479: What To Do After Your Startup Failed?
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In today’s episode of The Startup Chat, Steli and Hiten talk about what founders should do after their startup has failed.
We hear a lot about startups that succeed and do very well, however, what is not talked about very much is the number of startups that fail and how these failures can affect a founder negatively.
So in this episode, Steli and Hiten talk about what you should do after your startup has failed, why letting go is super important, why you shouldn’t make instantly massive life decisions on that day your startup fails and much more.
Time Stamped Show Notes:
00:00 About the topic of today’s episode
00:16 Why this topic was chosen.
02:24 Hiten’s thoughts on what you should do after your startup has failed.
03:13 Why you should write stuff down.
04:02 How we’re supposed to fail.
04:55 Why letting go is super important.
06:30 Why you should talk to people that were involved in the startup and ask them what they think went wrong.
08:19 Why you shouldn’t make instantly massive life decisions on that day.
09:03 Why you should take some time off.
10:00 What you should do if your startup fails or is failing.
3 Key Points:
- Write a post mortem as soon as you can.
- You gotta find closure.
- We are supposed to fail.
Steli Efti: Hey everybody, this is Steli Efti
Hiten Shah: And this is Hiten Shah.
Steli Efti: And today on The Startup Chat we’re going to talk about what founders should do right after their startup has failed. So here’s the reason why I want to quickly talk about this with you. I realized this is actually a really important point. I’m not sure how much content is out there around this. This is not like what should you do as your next venture, but this is what did you do the day that you close up shop, right? The day that you stop service or the day of bankruptcy of the day where you officially have failed with your startup. What do you do the next day? And the reason I wanted to talk to you about this is that I have two good friends that are currently going through this where a startup that they’ve been working on for a long time, they had a lot of ups and downs. They fought very hard this year to try to turn things around and now they’re kind of in the final, final week of running the business and then closing up shop. And this is a journey that has taken them, I don’t know, five or six years. So they’ve poured a lot into this business and they are definitely more along the burned out, exhausted side of the spectrum and they’ve been having a lot of conversations individually. One-on-one with both of them on what should come next. And I think that it might be an interesting episode for the two of us to kind of unpack this for people either that go through this right now or just for people to have heard this in case they have to go through this at some point in the future. Typically when a founder comes to you Hiten that has just failed and just closed up shop and is now wondering, what the hell do I do next? Should I go try to find a job? Should I start my next project? Should I, I don’t know, go meditate at a retreat for a couple of weeks and find the meaning of life. I know that it is a very individual question that depends on so many different factors but typically guide me through kind of your approach or your experience or your general philosophy when it comes to advising or helping founders that have just kind of failed with a grim style.
Hiten Shah: Write up post-mortem. As soon as you can get that shit out of your head, period. That’s the first thing you have to do. I think you have to get it out of your head. You have to like, I did this maybe a little bit late after Kissmetrics and it was just literally stream of thought bullets of like as much as I could write about it. One angle is like just bullets on what you think you did right and wrong. Another angle would be just write the story of the business so that it’s just out it’s done. You’ve got to find closure and talking about it is great, but you talk about it for a long time with other founders and stuff like that, but writing something up for yourself in a journal or a notebook or whatever, some form of a postmortem where you can review the experience and let it out is really key. That’s the only thing I suggest. Everything else comes from that because once you do that, you’ll realize all the mistakes you made, you’ll realize whatever feelings you had, you’ll realize all kinds of things. Just do that. As soon as you feel comfortable doing that, maybe you’ll cry. I don’t know, but go do that. That’s the thing I suggest every and so many people don’t do it and then what they’re doing is they’re sitting with all of that for a very long time. They don’t get past the point of the fact that it didn’t work out and the thing is we’re supposed to fail. That’s what this whole idea of creating something from nothing is all about, we’re supposed to fail. It’s like a thing we’re supposed to fail. It’s not like we design it to fail but we’re supposed to fail like we’re doing something so risky already in terms of likely to fail. Right. And when you started looking at all the stats you’ll agree obviously, but at the same time we failed. It didn’t work out the way we thought it would or didn’t work out. To be successful you have to just let it out, let it all out, find your way to let it all out. I would write it though because nothing else compares to actually writing it down.
