Every entrepreneur knows that there is a significant risk of failure in their future, yet each of them is crazy enough to think that they can overcome the odds and be the startup that survives. Of anywhere in the world, Silicon Valley knows this fact best. Every day new companies are sprouting up in the valley with dreams of grandeur and every year hundreds of companies shut their doors for the last time.
What makes Silicon Valley a special place for innovation is that these failures don’t hold the same stigma that they hold in other cities or countries. One entrepreneur, Kamran Elahian, was so brazen with his failures that he put the name of his failed startup on the vanity plates for his Ferrari F355. When asked why he didn’t use the name of one of his successful companies he said, “It’s to remind me not to be too proud. Unlike other entrepreneurs who put the names of successful companies on license plates, I decided to put my biggest failure. That way, I have to be reminded of it every time I get in the car.”
Dave McClure, angle investor and founder of incubator 500 Startups, is a great example of the new thinking on failure that has washed over Silicon Valley. He sees the importance of his company in purposely trying to manufacturer failure as an attempt to create many things and in order to quickly determine which fail and which will survive. If you notice the language of “purposely manufacturing failure” means moving beyond a tolerance for failure to truly embracing failure. With two particular trends of more funding options for startups (i.e., incubators and crowd funding) and less IT capital required (i.e., rapid growth of cloud services) we will certainly see more opportunity for failed companies and failed entrepreneurs. Silicon Valley seems to have warmed to the idea of embracing, when will the rest of us?