What did your last business failure teach you?

[Philip J. Fry]

People who aspire to become successful fail often, because they're pushing themselves. Of that, people who are successful learn from their failures, as their failures show them their weaknesses, which is also usually also their biggest strength. They acknowledge their weakness, learn and develop ways to compensate it, and become a better, stronger person because of the failure.

The stupid do not learn from their failures and keep on doing what they've been doing before. They double down. It might go good for the short term but, in the long term, their weaknesses are going to catch up with them.

The losers are those who quit. They give up and go to something else. This isn't a bad choice IMO when the path isn't for you but, with regards to finance and economics, it's not a good choice as we're all bound by the limited resources of reality.

For me, we lost about $50,000 due to fraud from writers who were submitting spun or copied and pasted content. We're not giving writers a list of similar topics anymore but are randomizing keywords so that they can't take a section from one article and use it in many other similar articles.

For the business, we had to let go about 50% of the company. That sucked and we have a 2 year emergency fund right now. We can finance operations for 2 years, which fits with the length of a recession. We also learned that good employees provide wonderful human capital to the company: when some of the employees were gone, we realized how much they contributed to the whole. Business isn't an autocracy where one person makes the rules and others work. It might be that if you're in some dumb industries but, especially in tech, it's a community where ideas are discussed and debated so that ideas are refined and the best ideas come forth. I've been surprised by ideas I deemed bad, but the sales numbers proved me wrong. I'm humbled. IMO you just have to guide, mentor, cultivate good employees and give them room to grow and do things on their own. The autonomy is what allows them to take on risks and surprise you. You have to trust them.

I think that, of the HR problems posted here, it's due to hiring unskilled data entry personnel and expecting them to do things that they're not able to do. That's not what I'm talking about. I'm talking about educated employees who have careers. They're professionals who can do their jobs.

Anyways, what's yours?

 

[DanielS]

How important it is to enjoy what you do. Of course, nothing is perfect. Writing, formatting, editing, etc. can all be annoying. However, you must enjoy the project overall. If you don't, you'll never make it- you'll crash and burn after a few months.

During my previous venture, I was making the most money I had ever made in my life. The problem was, the work was soul-killing, repetitive, and unfulfilling. Nothing I did made things easier. When I check out of things mentally, it's game over.

Also, I learned that many problems are a result of underlying issues. As you could probably gather from my description above, I didn't enjoy the work I was doing. However, the real underlying issue was that I didn't enjoy working for other people (I was freelancing).

 

[ORMAgencyDude]

People who aspire to become successful fail often, because they're pushing themselves. Of that, people who are successful learn from their failures, as their failures show them their weaknesses, which is also usually also their biggest strength. They acknowledge their weakness, learn and develop ways to compensate it, and become a better, stronger person because of the failure.

The stupid do not learn from their failures and keep on doing what they've been doing before. They double down. It might go good for the short term but, in the long term, their weaknesses are going to catch up with them.

The losers are those who quit. They give up and go to something else. This isn't a bad choice IMO when the path isn't for you but, with regards to finance and economics, it's not a good choice as we're all bound by the limited resources of reality.

For me, we lost about $50,000 due to fraud from writers who were submitting spun or copied and pasted content. We're not giving writers a list of similar topics anymore but are randomizing keywords so that they can't take a section from one article and use it in many other similar articles.

For the business, we had to let go about 50% of the company. That sucked and we have a 2 year emergency fund right now. We can finance operations for 2 years, which fits with the length of a recession. We also learned that good employees provide wonderful human capital to the company: when some of the employees were gone, we realized how much they contributed to the whole. Business isn't an autocracy where one person makes the rules and others work. It might be that if you're in some dumb industries but, especially in tech, it's a community where ideas are discussed and debated so that ideas are refined and the best ideas come forth. I've been surprised by ideas I deemed bad, but the sales numbers proved me wrong. I'm humbled. IMO you just have to guide, mentor, cultivate good employees and give them room to grow and do things on their own. The autonomy is what allows them to take on risks and surprise you. You have to trust them.

I think that, of the HR problems posted here, it's due to hiring unskilled data entry personnel and expecting them to do things that they're not able to do. That's not what I'm talking about. I'm talking about educated employees who have careers. They're professionals who can do their jobs.

Anyways, what's yours?

So are you saying in summary:

Bad choices were made. You had to realize you were wrong. That ideas or thoughts you once had were incorrect. That you were not right before.

