Don’t Fear Failure, Learn from It Instead

By Michael D. Rubin, CEO & Founder · Updated September 2026 · 709 words

Every owner fails at something, whether a new service line, a hire, a location or a first attempt to sell, and the owners who do best treat each failure as information: what did we assume, what actually happened, and what will we do differently? Fear of failure costs more over time than most failures do, because it stops owners testing the ideas that eventually work.

This matters beyond the day-to-day. When you sell, a buyer will study the company's history, including its setbacks. How you learned from them says a great deal about the business being bought.

Why avoiding failure is expensive

Owners who avoid failure tend to avoid trying. They keep a product that no longer sells, a process that wastes hours, or a manager who is not working out, because changing course means admitting a mistake. The cost is invisible, the growth that never happened, but it is real.

Owners who test more ideas have more that fail. They also find more that work, and they learn faster to tell the two apart. Perfection is not the goal; a steady stream of small, honest experiments is.

Company culture follows the owner's example. If employees see mistakes punished, they hide them, and problems surface late and expensive. If they see honest mistakes reviewed calmly and fixed, they report issues early. That habit is worth building long before any sale, because a buyer's due diligence team will find hidden problems either way.

How to fail cheaply

The aim is not to fail more but to fail small, early and on purpose. Habits that help:

• Test new ideas with a limited budget and a set review date before committing fully.
• Decide in advance what result would count as success, so the review is honest rather than hopeful.
• Separate the idea from the person. A failed test is a result, not a verdict on whoever proposed it.
• Hold a short review after any significant setback: what we expected, what happened, what we change.
• Write the lessons down, so the next manager does not have to learn them again.

Keep perspective when things go wrong

Some setbacks have nothing to do with your decisions: a supplier fails, a market turns, an event nobody predicted closes doors for weeks. Those are the moments when owners are most tempted to freeze or to blame themselves. Neither helps. Focus on what you can control, such as cash, customers and the team, and make the next decision well rather than dwelling on the last one. Owners who stay calm under pressure also tend to make better choices, because they are looking at the facts rather than at their own fear.

Explaining setbacks to a buyer

Buyers usually review at least three years of financial results, and they will spot a bad year, a closed location or a product that disappeared. Do not hide these. Explain them plainly: what happened, what you learned and what changed as a result.

A down year followed by a documented recovery can reassure a buyer more than a smooth record that raises questions. Problems a buyer discovers on its own in due diligence, by contrast, damage trust and often lead to a lower price.

If a sale attempt did not work

Some owners come to a sale after a first attempt that failed: no acceptable offers, a buyer who walked away in due diligence, or a deal that collapsed over financing. That history is not fatal. The lessons are usually specific: the price was set too high, the records did not hold up, the process relied on one buyer, or the owner was too central to operations. Fix those, wait until the results show the fix, and the next attempt starts from a stronger position. See what happens if you receive no acceptable offers.

Where MDR & Associates fits

MDR & Associates' success rate is above 90%, and part of the reason is selectivity: if the firm does not believe it can sell a company for maximum value, it declines the engagement. For owners who need time to fix what went wrong, pre-exit consulting covers the 12 to 24 months before a sale. Read what causes deals to fall apart in due diligence, then contact the firm for a confidential conversation.

Where this fitsSell your business in Texas →

Questions owners ask next

Will a bad year in my financials kill a sale?

Rarely on its own, if it is explained and followed by recovery. Buyers look at trends across several years and at the reasons behind them. A documented cause, a clear response and improving results can be presented honestly. An unexplained dip, especially in the most recent year, raises far more concern.

How long should I wait to try selling again after a failed attempt?

Long enough to fix the cause and show the fix in your results, often a year or more of improved financials. The right timing depends on what went wrong. An advisor can review the earlier attempt and tell you what buyers will need to see before a new process begins.