August 21, 2024 • 13 mins
Fail. A word we spend our whole lives running away from. The truth is that failure is the most common outcome for entrepreneurs and startups, but we rarely talk about these painful experiences with perfect candor and openness. The Real F Word podcast will explore invaluable learning and insight from the stories of failed businesses and collapses. These are the real stories rarely discussed by entrepreneurs and often hidden by investors.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Joe Grover (00:00):
Fail A word and experience that we spend our
whole lives running away from Aword I did not intimately
understand.
Until recently, my life wasfilled with progress, milestones
and growth, and it's not to sayI didn't have some
disappointments and some of theusual ebbs and flows, but I was
(00:21):
not acquainted with the actualdespair and darkness that comes
with letting so many people down.
I replayed the last few monthsa thousand times.
I've dissected every thought,every theory, each assumption
and decision that I made to tryto save this business.
Maybe it was arrogance that Icould solve an impossible puzzle
(00:44):
, but the realization that theoutcome was a result of some of
my decisions has brought me tomy knees and tears to my eyes
more times than I can count.
My heart has ached to the pointthat my body trembled.
My mind has spun justuncontrollably as I search for
(01:04):
answers, for peace, fordirection.
I have felt anger andbitterness.
I have felt remorse andhopelessness.
I have felt abandoned andlonely.
I have felt defeated thatreally is the word defeated.
Dead.
My care for people makesbusiness failure almost
unbearable.
(01:24):
Dead, my care for people makesbusiness failure almost
unbearable, whether it's thatlook on the face of an investor
who's lost all their money, orthe worry on the face of a
friend who doesn't have a job.
The weight of the decisionsthat impact people's lives sits
on shoulders not broad enough tobear them, and intellectually I
understand these outcomeshappen, even most of the time,
(01:46):
but emotionally I just can'tmake sense of it.
Peace eludes me as I search forlearning and for meaning in
what I've experienced the lastseveral months.
Hope seems as scarce as peace.
As things have crashed downaround me.
The collapse of something thatI have worked so hard for is
(02:08):
more than I can bear.
I tossed and turned most nightsbefore the crack of dawn on a
mental marathon without a finishline, thinking and solving and
praying, while I wondered whenthe sun would rise to steal away
the darkness in my heart andmind.
The only consolation isexperience, but I wonder if the
(02:31):
price is worth the reward, or ifthis experience will ever pay
back my family for the time andsacrifice, my investors for the
capital they've invested, or formy employees for the difficulty
I've caused them as well.
Why this happened?
It's a fair question, but onewithout a meaningful answer.
(02:53):
How did this happen?
I've been asked that so manytimes, but the confluence of
factors that led to this outcomecould not be replicated in a
way where the answer wouldprovide any relief.
So what is to be done?
There's really not much otherthan growing, learning and
moving on.
I am a failed entrepreneur.
(03:16):
Welcome to the Real F Word.
To the real F word.
That was my journal entry from2017.
And I have since reflected onthis experience over and over
and over again, and it's takenme these years to even get
myself to a place where I couldshare that publicly with you.
(03:39):
Welcome to the real F word, apodcast that dives into the
often overlooked side ofentrepreneurship failure.
Each episode featuresvulnerable, real conversations
with entrepreneurs who have feltthe sting of defeat, and we're
going to talk about false starts, failed launches and the
collapse of once-promisingstartups.
I'll invite our guests to sharetheir raw, unfiltered,
(04:02):
unvarnished stories of thesetbacks and disappointments and
the hard-earned lessons thatcome with entrepreneurship.
The Real F Word aims to reallyde-stigmatize the challenges of
entrepreneurship and willhighlight the resilience and
adaptability it requires to moveforward, but not by ignoring
the real personal and financialcosts of these failures.
(04:24):
Most importantly, we'll exploreinvaluable insights from facing
failure with perfect honestyand extract all of those lessons
and wisdom and insight to helpde-risk the journey for other
entrepreneurs.
These are the real storiesrarely discussed by
entrepreneurs and often hiddenby investors.
(04:44):
My name is Joe Grover and I'llbe your host.
I spent the first part of mycareer in venture capital.
Afterwards I had stints as aventure-backed CMO president and
CEO, and I'm excited to sharesome of my personal experience
and mostly learn from otherentrepreneurs that I've worked
with, and to set the stage forfuture conversations.
I'd like to share for the firsttime publicly how I felt when I
(05:09):
was dealing with my own painfulepisode of failure.
So I left venture capital and Ijoined one of our portfolio
companies in Denver, colorado,and the company was in the ad
tech space and it was booming.
