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Harsh Lessons: Real Entrepreneurs Share Why They Failed Brutally

Monica January 27, 2023

Life constantly hands us lessons. Oftentimes, we learn a new lesson that hopefully shapes us into better people. When we take these lessons and learn from them, we grow. But people working a normal 9 to 5 job aren’t the only ones who learn lessons. It’s the same for everyone, even real entrepreneurs. These entrepreneurs frequently make even more mistakes since they put more on the line. Even the best have failed repeatedly (and spectacularly).

At the very least, we admire these people who tried and failed, even if it cost them a lot of time, money, and effort. Owning your own business and becoming truly self-sufficient is a lofty goal along a path that’s always littered with failures and lessons. So we collected some of the greatest lessons learned from these real entrepreneurs about how and why they failed brutally. If you’re a budding businessperson who takes a close look at these lessons, you may learn something that prevents you from making the same mistake, so let’s get started here.

The Wrong Investor…Your Dad

Everyone knows involving your family members in your business can fail miserably. This person had their dad as the investor, which was the reason their business failed brutally. By the sound of it, this person’s dad had no idea what they’re doing in today’s tech-heavy society. Why did they choose them as their investor? There are some questions we’ll never have the answers to, but at the very least, we’ve learned from this entrepreneur not to hire our your parent as your investor (via eraserdust).

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Friends & Business Don’t Mix

As you have probably heard time and time again, it’s rarely if ever a good idea to start a business with your friends. There’s a reason you have friends and a reason you have business partners who you keep separate from those friends. This entrepreneur made the mistake of starting a business with several friends. This is the reason they failed brutally. But at they learned and were on their second start-up, this time hiring the right people for the task. They admitted that things were working out much better, which is what usually happens when an. entrepreneur moves on from hiring or working with their friends. That’s one of the biggest lessons in business. Pick your business partners wisely (via Grabben123).

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Failed Business & A Divorce?

Some people succeed and others fail. This entrepreneur has done both. They had a commercial office furniture dealership that failed brutally. It failed because they started the company in 2008 as the economy fell apart. They were also surprised by their wife with a request for a divorce. That’s a double whammy of bad luck. It’s possible their business would have succeeded if they weren’t hit with two bad things simultaneously. As they put it, they reached their limit (via zoomzoom42).

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Too Close Of A Call

Everyone makes mistakes in business, especially an entrepreneur. You live and you learn, and hopefully, you take those lessons and make something good out of it. This Reddit user freelanced setting up electronics. They had a close call where a customer threatened to send me to court for breaking some electronics they didn’t even touch. He wouldn’t have been able to afford to find out if he would win in court, so he shut it all down. With one mistake, an entire business can completely fail, which is what happened to this Reddit user (via OhTheHueManatee).

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The Oversaturated Market

This Reddit user made the grave mistake of entering an oversaturated market with zero business, marketing, or sales experience. After they failed, they learned a valuable lesson about choosing the right niche and specifying it. They even had a follow-up idea from the experience. Yet they had zero intention of actually carrying it out at the time. Sometimes, the best ideas come from business owners’ biggest failures. If you’ve ever had a beautiful idea stemming from something you’ve failed at trying to do, it may be a good idea to try again. But only if you’re truly ready to take that plunge again and do things right. And avoid over-saturated markets like it’s your job. Because in a way, it is (via EthicMeta).

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Don’t Quit Your Job Just Yet

New entrepreneurs should expect that they will lose money during the first two to five years of their business. Even if you have a successful business with a unique idea, it’s still going to lose money. It’s simply how the game works. This person’s business failed brutally because they didn’t keep their day job. They advised that “it takes time to become a fixture that enough people know and trust to build up a good client base.” After learning the ins and outs of entrepreneurship, they now have a successful family business that’s been running for over 30 years (via Edymnion).

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The Cardinal Mistake

To put it simply, starting capital is obviously the money you need to start a business. This funding helps pay for your initial costs, and you need enough of it. Many would say you need more than enough. Without enough starting capital, you simply can’t start. This Reddit user failed because of this. They soon began to see their business partners had the drive necessary but needed something more. Overall it gave them a valuable realization. It was time to cut bait and start over with a new venture that had enough capital to get off the ground (via Reddit).

