Learning from Failure: Insights from Harvard's Professor Tom Eisenmann on Entrepreneurship

Meet Tom Eisenmann, Professor of Failure at Harvard Business School, who shares his insights on why startups fail and how entrepreneurs can learn from their mistakes to build more successful ventures.

1. The soul of entrepreneurship is putting an idea into the world quickly and rigorously without wasting resources testing it.
2. Skipping this step can lead to wasted time and resources on a bad first version of a product.
3. Tom Eisenmann is a professor at Harvard Business School who has been teaching and studying entrepreneurship for 26 years.
4. He is the author of the book "Why Startups Fail," also known as "The Professor of Failure."
5. Eisenmann's work on failure goes back about ten years, sparked by students asking if there was anything to learn from failure after being taught that two thirds of startups fail.
6. He found that students enjoyed learning about failure and saw it as a puzzle rather than something to be feared.
7. A truly good failure occurs when an entrepreneur has a hypothesis and tests it like a scientist, quickly and without wasting resources.
8. Some failures are out of the entrepreneur's control, such as those caused by external factors like Covid-19.
9. The biggest cause of failure for early stage startups is a false start, which can be caused by starting too fast without fully understanding the opportunity or market.
10. This can be due to the desire to build and sell quickly, skipping important steps like studying the opportunity and talking to potential customers.
11. The lean startup concept emphasizes building a minimum viable product and getting feedback from customers quickly to iterate and change.
12. However, it also includes much more customer discovery work that may take four weeks, which should not be skipped in order to save time.
13. Non-technical founders of tech businesses often fall into the trap of starting too fast by giving their engineering team something to build without fully thinking it through.
14. Even technical founders can fall into this trap due to their love of building things.
15. To do customer discovery work better, Eisenmann suggests using frameworks like those in "The Mom Test" by Rob Fitzpatrick.
16. Entrepreneurs must guard against people saying what they think the entrepreneur wants to hear and seek real feedback.
17. Another failure pattern is the false positive, where an idea seems great but has serious problems that are not recognized until it is too late.
18. Early adopters have different needs than mainstream customers, so entrepreneurs must talk to both groups during customer discovery.
19. Entrepreneurs can realize they are making mistakes or heading towards failure by testing their main assumptions and pivoting when necessary.
20. It is important for entrepreneurs to recognize their own mistakes rather than blaming others.
21. The fundamental attribution error, which assigns blame based on personal characteristics rather than situational factors, can be a problem in entrepreneurship.
22. Learning from personal experience is more powerful than learning from other people's failures due to the emotional connection with failure.
23. It is not inevitable for every first-time founder to fail, but it is important to recognize mistakes and learn from them.
24. Startups have brought positive change to the world by creating new technologies and products that improve our lives.

Source: EO via YouTube

❓ What do you think? What are the most critical self-reflection questions you can ask yourself as an entrepreneur to avoid common pitfalls and learn from failures? Feel free to share your thoughts in the comments!