Learning from mistakes
In 1971 I made the biggest mistake of my life. It was an event referred to as recently as late 2007 by the Liberal Democrat MP Vince Cable in the House of Commons during Virgin Money’s bid for the Northern Rock bank. He said, when speaking under UK parliamentary privilege, that I was not a fit person to run a bank. In the UK, thirty-eight and a half years after a lapse in judgement, I was still being pilloried.
When I was 19 and running our record mail order service I stumbled on the fact that records bought in Great Britain intended for export were not subject to purchase tax. I bought the records I needed, pretended they were for export, and then sold them to British customers. I was caught red-handed by HM Customs & Excise and put in a cell overnight. Naturally I agreed to pay back everything and the fines imposed and avoided a criminal record. It nearly killed off my entrepreneurial dreams; thankfully it didn’t. But it did teach me a hard lesson about never doing anything illegal or unethical again.
One thing is certain in business. You and everyone around you will make mistakes. When you are pushing the boundaries, this is inevitable – and it’s important to realise this. Even when things are running well, there is always the prospect of a new reality round the corner. Suddenly, all the good decisions you made last week are doing you untold damage. What on earth did you do wrong? At Virgin, we have always been prepared to face the facts – however unpalatable they might be. Failure usually occurs when leaders avoid the reality of business. You have to trust the people around you to learn from their mistakes. Blame and recriminations are pointless.
23 Responses to “Learning from mistakes”
Andrew Galasetti - November 10th, 2008
I’ve learned more from “failures” than I’ve learned from my successes. Everyone will fail before they succeed. I guarantee it.
-Andrew
Samia Mohammed - November 10th, 2008
yes thats correct ,ups and downs happen in business and you must be ready always it might be good and it might be bad.but you need to be careful from all arround you also
Trevor - November 10th, 2008
We were just taught, first hand, how tough making a mistake can be. I’m majority owner of an aggressive marketing company. At the beginning of this year (’08) we were approached by a very large company to market for them ‘beyond the box.’ We saw how much this could help us out and allow for dramatic growth. After running numbers with my little lady and my business partner, we decided to accept - how could we not conquer!? We were in our last year of college, we had blown away all of our competition in the past, sold millions worth of accounts (during the summer months) for other companies that shot them up out of league with their peers - a feat that otherwise would have taken years if they had stuck with the norm in their fields. We were very proud - our reputation preceded us and our fancy business cards were sexy.
This sense of invincibility that we drive on is referred to by my mom as a lack of a frontal lobe. Whatever the case is… we signed the contract. We took that semester off of school to recruit the best we could find in the needed fields to not only fulfill our obligation, but to blow the records away. Tens of thousands of dollars and thirty-two employees later we were off.
Our calculated gamble didn’t take into account a failing economy nearing the collapse of the middle class - our targeted market.
No sweat, blood or tears could negate the fact that people could not pay for the services. Our high-energy took us farther than we should have gone considering the state of the market. However, our youth and naivete locked us into a contract with non-performance failure agreements that killed us. When presented with an exit strategy involving not having to pay our employees yet making it out with a dollar or two in our own pockets, we decided to decline, to sink farther into debt, then muscle our way out.
We are off of school again this semester to get back on our feet. We just hustled a contract with a company out of Cali that should boost us back up (taking the absolutely invaluable lessons we learned during the summer of hard knocks), and have our fingers in a few other ventures that should pan out.
When my wife asked whether I would do this again, I thought long and hard… “Absolutely.” They don’t teach these lessons in business 101.
Usman Khan - November 10th, 2008
Dear Sir Richard,
I hope you, along with your entire inspiring crew, are well. It’s been overwhelmingly fascinating reading your book, ‘Richard Branson Business Stripped Bare.’ It’s indeed greatly inspiring to read a personal account from none other than the person who encountered it all; a noble person who not only pushed the boundaries, endured the challenges, but, he, who also alleviated potholes and smoothened the surface to create opportunities for people from all around the world. I was literally moved to tears reading every page of the section, ‘find good people - set them free.’ My beloved mother always said, ‘it’s not what or how much you make, it’s how much you give away that makes you rich.’ Today, I feel that you are a living example of that — with a great vision, sound mind, and a pure heart, you continue to inspire us and the effects are deeply penetrating and far-reaching and will inevitably help us all to make this world a better place. You also said, ‘Throwing yourself into a job you enjoy is one of the life’s greatest pleasures’ — and I can only say that my desire to be part of the Virgin Group increases every day… It is my dream to provide my life’s worth of goodness to such people-oriented and warmth-emitting place for all.
