Entrepreneurship, especially innovation-focused entrepreneurship, is very much like science—involving a series of experiments that can bring something new and valuable into the world. You cannot learn what product or idea will work without being willing to discover what won’t work. This is known by every successful entrepreneur, most of whom have business “failures” in their portfolios. Before Evan Williams started Twitter, he founded Odeo, the podcasting platform you’ve never heard of. Before Reid Hoffman created LinkedIn, he launched SocialNet, a dating site that didn’t connect. Nick Woodman shuttered EmpowerAll.com and Funbug before clicking with GoPro.

I have heard many US-based investors say, “I would rather back someone who has tried to start a business, even if it didn’t work. At least they learned on someone else’s dime.” The research indicates that this approach is right. To some extent, entrepreneurship is a numbers game, and those who try, and try again, create jobs and drive innovation. A predisposition to give entrepreneurs a second chance may help explain some of the variation in entrepreneurial activity across cultures.

“Failure” is critical to innovation entrepreneurship. I invested $40,000 in an e-book company that created the largest database of off-copyright texts that existed in the commercial market at the time. I lost every dime. Why? It was 1994. There were no e-readers. Laptops weighed 12 pounds and weren’t fun to carry around. You got on the internet via slow, dial-up connections, and Amazon didn’t exist as a distribution channel. Countless companies launched tablet computers that went nowhere—think Apple’s Newton experiment, which was released in 1993, before a market coalesced around the beautifully designed iPad and its App Store. Many factors including timing, markets, technology, and the right team need to come together in order for a new product or business model to be successful, and if someone cracks the code, value is created.

Source Credit: Chicago Booth Review
Read full story: https://bit.ly/2GxuMhp