Changes had to be made and now you admit you made bad choices and were wrong. Now you are humble realizing that.

Is that a good summary?

 

[MinstrelJunkie]

Fry, could you please elaborate on what happened with the writers?

Did you have to take down the content they'd re-used from other articles they'd written? I encourage ours to just do a basic rewrite on similar articles if available, but I didn't think it would ever be a problem to re-use your own content. Maybe I misunderstood.

For my mistake, it's business 101. Not being diversified. Our income was solely Amazon Affiliates - and in the 8% categories for the most part. Revenue took a straight 55% drop when the commissions were changed earlier this year. Ouch.

We're now approximately 50% ad income, and I'm currently building up a second site, as well as looking to start with smaller affiliate programs. Fingers crossed that's the biggest % hit we'll ever take.

 

[Darth]

For me, we lost about $50,000 due to fraud from writers who were submitting spun or copied and pasted content. We're not giving writers a list of similar topics anymore but are randomizing keywords so that they can't take a section from one article and use it in many other similar articles.

Sounds like a massive project with a ton of content being produced, would be interesting in learning more if you are up to share.

 

[DanSkippy]

With the amount you posted here, am I missing something? There was no QA, editor or editor-in-chief, copyscape?

 

[LinkPlate]

This is not a business failure, but more of a personal one that I failed to recognize "earlier"

Working for an agency when I had the combined skill of 4 people working there and actually put in 3 times the effort to earn their trust, hoping for a raise! Never again will I let anyone undermine my skills or waste my precious time!

The thing that bothers me the most is that I realized my value a little late. But when I did!! Ohh boiii. I setup my own business (while working there), built a small client base (while still working there), used their printers (hahaa - free paper) and eventually made more money than my salary.

From the time I realized my value to launching a business - I was able to get a decent salary (on my own) within a 2 month period.

Technically, you could say that I monetized my time there while still on payroll - so they were paying me to be their competitor.

You could say I flipped the script on them bitches.

Wait.. it's not over. So what did they do once they realized that my "productivity" was down? A performance review haha

After the performance review, which is basically an excuse to tell you how shit you did and that you need to ADD more value (at least at my agency) - they decided to give me a trial period to "improve"

That was the best news I ever got! A time extension to grow my client base and become their most feared competitor (don't forget I know how they do things!).

After my awesome time extension were I landed more clients and tripled my salary. haha. So fucking satisfying. They decided to let me go!

So, I get pulled into a room with my "superiors" with a grim look on their face, saying bullshit like. "We are sorry to have to do this, but we have to let you go! You have been a great asset but it's time we go our separate ways - Consider this your 30 day notice and here is your severance package!"

To be honest, I had no idea what a severance package is. Thinking nothing of it, I thanked them and I left on good terms. No anger, no resentment - nothing! I just said, no problem and thank you for the opportunity! Looking back, they were kind of shocked and surprised at the same time. I think they expected me to argue and ask them for a second chance! Pffft. Not gonna happen.

So, I went to my house and google'd what a severance package is! Lo and behold, they were paying me for the next 2 months without having to work. hahaha. I was shocked! Can this be real? They are paying me to continue my journey!

Point here is, I underestimated my skills/value for a long time, but when I realized that - I flipped the script and got my time and some money back!

What I learned? -> You are only as good as you think you are. (you know what I mean!)

 

[darkzerothree]

Just having a side biz payment (SaaS that I want to get rid of) fall apart.

I ignored one rule I HAMMER into everyone.

Which rule? This one:
"NO WORK WITHOUT A CONTRACT!"

So now I am at "Fuck you. Pay me."

So.. whoever it is, mentor, guru, good friend, relative, girl you want to bone after she is impressed by your leet IT skills ....

NO WORK WITHOUT A CONTRACT!

I can't believe this shit happened. I am such a fucking dumbass.

 

[Philip J. Fry]

Just having a side biz payment (SaaS that I want to get rid of) fall apart.

I ignored one rule I HAMMER into everyone.

Which rule? This one:
"NO WORK WITHOUT A CONTRACT!"

So now I am at "Fuck you. Pay me."

So.. whoever it is, mentor, guru, good friend, relative, girl you want to bone after she is impressed by your leet IT skills ....

NO WORK WITHOUT A CONTRACT!

I can't believe this shit happened. I am such a fucking dumbass.