Albert Hallado - November 11th, 2008
Hi Sir Richard,
AMEN! to that and well said Sir!
Thanks’
Albert Hallado
Jason - November 11th, 2008
Richard, I want to ask a question which is completely unrelated to this. It’s about starting a magazine I just wanted to ask a few questions — is there anyway I can email you my question or something? Let me know.
Thanks.
Jonathan Fields - November 12th, 2008
Thanks for sharing this reminder. Taking risks, making mistakes and leveraging the learning from those mistakes not the harder part of the equation is just part of the entrepreneurial landscape. No doubt, a willingness to take risks, fail and learn from failure underlies a faster path to success.
To me, though, the greater challenge has always been in the challenge laid out at the end of your posts…”trust the people around you to learn from their mistakes.”
Hiring the best, then trusting them to not only make good decisions, but make mistakes and learn from them is not easy as an entrepreneur. But, when you allow for that level of latitude and faith in the people you choose you help steer the ship, it’s amazing how much faster the adventure begins to move forward.
Dean Jackson - November 14th, 2008
I think that, as mentioned in several of the comments on this blog article already, failure is actually quite close to success. In fact, I would say that if they were 2 points on a circle, they might both sit together, back to back. You have to go through success to fail. Failure could only be defined as what is relative to success, only failing because one didn’t succeed in their endeavours. Likewise, success is the achievement of one’s aims. (Although thinking that anything else apart from absolute success is a failure might seem a little black and white to some people). My point is, that a mistake is not a failure, but, turning it inside out, it is a step toward success. Afterall, everybody makes mistakes.
Regards,
Dean
Will Burke - November 16th, 2008
I am glad Richard is Richard. When he is presented in the media, his good cheer shines through. Refreshing !
Allen Arthur - November 18th, 2008
Thank you for your time;however, just one small question will my email even be read by Sir Richard. I think it’s great what he has accomplished with the Virgin Group. Anyway thank you for your time.
Bob - November 18th, 2008
Hi Allen
Richard checks in when he can but a few of us are on hand to help him out by answering any questions we can on his behalf.
As you can understand he’s an amazingly busy man and not always near a computer!
We’ll also bring any common threads or questions to his attention when he’s not able to log on himself…
It worked quite well having Richard answer people’s questions by video or phone so hopefully there’ll be more of that as well
cheers
Bob
Samuel - November 20th, 2008
Greatness always inspires! You are an industry Icon and I thank you for the encouraging message in this message. Like you said in your autobiograph,’RATHER THAN CONTRACT WHEN FACED WITH ADVERSITY,EXPAND OUT OF IT’
Mike Banks - November 20th, 2008
Hi Richard!
My biz partner and I are constantly inspired by you your books and your companies.
When are you going to bring Virgin Mobile to New Zealand?? the market is ripe for your company!!
Thanks for your inspiration.
Mike Banks (on behalf of CABID)
Brian Ellis - November 22nd, 2008
Dear Richard,
Thank you for another truly inspiring book.
From an uneducated start in life, meaning lack of guidance as well as academic. I have, in an effort to better myself and gain ideas read every autobiography and motivational book that I could lay my hands on. Several years ago I read your book “loosing my virginity”, since then I have read your other books. The effect these have had on me has been profound. In the early days I measured success with money (and it never really came to stay) however slowly but surely I have over the years learned to measure the true meaning of success, now I know I am heading in the right direction. Your books and your philosophies have contributed greatly to this. I believe you will go down in history as the person (and group) that initiated and fired up the concious of the coporate world. To often I see associates and others that have been “nailed to the wall” by the slick corporate’s who believe the only moral consideration is the shareholders returns. I am all for free enterprise, and yes there will always be casualties, however that does not mean that ethics must go out the window. And you Sir, are showing the world how it can be done, you have still made it to the top without carelessly stomping on anyone that gets in your way.
