7 Ways to Learn From Your Mistakes as an Entrepreneur

Mistakes are inevitable.

As an entrepreneur, you need to make friends with failure fast.

Try saying that ten times.

But seriously, over 50% of small businesses fail within four years.

I don’t say this to scare you.

I say it to motivate you.

I had two failed companies and was $1 million in debt all before I turned 21.

Wondering how I turned it all around to become the successful entrepreneur I am today?

Simple.

I started another company.

It sounds like a punchline, but it’s true. I failed twice.

I hit the jackpot when I created CrazyEgg.

Well, it wasn’t really a jackpot.

It was years and years of hard work, learning from my past mistakes, and hiring the right people to help me build it.

It’s sort of easy to put in the long hours to make your dream come to life, but learning from your mistakes is much harder.

Today, I’m sharing some of the ways I’ve learned from my mistakes over the past decade of being a young entrepreneur.

Check your ego at the door

This is the most important thing you need to do.

If you let your ego get in the way, you’ll never learn from your mistakes.

To be open to change, you need to accept the fact that you don’t know everything. You’re not the smartest person in the room.

I’m not saying you shouldn’t be confident in yourself. As an entrepreneur, you need to believe in yourself and your abilities to be successful.

But ego is more than confidence. Having an ego means you think you’re not just good, you’re the best.

In a survey by PayScale, 43% of respondents felt they were their company’s top performer.

Most of those people are probably not their company’s top performer.

When you’re an entrepreneur, success can be seductive. You can easily get caught up in wanting more money, prestige, or a nicer home.

But chasing superficial rewards only serves to strengthen your ego.

I was the same way when I was younger. I was making over $20,000 a month with my consulting business when I was still in high school.

I remained focused on my dreams, but I wasted a lot of time and money on things that didn’t matter.

Now, I don’t have a home. I travel full-time and focus all my energy on my software companies instead of doing consulting.

Consulting brought in good money and was good for my ego. But my real passion is to make software products that help people build their own companies.

It took me years to learn that.

When you ignore your ego, you find out what really matters to you.

Don’t be afraid of failure

Learning from your mistakes as an entrepreneur means expecting to fail and being okay with that.

More than okay: welcoming it.

When it comes to tech startups, 9 out of 10 will fail. That’s a lot higher than the half of all small businesses that fail.

Vator looked at the top 20 reasons startups fail.

“No market need” was the most common reason, accounting for 42% of all startup failures.

See how that’s related to ego?

You might think your product idea is awesome, but unless you step outside your head and ask people, you’ll never know.

If you don’t do any market research, you can’t be surprised when you launch to crickets, and no one buys it.

Your business isn’t about you.

It’s about your customers and the problem you solve for them.

If you have one or more failed ideas behind you already, remember to focus on the user of your product next time.

If you have regular access to someone who’s your target user, incorporate them into your startup. Ask them questions. Find out what they like and don’t like about it.

Make your product better with their feedback.

And if you still fail, that’s okay. Take the lessons you learned from one project and move on to the next great idea.

Failure doesn’t even have to mean the failure of your entire business. It could be just one aspect.

Like running low on cash, so you need to attract investors to keep going.

Or finding out a crucial piece of your software doesn’t work just a few weeks before launch day.

If you can solve the problem, you succeed.

If you can’t, you fail.

But failure isn’t permanent.

As long as you have an open mind, you can learn from every experience you have, whether it’s good or bad.

Your goal should be to make your next venture more successful than the last.

Keep a list of mistakes

This might seem weird to some people, but I like to keep a list of all my mistakes.

I don’t do it to torture myself about the past. I do it so that I’m always prepared for the future.

I look at my list to own my past mistakes and say, “Yep, I really did that,” or, “I really messed that up.”

Too often, people want to forget about their mistakes right away and move on.

But that doesn’t help you learn.

When I look at my list, I’m reminded not just of what I did wrong, but how far I’ve come and what I’ve learned since then.