Steli Efti: I love this so much. I am very tempted to just wrap up the episode at this point. This is such powerful advice. I love it –
Hiten Shah: Honestly. Honestly dude, everything else is bullshit. Like there’s nothing more to it. But then letting that thing go. You can’t let it go if you don’t have a good relationship with it. That’s all it boils down to. It’s like anything in life where like you had so much energy, you put so much time and effort into it and for whatever reason it didn’t work out. You don’t want this delusion in your head about why it didn’t work out. You don’t want to wonder. You don’t want to have regret. You just want to figure out what actually happened in my opinion and how can I just let it out because that’s what leads to the most productive learnings from it.
Steli Efti: I love that. Two more things that I’ll add and then we’ll wrap up this episode, but this is super powerful advice and obviously this applies to many different situations. It could be even a project that didn’t work out, a product that didn’t work out, but-
Hiten Shah: A partner that didn’t work out.
Steli Efti: And a partner that didn’t work out. Yeah. I think that adding some flavor around this, one thing that I’ve done and advised and have gone through myself that I found incredibly useful and valuable is to talk to a few people that you respect about it and ask that people hopefully that you know were involved but were not kind of like maybe you’ll call from somebody who worked in the business every single day. So people, maybe friends, investors, advisors, people that you know maybe over the months, over the years you kept telling them news and updates and they would kind of following the journey from the sidelines, sit down with those people to have coffee and ask them from their, the information in their vantage point, what do they think went wrong and what is the type of advise that they had they gave you that they didn’t think you listened to or that they weren’t comfortable sharing with you at the time? What was something that you thought was going wrong but you didn’t know how to tell me or something I was doing wrong. You weren’t quite sure how to share with me. I’ve gone through that process with people and sometimes I’ve gotten enlightening pieces of information in ways that really helped me add some pieces to the puzzle. But you have to be open enough to want to hear, right, to really want to learn and listen and if you’re still in the face where you have a narrative that you want to hold on to and it’s kind of a waste of everybody’s time. I’ve seen this as well over and over again with founders come to me and they ask for honest advice and I can tell as I’m trying to give it to them that they don’t want to hear it. They want to go through the theater of pretending they asked for advice, but they’re holding onto their thoughts and their ideas and they’re so shielded against anything that is challenging that, that it’s like what’s the point of this? You came here to hear what you want to hear and everything I’m saying that doesn’t fit that you’re ignoring. Why are we, I’m just, I’m just sitting here. So you have, so you can pretend that you’ve asked for feedback around and gone through the process. But if you’re ready to truly listen and to hear painful things sometimes with things that are uncomfortable, that can be incredibly useful. And then the last thing I’ll say is, again, everything, there’s exceptions to everything, but typically I would advise people to not instantly make massive life decisions on that day. Right. If your start up, just failed maybe it’s not the right day to propose to somebody to get married or to start a new business or to make a massive investment or to take any kind of huge risk. Ideally, I think in most cases it’s advisable to take whatever time is comfortable and feasible. Maybe it’s a week, maybe it’s a weekend, maybe it’s a month or quarter. For some people it’s a year, whatever it is. But take some time off and fill up your batteries, have some fun, do something that has nothing to do with the past business or with future massive life decisions. Just take a little bit of a break because what you’ve gone through probably was very, very difficult, so just be gentle and kind and kind of refill your batteries a little bit before you step into life again and make big decisions and commit to longterm big projects or whatever it is. When people rush from one, from a failure into something, into a big life event, I’m typically nervous that, that might may or may not come from a place where you have the awareness, the presence, the battery tank to make really, really good decisions.
Hiten Shah: Yep. Yep. That’s it.
Steli Efti: That’s it from us. If you are listening to us and you are going through this currently, your startup is just failing or is just failed. You’re going through a really difficult time. We want to be here for you. If you have nobody else, if you think that we could be good people to listen, to, give advice, to give you feedback or just support you, you can always reach out email@example.com, firstname.lastname@example.org. Being a farmer can be lonely at times. The two of us know this too well. So when it will be, can make a difference at a founder’s life and make sure that they are not going through this alone. Its our honor and pleasure, so always reach out if you feel like we could make a difference to help. And until next time we’ll hear you very soon.
Hiten Shah: Take care.