Business failure can be good and nothing to be ashamed of: How to start again if starting-up doesn't go to plan
Some of the world's most famous and most successful entrepreneurs are also people who have failed, succeeded, failed again and built everything back up.
Indeed, Virgin boss Richard Branson recently wrote on his blog: 'Making mistakes and experiencing setbacks is part of the DNA of every successful entrepreneur, and I am no exception.'
He goes on to cite Virgin's failed escapades into weddings and cola that sit alongside the group's enormously successful airline, bank and media group.
Branson recently wrote on his blog: 'Making mistakes and experiencing setbacks is part of the DNA of every successful entrepreneur, and I am no exception.'
Yet, in Britain perhaps particularly, failure is often still regarded as something to be ashamed of.
If you're self-employed, a business owner or a would-be entrepreneur, understanding that failure is part of success is not only important, it's also helpful.
And from a practical point of view, there are plenty of ways to pick yourself up and dust yourself off before you start all over again.
Here to share his firm's experiences of some business owners who have suffered setbacks, is Tim Sawyer, chief executive of the Start Up Loans Company, who has pulled together his top tips for a starting a business when times are tough.
Top tips when starting again
Tim Sawyer is chief executive of the Start Up Loans Company
Starting your own business isn’t always a smooth ride, and for some, the first attempt doesn’t always go to plan.
Many business owners also have to overcome significant challenges in their journey to start a business.
Whether it be personal setbacks, a change in circumstances or finance issues, there are many reasons as to why a business might not succeed.
But failures don’t need to be the end of the journey – many successful business owners take the opportunity to learn from their mistakes, dust themselves off and try again.
1. Be tenacious and persevere – no matter what
Most start-up business owners don’t come from a background you’d expect. They are invariably run by the people who are brave enough and resilient enough to pursue their dreams and take the plunge, and not necessarily confined to those who have an MBA from a top business school. Many of our loan recipients come from challenging backgrounds, but have used their experiences to drive them forward to success.
I overcame homelessness, illness and fire to achieve success
Valencia Simpson owns The Kupcake Kitchen which launched in May 2016
Valencia Simpson owns The Kupcake Kitchen which launched in May 2016. She sells cakes and sweet treats, as well as hosting children’s cupcake-making masterclasses and taking on vulnerable people through the Job Centre and other similar organisations to try and get them back into work.
'I’d spent some of my younger years homeless due to unforeseen circumstances, and I had my first son at a young age,' she says. 'Things were not plain-sailing for me growing up. My second son was born with respiratory health issues and I used to sit awake with him throughout the night on many occasions. In the early hours of the morning I’d watch baking videos on YouTube to pass the time, which is where my love for all-things-cake started.
'I’ve also unfortunately had health troubles myself and at one stage I spent several days on a life support machine in hospital after contracting sepsis which affected many of my organs. As I was recovering, I had a lot time to reflect on things, and I knew I wanted to make sure the rest of my life was spent doing something I love for a living. It’s why I sourced funding to help me pursue my dream of starting my own cake café.
'Most people had written me off years ago, but it made me even more determined. I used the money from the Start Up Loans Company to fund the deposit for the café. Sadly things weren’t smooth from there on in. A few days after Christmas, I came home to find my house up in flames. All my possessions were ruined and I spent six months living out of a hotel room with two young children whilst trying to kick-start my business.
'To say it was a massive struggle would be an understatement. But, we have gone from strength to strength since the launch and I now plan on opening a new shop and publishing a cookbook. My advice to any potential business owner would be to keep the end goal in mind, and continue to work towards it as best you can, no matter what life throws your way.'
Valencia’s story is extraordinary. It shows that no matter what your background is, being determined and striving for success can lead to achieving great things. It also shows what having an end goal in mind can do.
For anyone looking to start a business, write out your goals for the 12 months. Bullet point exactly how you’re going to achieve this, and constantly review it. Keeping it saved on your phone or written on your fridge will help, for example.
And constantly remind yourself why you started this journey. If you’ve been inspired by another business owner, keep them at the forefront of your mind too.
Not only will it help give you direction, but when times are tough it will act as a reminder of what you started out to achieve.
Share your goals openly with your loved ones too, they will be some of your best business advisers when you’re at your lowest point. They can help remind you of what you set out to achieve.
2. When one door closes, another one opens
It’s important to remember that a setback in your career doesn’t have to signal an ending. It can give you the opportunity to change direction and try your hand at something you’ve always wanted to pursue.
