How to Fail Forward
There are two ways to fail: forward and backward. Failing forward puts you in a better position for the future, so that you look back on the failure as a rung in your ladder of success. Just as you can’t climb a ladder by skipping rungs, the failure was necessary. Failing backward results in stagnation — you continue banging your head against the wall — or even regression, where your next gig goes worse than your previous one.
How do you identify whether you’ve failed forward or backward? Answer the below questions:
• Did you develop significant new skills? For example, my startup Futurecam
failed, but I learnt technical leadership, project-, product- and people- management, being a founder, and a whole lot of other things. I catapulted ahead in my career. I failed forward. If that’s a failure, I want more, please!
• Does it position you one notch higher in other people’s eyes? It’s one thing to have skills, and another to be perceived as having those skills. Both matter. After Futurecam failed, I could get a call with any founder I wanted, and they invariably treated me with respect. I found that I was one level above being just an engineer. I had failed forward.
• Would at least one person you worked with sing your praises and recommend you for any opportunity to anyone without ifs and buts? If so, you’ve failed forward. On the other hand, multiple overconfident “leaders” leave behind a whole bunch of people who wouldn’t recommend him to anyone for any reason. If you’re building a positive reputation as you go along, you’re failing forward. If you’re building an army of critics1, you’re failing backward.
• Did it build your character? This is similar to the previous point about reputation, but viewed from an internal point of view. Character is internal, and reputation is external. When I was running my startup, the stress made me a little more aggressive than I normally am, and one person I was talking to to work together looked down on me, shook his head and walked away. I could instantly see why, and why I’d do the same thing if I were in his shoes. I was embarrassed. So I toned down my aggression and told myself I’d rather fail while treating people right than succeed by treating people wrong. If the failure helped you understand who you are, who you want to be, and whether you’re going in the direction you want to, and make amends if necessary, you’re failing forward. On the other hand, if the failure is compromising who you want to be, chipping away at your soul (but you excuse it saying it’s necessary to get the job done) you’re failing backward.
• Was the failure necessary? A necessary failure is like Nadal adopting a certain strategy in a match but failing. An unnecessary failure is like playing tennis with a broken racquet. To succeed, you have to do new things, and when you do, the chance of failure is higher than if you kept on doing what you already did. So you should look back at your previous failures and ask if they were necessary. When you ask this question, keep in mind who you were when you attempted that venture. For example, I made a lot of mistakes at Futurecam, such as focusing on building the product for years at the expense of user acquisition. Anyone who’s done a startup will tell you that’s a dumb mistake. And if I were to do a startup again, and I made this mistake, I’d classify it as an unnecessary failure. But in 2016, I hadn’t founded a startup. I hadn’t even worked at one. I didn’t manage people. I never worked as a project- or product- manager. For that person, the failure was necessary to learn. So when we ask whether a failure was necessary, we should ask if it was necessary given who I was then, not some hypothetical ideal “founder”. Analyzed correctly, my failure was necessary, so it amounted to failing forward.
• Did you repeat the mistake? If you’re making a mistake again and again, you’re failing backward. For example, one founder always promises people what they ask and doesn’t deliver. His mistake is that he doesn’t consider whether he can deliver before committing. He’s had disputes with customers, employees, consultants and more. Multiple people don’t take his calls. But he continues with the same behavior. He’s failing backward. On the other hand, if you’ve done something new, or done the same thing in a different way you thought is the best available option considering your earlier failure, you’re failing forward.
• If you repeated the mistake, did it have a smaller cost this time? I once lost ₹10 lakh on a bad team member. This is a huge amount for an individual, causing a lot of stress. This month, I fired someone, after having lost ₹1.5 lakh on him. That’s a 7x reduction in the cost of the mistake. I also fired him in 2 months2 rather than 6 earlier. Bad decisions have two kinds of costs — time and money — and I improved in both. That’s failing forward.
• Are you making bets that have a bounded and affordable loss? You can’t avoid occasional loss if you want to get ahead, but what you can do is make bets that have a bounded downside — you can’t lose more than X. For example, when I hired a junior engineer for my consulting practice, I hired him as a subcontractor rather than an employee. With an employee, I have to keep paying month on month even if I have no income, which creates a lot of stress for me. With a subcontractor, I don’t. I agreed to an emergency fund of a fixed amount, and asked myself, “Can I afford to lose this amount?” Only then did I go ahead 3. That's failing forward. On the other hand, betting what you can't afford to lose, or betting without knowing what the worst-case scenario is, amount to failing backward, because you're in a worse position if the bet fails.
• Are you able to say no to bad ideas as a result of having failed earlier? When you fail forward, you’re able to spot bad opportunities that come your way and decline them. For example, I was asked to be a part-time CTO at a startup. I said no, explaining that a part-time CTO won't be able to make fast progress as is expected in a startup. The founder ignored my input and hired a part-time CTO. The startup couldn’t make enough progress in tech and shut down 4. When you fail backward, you’re no better at evaluating opportunities than you were before, so you say yes to bad ideas and get into trouble. When you fail forward, you're able to decline bad opportunities next time.
• Are you able to empathize with others better? Say you played a certain role and failed. If you failed forward, you should be able to empathize with people in that situation, and derive benefit from it. For example, I failed as the founder of Futurecam, but I failed forward, so I’m able to work with founders better today as a consultant, in ways other consultants can’t.
In summary, it’s okay to fail, as long as you fail forward and create a much better future for yourself. Use this list to evaluate each of your failures and ask yourself whether you failed forward or backward.
Having a few critics is fine, having too many is not.
That too part-time, so probably 1-2 weeks of actual work.
You could say this is similar to the previous point of impact.
You need to see how the story plays out to validate your decision.