Stepping stones

November 23, 2018

“Every failure is a step to success,” remarked British philosopher and historian William Whewell—a statement that holds true in all walks of life, including business. One has heard this statement in other words from parents and teachers right from childhood. War is replete with examples where an attacker failed to breach the defences of an opponent despite numerous attempts but finally succeeded through sheer persistence.

The anecdote about King Arthur readily comes to mind, wherein he watched a spider continuously spinning a web to cover a cave’s entrance. But the web strands kept breaking each time. Undaunted, the spider went back to spinning the web again and again and again. Finally, the spider succeeded when the web did not break. The moral of the story, try and keep trying till you finally succeed.

While this statement can apply to everyday life as a guiding principle, it is equally applicable in the field of management for making a success of one’s ideas
and endeavors.

hurdles as stepping stones

Corporate history is rife with similar examples in India and abroad. In recent times, the case study of Air Deccan, conceived and built by Captain Gopinath, comes to mind. Although he ultimately sold Air Deccan, it still ranks as one of the breakthrough attempts in making air travel affordable for the masses. In politics, Mahatma Gandhi and Abraham Lincoln were two icons who failed repeatedly in early endeavors but doggedly pursued their dreams until finally victorious. Numerous obstacles and failures strewn in the path only made them more determined to finally script their own success stories.

The most legendary story in overcoming incessant failures is that of Thomas Alva Edison. The iconic inventor apparently failed more than thousand times in trying to invent the light bulb. Undaunted, he quipped: “I have not failed. I’ve just found 10,000 ways that won’t work!” Edison later acknowledged that if he had not failed so much earlier, he may never have emerged as America’s most prolific and renowned innovator.

Today, the world celebrates the success stories of many startups, some of whom have breached the unicorn club. What is less known is that some of their founders encountered initial failures before finally tasting the fruits of their hard work. OYO is one such example.

OYO founder Ritesh Agarwal first launched Oravel Stays, which was a portal aggregating budget hotel accommodations and then listing them online in order to boost their discoverability. Typically, the portal listed unbranded hotels on Oravel. Though this failed to take off in a big way, the early lessons from the failure came in handy for Agarwal in later launching OYO Rooms. What he learnt during the transition from Oravel to OYO was that the real problem was not discoverability. Instead, it lay in the lack of predictability, affordability, and standardization of rooms across India. Once this code was cracked, OYO went from strength to strength.

There are many examples in the start-up and other domains of repeated failures finally coming good, thanks to the persistence of promoters who never lost hope or heart in pursuing their dreams. Today, we speak blithely about these success stories without realizing the sweat, toil, and tears that flowed during the umpteen failures prior to success.

It is imperative, therefore, that we know the full story of how they ultimately emerged winners rather than runners-up. In all this, the fact coming through clearly is that if these final winners had not persisted in their efforts, they would never have crossed the finishing line first. Undoubtedly, the repeated failures can be considered as stepping stones to success when backed by sheer grit and determination.

funding and other fears

Across all eras, one of the biggest obstacles to business success emerges in the form of funding—or, rather, the lack of it. As a packaged food startup that markets light, nutritious snacks, Sattviko too faced similar challenges in its initial years. Naturally, the journey began by investing one’s own capital, besides borrowing from banks, relatives, and friends. Like many entrepreneurs, one also got going by operating from home, which helped in saving on the costs of purchasing or renting an office. When hiring employees seemed like a costly proposition, as a first-time entrepreneur, one managed by roping in relatives, friends, and other well-wishers—who were generally reimbursed with goodwill instead of cash!

But as they say, such good times never last long. Once the initial capital ran out, the outreach to venture capitalists and banks for additional funding began in right earnest. Of course, by then the early idea was already in a robust stage of execution. Procuring funding at this stage was more like a make or break moment. Had the funding not come through finally, there would have been little choice but to down shutters. Fortunately, fortune favors the brave. The initial funding came through, helping sustain the early momentum of Sattviko’s operations.

Once more, the importance of standing firm and weathering the early losses becomes clear. It is also crucial to repose faith in one’s business model and not be dismayed by early setbacks, which are generally part of the ‘teething problems’ of any new establishment. In this context, one can cite the example of another food industry startup, but for reasons of propriety, cannot disclose the name of this entity or its founders.

The company began as a restaurant chain but was unable to scale up well. In business, the ability to scale up can mark the difference between success and failure. The founders reached out to their close circle of family and friends to seek money, raising a robust amount to kick-start operations in earnest. Their idea was to open three restaurants with this funding and one base kitchen. Unluckily, when the property was taken on lease, the largest investor backed out. The company stared at losses and had little money for marketing their infant enterprise. The restaurant’s location was also far from ideal because many people did not venture there. Crowds only came on the weekends, indicating it was a bad location. Somehow, the founders kept operations running. Meanwhile, through word-of-mouth publicity, people came to know a good restaurant existed in the vicinity. Before long, they began visiting the restaurant to savor wholesome food. By the end of 2015, the founders managed to open seven restaurants in and around Delhi-NCR.

In the same year, one of the chefs in the restaurant suggested introducing packaged food that other restaurants do not provide as it helps in brand retention. Therefore, the founders rearranged the business model to test the waters as a packaged food company. Luckily, the re-modelled company did extremely well. Sensing the availability of a lucrative business opening, the founders decided to go the whole hog in transforming the entity into a packaged food company.

It is no wonder then when it comes to select businesses; some analysts believe the three main pillars driving profitable outcomes are: “Location! Location! Location!” Although food has a 365-day appeal and saleability, it is best not to push one’s luck by selecting the wrong location, thereby prolonging the gestation period towards profitability—which is what business is all about.