Looking at my mistakes is a positive thing for me.

I can reflect on my entrepreneurial journey so far and see where I came from, where I am now, and where I have yet to go.

It’s been proven that writing things down improves memory.

People who write down their goals are 42% more likely to achieve them.

By writing down every mistake, I have a record of everything I’ve learned. How cool is that?

There’s some real psychology behind list-keeping, too.

The ‘Zeigarnik effect’ was discovered in the 1920s and still holds up today. It found that our brains remember upcoming tasks we haven’t started yet better than ones we’ve already done.

If I didn’t write down my mistakes, I would likely forget most of them once they were over.

I want always to be learning and growing. So for me, keeping a list is essential.

Investigate every mistake

When I make a mistake, I always ask myself the same questions.

I write down my answers in my ‘mistakes notebook’ so I can see evidence of my progress.

In marketing agencies, this is called a project post mortem.

It basically means evaluating how the project went and identifying areas to improve for next time.

I do the same thing with my mistakes by asking myself:

• What did I want to achieve?
• What was the actual result?
• What could I have done better?
• How could this mistake have been avoided?
• When might this situation happen again?
• How will I handle it next time?

Studies have found that adults learn differently than children. There are three main ways adults learn:

1. Andragogy: Learning from past experiences.
2. Transformational: A new perspective gives meaning to a previous experience.
3. Experiential: Learning by doing.

When we learn from mistakes, we’re using all these methods.

Of course, I don’t say to myself, “What a wonderful transformational learning experience I’m having!”

But that’s what’s really going on in the brain.

When I’m evaluating a mistake and answering my questions, a lot of that is experiential. I relive the mistake to learn from it.

Later on, when I am reviewing my notes, I might uncover a new lesson I didn’t realize at first. That’s transformational learning.

But learning theories aside, it’s important to dive deeply into each mistake and be honest with yourself. Ask yourself what you could have done better.

Then make a plan to do that next time.

Be optimistic

Mulling over past mistakes may not sound like much fun so far.

You need to approach learning with a positive mindset. The goal here isn’t for you to constantly think about all the stupid things you’ve done.

The goal is to become even better than you are today.

Optimistic people are better at controlling fear. They take action more often than negative people.

I’ve definitely felt discouraged many times in my business life, but I never let it stop me from achieving my goals.

I always knew I could push through any obstacle and solve any problem.

Having faith in yourself can be the deciding factor between being successful or not.

These are some ways I keep myself positive, even when the going gets tough:

Focus on your goals.

92% of people who set New Year’s goals will not achieve them.

Yikes.

But it doesn’t need to be so dreary. Researchers found people who set specific goals were far more likely to succeed.

New Year’s goals are mostly vague and lacking deadlines.

Things like, “I’m going to lose weight,” or “I’m going to be more positive.”

But how would you go about doing those things? Unless you’re thinking of action steps right away, you’re unlikely to achieve either of those lofty goals.

Instead, you could say, “I’m going to work out 3 days per week every week this year.” Or, “Every morning, I’m going to recite a positive affirmation to lift my mood.”

Those are very specific actions that will deliver the results of the original goals.

Make learning a game.

It’s no secret people love games.

The term gamification means to add elements of games into non-game experiences.

An example of gamification is Fitocracy.

Fitocracy is a fitness app where you can track your food intake and workouts and connect with other people.

It rewards users with points, badges, and quests when they reach certain milestones. A milestone could be logging in for a certain period of days, or meeting a new goal.

Gamification is based in psychology. It’s effective because it plays on our innate desire to compete, track progress, and be rewarded.

Fitocracy is a rather new example, but these concepts have been around for a long time.

Remember back in the old days when you could buy a coffee at a coffee shop, and they would stamp a card for you? There would be some deal, like buy 7 and get 1 free.

That’s gamification.

You’re collecting points to get a reward: a free coffee.

That’s a very basic example.