Redundancy was the kick start I needed to set up on my own
Chis Evans launched Waterfall Ways, an events and catering company based in South Wales
After being made redundant, Chis Evans launched Waterfall Ways, an events and catering company based in South Wales. His business offers bespoke outdoor activities and adventure days on the edge of the Brecon Beacons National Park, as well as providing a catering service for both corporate and private clients.
'I’d had a successful career for many years, but took voluntary redundancy and decided it was now or never to take the plunge and start my own businesses,' he explains. 'I’d always had a bit of an adventurous streak, and with the help of an £18,500 loan, set up Waterfall Ways.
'Since then, it’s been a rollercoaster but our business has really started to gather momentum. As word spreads, bookings have sky-rocketed. We now employ a full-time member of staff, and eight part-time, just one year after we opened our doors.
'Taking redundancy wasn’t something I’d ever envisaged having to do, but it makes you re-evaluate your circumstances. Instead of seeing it as a stumbling block, I used it as a springboard to motivate me to do something I’d always dreamed of.'
It’s common for people who take redundancy to look for another job in a similar field, but we would encourage anyone in this position to use it as an opportunity for a ‘career 180’.
Think back to when you were at school and imagined a ‘dream job’. Would it be viable to give it a go now? Our main piece of advice is: when your career doesn’t go as planned, take it as an opportunity to make a change for the better.
Take some time to challenge yourself in to writing a brief business plan over a weekend.
If you find yourself excited and inspired afterwards, then rather than dusting off your old CV and applying for similar roles, devote yourself to building a solid business plan.
There are loads of free tools available online to help do this, like the British Business Bank’s Business Finance Guide.
3. If things aren’t working, rethink your strategy but don’t give up
Many start-ups think that from the outset their business will take an upward trajectory. Unfortunately, it’s not always plain-sailing, and for many, rethinking your initial strategy is the only option to keep your business alive.
My pop-up rent was spiralling out of control so I moved work to my home and now have cash to spare
Keisha Henry, owner of Gold Lazer, is a prime example of someone who has had to scale back her business after first starting up.
In April 2015, she launched her own laser cutting service, which she launched using a £9,600 start up loan to help her fund machinery and set up a premises from which to kick-start trade.
'Originally, I opened a pop-up shop, but it didn’t quite take off how I’d imagined,' she says. 'Rent costs were high, and maintaining the machinery was expensive. All my earnings went towards renting the premises and I new I had to downsize the business fast before it spiralled out of control.
'I made the decision to work from home to help save money. Now I have cash in the bank, and with the help of a second round of funding, I am looking to move into a studio space.
'I’ve learned that you have to be malleable when it comes to running a business. If I’d stayed as a pop-up, all my income would have gone towards affording rent.
'It was just a case of rethinking my strategy and looking at where I could cut costs, which would enable me to grow the business.'
Often, start-ups think that they must follow their original business plan word-for-word. But this can lead to failure as they are far too static in their approach.
We’d encourage people looking to start their own business to write a detailed business plan, but to revisit and evolve it constantly as the business grows.
You can’t predict exactly how your business will expand, or what might happen during your journey, so be prepared to rethink your original plan.
This is why it’s useful to have a mentor on hand to help you make vital decisions like this.
They will have had first-hand experience of decisions like this during their career, and having somebody else to learn from can be invaluable, which is why we pair our loan recipients with a dedicated mentor from the outset.
We’d advise you to meet them regularly, speak to them over the phone, or email them to seek their advice. Explore which funding and mentoring provider is right for you by searching online, asking friends or family for business contacts, or by attending networking events.
Most watched Money videos
- Big Money Questions: Would a Universal Basic Income work?
- Investing Show: Tips to choose the best funds for your Isa
- The Tesla Model X and its falcon wing doors
- Investing Show: How are UK companies doing?
- Watch the production of the one-millionth Porsche 911
- All you need to know about the new 12-sided £1 coin
- Investing Show: Will shares go off the boil or keep rising?
- Footage showing the amazing evolution of the Porsche 911 Carrera
- Time to invest in Europe? It's not fixed, warns Tom Becket
- Anthony Joshua receives 'phenomenal' bespoke Range Rover
- New Beatrix Potter 50p coins unveiled including Peter Rabbit
- The exciting launch film for Mini Remastered by David Brown
The comments below have not been moderated.
The views expressed in the contents above are those of our users and do not necessarily reflect the views of MailOnline.