FAILURE

Failure is a reality which we all will experience, and ultimately have to deal with. There will be many failures before you are able to create the life that you want, especially if you are struggling to overcome disadvantages.

The Myth of Failure

Failure has been built up as one of the defining activities of modern life. We're told that if we’re not failing, then we're not trying hard enough; not trying big things, not stretching ourselves. The Silicon Valley “fail fast” approach to failure works well when you have a lot of Venture Capitalist money and you’re using other people's resources. It doesn't work so well when you're trying to pull yourself up by your bootstraps; when you're working from a position of disadvantage and trying to build your own income and your own businesses without many external resources. It's good to fail – and fail fast – then start again when resources are almost unlimited and the personal costs to you are negligible.

The Reality of Failure

In reality, failure can be very destructive, if you fail to the point where you've lost all your money, your house, your business, and your income streams. Relationships disintegrate, children are taken out of school, credit cards cancelled, bank accounts closed. Creditors appear from all angles and debts are sold to professionals who have many ways of finding you. Life can become very unpleasant.

The Inevitability of Failure

Failure is inevitable. We are going to experience it in life at some point, no matter how cautious we are. We cannot be overly cautious if we hope to overcome disadvantages. Living is risky business. Even with the best management, some risks will become reality. You need to survive in order to strive and thrive.

How to Fail

There is a way to fail in which we are not destroyed, and are able to apply the lessons that we have learned as we go forward. There are a few key things that have to be done in order to fail with purpose.

First things first: As usual with whatever we do, protect your health. If you are not healthy, you're not in a condition to get up and go every day. If you're battling with degenerative diseases, illness, or dependent on taking prescription drugs, it will be much more difficult to deal with failure. We need to protect our health. You can find more on how to do this here.

Secondly, you cannot plan for failure. You have to plan to succeed and work to succeed. You have to use all your experience and the experience of your mentors to make sure you have a workable plan. You have to put in all the protections and insurance you need to make sure that you do not fail. Do not accept the inevitability of failure when you're entering into a venture. Make sure that you have hedged your risk, that you understand it, and that you have a good probability of success.

Thirdly, and this is critical, you have to know when to pull the plug. You have to recognize when you have gone far enough down the road. You need to check these boundaries before you start, you need to stick to them, and recognize when you get to that point. When you have exhausted the initial pool of money that you set aside to do the business, it’s time to stop. Do not fly into the ground. Don't eat up all your capital and damage your capacity to create something else.

Fourthly, you have to fortify your position. You cannot allow the failure of one aspect of what you do to destroy the whole. Ships and submarines have what is called compartmentalisation. It is possible to seal off one part from the rest; this is how you have to see your life and your ventures. Compartmentalise. Do not let failure in one area bring down the whole. Seal off the leaking areas and stay afloat.

Fifthly, always have a marketable skill. This means you need to know how to do something that makes you money now. Your skill does not have to be anything to do with what you intend to do in life or how you see yourself; it only has to drive income so you can pay your bills. If you do not have such a skill, get one. Now it is easier than ever; you can use free or inexpensive internet courses to acquire valuable skills. Look here.

Number six is the most important point. It may be difficult for most of you to appreciate it now when many of you will not yet have anything to show, and nothing to lose. As you acquire, as you grow, as you climb higher and higher, you do become a target. More and more people will seek to bring you down; you have to guard against this. This is no easy task. If you have a business, then choose some form of incorporation to separate it from yourself. Avoid giving personal guarantees to creditors, and do not leave money in your business, even if you are a sole trader. If you have excess cash not immediately needed to operate, move it out of your immediate reach and that of your partner/employees etc. As you become wealthier, you might want to look farther afield for safe places to invest. Do not offer your primary residence as security for loans, have only the mortgage necessary to buy the home and keep payments current.

A final word on failure: How we are able to deal with failure depends on our attitude towards it. You need to see life for the journey that it is. Failure and success are just points along this journey, and they are merely the result of perception. Some have said that they are sides of the same coin. For both failure and success (or the perception of them), we need the same approach: Examine it, learn what you can, put it down, and move on.