Let's say this is my second startup and for the first one there was a significant amount invested which included friends and family, angel investors and VCS. How do you recover from that in order to launch from scratch a second venture?
A great idea is 1% of the work. Execution is the other 99%. In this course, we’ll teach you how to conduct market analysis, create an MVP and pivot (if needed), launch your business, survey customers, iterate your product/service based on feedback, and gain traction quickly.
Recover emotionally first so that you no longer consider your first venture
If you don't think of it that way, you won't talk about it that way, and
the whole way you approach your next venture will be framed in a
dramatically different way.
You didn't fail -- you learned.
You are far more prepared than the first-time entrepreneur to start a
company. Catalog all your mistakes, what happened, what you learned, and
how you will avoid making those mistakes in the future. Be straight with
yourself, but don't be too hard on yourself either. If something that
happened was bad luck, then it was bad luck. Hey, it happens. The odds are
stacked against us, 10 to 1 according to stats.
We never really do anything wrong, we just act with imperfect information.
We're never operating with perfect information. If you'd known then what
you've learned since, you would have made different choices. This is the
nature of life.
And guess what - you may "fail" again! And that's okay!
Never give up. Just keep learning, keep looking hard at what you've
learned, then adapt and rinse and repeat.
If you learn from every attempt you make, then it is a success.
Believe that balls-to-bones (because it is true), and your pitch to your
next round of investors will be fine.
You were able to raise money for your first venture - you believed in something that other people believed in too.
Assuming a failure rate of start-ups of 90%, you are one step closer to success - If 9 out of 10 ventures fail, statistically, your 10th venture should be successful. To get to the 10th one, you have to make it past the first 9.
You know what it takes to start a venture - you started one. You can start one again.
You were smart enough to shut down - one of the hardest decisions to take is when to say "this is not working", and try something else.
You are actually "thinking" of launching a second venture - how is that failure? All the learning from the first venture is a huge asset for your second one.
With all those positives, I'm not sure what you're waiting for.
Be honest with yourself and those investors about why it failed.
Don't make the same mistakes again (aka learning from your mistakes)
Try and boot strap this next one to prove you can do it without spending other people's money.
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October 5th, 2016
Start thinking 1) Is there a way to reuse the ashes of this business in another venture? 2) What can I do for immediate income that will enable me to pay back my investors (because of course you DO want them along next time, and if you pay them back, they will not hold your failure against you--and also because you certainly don't want to hurt your friends and family financially). This might mean working out a payment plan where you pay a bit as you can, every month. 3) What kinds of businesses can I start that won't require any capital invested (and there are plenty)?
Well ... it will be hard to raise another "friends and family," round but
first things first ... you need to have a realistic and unbiased post
mortem ... a dispassionate and objective as possible analyis of what
heppened and why. Don't be concerned about blaming yourself when it is
clear that you screwed up ... investors realize that failure is part of the
learning process, in fact, a failure of two is not a liability but can be
an asset in the eyes of an investor. This is especially if you can show
you learned from it.
Don't try to sugar coat it. Be direct and and honest as possible.
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