I get what you're saying but I think you're approaching it the wrong way. Is there social niceties, where you do kind things for other people? Yes. Do people who do not understand tech work (or any other field) incorrectly assume that it's easy, magic and therefore assume that it'll be no big deal for you? Yes. However, being dogmatic about being paid could alienate you from people whom you're seeking to create a contract with.

In my experience, it's not only "no work without a contract" but it's also "No work for people who can't afford my work." When people pay peanuts, they get monkeys the saying goes. People who are unsuccessful usually pay peanuts because that's all they can afford, hence they get low quality workers. This is OK if you're doing physical labor but when it's a hard skill, like tech, it'll go very badly.

If you were with a serious businessman (or businesswoman), they'd have you sign a contract and maybe a NDA and non-compete. What the contract would do is prevent you from asking for more money later on The NDA is to keep your mouth shut and the non-compete is so that you won't become a competitor in the near future.

Harsh truth but not only were you dumb enough to work for free, you were dumb enough to work for free for an idiot Next time, don't even waste your time entertaining offers from them. Even the negotiation period would be a waste of time after you've evaluated them as businessmen (or businesswomen).

Good luck.

 

[LinkPlate]

Not sure if this fits within the realm of failure, but definitely a lesson.

I decided to go after some charities and help them out for FREE. So, we reached out to a few charities and told them we will update their website and make sure its easier for people to donate and get them some extra traffic through traffic leaking.

The charity we chose had a very poorly designed website, donate buttons are wonky and they have no traffic going to them. They do however have a good nice team (or so we thought) and already did some great work before, as seen on a lot of news channels. We did the research before deciding to help them!

Anyway, we got on the phone and told them that we would upgrade their website and they would have to trust us with the design. They can't be picky (since we are doing this for free) and we will get their input before anything goes live!!

Awesome. We are feeling great to start and pumped to help out someone in need. Better yet, we are helping someone who is helping a larger group. Feels good!

First week comes in and we design a brand new logo that is better quality, use their brand colors and even have it animated. We send it to them to get their "approval". They come back to us with a few suggestions, like different colors and slight adjustments to the logo. We took their feedback and updated their logo to match their preferences. Sent it to them again for approval. Keep in mind, we need the logo to complete the website, since we will use those colors across their site.

Long story short, they were emailing us about changing the shade of green on the logo. When we ask them what color code they want - they literally say "just look outside - the color of the tree!". That just blew our minds (was also joke material for months! haha)

Anyway, after a lot of phone calls and back & forth, it became obvious that they didn't appreciate our time or help. They wanted to do things their way, even though they know nothing! We stopped the project and broke communication with them cold turkey.

Moral of the story. Don't do shit for FREE! If they really need help - they can figure out a way to get funds and pay someone to do it. There are very few people/organizations that will appreciate your time and actually let you help them for "FREE"

 

[Philip J. Fry]

Not sure if this fits within the realm of failure, but definitely a lesson.

I decided to go after some charities and help them out for FREE. So, we reached out to a few charities and told them we will update their website and make sure its easier for people to donate and get them some extra traffic through traffic leaking.

The charity we chose had a very poorly designed website, donate buttons are wonky and they have no traffic going to them. They do however have a good nice team (or so we thought) and already did some great work before, as seen on a lot of news channels. We did the research before deciding to help them!

Anyway, we got on the phone and told them that we would upgrade their website and they would have to trust us with the design. They can't be picky (since we are doing this for free) and we will get their input before anything goes live!!

Awesome. We are feeling great to start and pumped to help out someone in need. Better yet, we are helping someone who is helping a larger group. Feels good!

First week comes in and we design a brand new logo that is better quality, use their brand colors and even have it animated. We send it to them to get their "approval". They come back to us with a few suggestions, like different colors and slight adjustments to the logo. We took their feedback and updated their logo to match their preferences. Sent it to them again for approval. Keep in mind, we need the logo to complete the website, since we will use those colors across their site.

Long story short, they were emailing us about changing the shade of green on the logo. When we ask them what color code they want - they literally say "just look outside - the color of the tree!". That just blew our minds (was also joke material for months! haha)

Anyway, after a lot of phone calls and back & forth, it became obvious that they didn't appreciate our time or help. They wanted to do things their way, even though they know nothing! We stopped the project and broke communication with them cold turkey.

Moral of the story. Don't do shit for FREE! If they really need help - they can figure out a way to get funds and pay someone to do it. There are very few people/organizations that will appreciate your time and actually let you help them for "FREE"

Interesting story.

