Four reasons social entrepreneurs find failure difficult to discuss

3rd August 2017



Social entrepreneurs find it difficult to talk about failure and are too concerned about business and reputational damage, according to a new paper from UnLtd's research team and Roxanne Persaud. Celebrating failure has become fashionable in recent years. Practitioners, supporters and social entrepreneurs themselves frame failure as a learning opportunity; something that inevitably drives success. We ran a workshop to hear the thoughts and ideas of 28 social entrepreneurs on what they found challenging about failure. We published our findings here.

'Privately yes, publicly no'

Although currently portrayed as a positive experience, many social entrepreneurs told us talking about failure openly was difficult. When asked whether they discussed failure, the most common response was 'privately yes, publicly no'.

Failure is not clearly defined - it can be interpreted in different ways

Failure is not an easy thing to define. It means different things to different people. The most obvious kind of failure for a social venture would be the business closing. But according to our survey data a venture achieving its social aim was a common reason for a business closing. For some this represents social entrepreneurial success, not failure. Traditional business indicators like turnover are often used as proxies for success. While clearly important, they can ignore that some social entrepreneurs sacrifice profit to deliver more social impact. On the other hand, social entrepreneurs reported that focusing too heavily on income generation was seen as selling out by others in the social sector. In part, failure is hard to talk about because it is complex. Different audiences think of failure in different ways.

Fear of judgement and reputational damage

Social entrepreneurs we talked with expressed a fear of being judged negatively by others and consequent reputational damage. According to one social entrepreneur, talking about failure could lead to a 'loss of face' and failure damaged their sense of pride. On a practical level, social entrepreneurs felt that it was important to 'preserve enough ego to persevere', which could be challenging in frank discussions about failure.

'Talking about failure can shake your resolve in your mission and ability' - Social entrepreneur

This was only made worse when social entrepreneurs could not fully understand what had gone wrong and were unsure of how to learn from their mistakes.

Fear of business consequences

Concerns about public failure having a damaging effect on organisational reputation is another key issue for social entrepreneurs, especially because it might limit future opportunities for partnerships and funding.

'There's the integrity issue, how much can you get reinvestment.'- Social entrepreneur

Not having a positive story to share means outside organisations may begin to lose trust in your ability to deliver.

 'If something is a global failure, it's not only money you lose but trust.'- Social entrepreneur

Social entrepreneurs at our workshop said that failure affected the morale of staff and created tension within their organisations. Talking about failure with others tends to happen in informal settings, but it is difficult to create a shared organisational understanding of failure when only family members or close colleagues are part of the conversation.

Culture of celebrating failure excludes negative experiences

Social entrepreneurs in the report said that the current zeitgeist around failure, full of positive messages like ‘never give up’, was an unhelpful pressure and ‘astoundingly bad advice’. Social entrepreneurs told us that pressure to be positive about failure focused responsibility on an individual even when they were feeling discouraged and bruised by the experience.

'The difficultly of being trendy about it is that it just makes me feel so crap… it becomes about me and my own response to it.'- Social entrepreneur

Conversely, resolutely pursuing success with the idea that 'failure is not an option' can make it difficult to take responsibility for things that go wrong, to develop a 'plan B or C' and communicate that in an effective way.

Failure is both personal and public

Social entrepreneurs reported that the biggest challenge to shared reflection and learning from failure was being able to allow others to judge their performance and potential. A  Planning openly and honestly for potential failure was seen as a risky thing to do because sharing an 'escape plan' puts doubts into the minds of investors.

'Personally you need an escape plan but you need to be able to craft a believable story that what you're proposing can be done.'- Social entrepreneur

Failure is a reality of business, not everything works. This doesn't mean that it doesn't hurt. Moving on after failure involves talking about it in all of its depth. We want to better support social entrepreneurs to be able to deal with failure and it begins with critical discussion of the costs of failure.

UnLtd research social entrepreneurs and failure

Exploring: Social entrepreneurs and failure

Read the Explore paper here. Download PDF (6 MB) >

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