Fast Lane: Entrepreneurship takes practice

Fast Lane: Entrepreneurship takes practice

Entrepreneurs are too often afraid to fail in Australia, the land of tall poppies.

But a lack of failure may be what is holding us back, according to research published this year by the University of Stanford and University of Michigan.

The research, Serial Entrepreneurship: Learning by Doing?, examined the records of 2.8 million small retailers in Texas and found entrepreneurs were more likely to succeed the more times they had run businesses in the past.

This suggests entrepreneurship is more of a craft than an aptitude.

Repeat entrepreneurs are able to focus on the lessons and takeaways from a failed business, lowering the risk of failure in new ventures.

Over the 22-year period of research 2.5 million retail businesses opened and 2.2 million closed.

The researchers found the odds are overwhelmingly stacked against small retailers.

The median length of time the businesses stayed open was only 24 months; the average was 40 months.

“Failure is very, very common,” co-author of the research, Kathryn Shaw, said.

“It remains common even for those businesses that are led by serial entrepreneurs.”

The researchers found more experienced entrepreneurs increased their odds of success, adding to their business longevity with each new venture.

They experienced better success on their second, third or fourth time around, remaining open longer in each case.

But in Australia we gloss over or avoid stories of failure.

When Nikki Durkin wrote a blog post about her failed startup, 99 Dresses, it went viral.

“Most startups fail, and yet this industry doesn’t talk about failure nearly enough,” Durkan says.

“I’d encourage anyone who has failed to write about how it felt, as I can’t tell you how much that would have helped me in those final months and weeks. I just wanted someone to relate to. Instead, I was left feeling isolated and ashamed.”

Durkin has been inspired to write a book about business failure to share these stories.

But all of us need a change of mindset.

An entrepreneur with a business that didn’t work out is not a failed entrepreneur but an experienced one.

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