A flimsy solution to the wrong problem
The Spanish press this weekend talked about a new online initiative to “banish the fear of failure”, in a bid to stimulate entrepreneurship. The European Commission is financing FACE Empreneurship, a digital platform that will encourage entrepreneurship through seminars and activities both online and offline, designed to help would-be entrepreneurs overcome their fear of failure. No, I’m not joking, I wish I were. €1.5 million is about to be spent on “fixing” the fear of failure.
Personally, I don’t see much evidence of a crippling fear of failure, certainly not one that warrants that much money thrown at it. The start-up scene, at least here in Spain, is bustling with good ideas that deserve success. We all know that they don’t all achieve it.
So, say we reduce the fear of failure and more entrepreneurs pile in with their startup ideas. Are these “additional” (as opposed to the startups that would have launched anyway) businesses going to make it? Will there be a noticeably higher number of successful startups because of this initiative? Let’s assume that some of them do survive. We’re still increasing the number of failed startups. But that’s ok, right? At least we’re no longer afraid of failure. Bring it on.
Seriously, in what way is increasing the overall number of failed attempts good for the economy? For the net affect to be positive, we would need to target the percentage of new businesses that make it. And for that, we need a different type of initiative. Obviously I’m not implying that, to make sure there are no failures, we should not allow any new businesses. The point that I’m trying to make is that the initiative is misdirected. Fear of failure is not the main barrier to success.
I know several entrepreneurs who did not have a knockout success the first time around, and yet are still willing to try again. They are willing to talk about it, too. That is a giant step in the right direction, that we see real examples of inspiring people not ashamed of failure. Strong people, willing to ignore the social stigma, and to use their experience to help others get through bad times. Entrepreneurship is very, very hard. Few fulfil their dreams. Most give up and go and get a stable, salaried job. Some pick themselves up and keep on trying. As Winston Churchill said, “Success is going from failure to failure without ever losing your enthusiasm.”
Did failure make these men and women stronger? No. They were strong to begin with. They learnt a lot, obviously – you learn so much more from bad times than from good times. But failure is something you survive, and these entrepreneurs were strong enough to do so. Most aren’t. Entrepreneurship isn’t for everyone, and failure can ruin lives.
So, should we remove the fear of failure? Isn’t fear, in general, a good safety mechanism? We’re not talking about not being able to quit smoking, or failing to get into the university you wanted. The kind of failure that we’re talking about can obliterate family savings, it can even cause people to lose their homes. And sometimes, there’s no climbing back from that, because of unforgiving structural factors that have nothing to do with psychology.
If we want to bridge the startup gap between Europe and the US, we should be focussing on reducing the consequences of business failure. Would we not be less afraid, if the consequences weren’t so severe? Should we not be doing more to help those who do fail, to pick up and start again? A focus on helping entrepreneurs to rebuild, the development of support systems to help them to do so, and the removal of the social stigma that accompanies failure in Europe, would do so much more to reduce the fear. I don’t believe that it’s the fear of failure itself that paralyzes, rather the fear of facing its consequences.
I’m going to assume that the objective is a higher number of successful startups, not just a higher number of startups, irrespective of whether they’re successful or not. So, to achieve the objective, aren’t there more effective things that we can do? Like, make it easier and less costly to hire people? More tax breaks? Better access to training, export finance and low-interest loans? Fewer laws that penalize investments in startups? An even better way of reducing the fear of failure is to reduce the risk of it happening.
Seminars, inspiring talks and interactive exercises will not doubt be motiving and possibly even fun. But, good for the economy? I doubt it. Increased risk is great for the winners. It’s not for the losers. And there are always many more losers than winners in this game.
And I seriously doubt that the main barrier to more successful entrepreneurship in Europe is a fear of failure. The European Commission should be focussing its euros and its time on encouraging structural change, not placating psychological blocks that could well turn out to be a good thing.
When will someone ask why European entrepreneurs are more afraid of failure than their counterparts in other continents? Once we figure that out, and once we start to deal with this fear at its source, then maybe we can get somewhere.