Almost 75% of all German startups fail within 2.8 years. In other words, failure is something completely normal. While mainstream thinkers in Germany tend to furrow their brows at this, Fuckup Nights sees failure as a recipe for success.
There are many different reasons why startups fail: They overestimated the size of the market, their product served merely a niche audience or their "innovative" idea was already on the market. The landmines that entrepreneurs inadvertently step on are many and varied. It’s easy to be judgmental and blame these entrepreneurs for being naïve – but that would be wrong. At Fuckup Nights, company founders deliver a professional report on their failures, while retaining their sense of humor. On the one hand, this helps other company founders avoid making the same mistakes. And on the other, it helps society rethink the false image of failed entrepreneurs as being "losers".
In a study conducted by the University of Leipzig, founders, investors and researchers gave their opinions on the startup culture in Germany. 79% of respondents indicated that society as a whole is reluctant to accept failure. Entrepreneurs whose ideas don’t fly are stigmatized – an attitude that Christian Lindner, national chairperson of the FDP political party also criticizes . Prior to his political career, he founded a startup that failed. "Once you’ve screwed a project up, you’re quickly seen as a loser – even a criminal," he says.
A climate like this is harmful to the business community because it holds back innovations. The number of new startups in Germany has been on the decline for years. In his preface to the German Startup Monitor , Wolfgang Schäuble, German Minister of Finance, points out: "We need an innovative startup community to maintain our competitive edge and ensure prosperity." Germans would be well advised not to socially ostracize unsuccessful entrepreneurs, he maintains.
Failure should not be seen as something shameful, but rather as an opportunity. And that’s exactly what the Fuckup Nights do. First launched in Mexico City in 2012 , the event serves as a platform for young, unsuccessful business starters from across the globe. They report on the circumstances which led to failure in a series of events at different cities – events which are becoming more and more popular in Germany. After all, this help change society’s view of failed projects. And they can let the startup community know the possible sources of error and the mistakes they need to avoid.
Even though each speaker is talking about a major setback in his or her life, the mood at Fuckup Nights – otherwise known as FUN – is light and punctuated with humor. The participants deal with the topic in a way they think society could and should. They form a community because failure is defined differently here. Daniel Putsche, the organizer of Fuckup Nights in Frankfurt, explains it like this: "Failure is an important component in being able to ultimately generate success. Because it’s all part of the innovative process."
So, could it be that a failed enterprise is the ultimate basis for success?
Speakers at Fuckup Nights have made lots of mistakes, as they themselves are the first to admit. Entrepreneur Justus Nagel for instance advises against setting up service networks. His plan of using private individuals who spend a lot of time behind the wheel to deliver packages at a significantly cheaper rate didn’t hold up. Even good ideas can quickly turn into failure. Axel Hesse recommends that you really think things through – because the startup spirit will put blinders on you, tempting you "keep marching on straight ahead, without looking left or right."
Florian Hofmann says there is a thin line between success and failure. He was riding high with his "paji" pay software. "We thought we were invincible", he reports. His startup generated a million euros in funds in just six weeks. His user numbers were 12 times those of the competition. But a hard fall soon followed. Hofmann wanted to stay independent and rejected additional investors. As a result, he and his team were unable to find adequate financing over the long term. But he passes along what he learned from his business venture: "If an investor gets invasive and tries to take over your position or your product strategy, just stay cool. Negotiate the conditions, take what you can get, then run as fast as you can!"
Reports from the front lines like these are valuable resources for the startup community. Despite strong headwinds from the rest of society, close to 50% of all entrepreneurs who have failed pick themselves up, dust themselves off, and start all over again.
SCALE11 , the startup area at CeBIT 2017, will also delve into the topic of failure. This startup event will feature not just one, but two, Fuckup Nights this year. Anyone interested is welcome to attend these events, the first of which takes place in Hall 11 on 20 March and the second which takes place on the Salesforce stage in Hall 9 on 21 March.