If you really want a fun way to motivate yourself, sign up for Habitica.

Habitica may not be for everyone, but if you need some serious positive motivation, this game is for you.

It gamifies every aspect of your life. When you accomplish tasks and goals, you progress in the game.

But the real motivating part? If you don’t make any progress for a while, you slide further back in the game.

Whether you use a game to track your progress or not, remember to stay positive about your journey.

Celebrate your successes

You need to learn from your mistakes, but you also need to take the time to celebrate your wins.

The physical effects of celebrating are real. When you celebrate, your brain releases dopamine, serotonin, and endorphins.

Dopamine is one of the brain’s “happy chemicals.” It surges after you accomplish a goal or feel successful.

Low levels of dopamine are linked to procrastination and a lack of work ethic.

Serotonin can reduce anxiety and depression. It contributes to your overall feeling of happiness.

Thinking of a happy memory can give you a little boost, as can getting a bit of sunshine during the day.

Endorphins give you that feeling of an energy rush.

They are a natural anxiety and pain reliever that gets released when we exercise, and when we are motivated to accomplish something.

Your brain is capable of some amazing things!

Achieving a goal and celebrating it creates a feedback loop of joy in your brain. All these chemicals get released that make you feel awesome.

Don’t always focus on your mistakes. Celebrate your positive achievements, too.

Take action on your ideas

I’m sure you’ve had this happen before.

You’re in the shower or about to fall asleep in bed, and a great idea hits you.

It’s suddenly so obvious that you need to work on this idea right now.

But then you think of all your other responsibilities. When would you be able to start this new project? A month from now?

Your motivation starts to wane until eventually, a month later, you aren’t really into the idea anymore.

Most likely, you never start working on it. It goes in a metaphorical box on a shelf of ideas that you’ll get to when you have time.

But is that the most successful way to be?

Nope!

It can be easy to put off working on something new and exciting because you already have a full plate.

But sometimes, the best ideas come at the worst times. Not taking action could mean limiting your future.

First, you need to evaluate your idea. Think about it for a few days or weeks depending on how big the idea is.

Will it take you millions of dollars to get off the ground?

Okay, maybe put a cork in it for now unless you have that much spare change.

But if it’s something simple and all you need is a few hundred dollars and some time to get started, then nothing should stop you.

Find the time to make progress every day.

One of my biggest mistakes in life was going to college.

Not because it wasn’t a good place to be, but because I spent so much time there. I could have been using that time to build my company!

If you’re in college right now, I’m not saying drop out.

I’m just saying find the time to work on your passion project until it becomes a viable business. Nights, weekends, early mornings, whatever it takes.

Your idea might fail. But it might be something great.

You’ll never know unless you take action.

A 2017 study by Side Hustle Nation discovered that 46% of people surveyed hadn’t taken any action on starting their business yet.

How many of those 46% of people actually have a great idea, but aren’t doing anything about it?

If you really want to become an entrepreneur, you’ll become one. It’s that simple.

Finding time can be tricky, but it’s not impossible.

Conclusion

Not many entrepreneurs are successful right away.

Many of them, like me, go through a few ideas or more that end up being absolute failures before finding an idea that works.

Milton Hershey, the founder of Hershey Chocolate, went bankrupt two separate times before he finally had a profitable idea. He invented caramel candies which were extremely popular.

His new idea allowed him to pay back the debt from his previous business ventures. He was able to turn Hershey into the multi-billion dollar company it is today.

What if he had given up?

The road to success is often long and winding. You need determination to get to the finish line.

You also need to treat every experience as a learning experience. Your mistakes are the greatest source of learning you could possibly have.

Be grateful for your successes, but never forget your failures.

Successful businesses are built on the ruins of failed ones.

Dedicate yourself to your ideas and set specific, actionable goals. Review your goals often and adjust as needed.

You may not succeed at first, but you’ll always be learning.

What’s the most important lesson you’ve learned from a mistake? How did it help you change your business?