Like we were growing, we werewinning all the awards for five
years.
Like we were hiring, we weretraveling internationally,
(05:31):
closing deals.
We were profitable.
In fact, we had twoopportunities to sell the
business and we should have likewe really should have, and you
know I probably advocated forthat, but I think the team and
investors especially they sawthis kind of meteoric rise and
they thought, listen, the bestis yet to come.
(05:51):
And so they asked us to keepbuilding and we did, and we kept
building and building and thenthe market started to falter and
ultimately, things started toshift and we did not adapt.
We did not make the rightdecisions in this market shift
that would allow us to continueto succeed, and so our business
(06:12):
started to contract a little bit.
We had raised some equity andsome debt.
And listen, when you have somedebt on your business and you
start tripping covenants, thingscan get perilous quickly, and
it did.
It got perilous, in fact.
The board came in and theyrestructured the leadership team
and they had asked me to stepin as the interim CEO and I
(06:34):
really had no interest in tryingto solve this.
It was an impossible puzzle tosolve.
I felt like someone had dealtme a two and a five, if you play
blackjack, and they expected meto beat the house and get 21.
And it's just tough.
So here's the reality is like Idid all that I could and I
remember we stood up in front ofthe company and we told all the
(06:57):
employees the day that theleadership teams switched, that
we had X number of dollars onour balance sheet and we had
five months of runway and thatwe were going to be forced to
make some really difficultdecisions and to cut expenses
and probably kind of shift thebusiness a little bit more to
adapt to the, you know, to themarket.
And then I met with everysingle employee, one by one, and
(07:20):
I was just really honest.
And some of those employeeswere kind of spooked and they
said, hey, I think I'm going toleave.
And I said, totally respect andunderstand that, and you know,
and a bunch of employees goodpeople left the company and that
was hard but it also helped usto reduce our burn rate.
So we cut our burn rate in half.
We kind of made some reallytough choices on who we were
willing to work with on thecustomer side.
(07:42):
That, you know, value-baseddecisions that didn't always
translate into revenue, whichwas which was really tough.
I had an incredibly supportiveboard, but in the end I had to
raise more capital.
So the spring came and we wererunning out of money again, and
so the clearest path was tomerge our company with a company
in New York City in the samespace.
(08:03):
And we did that and we wereable to capitalize the business
and we worked really hard.
But it just didn't work.
The combined company wasn't asstrong as the independent
businesses were, and so I had towalk in to that amazing team
that had rallied behind me andrallied behind the business and
lay off my management team andthe rest of the employees, at
(08:26):
least in that division of thecompany.
I remember sitting down with myhead of HR and she said Joe, why
are you on this list?
And I said because today isalso my last day.
And I just remember puttingmyself on the termination list
and thinking about this move Ihad made from Salt Lake to
Denver and bought a house inColorado, and I knew that there
(08:48):
wasn't going to be a goldenparachute there's.
There wasn't going to beseverance right, and that
impacted me, but it alsoimpacted all those people in
that room and so it was painfulbut it had to be done.
And then I proceeded tocontinue to work in the business
for some period of time.
I wanted to make sure we got itto a good spot and I met with
(09:08):
all the investors.
As the debt investors came inand essentially foreclosed on
the asset, I met with all theequity investors.
I called them.
In some cases I met with themin person.
I remember driving from StGeorge, utah, to Ogden, utah,
meeting with the local investorsto let them know that we hadn't
figured it out and we had takensome capital and it was
(09:31):
unlikely they would ever see adime from that investment and
that was really painful for me.
Um, and coming from the ventureside, I felt great stewardship
over those dollars.
I felt like people hadentrusted me with these dollars
and really entrusted me with thecompany to help turn this thing
(09:52):
around, and I wasn't able to.
And I remember just sittingwith one investor in a coffee
shop in Ogden, utah, and I waspretty emotional and I was
really discouraged, utah, and Iwas pretty emotional and I was.
I was really discouraged and Iremember he just listened and
then he paused and he looked atme and said Joe, how are you,
how's your family?
So I just remember like in thatmoment, like I was, I felt like
(10:18):
a complete failure and I feltlike I could maybe never even
show my face again in aninvestor meeting and this kind
empathetic gentleman was worriedabout me when I had lost all of
his investment.
It taught me a great lesson andI remember he said to me and
(10:42):
whether he meant it or not, Ireally appreciated the sentiment
he said listen, joe, if youasked me to invest again, I
would do it.
It was a risk I was willing totake and I know you did all that
you could, and so I reallyreally appreciated that and I
realized that I could move on,that I could be accountable, I
could really learn from thisexperience so that I don't
(11:05):
repeat the same mistakes.
