Learning from Failure – Premature Scaling

Rewardme was a loyalty program for restaurants and retailers which closed down in mid 2015. The startup was funded and spent a lot of money in trying to acquire customers and scale the business. What made them close shop was that they spent huge amounts of money in acquiring customers without really having a clear business plan and product market fit. Their customer acquisitions costs went through the roof and eventually the startup ran out of funding.

Advice – Cash is king. You need to find the best product market fit before deciding to spend cash on scaling the business.

First-Hand Learnings of an Entrepreneur

Entrepreneurship teaches one a lot. The learning is first hand and very diverse.

Learning is broadly from the following 2 things.

Experiences: Whatever you do teaches you something. If what you do goes right, your learning is good. If is goes wrong, your learning is great.

People: An entrepreneur should keep learning from people around him/her. The more skilled or experienced the people around you are, the better the learning is. From picking up core domain skills to learning how to build a team, there is a lot which can be learnt.

A good entrepreneur will keep learning from his/her surroundings and activities. We should always 

keep our eyes and ears open and should develop an interest in learning as much as we can. Besides these first hand learnings, reading is also a great way to learn from other’s experiences.

What failure teaches you...

I've failed in my startup ventures till date.. I've tried more than a couple of times and have had to close down the ventures within 1-3 years from inception. I've lost money, confidence and respect towards me from my friends & family. I stand here today reflecting on what I've done. All looked bleak initially. But then, on analyzing further, I feel now that I have taken a lot from each of my ventures (which I will individually detail in other posts).

Failure has taught me things right from the importance of a business plan, team building, building a robust business model, having concrete estimates and expectations, having good mentors & advisers in your journey and so on. Probably, if I had to succeed in my first venture, a lot of this learning would not have come to me in as detail as it has.

So, failure is not bad at all. It's important to try and if you fail, just make sure you take back as much learning as possible. Repeating a mistake and failing a second time because of it is stupidity and a complete waste of time.