Ninety Percent of Experiments Fail
Seconds and Cents, Episode 20 Episode 20. We're going to talk about something it's a Tuesday, I didn't record one on Monday. And this is something I was thinking about over the weekend. It's something that kind of is pervasive in my life. It's a mindset, I found. It's not a capability set. It's not something necessarily for somebody who has money. It's not something for somebody who doesn't have money that's trying to get money. It's not for somebody who has a team or doesn't have a team, it's just purely a mindset. And that is experimentation. Today, kind of it's gonna be a lot of personal stories, a lot of how is experimenting done in my business, how are we experimenting? What's our mindset towards it? And kind of once we have something that's successful, right, what happens? So my goal for the listener, my goal for you out of this is to really understand well, what is my mindset around that experimentation how has it been successful for me? how might it be successful for you? And ultimately, what's your risk tolerance? So I'm not going to say do the experiment or don't do the experiment or take the risk or whatever it is. But what's your risk tolerance? Here, I have a very high risk tolerance. It's something that I'm known for in my kind of social circle. And so my hope here is that my successes, my failures, help kind of prime you into understanding a bit more about yourself help you think about your own thinking. And ultimately, as you see the world a bit differently, as any entrepreneur does, you
really kind of have a language to think about experimentation with so what's the first thing that I think about here? Well, it's that I think nine out of 10 experiments fail. And not only do nine out of 10 experiments fail, but they fail really, really hard. And so in my world, the way that I treat it is that success
One has to pay for the other failures. And then it has to propel our business forward. What's that mean? Well, that means that I'm taking higher risks I'm taking, I'm doing more experiments, I'm doing more experiments, as my capability sets grow, I'm doing more experiments with those capability sets. As my cash grows, I'm doing more experiments with my cash. But ultimately, I only need one 10th of them to succeed. It's just that the one 10th of them that succeed have to pay for the rest in the event that the one that succeeds, doesn't pay for the rest. It's an interesting learning experiments, experience. It was an interesting experiment. But it probably didn't work looking into the long run. It's not something that I necessarily want to work through. So here, one thing that's interesting is in this mindset, that mindset that 90% of these things are going to fail. 90% of the things that I do are going to fail, and anything that I do in my business, as an experiment, from marketing, to sales to product development, to hires
We're going to talk about hiring Tamra and how that in itself was an experiment.
But anytime a failure is painful, so what I found in, in doing experiments, what I found in kind of having a mentality of, we're always experimenting, we're always looking to find something better to try something new, is that if failure is going to be painful, it means that I'm over leveraged in that area. So I have some current areas in my life where, hey, if I have to write this down as a failure, it's going to be painful. And what that tells me is that tells me that somewhere in my business, I'm over leveraged somewhere in my business, I am kind of not hedging my bets enough or there's a negative experience that I'm trying to avoid. So instead of running towards abundance, I'm running from a negative experience that could be in the future. But what I want to talk about my kind of example here is with a line mindfulness so my first ever client, my first ever consulting client,
I am so grateful to mind body align for giving me the opportunity to do align mindfulness with them,
which I would consider overall to be a long term success. So commercially, was it viable? No. Did we monetize it? Well, we did not. Did we drive a lot of app downloads? That turned into customers? We did not. But was it a success in that it accomplished the goals that we wanted to accomplish? Which was we wanted to bring mindfulness into people's everyday life. Yes, that was a success. Was it a success in that mind body line has a product that they're able to sell that they're able to bundle? Yes, that was a success. So here, however, the experiment was in itself aligned mindfulness on mindfulness was not in the core business of Mind Body align. They were my largest consulting client.
And they were paying my payroll. And ultimately, it was just me and it was one other person but I knew
If we lost Align Mindfulness, there was going to be a serious problem. And I was gonna start to have cashflow issues from day one. It's just how it was the time, I was just starting out, I was pouring all of my energy into a line, I wasn't able to take on more consulting arrangements. And so what I really needed to do was I really needed to diversify the business. Well, I knew that in the experiment that was align mindfulness as a product as a business.
It was gonna be really, really painful if a line failed. And so what that told me was, hey, in my business in my entrepreneurial life, I'm over leveraged right now. So as I think about this mindset of, well, nine out of my 10 experiments will fail, which is true nine out of the 10 experiments that I run, well absolutely fell.
And they'll fail really hard. If I think about that failure and it's painful. It means I'm over leveraged. There are some aspects of my business where I could fail. I could lose
$10,000 and I'm probably not going to be all that brokenhearted about it. But there are some other areas where I could lose a lot less or in fact, in shutting down an experiment, I'm actually going to make more money in the short term. But that failure is, is a painful experience. And so what we're doing right now is we're iterating to make sure that the possible failure turns into a success. So that's number two, let's talk about failure for a second. Failure is just tuition if you think about it as a learning experience, so it's just the price that you pay in order to learn the price, the price that you pay in order to grow. My example here that's really interesting is the pizza app. We had a business unit that was building apps for pizza shops, we had a pizza shop approached us. They said, Hey, we need apps that people can order through the app and then they could come pick it up. Then I'm a delivery service. So we weren't working with delivery although with a future customer. We work
They said, We'll pay you to build it. Well, what I thought was an interesting opportunity was this idea where I could build one pizza app. And I could just change the menu and sell it to all sorts of different pizza restaurants. And this app was a colossal failure. I mean, colossal failure. I ended up getting two clients, one of them never actually launched one of that the one that never launched, they just stopped talking to me, they paid their first invoice for the year, and they just did not want to do the pizza app anymore. I'm the only invoice that I've ever really written down before. And so because we had one that was outstanding, but I didn't like building the product, I didn't like servicing the product. I didn't like serving that client. It just wasn't the right clientele. For me. Every business has clients that are great clients for them and bad clients for them. And some people, some clients that are bad clients, from your great clients for other people, but I didn't really
Like any aspect of the business, and I just wrote down the thing I lost, I lost several thousand dollars minimum, which at the time was heartbreaking because I didn't have a lot of money, several thousand dollars was quite a sizable percentage of my overall net worth. And so for me, that was a painful experience. But it taught me so much about those types of businesses. It taught me about those types o