But I could move on, I couldbuild again.
So that's what I'm working on,that's what I've been doing for
the last seven years.
So that's a little bit moreabout that story and I hope that
that experience and some of thelearning there will be
beneficial to you as you buildyour companies.
So, at the end of this wholeexperience right, laying off
(11:26):
employees, losing all the equityinvestors' money, having to
meet and talk and explain thisto all those investors, talking
to vendors whose checks wouldnever be in the mail after that
I just I had to reflect.
I had to think like what do Ido with all this?
What do I do with all thisexperience?
And I've shared bits and pieceswith a few close friends over
(11:49):
the years, but I just decidedthat I have to share it.
I have to be raw, I have to bevulnerable, I have to like, open
up and and listen.
I mean, this is whatentrepreneurship is all about.
In fact, most of the outcomeslook more like this than they
look like the you know the IPOwhere someone makes a billion
dollars but we never talk aboutthe failures.
(12:10):
We never talk about the realityof, and the cost of those
failures the cost emotionally,to our mental health, the cost
to our families, the cost toinvestors we don't talk about it
.
It literally is a footnote inan investor.
Investors we don't talk aboutit.
It literally is a footnote inan investor report.
Because they don't talk aboutit in their annual meetings and
entrepreneurs don't want toadmit it.
(12:31):
In fact, they want to move onfrom that so quickly and there's
some that's healthy too, tomove on quickly, but that they
don't even take enough time toreally just like live in this
space where we can learn andgrow and feel some pain.
And so the Real F Word podcastis all about us living in that
space and listening and learningand being real and authentic
(12:55):
and vulnerable, and I think ifwe can do that, we're going to
learn as a community that it'sabsolutely okay to fail.
And it really is the cost ofinnovation.
That failure is the cost ofbuilding something worth
building, of creating value, ofdoing something different.
And I know we talk about thatintellectually, we read about it
(13:17):
in textbooks, but we don'treally talk about what those
failures are like for theentrepreneurs that have to live
those experiences every singleday.
That's what this podcast is allabout.
Thanks for tuning in to theReal F Word.
The Real F Word is failure, andremember that failure is a
stepping stone, it's not just astumbling block.
(13:38):
Join us next time as wecontinue to explore the journey
of resilience and growth,without ignoring the true cost
personally, professionally andfinancially that comes with
failure.
Keep learning, keep growing andkeep embracing the real stories
of entrepreneurship.
See you next time.
Fail A word and experience that we spend our
whole lives running away from Aword I did not intimately
understand.
Until recently, my life wasfilled with progress, milestones
and growth, and it's not to sayI didn't have some
disappointments and some of theusual ebbs and flows, but I was
(00:21):
not acquainted with the actualdespair and darkness that comes
with letting so many people down.
I replayed the last few monthsa thousand times.
I've dissected every thought,every theory, each assumption
and decision that I made to tryto save this business.
Maybe it was arrogance that Icould solve an impossible puzzle
(00:44):
, but the realization that theoutcome was a result of some of
my decisions has brought me tomy knees and tears to my eyes
more times than I can count.
My heart has ached to the pointthat my body trembled.
My mind has spun justuncontrollably as I search for
(01:04):
answers, for peace, fordirection.
I have felt anger andbitterness.
I have felt remorse andhopelessness.
I have felt abandoned andlonely.
I have felt defeated thatreally is the word defeated.
Dead.
My care for people makesbusiness failure almost
unbearable.
(01:24):
Dead, my care for people makesbusiness failure almost
unbearable, whether it's thatlook on the face of an investor
who's lost all their money, orthe worry on the face of a
friend who doesn't have a job.
The weight of the decisionsthat impact people's lives sits
on shoulders not broad enough tobear them, and intellectually I
understand these outcomeshappen, even most of the time,
(01:46):
but emotionally I just can'tmake sense of it.
Peace eludes me as I search forlearning and for meaning in
what I've experienced the lastseveral months.
Hope seems as scarce as peace.
As things have crashed downaround me.
The collapse of something thatI have worked so hard for is
(02:08):
more than I can bear.
I tossed and turned most nightsbefore the crack of dawn on a
mental marathon without a finishline, thinking and solving and
praying, while I wondered whenthe sun would rise to steal away
the darkness in my heart andmind.
The only consolation isexperience, but I wonder if the
(02:31):
price is worth the reward, or ifthis experience will ever pay
back my family for the time andsacrifice, my investors for the
capital they've invested, or formy employees for the difficulty
I've caused them as well.
