Here is the simple, honest reality: Nobody actually learns from their mistakes.
Most people will tell you that failure is part of the process and that you should learn from your mistakes. But no one ever learns anything from their mistakes.
That’s because your ego makes it hard for you to learn. Most of the time, when you fail at something, you learn not to do it again. If you try to start a business and fail terribly, the odds are very low that you will try again.
If you spend some money and lose it all, it’s very unlikely you’ll ever invest again, according to statistics.
Then what should you do? How should you handle this situation of failure?
You have come to the right place to find out.
This is why you don’t actually learn from failures! Don’t worry if you don’t feel like reading, you can enjoy the video below or watch it on YouTube:
“Failure is part of the process” – Only half right
The correct form is “failure is an optional part of the process.” If you find success after taking a big L, it’s not because of the failure; it’s despite it.
Sure, your Ted Talk will sound more dramatic if you say failure taught you how to win. But we all know that’s not how this works.
We’ll argue that you have all the reasons in the world to avoid failure at all costs. We mentioned in the intro that, for one, you don’t really learn from your mistakes.
You have a tendency to gamble with the odds, and saying “Maybe this time will work” sounds more interesting than “Let’s adapt and apply what I’ve learned so far”.
Think about the people who keep buying lottery tickets. Every time they don’t win, technically speaking, they fail. As a matter of fact, it’s almost a guarantee that they will fail.
You are more likely to get hit by lightning than to win the lottery.
Yet people still do it time and time again. That’s because the hope of a different outcome is stronger than the impact of the lesson. Also, hoping doesn’t require any effort.
Moreover, it’s easier to hope this time it will be different than to actively think about what went wrong and strategize a plan.
Now, you all know the story of Colonel Harland Sanders, the founder of KFC. He faced many rejections before finding success with his friend’s chicken recipe.
As a matter of fact, the legend says he has been rejected a total of 1009 times.
And we say “legend” because nobody can actually verify that number. It’s an urban myth.
Yet his story, to this day, serves as an inspiring example of determination and resilience. The point we are trying to make is that failure is overly glorified and it shows in the ability to learn from failures.
Everybody knows how Colonel Sanders failed countless times.
But how many know what business model he was trying to sell?
If we were to ask you what valuable lesson you can take from the KFC example, what’s your answer? We’ll guess that most of you wrote “resilience” or “not letting failure dedicate your success.”
But how many of you wrote, “Sometimes, your timing stinks” or “You might be bad at pitching”.
Because, you see, let’s just imagine they were indeed 1009 rejections. After all those mistakes, he never learned from failure. The recipe remained the same.
So why was the 1010th time a success?
Well, nobody knows, and nobody cares. because that’s not interesting for most people. It’s not an inspiring story. This is what we mean when we say failure is over-glorified.
Nobody learns anything from failure. As it stands, it’s not an achievement.
We have been invited to plenty of celebration parties. We have yet to be invited to a party where they celebrate failure.
Now, the next reason you should avoid failure at all costs is really simple and straightforward.
Failure is a waste of time and resources.
It’s pretty obvious when you think about it. Let’s say you got all excited and are starting a dropshipping business. And you decide, for some reason, to drop $10,000 on ads.
And after you run the campaign and cross the line, you find out that your ads didn’t do much, and you lost money. You could say that you learn the valuable lessons of conversion rate and cost of acquisition from your failure.
But the reality is, you spent $10 grand on something you could have learned in 5 minutes from a course for a fraction of the price. By the way, we have some amazing courses on our website, just in case you want to really learn something useful. You can find them here.
In business, at least, failure is purely a waste of time and resources, on top of the opportunity cost. No matter how cute you want to dress it up, an L is an L.
And not only do you waste those precious, limited resources, but you are also now in a position where you first need to bounce back, then try something else.
So double the effort.
When you have employees on the payroll, shareholders, investors, and other business expenses, an L can really set you back big time.
So the recap, you don’t learn from your failures, and it’s also an over-glorified phenomenon that obscures the real negative impact it really has.
We could add the emotional toll and the stress, but by this point, we think you agree with us that in a perfect scenario, failure is not an option.
But we all know life doesn’t work like that. Nobody can predict the future, we can only make educated guesses, and sometimes, those guesses are wrong.
So, what’s the right approach?
First of all, throw out the idea that failure is a teachable moment. Let go of the mentality that failure is there so you can learn from it.
If you have unlimited money and time, sure, try as many things as you want until something sticks. But we’re guessing you are not in that situation.
Secondly, always think of the realistic worst-case scenario.
Let’s say you decide to invest in some stocks.
You’ve been watching the channel, you know what stocks we’ve personally invested in, and you’ve taken the first step. Also, a word from our lawyers, this is not financial advice. It’s our educated guess.
So you buy stocks in your favorite companies. What’s the worst-case scenario? No, it’s not those companies going bankrupt.
It’s you overleveraging with borrowed money, and then those companies go bankrupt. And now not only have you lost your money, but you are also in debt.
When you educate yourself on the worst-case scenario, you already start minimizing it. This takes us to the next step.
Do everything in your educated ability to make the worst-case scenario as manageable as possible.
If it’s still way out of your control, it’s a bad tradeoff. You won’t learn anything from your failure.
You see, every action you take in business is a trade-off between what you hope will happen and what will actually happen.
The better you are at making these trades, the more often you will find success. With this being said, there are two ways to do it.
First of all, your educated guess, or what you hope will happen, needs to be more accurate. And you do this by, well, getting more educated.
Let’s say you want to start a YouTube channel and become a content creator.
What you hope will happen is that you quit your job, work on your own terms, and be in full control of your time and money. Plus, you now have a cool job.
This is an uneducated guess.
When you learn that it takes on average 1-3 years for a channel to pick up speed, your guess gets more accurate.
Now you can say “If I stay consistent for a year and learn everything I can about content creation, there is a realistic chance I can build myself a secondary stream of income from producing content”.
The second method to make this trade-off better is to multiply the reward by the risk. Long-time Aluxers know about asymmetric risk. Check out this video if you don’t.
Essentially, this means the potential upside is unequal to the potential downside.
Imagine tossing a coin in the air.
If it lands on one side, you lose the coin. If it lands on the other side, someone gives you an extra coin. It sounds fun at parties, but in business, this is a huge waste of time.
But imagine you toss the same coin, and you lose it if it lands on one side, but someone gives you $10 if it lands on the other side. This is an asymmetric risk. This is also how people get super rich.
If you can’t minimize the downsize and you can’t find a way to maximize the upside, the trade-off will always work against you.
You see, failure is part of the process only when you get to play again. This is why you don’t learn from your failures.
If you start a business and it fails, and then you start another one and it fails, and you start a 3rd one and this finally picks up and you are now financially independent, then failure was a part of the process.
But if you run out of money after the second failure and now you are flipping burgers, there was no process. You just failed.
You see, Colonel Sanders didn’t randomly wake up one day in retirement and decide to go door to door to sell a fried chicken recipe until someone agreed to invest in his idea and create an empire.
He had already been in the restaurant business for more than 20 years.
He slowly got some franchising going on, and by the time he got tired, he sold the company for $2 million, remained on the board of directors for $60,000 a year and that was it.
What KFC is today has nothing to do with the story you’ve been told. It was just simple, honest work, over a long period of time. People love success stories despite all odds. However, most of the time, those are just stories.
If you ever find yourself in a position where you have to succeed despite all odds, that means you’ve goofed up my friend, and you made a bad trade-off.
That’s the failure that needs to be avoided at all costs because chances are you won’t learn anything from it. Put this knowledge to good use.
