Handling Business Failures Of Start-Up Entrepreneurs

June 22, 2015 8:38 pm0 commentsViews: 129

By : Dan Radak

business_failureThe estimates show that while 9 out of 10 startups fail, every established business has to get on with failure at least once during its operation. The reasons are diverse, ranging from the lack of cash to putting trust in the wrong people. Successful enterprises, on the other hand, besides having a premium product or service to offer, often base their success on well assembled team that knows how to handle minor failures. We can learn from them that fast recovery after an early fail is crucial for staying above the surface. Let us analyze the best ways to do it.

Estimate your assets

A part of your startup asset can be used for recovering your debt after a minor fail. When you have paid your dues and still have some equipment on your disposal, like machines, vehicles or property, you can either sell or rent them or incorporate them anew in another new enterprise. In some cases, if you have developed a brand that appeals to customers, you can always sell it to another company. Aside from these material assets, you also have one more invaluable asset, experience that you have gained from running your first startup.  

Paying back

Usually the hardest thing after your startup fails is the debt that remains once all the fuss is over. At this point, you might need to sell some of your valuable possessions, find a part-time job or change your lifestyle altogether. Failed Start1The second thing you need to do is call your creditors and arrange the debt collection plan. Recovery from debt is the most demanding part of enduring a startup failure, but if you work your way through it, you will end up stronger and more careful for future decisions.

Determine what went wrong

A crucial step in a startup failure recovery is ability to find out what caused the failure in the first place. That is your role and duty as an entrepreneur to avoid the same mistake all over again.  If you repeat the same mistake, you may even run your next startup company to the ground that will likely make you consider giving up entrepreneurship for good. Thus, in starting-over stage, you have to be very analytic as you conduct detailed inquiry. Make sheets and charts, ask your colleagues for help or even hire professionals to conduct the analysis.

Starting out again

You should not try to set up a new business unless you have elaborately planned everything and established new financial constructions for the future. If your startup needs more cash to get rolling, what you need to do is find several part-time jobs. That option is much better than taking a new loan from the bank while you are still lingering with the bitter taste of the previous debt recovery. Those part-time jobs will also give you time to think before starting a new startup company, and most importantly, clear your mind.

In a nutshell, staying positive and learning from a failed business enterprise is more valuable than anything. When the dust settles, you need to start over. You will certainly have more chances with all the know-how and experience from the previous crash.

 

Dan Radak  is a web hosting security professional with ten years of experience. He is a co-author on several websites and regular contributor to BizzMark Blog. He’s also interested in business promotion. Currently, he works with a number of companies in the field of online security, closely collaborating with a couple of e-commerce companies.

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