ECONET founder Strive Masiyiwa has shared an inspirational story of how a setback after he lost out on a US$4 billion deal gave him valuable lessons.
We share the full story below:
By Strive Masiyiwa
Whether it is in sport, or an entrepreneurial venture, failure can be very bitter and painful. Just think of the guy who misses a penalty in a World Cup final… eeeish! How do you pick yourself up from that? You must. It’s your life?!
My first attempt to get into the telecoms industry was actually a frustrating failure! Here is how it happened: Round about 1991, a huge American company contacted me about this amazing telecoms venture called Iridium. You should Google it on Wikipedia. This was before cell phones. It was a satellite-based telecoms system that represented the most advanced innovation the world of telecoms had ever seen.
The American company Motorola was going to build this system as a global system, and can you imagine they asked a scrappy little entrepreneur from the backwaters of Africa to be part of it? How cool was that?!
The whole project was valued at over $4bn, and that was 1991! Well, I dropped everything I was doing to chase my dream. For the next two years, I was on the road, hobnobbing for the first time in my life with real big boys: Geneva, Paris, Monaco, London, Nairobi, Joburg, New York. I crisscrossed the globe, flying coach, but I was young!
To own 5% of this giant venture, I had to raise $40m, and if anyone came to Africa with one of those phones, I would get a cut.
What a beautiful business, or so it seemed!
First problem I had: That $40m might as well have been $400bn, because it was way out of my league, except I did not know it. I would have struggled to raise $400,000–never mind $40m!
Somehow I thought I could do it, which was just delusional as I look back on it. But after two years, I was exhausted. I lost the rights, and they were bought by a huge Saudi company. Embarrassed, I headed back home to find my business in total disarray due to neglect. For the next year, I pretty much disappeared as I rebuilt my construction business.
But something amazing had happened: Without even realizing it at first, I had stumbled into studying the whole development of something called Global System For Mobiles [GSM] and I realized that I could enter the industry more cheaply through this ground-based system. I switched my interest completely.
Suddenly all the contacts I had made, and all the things I had learnt on the road watching those big guys, became a massive windfall. It was like I had advanced 25 years as an entrepreneur! The rest is history, as they say.
As for Iridium, it was built, and eventually collapsed. It went into bankruptcy and was rescued , and is actually still operating, but is not even worth a fraction of what I eventually built for my own investors over time.
There are so many lessons for you in this. Thoughtfully sit down, and jot down what you see. Read other people’s own comments, and see if you can add something new. Here are some of my own takeaways:
- If such a proposal were made to me today, I would have turned it down. Today I turn down proposals like that every week. I have a better understanding of what I can, and cannot do: You must always be careful not to be sucked into things that you are not ready for.
I was fortunate I did not lose my business back home altogether. In the end, I succeeded because I went back to basics, and did something I had the capacity for. I consider that whole thing a misadventure [except for important learnings!]
- Any situation, whether good or bad, has lessons for you. I used the lessons of that failure well, but I do not believe that it was my destiny to go into something that would fail!
- Any failure has lessons for you, even if it is a complete business failure. Many of you will fail, many times, before ultimately emerging as successful entrepreneurs.
There is no one on this platform who has read and understood many of the lessons I have taught who would make the mistake of chasing a project like that for two whole years!
- God does not put you into bad situations in order to teach some lessons. You put yourself into bad situations most of the time, or some other people do, but in rescuing you, God will use that bad situation to teach you important lessons.
- Source: Strive Masiyiwa.