Deadpool

Based on news that gets published, you would think that every startup raises millions in investment and inevitably goes on to be spectacularly successful. But for every Twitter and Facebook, there are many more failures. And these failures generate little attention.

Take a look at the Deadpool. TechCrunch has been tracking startup failures and it is a long, sad parade. These are, for the most part, very good ideas lead by brilliant people that have, for what ever reason, failed to thrive and been shut down.

Think of the destruction: laid-off employees, disappointed customers, exhausted founders and money down the drain.

In many ways there is more to be learned from failure than from success. What do I get out of this list in terms of strategy? There are three main points:

1. Get customers. We only have a business if we provide something that people will pay for. To quote Peter Drucker "The purpose of business is to create and keep a customer. "
   
2. Don't bet everything on a single idea. Investors have a portfolio approach to risk. For them, nine investments can fail so long as one is successful. We don't have a portfolio, we only have the one business. We won't be gambling.
   
3. Most ideas are not immediately successful. We have to be prepared to try many different things and we have to conduct these experiments cheaply enough so as not to risk the core business.
   

Our strategy seeks a balance. We innovate. We invest in new technology and ideas. But we don't do more than we can afford. We place business viability ahead of everything else.