As an entrepreneur, your business is like your child: You’ve invested a lot of time, money, and care into it. You’ve watched it grow over the years, and you wanted it to succeed. Likewise, you can feel a sense of loss if your business venture doesn’t work out in the long run. Then, at that moment in time, you need to know how to overcome a business failure to get back up and running.
Although none of us want our entrepreneurial endeavors to fail, roughly half of all small businesses close their doors within their first five years. Taking risks is part of being a business owner — and so is overcoming a business failure. If things didn’t work out the way you’d planned with your company, it doesn’t mean you aren’t cut out for entrepreneurship.
Countless entrepreneurs, from Walt Disney to Oprah Winfrey, failed before they struck success.
By learning from your mistakes, you can move forward as a business owner. Brought to you courtesy of Duquesa D. Dean, here are ways to pick yourself back up, emotionally and financially, so you can overcome a business failure and continue chasing your dreams.
How to Recover Financially
The first step to overcoming a business failure & the financial hardships of business closure is to understand why your business closed in the first place. Was there an economic downturn? Was it something you did, or did something happen that was outside of your control? Once you get clear on the reasons why your business didn’t work, you can learn from any mistakes and move forward.
Having a knowledgeable business mentor can help you ask the right questions, get clear on what happened, and ensure your next business venture is more successful. Every small business needs a mentor. Thanks to organizations such as SCORE, you can often find experienced business mentors who are willing to offer advice and input absolutely free of charge. These mentors can sometimes even refer you to business lawyers, help you secure funding for your next venture, or introduce you to resources within their network.
After you’ve taken some time to contemplate and prepare, you can start looking ahead to your next idea. As you consider your next business venture, online businesses and eCommerce websites could be an easy way to start making some passive income. For instance, you might set up a dropshipping business so you can sell products online without having to maintain a physical inventory. Dropshipping companies sell a variety of products, and you can usually zero in on trending items to get a feel for the marketplace. There are a plethora of dropshipping platforms out there, so try to find one that allows automation, has a wide variety of products to choose from, and provides free 24/7 support.
Lastly, if you haven’t already done so, consider registering your business with the state. Many business owners opt to register as an LLC due to the tax advantages and liability protection it provides. Ensure that registering as an LLC makes sense for your business, then connect with a trusted professional like ZenBusiness to handle all of the paperwork for you.
How to Recover Emotionally – Overcoming a Business Failure!
After closing your business, your finances shouldn’t be your only focus. Self-care practices are equally important. Give yourself all the time you need to grieve the loss of your dream. Spend time with people you love, write in a journal, or meditate if it makes you feel better. Create a positive atmosphere in your home by decluttering, organizing, and opening the blinds to let in more natural light.
Above all else, if you start to experience any of the warning signs of depression, such as fatigue or feeling hopeless, make time to speak to a counselor. Although some people might think entrepreneurship is about lounging around on the beach or working from home in your pajamas, running a business is hard work. It’s common for entrepreneurs to wrestle with depression, there’s even a term for it: founder depression. If you’ve been feeling blue lately, it’s okay to reach out for help, especially if you think your depression is worsening.
Remember, just because you started a business that ultimately didn’t thrive doesn’t make you a failure as an entrepreneur or as a person. By learning from your mistakes, you can hit the ground running on your next business and build an even stronger, more scalable business idea next time. After all, the right planning, funding, and flexibility could improve your chances of success and help you overcome a business failure.