{"id":2367,"date":"2021-12-10T17:41:56","date_gmt":"2021-12-10T21:41:56","guid":{"rendered":"https:\/\/www.skypointfcu.com\/wph\/workarea\/?p=2367"},"modified":"2021-12-10T17:42:11","modified_gmt":"2021-12-10T21:42:11","slug":"how-to-bounce-back-after-a-business-fails","status":"publish","type":"post","link":"https:\/\/www.skypointfcu.com\/wph\/workarea\/blog\/how-to-bounce-back-after-a-business-fails\/","title":{"rendered":"How to Bounce Back After a Business Fails"},"content":{"rendered":"\n

For small-business owners, failure isn\u2019t an option \u2014 it\u2019s a reality.<\/p>\n\n\n\n

For example, consider the roughly 733,000 businesses that launched in the U.S. in the year leading up to March 2016. Only about half made it to March 2021, according to the Bureau of Labor Statistics.<\/p>\n\n\n\n

\u201cOne of the inside secrets of great entrepreneurs, and businesspeople in general, is they are resilient when it comes to failure,\u201d says Mark Coopersmith, co-author of \u201cThe Other \u2018F\u2019 Word: How Smart Leaders, Teams, and Entrepreneurs Put Failure to Work\u201d and a faculty member at the University of California, Berkeley\u2019s Haas School of Business. \u201cFailure happens a lot.\u201d<\/p>\n\n\n\n

What can set you apart is how you respond to failure in the moment \u2014 and what you learn from it when you look back.<\/p>\n\n\n\n

Shut down correctly<\/strong><\/p>\n\n\n\n

Before you walk away from your business, make a list of everything you need to do to shut down properly. A lawyer or financial advisor can help with this process.<\/p>\n\n\n\n

\u201cIf you\u2019re in dire straits, sometimes people do foolish things,\u201d says Manny Henson, a certified financial planner and founder and president of Maryland-based Gamma Wealth Management. \u201cTalk to your consultants to make sure you understand what you need to do.\u201d<\/p>\n\n\n\n

That process includes paying your taxes<\/a>, paying your employees and closing your books correctly. If you miss any of these steps, you could face fines \u2014 and put your reputation at risk.<\/p>\n\n\n\n

\u201cIt\u2019s a small world nowadays, and you\u2019ve got to treat people well,\u201d Henson says. Memories of your business failure will fade, but \u201chow you go about addressing and reacting to that situation is going to impact you for longer.\u201d<\/p>\n\n\n\n

Care for yourself<\/strong><\/p>\n\n\n\n

Once you\u2019ve closed up shop, take time to care for yourself.<\/p>\n\n\n\n

A business failure can feel like the death of a friend, says Penny Pompei, who coaches small-business owners in the Palm Beach, Florida, area and is a certified SCORE mentor<\/a>. It\u2019s OK to grieve the loss.<\/p>\n\n\n\n

Before you investigate what happened, \u201cStop and breathe,\u201d Pompei says. \u201cYou\u2019ve just got to be able to just decompress and give yourself permission and time to mourn.\u201d<\/p>\n\n\n\n

If others ask why your business went under, you don\u2019t have to give an answer right away.<\/p>\n\n\n\n

\u201cDon\u2019t even try to go there, because your first inclination is going to be to blame,\u201d Pompei says. \u201cYou really don\u2019t know yet what happened.\u201d<\/p>\n\n\n\n

Figure out what went wrong<\/strong><\/p>\n\n\n\n

Once you\u2019re ready to look back at your business, Coopersmith recommends bringing together trusted stakeholders \u2014 like customers, partners, key employees, investors or funders \u2014 for a postmortem.<\/p>\n\n\n\n

To start, ask: \u201cWhat were the risks that we missed?\u201d<\/p>\n\n\n\n

As an investor or when presenting a business plan<\/a>, Coopersmith focuses on mitigating the risks businesses face in five areas:<\/p>\n\n\n\n