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Brotherly Business Rivalry

There are failed ventures of all kinds, so just to lighten the mood, this Reddit user gave us a piece of advice about starting a lemonade stand with his brother when he was nine years old. Most of us have probably tried to start a lemonade stand at a young age, so we can relate to this child’s business. He said that when they began arguing, a physical bout broke out between the two. The brothers learned their lesson early on when mom came to the rescue. It’s a rudimentary example for sure, but this just further shows you the earliest example of why you don’t go into business with family (via Reddit).

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Don’t Invest Your Whole Life

This Reddit user’s family member invested his entire life and money into a project that had zero ROI. His original success in starting a business during the dot.com boom quickly turned into a nightmare. With zero clients and someone who stole from his business, he failed brutally. This Reddit user tried to give some wise words of advice by telling his family member to get a regular job and not invest his whole life into his own business for nothing. While taking risks is one of the best things you can do for yourself and your own business, you have to do it intelligently. If you don’t, there’s a high chance you’ll fail (via stylz168).

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Too Naive To Make It

This Reddit user didn’t do his research. New business owners need to make sure you deeply research other companies who will inevitably be your competition. This Reddit user failed to do so, and because of it, failed brutally. He was naive and left himself with only one customer bringing in a small amount of money per month. His product was not unique and other companies already had his idea. Unfortunately, he now wakes up depressed, something that many entrepreneurs have experienced. There are ways to avoid this in business by doing your research (via Reddit).

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Lack Of Self-Confidence Leads To Failure

Lacking the self-confidence to start your own business is a guaranteed failure. After this Reddit user tried to start a business during the expansion of the world wide web, they realized they lacked the self-confidence to convince others about their business. A year and a half after they failed brutally, they had to get a full-time job. But it wasn’t all a flop, because everything they learned about what not to do the first time around meant they were able to freelance for the next eight years. At least this person tried, which is something many people fail to do (via avesthasnosleeves).

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A Lot To Learn

Most of us won’t learn the ins and outs of business straight off the bat. This Reddit user shared their wise words of wisdom after their sales business failed brutally. His mistakes included making his home base where he lived, instead of a more regional hub where he could work with his accounts closer, and that made for extra travel time and expenses. Stores wouldn’t pay, and several off-trend lines rendered him unprepared. And in the end, his business partner was a liar who stole from him. These sound like valuable lessons learned that made him a stronger businessman the second time around (via cbpantskiller).

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Good Turn Of Events

This Reddit user’s online healthcare company failed brutally after their business model was regulated out of existence. Their competitors were to blame. You have to be one step ahead of your competitors, otherwise, they’ll run you over. Even though they learned from this experience, they still came out on top. Because of it, they landed a solid career in a field of work that they enjoy (via throwaway38).

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Pick Your Co-Founders Like A Marriage Partner

But also “with the expectation they’ll also screw you over,” according to this Reddit user. This person gave the internet tons of advice after they failed brutally at their business. Their mistakes involved starting a business with their friend and trying to invent something because it was a trend. That’s why they give the following words of wisdom to avoid inventing a product for a problem that doesn’t exist. Don’t invent a product for a problem that doesn’t exist, because you’ll have to spend time inventing the problem too. They let new entrepreneurs know takes at least two years without pay and that “your first customers are your employees. If they don’t see value in you or what you’re selling, you’re in trouble.” And finally, take care of yourself first. There’s no business if you’re unhealthy(via princesssquish).

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Out Of Your Control

Some things in life are out of our control. While we can try and control a business, we can’t control accidents. Amazon was about to acquire this Reddit user’s business. However, life had different plans for them. Doctors diagnosed their lead developer with aggressive stage four cancer and he passed away several weeks later. Amazon backed out because of it, and its business eventually failed brutally. It’s a very sad outcome, but unfortunately, there isn’t anything they could have done to prevent it (via pwnies).

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Mentally and Physically Burned Out

In business terms, mushrooming is expanding rapidly, sometimes at a rate you can’t keep up with. Admirably, this Reddit user started an online business in their bedroom that grew to be the largest of its kind in the country. They went from a laptop to over a million sales in three years. Six years later though, they were answering emails for at least 10-12 hours a day and got burnt out. That sounds like a lot on one plate, and a recipe for a complete failure. Their desire for success and ambition to succeed was quickly lost. When you expand too rapidly and put too much of your energy into a project, you understandably get burnt out. That’s why it’s important to take care of your health, mentally and physically (via Reddit).

