Today, I went to the Berkeley Entrepreneurs Forum to increase my knowledge about angel and venture capital financing. The event was hosted by the Lester Center for Entrepreneurship at Haas and Fenwick & West LLP.
The industry panel was absolutely fantastic and owed its success to three factors:
- The moderator was excellent. He asked clear, topical questions and kept the panelists on-topic from beginning to end.
- The discussion was casual and down-to-earth. Even though all three panelists worked in VC and tossed around billions of dollars on a daily basis, they actually avoided using industry jargon in their responses.
- Most importantly, all three panelists used charming analogies and personal anecdotes to answer questions. If they had delved too far into the weeds, I think they would have lost the audience.
The most outspoken (and consequently most charming) panelist was Joe Kraus, the co-founder of Excite.com, an early search engine, and JotSpot, a wiki company. Today, Kraus is a partner at Google Ventures. At one point in the conversation, he shocked the audience by claiming that learning from failure is a severely overrated concept:
“Failure builds character, there’s no doubt about it. However, a person always learn more from their successes than their failures. When you fail, you only learn what not to do. But when you succeed, you learn objective lessons that lead to further success.”
I agree. Failure is sometimes a necessary obstacle on the road to long term success. But that doesn’t mean people should actively seek failure to learn lessons. For the would-be entrepreneurs in the room, Kraus had the following advice to give:
“When you graduate, don’t directly join a 2-3 person startup. Chances are, it will fail and your morale will drop. Instead, try joining a mid-sized start up (30-40 people) or even a large, successful company so that you can witness and learn the frameworks, strategies, and decisions that lead to future success.”
Many people in the auditorium laughed nervously at Kraus’ comment about failure. That’s because everybody who has ever applied to an MBA program has had to write essays about learning from failure. I know I did when applying to schools.
It was very refreshing to hear somebody challenge assumptions. If your business fails, it’s not the end of the world. But let’s not kid ourselves. Failure is not all sunshine and rainbows. You can certainly learn from failure. But it doesn't mean you should set out on your next venture looking for failure.