The question: What has been your biggest failure in business and what did you take away from that experience?
We invested in a multi-family project in Mississippi at the height of the market in 2006. The project didn’t make sense — it only did so because we lacked places to invest, which resulted in us accepting an incredibly high level of leverage and rosy assumptions that on paper looked great. The reality was that “paper accepts everything,” and you can’t simply trust a financial model to tell you of the risk/rewards of a project. There are times when one simply needs to stay in cash.
Daniel Ades, managing partner, Kawa Capital Management
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One of my many college jobs was selling ads for the yellow pages. I was terrible at cold calling and within three months was fired. I learned you have to love what you do to be successful.
Christine Barney, CEO, RBB Communications
I have truly been fortunate not to have experienced any “failures” in my 26 years in business, though there have been a few “bumps on the road” along the way, but these experiences only teach you to be a better business person.
Richard Behar, founder and president, Capital Clothing Corp.
I had to decide between staying on a job for zero pay or walking away. I decided to walk away because I thought it was unfair that ownership was unwilling to negotiate new terms based on current market conditions. In hindsight, it would’ve been better to stay the course, maintain the relationship and live to fight another day.
Alicia Cervera Lamadrid, managing partner, Cervera Real Estate
My first entrepreneurial venture was the co-founding of Renew Charter Management Organization where we changed how schools scaled using business principals. We opened 6 schools the first year, 11 the second and 16 the third year. I was the founding principal of one of the most successful schools in New Orleans. Batiste Cultural Arts Academy took students from a failing environment to ranking in the top 10 in state. Due to my success, I was recruited to Washington, D.C., which led to the critical turning point in my career. Six months into my time in D.C., a student of mine was killed in New Orleans. In my 10 years in schooling I had never lost a child. This was devastating and helped me to realize social services could not be the birthplace of the type of massive change I wanted to bring about because too much emphasis is placed on the leader instead of the strategies being woven into the very fabric of the organization. I also realized that you cannot help children/urban communities without economic development strategies. Why learn the periodic table when service jobs permeate the economy and the only jobs available are low-wage McDonald’s jobs? This failure/loss of life led me to leave schooling as an industry and refocus my skill set on a field where I felt I could truly make a difference. Maker Manufacturing has been the shift from school developer to manufacturing business developer. America exists because of industrial development and Americans through clean technologies can lead the nation once again in innovation and a healthy middle class can make stronger communities through the green jobs movement.
Pandwe Gibson, executive director, EcoTech Visions
Operating a restaurant was my biggest business failure. My takeaway was to avoid getting involved in food and beverage again, unless with a seasoned, successful operator.
Julie Grimes, managing partner, Hilton Bentley Hotel
When my brother Eric and I were in high school and college we made millions of dollars using high leverage in takeover stock arbitrage — we thought we were geniuses! When the market crash came in October of my Junior college year, we were wiped out. We took away from it that we should never, ever give up. Reversals mean opportunity and it was then that we decided to try to take over HEICO, as its shares had become cheap. This led to Eric, my father and my takeover of the company and the creation of nearly $3.5 billion in shareholder value and a company that’s one of the largest aerospace/defense companies in the world.
Victor Mendelson, co-president, HEICO
My biggest failure was a restaurant called Wrapido. This painful financial experience showed the value of perseverance and the understanding that all businesses must be nimble and have the fortitude to try new things. When your back is against the wall, you just have to dig deeper.
Abe Ng, founder and CEO of Sushi Maki
I invested in a technology company that did not have an engineer on its founding team. They completely relied on outsourced help and did not have a strong understanding of the technical components. Cost overruns and delays caused the business to burn cash too fast and fail. What I took away from that experience essentially was: Don’t open up a restaurant without a chef who has a meaningful vested interest.
Todd Oretsky, co-founder, Pipeline Brickell
We can always learn so many valuable lessons when things do not go as planned. One of the biggest regrets I have relates to the difficulty I am having in securing adequate state funding for the College. This story has been well publicized, but what I took away from the experience of our local voters being denied their right to support our community’s college, is that I need to fight even harder for our community’s voice to be heard. Another failure has been achieving balance in my life. Early on, my dreams and goals were a bit too lofty and with time, I learned to be more targeted and strategic.
Eduardo Padrón, president, Miami Dade College
Winding down my commercial mortgage business in the midst of the financial crisis was an agonizing and humbling experience that I’ll never forget. As a leader, it taught me that you can’t control everything, but you can control how you manage difficult situations. Transparency and open communication are key.
Joanna Schwartz, CEO and co-founder, EarlyShares
My biggest failure in business was missing a crucial deadline by 15 minutes that cost me a $500,000 award. That valuable lesson taught me about time management; to ensure everybody around me met their goals. As well, my supervisor recognized it as a learning experience; to know that everybody screws up, but second chances can lead to better relationships and opportunities.
Paco Velez, CEO, Feeding South Florida
Timing is everything, and while in the middle of due diligence going through the sale of our first company we decided to upgrade a server, and instead of making this more efficient it actually crashed and created many errors that took a great deal of time and energy to fix. The obvious lesson was: Don’t do a server change when you’re going through due diligence. But more importantly, that the company acquiring us had the trust in us to know that the situation would be resolved and the numbers were accurate.
Alina Villasante, founder, Peace Love World clothing
There are too many to mention, thankfully most have been small. Each failure has taught me a valuable lesson and collectively they conditioned me not to fear failure. If you fear failure in business or in life, you will be destined for mediocrity. I love to read biographies of famous people, and invariably, each of their lives are filled with small failures that paved the way to their ultimate success.
John Wood, president, Amicon Construction