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Sketchy Business

This Reddit user was an employee of an entrepreneur and shared how they failed brutally. Two guys put a bit of money into an IT company, and they hired the Reddit user to design and implement the network infrastructure. They told him he would manage their data center, which turned out to be a complete flop. Using his time, effort, and knowledge, he set up the basic network infrastructure and monitoring for it. They scammed him for his knowledge and work. The owners did something sketchy with the original investor’s money and the entire business went down soon after. It goes without saying that this serves them right(via zombie_overlord).

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Follow The Rules

Running a business requires entrepreneurs to follow the rules in place. Even though many people believe they’re above the rules, it doesn’t mean they will be successful. Those who cheat the system eventually get caught, which is exactly what happened to this entrepreneur. He said, he ran a shuttle service for a nightclub and was making bank. But he didn’t have a commercial license, insurance, or a business license. He was trying to do everything under the table from day one. That’s a huge red flag. Eventually, the cops shut him down. Was this worth getting shut down by the cops? Probably not. Doing things legally is the best way to go about it in the long run (via Reddit).

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Get It In Writing

Always get your contracts, agreements, deals, and signatures in writing, especially when handling money for business. This Reddit user shares their experience trusting their banker without getting anything in writing confirming their agreement. They got a loan because the banker represented them. It sounded like a scam from day one, especially when the banker claimed they never had a previous conversation about a loan. The Reddit user got angry and left this office, heading to another branch to close all their accounts.” This person had to deal with the consequences because they never received anything in writing. Huge mistake that they learned from. Their lesson? “It’s a little frustrating to be on the verge of making it on your own and have the rug pulled out from under you by someone you considered a reliable ally.” (via crimsonlaw).

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Commercial Brewing vs. Home Brewing

As a brewer, apparently you need to know the difference between commercial brewing and home brewing. This Reddit user shared how his friend, who’s a legendary small-batch brewer, did not know the difference. Because of it, his venture into commercial brewing failed brutally. While his home-brewed beer tasted delicious in smaller batches, when he tried to take it commercially, it tasted completely different. And he didn’t know the business very well either. This brewer only had enough resources to keep his business open for another month or two. This lesson is to do your homework. It’s important to know every nook and cranny possible of a business venture before starting (via Reddit).

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Follow The Marketing Numbers

Without marketing your business, how will anyone ever find it? This entrepreneur didn’t follow the marketing channels or the numbers it said were working, and because of it, their business failed brutally. They were set on building a blog even though all their sales success came from influencer marketing. They admitted that if they had to do it over, they would have put everything they could into the marketing channels that worked. You live and learn. At least this person has a vision for their next business venture and what they’ll do differently (via bputano).

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Don’t Focus On Old Customers

When a business is too focused on the past, it cannot grow. That’s exactly what this entrepreneur did. Because of it, their business failed brutally. After starting an independent engineering consulting firm that was made up of only them, they tried to get their old customers to pay them and avoided looking for new customers. An art collective agreed to pay him a flat rate for a job that took him a short amount of time to do and he was never paid. This same experience happened several more times before they ended up dropping the whole thing and working for someone else. Their time may have been wasted but at least now they know to focus on present customers rather than deadbeats customers from the past (via Optimized_Orangutan).

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One-Man Band

Running a business is one thing. Running a business completely by yourself is something else, and a lot harder than working with a good team. This Reddit user convinced themself to quit their job and become a one-man band IT technician. In reality, it was an excuse, because they needed to quit working to grieve the death of their father. They tried to force a project that wasn’t aligned with their current mental state. As we’ve mentioned before, it’s important to keep your mental and physical health as your number one priority when starting a business. They spent a month before developing a drug habit before getting their act together. At least they managed to turn their entire life around, learn from the experience, and start over (via Gaunts).

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Not Enough Money

You can’t run a business without investing money. It’s just as important as the business itself. This Reddit user failed brutally after learning they didn’t have enough money to operate the first year at a loss. Even though they could’ve run their business, they would have starved as a result. In regards to one-year projections, don’t forget your own personal salary (via Reddit).

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Jumped Ship At The Right Time

This Reddit user managed to get out of a bad deal at the right time. It wasn’t their business, but they were the supervisor for an entrepreneur. They made them a lot of money, and immediately afterward, noticed the owner started disappearing little by little. Suddenly, he was seen in photos in China, Greece, South America, while claiming he was on work trips even though they didn’t have any clients out of the country. A year later, the owner was caught embezzling money from the investors and pocketing the money. He was forced to close the doors (via brazenbologna).

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