So we’re all watching the O-lympics — which is a lot healthier, if you ask me, than when we were all watching the O-J show — and all anyone can think of are “the thrill of victory and the agony of defeat” (as one TV network used to put it). Certainly a lot nobler sounding than “greed and fear,” or “bull and bear,” or “bid and asked,” which may be the rough equivalents from Wall Street. On the other hand, show me an economy that was ever built on the speed of its runners.
I tried to think what I could say about the thrill of victory and the agony of defeat and quickly remembered: I don’t know the first thing about sports. Nothing! I was the only left halfback on my high school varsity soccer team to be right-footed (though I did have heart), and it went downhill from there.
But business is a sport itself, no? A competition? Coke versus Pepsi? Kodak versus Fuji? Gimbel’s versus Macy’s?
So here’s the story I wanted to tell all you aspiring Gold Medalists (and even just those of you going for the gold):
R.H. Macy started a small thread-and-needle shop in Boston in 1842 that closed within a year. A second, also in Boston, was shuttered in 1845. You can just feel his frustration as he made his last entry in the account book:
“I have worked Two Years for Nothing.
(And, as I’m fond of reminding slow-starters, Tolstoy was 50 before he wrote his first book.)
The lessons: don’t give up, of course. But also: in considering whether to back some entrepreneur, don’t necessarily count him out for having failed in the past. Indeed, just the opposite may sometimes be true. That failure can be just the education an entrepreneur needs.
Note: When it comes to Internet companies, there are no failures. Any 20-year-old with an idea can be reliably expected to go public at a $200-million-plus valuation, so give him whatever he asks for.
(Or so I thought until a couple of weeks ago. Lately, at least a little sanity has reappeared.)
Tomorrow: Can You Beat an Index Fund?
Quote of the Day
In 1800, 75% of [an American's] working man's expenditures went for food alone. By 1850, that had dropped to 50%. Today it is a little more than 11%.~The Wall Street Journal, September 20, 1996
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