present a Day1 so I had 20 minutes to listen to someone else’s as I rolled around some stories in my head. Amy and I just listened to it together and it made us both smile and chuckle a lot with memories.

What’s your Day1?

The Deming Center for Entrepreneurship at CU is looking to hire a new Director. As part of the Leeds School of Business, the Deming Center prepares students across CU’s campus to think like entrepreneurs, act as social innovators and deliver as successful business leaders. It actively engages the community members of Boulder in order to accomplish this. The Deming Center also partners closely with Silicon Flatirons and other CU organizations to put on events such as the New Venture Challenge, Productive Collisions, and annually hosts the regional Venture Capital Investment Competition for MBA students.

This is an exciting opportunity to be part of CU and the larger Boulder entrepreneurship community. The person who serves in this Director role will have a unique opportunity to work with individuals both inside and outside the University to help foster and shape entrepreneurship on and off the campus. This person will also be responsible for the overall brand of the center as well as its operational and financial oversight. If you want to be part of a unique contributor to Boulder’s startup ecosystem, apply here!

For the past two days I’ve been at an even called SERGE (Seasoned Entrepreneurs Gathering Exchange). I co-founded it with two long time friends, Martin Babinec (founder of Trinet) and Keith Alper (founder of Creative Producers Group). Martin, Keith and I have known each other since the mid-1990s when we were much younger entrepreneurs playing leadership roles at the Young Entrepreneurs Organization (now simply “EO”).

We each invited about ten entrepreneurs and their partners to the event. 50 people showed up – 25 entrepreneurs and their partners – and we spent two days on Miami Beach hanging out and covering a lot of different topics. All of us were between the ages of 40 and 50 (+/- a few years), have each had at least one successful business, and were from all over the US and in plenty of different industries.

We had a solid 12 hours spread over two days in a conference room where the following eight topics were discussed.

• How Will You Measure Your Life?
• Mentor Manifesto
• Impact in the Public Interest – Doing Something That Matters
• Finding and Managing High Impact Board Members
• B Corps – Leveraging Social Purpose To Drive A Business
• Setting Up Family Office to Manage Diversified Portfolio
• Leading the Team: CEO Habits That Set The Pace
• Maximizing Impact of Your Angel Investing

One of led on each topic (for example, I kicked things off with “How Will You Measure Your Life?” – talked for about 15 – 30 minutes, and then facilitated a discussion for the balance of an hour.

It was amazing. If you’ve ever been in an organization like YEO, YPO, EO, Birthing of Giants, or Gathering of Titans, it was like a “super forum”. Two days with peers, talking confidentially and intimately about a wide range of issues, and getting to know each other at a different level. In this case, there were three intersecting groups (mine, Martin’s, and Keith’s) so you got the added bonus of meeting a set of new people that were highly vetted to be your peers that you could immediately trust and engage with.

Partners were included. Some – like Amy – participated for most of it. Others didn’t. This was the only big miss – we should have worked harder to include all the partners in the entire discussion, and have several of them lead topics. Next time.

Once again I was reminded of the power for entrepreneurs of spending time with your peers outside of the craziness of the daily schedule. 50 people invested two days of their life in this event – the feedback I’ve heard so far was awesome. And – for me personally – it was very rewarding.

If you are an entrepreneur, do yourself a favor and find a peer group. If you don’t know where to start, try Entrepreneurs Organization. You’ll thank me in 10 years.

I woke up to an email today from Aaron Schwartz, founder of Modify. I don’t know Aaron other than our email exchanges but he thanked me for Venture Deals which he said has been very helpful to him.  His note went on to say:

A close friend of mine, and one of my best friend’s co-founders just passed away after a 15-month battle with non-smoker’s lung cancer. I thought the below article was incredibly revealing about how meaningful a partner and leader can be for a start-up. If you think it would be useful to other entrepreneurs, I hope you’ll take a moment and share it.

I went on to read Farewell Hansoo, We’ll Miss You, a beautiful tribute by Bhavin Parikh, the CEO and co-founder of Magoosh. At the end, I had tears in my eyes. Hansoo is 35 and just died of cancer, which was discovered a year ago. I have several friends fighting cancer right now and had one die last year and this story really touched me – of the intimacy of the relationship between co-founders, the beauty of spirit of Hansoo, and how rapidly loved ones and partners can be taken from us.

I just made a donation to the The Hansoo Lee Fellowship to support entrepreneurs. The fellowship will provide  a stipend and mentorship to help Berkeley-Haas MBA students pursue their venture full-time for their summer internship, as Hansoo did. MBA students will receive a summer stipend of $5 – $10K, Mentorship from Haas alums focused on entrepreneurship, and office space.

At the minimum, I encourage you to read Farewell Hansoo, We’ll Miss You. And if you are inspired, make a contribution to the Hansoo Lee Fellowship.