I get where you're coming from. My company offered to donate money to a local food bank during COVID. This was for their corporate sponsor's page. The assistant didn't reply for a month and, once she did, she forwarded me to her boss, who disregarded the information requests I sent.

I don't know where you're from or the non profit (or you really) but, to me, it sounds like different cultures. People who start non-profits have a different mentality than ones who start for-profits. Also, a non-profit operates differently than a for-profit. A for-profit maximizes profits for its shareholders. A non-profit receives donations and spends the majority of its funds for its cause.

To me, it sounds like you're saying "I'll help you make more money!" when, to them, they couldn't care less and might dislike you (or feel estranged from you) for presenting that argument. You could have stated it as you having solidarity with them and helping them with their mission.

Also, did you find out the education of the person you were talking to? He (or she) might not have a background in design and didn't know any better. He or she might just be picking a color based upon likability, which is him or her picking what he or she has been exposed to previously. If he or she wasn't exposed to good design and creative thinking, they'll lack the knowledge to understand and appreciate your logo.

For me, I'm learning that business is as much about educating people than it is about profits. If people don't understand something, they don't appreciate it (valuate it), and if the valuation is above the price the thing is being offered, they buy (in terms of a product or service)!

Looks like you need to work on your patience, empathy, understanding, and academic capital. I'm sure the logo and design would have been great. They just needed to know how to appreciate it. Also, if the deal worked out well, they could have taught you how to appear on TV!

Good story! I like it.

 

[darkzerothree]

I get what you're saying but I think you're approaching it the wrong way. Is there social niceties, where you do kind things for other people? Yes. Do people who do not understand tech work (or any other field) incorrectly assume that it's easy, magic and therefore assume that it'll be no big deal for you? Yes. However, being dogmatic about being paid could alienate you from people whom you're seeking to create a contract with.

In my experience, it's not only "no work without a contract" but it's also "No work for people who can't afford my work." When people pay peanuts, they get monkeys the saying goes. People who are unsuccessful usually pay peanuts because that's all they can afford, hence they get low quality workers. This is OK if you're doing physical labor but when it's a hard skill, like tech, it'll go very badly.

If you were with a serious businessman (or businesswoman), they'd have you sign a contract and maybe a NDA and non-compete. What the contract would do is prevent you from asking for more money later on The NDA is to keep your mouth shut and the non-compete is so that you won't become a competitor in the near future.

Harsh truth but not only were you dumb enough to work for free, you were dumb enough to work for free for an idiot Next time, don't even waste your time entertaining offers from them. Even the negotiation period would be a waste of time after you've evaluated them as businessmen (or businesswomen).

Good luck.

I may be stupid, but I am not that stupid.

People were paying me.. this is a project that has been running for nearly two years.
Now I want out and they are fucking me on the last payment.

We actually had an NDA (lol), but no contract.

Oh well.

PS: Also getting that $$$

Not sure if this fits within the realm of failure, but definitely a lesson.

I decided to go after some charities and help them out for FREE. So, we reached out to a few charities and told them we will update their website and make sure its easier for people to donate and get them some extra traffic through traffic leaking.

The charity we chose had a very poorly designed website, donate buttons are wonky and they have no traffic going to them. They do however have a good nice team (or so we thought) and already did some great work before, as seen on a lot of news channels. We did the research before deciding to help them!

Anyway, we got on the phone and told them that we would upgrade their website and they would have to trust us with the design. They can't be picky (since we are doing this for free) and we will get their input before anything goes live!!

Awesome. We are feeling great to start and pumped to help out someone in need. Better yet, we are helping someone who is helping a larger group. Feels good!

First week comes in and we design a brand new logo that is better quality, use their brand colors and even have it animated. We send it to them to get their "approval". They come back to us with a few suggestions, like different colors and slight adjustments to the logo. We took their feedback and updated their logo to match their preferences. Sent it to them again for approval. Keep in mind, we need the logo to complete the website, since we will use those colors across their site.

Long story short, they were emailing us about changing the shade of green on the logo. When we ask them what color code they want - they literally say "just look outside - the color of the tree!". That just blew our minds (was also joke material for months! haha)

Anyway, after a lot of phone calls and back & forth, it became obvious that they didn't appreciate our time or help. They wanted to do things their way, even though they know nothing! We stopped the project and broke communication with them cold turkey.

