Someone recently suggested I share some of my “money” related failures. My first thought was if I write about my failures, I will have to change to the name of this site to “What Not to Do” because there are countless examples! However, after a second thought, it’s a brilliant idea (thank you B.B.). Here is the first of a three-part series that will detail a few of my perfect failures. Each has created immense value, in the form of experience, and have helped me build wealth in its own unique way.
“Success is not final, failure is not fatal: It is the courage to continue that counts.”
Part One: Starting a business with an idea and postage stamp
Shortly before graduating high school my buddy and I decided to launch a clothing line. He had long hair (beyond being stereotypical, why that mattered is beyond me!) and I had developed a passion for surfing. Hey, there it was, the equation for the next Ripcurl or O’Neil. We picked a name (one that made no logical sense and had no connection to us or surfing), scraped together $300, and filed a “poor man’s patent”. This is essentially a ghetto attempt at a patent:
- Write out the company name/idea
- Place it in an envelope
- Add a stamp
- Mail the envelope to yourself
Geniuses! how could this possibly fail!?
We subsequently convinced our friend’s step-dad to allow us access to his silk screen studio that was in a warehouse with no AC (Keep in mind, it’s the beginning of summer) and bought a few cases of cheap T-shirts. We paid (I think $20) a friend to draw a logo of a palm tree and wave and immediately printed several dozen shirts. We were well on our way to fame and fortune!
Knowing we needed to get our brand some exposure, we gave a couple of our shirts to our football buddies (remember, this is a surf company) to wear around school. We then sat back and waited for the sales to pour in! The results were astonishing – we sold exactly zero shirts and were left completely confused!
Not to be discouraged and given our vast marketing knowledge (yeah, right!), we took a few samples to a popular surf shop and made our pitch. It went something like this:
Us: Hello, we are here to give you an opportunity to be the first to carry our up and coming clothing line!
Shop: Oh yeah? Tell me about it.
Us: Well, we have this sweet logo and know that people will buy it, I mean, check this out (pointing to the shirts we were wearing)…
Shop: (long pause) Hmmm. We don’t really have room (clearly not wanting to offend us)
Us: Can’t you see, we are giving you a chance to be the first retail shop to carry this amazing shirt and we will even let you keep 20% of the proceeds!
Shop: (longer pause) No thank you
That was the end of the discussion and the shirts sat in my dad’s garage while rejigged our plan…
We took the shirts to second-hand surfboard shop (I mean, one step above a garage sale) and offered them 30 shirts. We told them they could keep all sells proceeds if they would just hang the shirts on their rack and when sales went crazy, we would give THEM 80% of the proceeds of future sells. How could they refuse? Free merchandise for them and a huge cut of revenue. We were laughed at and told to get lost.
In the end, we convinced our friends and parents to buy our shirts and ended up making $320 in “charity”.
What went wrong? EVERYTHING!
What do I have to show for it today? A single, faded, reminder of my first company – one remaining T-shirt. Oh, and a sealed envelope I mailed to myself.
This was my first “perfect” failure. I learned to be courageous, but cautious. To be confident, but humble. To take risks, but be aware of the consequences. Most of all, I learned that the pain of failure is temporary.
If this were the cheapest and least painful investment I have ever made through the years, I would be one lucky guy.
Stay tuned for Part Two: “Greed Can Cloud Your Judgement”