Why this happened?
It's a fair question, but onewithout a meaningful answer.
(02:53):
How did this happen?
I've been asked that so manytimes, but the confluence of
factors that led to this outcomecould not be replicated in a
way where the answer wouldprovide any relief.
So what is to be done?
There's really not much otherthan growing, learning and
moving on.
I am a failed entrepreneur.
(03:16):
Welcome to the Real F Word.
To the real F word.
That was my journal entry from2017.
And I have since reflected onthis experience over and over
and over again, and it's takenme these years to even get
myself to a place where I couldshare that publicly with you.
(03:39):
Welcome to the real F word, apodcast that dives into the
often overlooked side ofentrepreneurship failure.
Each episode featuresvulnerable, real conversations
with entrepreneurs who have feltthe sting of defeat, and we're
going to talk about false starts, failed launches and the
collapse of once-promisingstartups.
I'll invite our guests to sharetheir raw, unfiltered,
(04:02):
unvarnished stories of thesetbacks and disappointments and
the hard-earned lessons thatcome with entrepreneurship.
The Real F Word aims to reallyde-stigmatize the challenges of
entrepreneurship and willhighlight the resilience and
adaptability it requires to moveforward, but not by ignoring
the real personal and financialcosts of these failures.
(04:24):
Most importantly, we'll exploreinvaluable insights from facing
failure with perfect honestyand extract all of those lessons
and wisdom and insight to helpde-risk the journey for other
entrepreneurs.
These are the real storiesrarely discussed by
entrepreneurs and often hiddenby investors.
(04:44):
My name is Joe Grover and I'llbe your host.
I spent the first part of mycareer in venture capital.
Afterwards I had stints as aventure-backed CMO president and
CEO, and I'm excited to sharesome of my personal experience
and mostly learn from otherentrepreneurs that I've worked
with, and to set the stage forfuture conversations.
I'd like to share for the firsttime publicly how I felt when I
(05:09):
was dealing with my own painfulepisode of failure.
So I left venture capital and Ijoined one of our portfolio
companies in Denver, colorado,and the company was in the ad
tech space and it was booming.
Like we were growing, we werewinning all the awards for five
years.
Like we were hiring, we weretraveling internationally,
(05:31):
closing deals.
We were profitable.
In fact, we had twoopportunities to sell the
business and we should have likewe really should have, and you
know I probably advocated forthat, but I think the team and
investors especially they sawthis kind of meteoric rise and
they thought, listen, the bestis yet to come.
(05:51):
And so they asked us to keepbuilding and we did, and we kept
building and building and thenthe market started to falter and
ultimately, things started toshift and we did not adapt.
We did not make the rightdecisions in this market shift
that would allow us to continueto succeed, and so our business
(06:12):
started to contract a little bit.
We had raised some equity andsome debt.
And listen, when you have somedebt on your business and you
start tripping covenants, thingscan get perilous quickly, and
it did.
It got perilous, in fact.
The board came in and theyrestructured the leadership team
and they had asked me to stepin as the interim CEO and I
(06:34):
really had no interest in tryingto solve this.
It was an impossible puzzle tosolve.
I felt like someone had dealtme a two and a five, if you play
blackjack, and they expected meto beat the house and get 21.
And it's just tough.
So here's the reality is like Idid all that I could and I
remember we stood up in front ofthe company and we told all the
(06:57):
employees the day that theleadership teams switched, that
we had X number of dollars onour balance sheet and we had
five months of runway and thatwe were going to be forced to
make some really difficultdecisions and to cut expenses
and probably kind of shift thebusiness a little bit more to
adapt to the, you know, to themarket.
And then I met with everysingle employee, one by one, and
(07:20):
I was just really honest.
And some of those employeeswere kind of spooked and they
said, hey, I think I'm going toleave.
And I said, totally respect andunderstand that, and you know,
and a bunch of employees goodpeople left the company and that
was hard but it also helped usto reduce our burn rate.
So we cut our burn rate in half.
We kind of made some reallytough choices on who we were
willing to work with on thecustomer side.
(07:42):
That, you know, value-baseddecisions that didn't always
translate into revenue, whichwas which was really tough.
I had an incredibly supportiveboard, but in the end I had to
raise more capital.
So the spring came and we wererunning out of money again, and
so the clearest path was tomerge our company with a company
in New York City in the samespace.
(08:03):
And we did that and we wereable to capitalize the business
and we worked really hard.
But it just didn't work.
The combined company wasn't asstrong as the independent
businesses were, and so I had towalk in to that amazing team
that had rallied behind me andrallied behind the business and
lay off my management team andthe rest of the employees, at
(08:26):
least in that division of thecompany.