Moral of the story. Don't do shit for FREE! If they really need help - they can figure out a way to get funds and pay someone to do it. There are very few people/organizations that will appreciate your time and actually let you help them for "FREE"

As I worked in an academic setting (IT, and also helping partner orgs in the same field), I actually had almost the same experience.

When people don't have to pay, they lose sight of money/time.

The only thing that work in this case is clear boundaries (set max time / nr of revisions, etc).,

(Rich, coming from the guy without a contract in place, I know... tbh it was only that one time)

 

[Philip J. Fry]

As I worked in an academic setting (IT, and also helping partner orgs in the same field), I actually had almost the same experience.

When people don't have to pay, they lose sight of money/time.

The only thing that work in this case is clear boundaries (set max time / nr of revisions, etc).,

(Rich, coming from the guy without a contract in place, I know... tbh it was only that one time)

I agree that setting clear boundaries is needed for any work but I disagree that people "lose wight of time/money" with regards to free things. https://thedecisionlab.com/insights/business/impact-free-consumer-decision-making/ That article covers a few studies by Dan Ariely. In one study, they placed cookies in the hallway for $2 one day, 1 cent another day, and free on the last day. Based upon your statement, you'd think that people would take as many free cookies as they can but, in fact, people took less cookies than they did when it was 1 cent.

The argument is that, when things are free, it is no longer market norms that are in effect but social norms. Taking many cookies when they're free is considered rude. Buying many cookies when its 1 cent is considered finding a good deal.

I think all you have to do is tell the free client that your time and energy is limited and that he or she should pay someone else to do that other task. You don't have to over complicate things.

 

[ORMAgencyDude]

That article covers a few studies by Dan Ariely. In one study, they placed cookies in the hallway for $2 one day, 1 cent another day, and free on the last day. Based upon your statement, you'd think that people would take as many free cookies as they can but, in fact, people took less cookies than they did when it was 1 cent.

hmmm you find what you look for.

Since the free cookies were on the LAST day, maybe not as many wanted them because they had hoards of "good deal" cookies from the 2nd day stored up at home and are passing by again today and not "wanting" any because they have a stash at home.

Also, when something is "free" it is looked at as worthless. This is why people don't do anything when they are given great free information, but act once they have to pay ( or deal with the pain of giving something up in return ). The cookies were looked at as worthless if "free", same as with @darkzerothree time and expertise in this situation.

So many reasons why someone wouldn't want free cookies.

 

[southpaw]

The argument is that, when things are free, it is no longer market norms that are in effect but social norms.

Depends on what the prevailing social norms are. When working with (some) people of some cultural backgrounds, offering freebies is a disaster and attracts terrible clients. Word gets around quickly and the label of "cheap" or "free" is difficult, if not downright impossible to get rid of.

 

[Philip J. Fry]

hmmm you find what you look for.

Since the free cookies were on the LAST day, maybe not as many wanted them because they had hoards of "good deal" cookies from the 2nd day stored up at home and are passing by again today and not "wanting" any because they have a stash at home.

Also, when something is "free" it is looked at as worthless. This is why people don't do anything when they are given great free information, but act once they have to pay ( or deal with the pain of giving something up in return ). The cookies were looked at as worthless if "free", same as with @darkzerothree time and expertise in this situation.

So many reasons why someone wouldn't want free cookies.

I'll make sure to never give you anything for free!

Depends on what the prevailing social norms are. When working with (some) people of some cultural backgrounds, offering freebies is a disaster and attracts terrible clients. Word gets around quickly and the label of "cheap" or "free" is difficult, if not downright impossible to get rid of.

Yup! Psychology is the study of the individual. Who an individual is and his or her behavior is also determined by the society he or she is in.

However, with regards to consumers of cookies, I doubt anyone can be that terrible. I think you're more fed up with having worked with cheap people

 

[nothing]

My last failure taught me the stupidity of relying on someone elses platform, in my case, Amazon. Previous to that, Ebay/Paypal. Amazon really fucked me hard and whilst I can't prove it, I think they actually stole profit from me. This corellates with what other people have stated, though I have not as I don't wish to burn that bridge however much I dislike the company. I went from selling books on all platforms where Amazon outperformed by far to signing into "Select" which has a 90 day exclusivity contract and literally as soon as I did this and withdrew from the other platforms my Amazon income dropped by 90%. It's like they know they got you, so they can fuck you.

Never again.