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INNOVATION
& DESIGN Home Page Architecture Brand Equity Auto Design Game Room SMALLBIZ Smart Answers Success Stories Today's Tip INVESTING Investing: Europe Annual Reports BW 50 S&P Picks & Pans Stock Screeners Free S&P Stock Report SCOREBOARDS Hot Growth 100 Mutual Funds Info Tech 100 S&P 500 B-SCHOOLS Undergrad Programs MBA Blogs MBA Profiles MBA Rankings Who's Hiring Grads | | MAY 14, 2001 ENTREPRENEUR PROFILES A Cyber Sanctuary for Wounded Entrepreneurs Nicholas Hall knows the pain of seeing a business go bust. That's why, as he explains in this Q&A, he launched startupfailures.com
The new venture serves as a Web-based support group -- "the place for bouncing back," as he describes it. His timing wasn't bad. The death rate for startups has soared since he founded the site, which gets some 7,500 visitors a week. On the site, the wounded can share the lessons they learned from failing, read profiles of other entrepreneurs, and ask an expert for advice. They can also enter the Survivor contest: In this version, the entrepreneur with the best story about getting back on her feet wins $1,000. As Hall prepares to move from the San Francisco Bay area to the New York suburbs, where his wife is starting a new job, he has no plans to abandon the entrepreneurial life or startupfailures.com. He discussed his successes, failures, and plans for the future in an interview with BusinessWeek Online reporter Theresa Forsman. What follows is an edited excerpt of that interview. Q: What do people need from startupfailures.com? A: They get that they're not alone, that they're not the only ones going through what they're going through. The actual inspiration for startupfailures came in February, 2000. As much self-confidence as I have, I was still dealing with issues of having closed down my Internet startup. We were at the end of the bubble, so to speak, but it had been three years of constantly hearing about this company that's worth $20 billion and that company that's worth $50 billion. I was being bombarded by those success stories, and I thought, "What is wrong with me?" Some of the things that were being funded made you ask: What is that? It made you question your own rationale. It can be a lonely experience. Now, even though there's the whole shakeout going on, it still does not take away the personal feeling of failure. Q: There must be some expenses in running the site. A: I put $2,500 into it. It's really, really inexpensive to maintain. I have an administrator who keeps the Web site up. I submit a few things content-wise. Maybe it costs me $500 a month. It has a social purpose to it. We raise funds to support the ongoing development of the community through sponsorships, advertising, speaking, selling T-shirts. Typical community theater-type stuff. Right now we don't have any sponsors. Q. What was your business failure? A. I've been in all sorts of businesses. I got up the nerve at about age 25 to start my own business, providing financial services in Cincinnati. I realized how tough that was at age 25 -- it's a big deal for people to trust someone with their money. It's a lot harder for them to trust you when you're just a kid. I closed up shop after about a year and a half. Then I consulted with an investment bank that was in the process of doing some investing in high-end beverages -- this was 1997 when microbreweries were popular. I helped form a company called Brewserv, which acquired a hard-cider company, some high-end coffee houses, and a restaurant after raising a couple hundred thousand dollars from private investors. I was out to raise a couple million, and the microbrew market just tanked. About a year and a half later, the company filed for bankruptcy and closed up shop. Q. Then you moved to the Internet and Silicon Valley? A. In early '98, I was reading more and more about this Internet thing. I had always put a great deal of effort into building relationships -- networking. I thought the Internet could bring people together more efficiently, and I thought I could develop a software company that would do it. I didn't know squat about software. Our company, Intori, was developing a bot that would work within virtual communities on the Internet, searching for potential networking relationships for you, based on your profile. After a year and a half, I'd blown through the savings we had and had some credit-card debt. Looking back, it would have made more sense to approach a Yahoo! or an AOL and try to be part of their community rather than a separate company. Q. A lot of companies could say that now. A. I was clueless. I moved out here, didn't know anybody. A lot of it was like trying to find a needle in a haystack with the lights turned off. That's what it's like for an entrepreneur. You can't learn about what it takes emotionally to be an entrepreneur until you do it. Q. And yet you still want to do it. A. Now, I've been an entrepreneur for seven to eight years. I know a lot more people. I can build teams much more quickly. The level of influence I have is more significant. I understand now to focus on how you're going to generate revenue. Q. Have there been any surprises in the year you've been running the site? A. The biggest surprise to me is what a difficult challenge it is to come back from a failure outside the U.S. I knew it was emotionally difficult for people here. I didn't realize how culturally difficult it was outside the U.S. Taking away some of the stigma is the point of startupfailures. Everybody knows that many, if not all, of the great entrepreneurs went through many failures. But history tends to gloss over that -- Bill Gates and other people kind of skip over stuff that was a flop. If you take enough risks, you're going to have some big flops. Q. Are you a success, or a failure? A. I am neither. Some of the things I try succeed. Some of them fail. Too many entrepreneurs overidentify with their business -- and when the business dies, they die with it. I have a passion and vision for my lifetime: I see myself as a global leader contributing to people living lives that they love. Within that vision, I will do many things. Q. What's next? A. A couple days ago I started a new company, Possibility Productions. We will collaborate on events, conferences, workshops, helping organizations dramatically improve the effectiveness of networking that these events are designed for. We make a very conscious effort to create structures so it happens automatically, so people will have to interact. People are spending big bucks at conferences all the time. You get there, and there are a bunch of influential people out in the audience, and we're just listening to people up on stage. It's great to listen to the people up there, but who's going to make a difference in my life are the people sitting in the chairs next to me. Q. You're a big believer in networking. A. Networking makes the world go round. The world is what it is -- the good, the bad, and the ugly -- strictly because of people.  By Theresa Forsman in New York  | | |
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