As a tech investor, I’ve heard ‘fail fast, fail often’ countless times. A mantra that made its way over from Silicon Valley to Tech UK in the 2000s as a philosophy that celebrates failure by emphasising the knowledge gained to improve the chances of eventual success.
My favourite quotes about failure are Michael Jordan “I’ve missed more than 9,000 shots in my career. I’ve lost almost 300 games. 26 times, I’ve been trusted to take the game winning shot and missed. I’ve failed over and over and over again in my life. And that is why I succeed.”
And the famous Thomas Edison quote on his way to inventing the lightbulb: “I have not failed. I’ve just found 10,000 ways that won’t work.”
I’ve seen the positive and negative results of failure play out in my own life – having failed twice in Ironman triathlons to run the marathon. In Frankfurt 2018, I had trained for 9 months averaging 12 hours per week and spent hundreds of pounds on a coaching plan. I could not have been better prepared. However, I failed to execute, I failed to follow my nutrition plan and when the temperature rose to over 30c, I failed to adapt and take into account how factors outside my control would impact on my performance.
And this led me to thinking about the many different factors that management teams face, both in and out of their control, on their way to delivering their business plan.
After walking for almost two hours, I’d missed my time by a LONG way. Instead of elation at the finish line, I cried my eyes out. In my head, I was already committing to hours more training (and more importantly my long suffering wife was going to live through it) for a third time in order to achieve a goal that was only important to me.
Did my mental health suffer? Well, yes and no – for months after, I felt the loneliness and pressure of having put myself out there and ending in failure – emotions that lots of CEOs tell me they experience every day in the top job – but on the plus side, I converted the anger and disappointment inside me, into the drive to train to a (relative) success in the London marathon a year later, running 2h44m. Whilst my short experience in no way compares, I empathise with the feelings of a management team who have shown sustained commitment and drive, often against the odds, to grow a business over years.
So how can Private Equity – an industry that can only contemplate success and celebrates management teams with a perfect track record – cope with a concept that says it’s the people with a record of failure that go on to be the biggest successes?
In the end, it surely comes down to building proper relationships and trust:
Like Thomas Edison or many would-be Ironmen, Private Equity was never looking for perfect today – so we need a deal process and board relationship that reflects that – it’s always been about the opportunity to add value to the business, filling gaps in an incomplete team, and using our networks to build complementary skills around a CEO as the business scales.
Investors as well as entrepreneurs, repeat after me, “what would Michael Jordan do”.