Office Hours: “What was your biggest failure — and what did it actually cost you?”
A student asked me a version of this in class. Here’s the answer I gave — the honest one.
The question, roughly as it came in: “What’s the biggest mistake you’ve made in your entrepreneurial ventures, and what would you do differently?”
Quick Answer: I signed a lease.
I’ll say it plainly, because the lesson lives in the specifics. While I was helping build and run a fitness company, we signed a lease on a space. We’d just raised a round. We had the money to do it. On paper it was the responsible, grown-up move. It became a disaster.
And here’s the part I want you to sit with: it wasn’t because we had a bad attorney. We had a good one. Looking back, there were things I should have looked at myself — things that weren’t legal questions, just business points — and I didn’t. Specifically: I’d have made sure the landlord — not us — was on the hook financially if we followed the lease to the letter and the condo board still took issue with it. There may have been no clean way to know it in the moment. I still beat myself up about it a little. But if I had caught it, it would have saved us around $200,000.
To give you the scale of that: the company at the time had just under $900,000 in annual revenue. So that mistake wasn’t a rounding error. It was a real chunk of a young business, gone. There was a lot of tequila involved after the fact.
We came back from it. The company still exists, it’s fine — but it sucked for a long time, and I won’t pretend otherwise.
So what do you take from it? Two things. First: get advice, and trust good advisors — but “I hired a smart lawyer” does not transfer the thinking off your shoulders. On any decision where you’re committing real capital, you still have to do your own pass. Not the legal pass. The founder’s pass. Ask the dumb questions out loud. What happens if this assumption is wrong? Where does this hurt us in eighteen months? Nobody owns that question but you.
Second, and this is the one I’d tattoo on a new founder: the uncomfortable conversation and the careful look only get harder the longer you wait. Whether it’s a lease, a founders’ agreement, or telling a partner something they don’t want to hear — do it faster. Today it’s awkward. Tomorrow it’s more awkward. The day after, more again.
Failure is fine. I mean that. Get up, learn the actual lesson, and go again. Just try to make it a $200,000 lesson once — not twice.