I had lunch today with two entrepreneurs. I had been an advisor to their previous company, a promising startup that, due to some external personnel issues, had been forced to close down despite some early traction in the marketplace.
I met these entrepreneurs when they cold-called me based on my LinkedIn profile. And while they didn't fit the central casting profile for Silicon Valley entrepreneurs (while they were young, they weren't technical, hadn't got to a prestigious university, and didn't have any track record or contacts in the industry), they impressed me with their persistence and appetite for hard work.
I started off by providing informal advice, then eventually agreed to become a formal advisor, and hooked them up with the folks at Orrick to clean up their legal situation (like many first-time entrepreneurs, there was a lot of legal cleanup that needed to happen).
As I mentioned, around the time we began the fundraising process for a seed round, some external issues forced the company to shut down. The founders stayed in the general space, accepting positions with another startup.
Fastforward to today. We had lunch to catch up, and so the entrepreneurs could tell me that they had found a buyer for the assets of the company. One of the other advisors, after the shut-down, had gone to one of the company's primary competitors and told them what they were doing wrong, and how our company had planned to fix the issues. In response, the competitor made the advisor their CEO!
That advisor then turned around and bought the assets of our company. (Note that I don't see anything wrong with this; while there is a clear conflict of interest, it ended up helping all parties concerned) The purchase price wasn't great, but it would cover all the outstanding debts and obligations of the company.
Meanwhile, the entrepreneurs were very excited about their new company, and shared some of their war stories. As it turns out, they might meet with another company I'm advising to explore mutually beneficial collaborations.
While their company failed, and I didn't make a dime from the acquisition, I view the entire episode as an entrepreneurial success story. When I talk with entrepreneurs, I often paraphrase the old saying, "Any landing you can walk away from is a good one." Any exit is a good exit, especially early in your career.
At the end of the day, everyone benefited. I got a chance to learn more about an industry I didn't have a lot of experience with, and I met and built a relationship with two smart and hard-working entrepreneurs. The entrepreneurs learned a lot about building a business, and their progress impressed a hot startup enough to hire them into positions of real authority and opportunity. Even their investors and creditors got their money back. Heck, even Orrick came out ahead--the entrepreneurs brought Orrick on board as the law firm for the company they joined.
Most important of all, society now has two more entrepreneurs who might make an impact somewhere down the line, perhaps with their second company. Or their third. Or their fourth....
Back when I was in business school, I had a lot of classmates who defined success in terms of power, wealth, and fame. If you didn't run a major corporation or make $100 million, the thinking went, you were a failure. (In their defense, this was a time when you could go public on quarterly sales of $165,000)
This definition of entrepreneurial success is far too narrow and limiting. The odds are against any particular startup, and even against any particular entrepreneur's career. Otherwise we'd retire and live like kings in Patagonia.
If you learned important lessons, met interesting people, developed meaningful relationships, and walked away without losing your shirt, you're an entrepreneurial success. 99% of people will never get that far, and your life will be far richer for it.
Besides, there's always next time.