For this I have the utmost respect for you.
In my opinion your latest book is the best inspirational and motivational book available on the market to date.
Of course the fact that I am an Aussie means that I have a love of the underdog and especialy one who can bring the corporate fat cats into line hehehe…… I love it.
I hope you live to be well over 100, imagine the good you can do with your energy and another 40 years.
Thank you and best regards
Brian
naveen - November 23rd, 2008
hai richard,
thanks for sharing your remainder with us. you quoted one should not do illegal things,but in certain cases proceeding illegally will serve the society better than relying on unsophisticated systems.do u disagree with my opinion.
thanks,
naveen
Bobby Norris - November 25th, 2008
Hi everybody, what a cool discussion. I didn’t know Richard had a little sneaky side when he was younger! Naughty naughty. You would think however that after thirty-eight and a whole half years later that a bank person wouldn’t have such harsh judgements. Especially when some of the greatest crimes is the money printing.
Nevertheless, its bizarre how slights of hand rest on your mind at night. To me, they are the real ghosts that haunt you. Not dead people => its the choices you make which you know grind on your ethics.
Personally, there is something I do which perhaps is illegal and that is I do everything I can to avoid tax. I see myself as a very contributive person in society and actually want to flip upside down most of what I see in society. So I don’t encourage what I see in governments by paying them money to do what I don’t support, e.g military and drugs and school prisons, really most of what they do.
I’m not a cynic, but I invest my time in small groups of active business people who are changing the world and believe one day that mandatory tax in its current form will be a thing of the past. So for me, its an illegal activity that haunts me, but it feels like what is the right thing to do. If I payed all the tax expected of me I wouldn’t have the amounts I need to support the new movements I believe in. And so the world stays the same.
What are your thoughts?
I wish tax was selective. When it comes round to tax counting simply select the checkboxes on the changes in society you wish to support. I believe it will be that easy and I will not have to live in fear of being a criminal for just not wanting to support what I actually believe to be the real criminal activities => war.
Thanks for all your time, all the power to everyone.
Bobby
Jerry Holliday - November 26th, 2008
I’m sure anyone worth their salt has done a bit of that.If we didn’t make mistakes we wouldn’t grow and learn after all :-)
James Tervit - November 27th, 2008
I have developed my own system for recognising the power of mistakes and using it to your advantage. When we are young we think we know it all and that we are untouchable, am sure with the benefit of hindsight, there are no shortcuts in life or business. The internet generation should take heed and learn from your experience, there is no get rich quick, there is no quick win, unless you get lucky on the lottery, it is simple focused persistence that is difference between doing and not doing. As for the MP’s they have not earned the right to be looking at the 70’s and bringing up simple mistakes that are now spent, I wonder what they had been doing at the same time, nobody goes through life without mistake…..
Jerry Wild - November 27th, 2008
Sir Richard,
I beleive all successfull people are people who have made many mistakes , but learned something each time to grow more positive. When I was Dx with Parkinson’s Disease at 52
it took me to the bottom. I took this negative and worked day and night to create two web sites, DVD, Music CD ,teach worldwide , design millionaire’s homes and help people with incureable illnesses to find the creative side of their life. To face you fears with challenges as you do everyday to inspire people and uplifts the human spirit.
Jerry Wild
Mark Lise - December 1st, 2008
Sir Richard,
Thank you for your inspiration and openness. The comment you make about making mistakes, both yourself and those around you rings very loud to me. We certainly need to apply this attitude not only to business endeavors, but to every other aspect of our lives as well.
PS: Love the fact you’re on twitter!
Mark.
Milind Bhavsar - January 23rd, 2009
Dear Sir Richard,
Thank you for this share ….my buried enterprenurial dream has woken up again !
rachael chatoor - January 26th, 2009
You make complete sense. Thank you for posting that so clearly and concisely, it was a very enjoyable and worthwhile read.
Nintendoll - February 8th, 2009
Anyone with an ounce of good character knows you
have good character too! We think you’re brilliant
and nothing you could do from here on out could change the fact that you’ve been a super moral booster and done a TON of Helpful things for a TON of people all over the world
:) Don’t change a bit
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