Why Jeff Bezos Says It’s Best To ‘Fail Often’ When Building Wealth
Written by
Cara Danielle Brown
Edited by
Jasmine Browley
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According to Forbes’ Melissa Houston, business ownership remains one of the most successful wealth-building strategies. It ensures control over one’s financial future and offers unlimited earnings potential, tax advantages and the opportunity to make an asset that can be appreciated over time.
There may be no better example of successful business ownership than Amazon chairman and founder Jeff Bezos, who has amassed a current net worth of more than $200 billion. But that wealth wasn’t built overnight. There were certainly some setbacks along the way, especially in the early stages.
Amazon now promotes a “fail fast, fail often” culture. According to Bezos, failure is an essential part of success. GoBankingRates spoke to some experts about failing in business can be more helpful than you think.
Failure Teaches You To Spot Red Flags Early
Have you ever had a business partner or vendor who is unable to compromise or perhaps has particularly poor communication skills? Naive business owners may hope things magically get better over time. But seasoned pros know they don’t. They learned the hard way that these factors will sink an entire venture, and they will avoid them next time.
Erika Kullberg, attorney and founder at Plug and Law, explained that failure helps refine your business instincts: “A failed venture can teach you how to spot and react to red flags earlier, whether it’s bad partnerships, weak pricing strategies or unsustainable business models.”
Failure Helps You Address and Identify Your Biases
It’s common to assume others think and feel exactly how you do. But this is typically a mistake — especially in business. Other people don’t possess the same knowledge, experience or points of reference that you do.
“We can’t possibly see the full picture, so tactics and ventures we try won’t succeed every time,” stated Joel Popoff, founder and CEO at Axwell Wallet. “Failure helps disrupt limiting mindsets and seek more diverse experiences and answers, which in turn help us build better businesses.”
Failure Allows You To See Flaws in the System
Failing at something can be an effective way of error-proofing your processes.
“Failure has advantages, as it allows a person to see the flaws in their systems or strategies that might go undetected,” stated Brian Lim, founder and CEO at iHeartRaves. “For example, many e-commerce companies in their infancy faced what is known as customer churn due to poor fulfillment. These businesses ultimately recovered by refining the logistics of the processes involved, finding better suppliers and automating systems.”
Nate Banks, CEO of Crazy Compression said it best: “Failure is a crash course in reality.” In other words, failure is the most efficient way to learn what not to do next time.
Failure Teaches Resilience
For Sophie Musumeci, CEO and founder of Real Entrepreneur Women, failure has been one of her best personal and professional growth tools.
“In April 2021, I made $0 in my business. Instead of giving up, I became the best comeback story,” she said. Musumeci returned to basics to figure out what was and wasn’t working.
“I was hesitant to invest in paid ads, worried about spending $20 a day — now, I confidently invest thousands,” Musumeci stated. She tapped into her resilience, grew her company into a seven-figure business and now credits that failure as a turning point. It strengthened her wallet and resolve, making her the entrepreneur she is today.
Failure Can Lead You Somewhere Even Better
Paige Arnof-Fenn, founder and CEO of Mavens & Moguls, was risk-averse and scared of failure when she was younger. Now a successful entrepreneur, she doesn’t believe in failure.
Arnof-Fenn had a successful career working in marketing for a large corporation when she lost her job in 2001. Once she had nothing to lose, she suddenly had everything to gain. Arnof-Fenn decided to start her own company and now refers to herself as “the accidental entrepreneur.”
“Like most entrepreneurs, I am working harder and longer than ever and I have never been happier,” Arnof-Fenn stated. “Not getting what you want can lead you to magical outcomes.”
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