I remember sitting down with myhead of HR and she said Joe, why
are you on this list?
And I said because today isalso my last day.
And I just remember puttingmyself on the termination list
and thinking about this move Ihad made from Salt Lake to
Denver and bought a house inColorado, and I knew that there
(08:48):
wasn't going to be a goldenparachute there's.
There wasn't going to beseverance right, and that
impacted me, but it alsoimpacted all those people in
that room and so it was painfulbut it had to be done.
And then I proceeded tocontinue to work in the business
for some period of time.
I wanted to make sure we got itto a good spot and I met with
(09:08):
all the investors.
As the debt investors came inand essentially foreclosed on
the asset, I met with all theequity investors.
I called them.
In some cases I met with themin person.
I remember driving from StGeorge, utah, to Ogden, utah,
meeting with the local investorsto let them know that we hadn't
figured it out and we had takensome capital and it was
(09:31):
unlikely they would ever see adime from that investment and
that was really painful for me.
Um, and coming from the ventureside, I felt great stewardship
over those dollars.
I felt like people hadentrusted me with these dollars
and really entrusted me with thecompany to help turn this thing
(09:52):
around, and I wasn't able to.
And I remember just sittingwith one investor in a coffee
shop in Ogden, utah, and I waspretty emotional and I was
really discouraged, utah, and Iwas pretty emotional and I was.
I was really discouraged and Iremember he just listened and
then he paused and he looked atme and said Joe, how are you,
how's your family?
So I just remember like in thatmoment, like I was, I felt like
(10:18):
a complete failure and I feltlike I could maybe never even
show my face again in aninvestor meeting and this kind
empathetic gentleman was worriedabout me when I had lost all of
his investment.
It taught me a great lesson andI remember he said to me and
(10:42):
whether he meant it or not, Ireally appreciated the sentiment
he said listen, joe, if youasked me to invest again, I
would do it.
It was a risk I was willing totake and I know you did all that
you could, and so I reallyreally appreciated that and I
realized that I could move on,that I could be accountable, I
could really learn from thisexperience so that I don't
(11:05):
repeat the same mistakes.
But I could move on, I couldbuild again.
So that's what I'm working on,that's what I've been doing for
the last seven years.
So that's a little bit moreabout that story and I hope that
that experience and some of thelearning there will be
beneficial to you as you buildyour companies.
So, at the end of this wholeexperience right, laying off
(11:26):
employees, losing all the equityinvestors' money, having to
meet and talk and explain thisto all those investors, talking
to vendors whose checks wouldnever be in the mail after that
I just I had to reflect.
I had to think like what do Ido with all this?
What do I do with all thisexperience?
And I've shared bits and pieceswith a few close friends over
(11:49):
the years, but I just decidedthat I have to share it.
I have to be raw, I have to bevulnerable, I have to like, open
up and and listen.
I mean, this is whatentrepreneurship is all about.
In fact, most of the outcomeslook more like this than they
look like the you know the IPOwhere someone makes a billion
dollars but we never talk aboutthe failures.
(12:10):
We never talk about the realityof, and the cost of those
failures the cost emotionally,to our mental health, the cost
to our families, the cost toinvestors we don't talk about it
.
It literally is a footnote inan investor.
Investors we don't talk aboutit.
It literally is a footnote inan investor report.
Because they don't talk aboutit in their annual meetings and
entrepreneurs don't want toadmit it.
(12:31):
In fact, they want to move onfrom that so quickly and there's
some that's healthy too, tomove on quickly, but that they
don't even take enough time toreally just like live in this
space where we can learn andgrow and feel some pain.
And so the Real F Word podcastis all about us living in that
space and listening and learningand being real and authentic
(12:55):
and vulnerable, and I think ifwe can do that, we're going to
learn as a community that it'sabsolutely okay to fail.
And it really is the cost ofinnovation.
That failure is the cost ofbuilding something worth
building, of creating value, ofdoing something different.
And I know we talk about thatintellectually, we read about it
(13:17):
in textbooks, but we don'treally talk about what those
failures are like for theentrepreneurs that have to live
those experiences every singleday.
That's what this podcast is allabout.
Thanks for tuning in to theReal F Word.
The Real F Word is failure, andremember that failure is a
stepping stone, it's not just astumbling block.
(13:38):
Join us next time as wecontinue to explore the journey
of resilience and growth,without ignoring the true cost
personally, professionally andfinancially that comes with
failure.
Keep learning, keep growing andkeep embracing the real stories
of entrepreneurship.
See you next time.
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