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Last week we spoke about the 3 biggest mistakes that cause over 50% of businesses to fail.
If you missed out on that newsletter do not worry just make sure to visit the Mid Market Insider homepage and catch up!
Now if you prefer to watch a video you can find it here:
Why Over 50% Of Businesses Fail (3 BIGGEST MISTAKES)
This week I want to break down the myth of the overnight success stories by covering 2 popular examples that demonstrate why it doesn’t exist.
We have all heard the stories.
Tech startups that went viral overnight, businesspeople who found success on their first try, or brands that, apparently, started as household names out of nothing.
These stories are appealing and feed the conviction that quick gains are not only feasible but somewhat common.
The truth is, though, that these tales often overlook years of labor, failed efforts, and many hours of grinding it out behind the scenes.
I want to share two examples of household names and break down the trials and tribulations these businesses faced to become successful and dispel the overnight success myth.
1. Nvidia
Now we all have heard of Nvidia and its recent success.
It officially took over Apple as being the most valuable company as its stock market value touched $3.53 trillion.
But people don’t realize the early obstacles they faced that nearly put them out of business.
Antitrust Allegations
In 2010, Nvidia faced intense scrutiny regarding their acquisition of Arm Holdings.
Regulatory and legal challenges threatened to derail their landmark deal which was integral to assuring Nvidia’s position in the semiconductor industry.
This scrutiny cast a shadow over Huang’s leadership and Nvidia’s future trajectory.
Dot Com Collapse
In the late 1990s, Nvidia's growth was fueled by the dot com surge.
However, all good things must come to an end and as the bubble burst in the early 2000s the company faced a huge downturn.
Sales plummeted and Nvidia’s stock price took a huge nosedive.
Huang decided to cut costs, restructure the company, and focus on core technologies.
These strategic moves enabled Nvidia to weather the storm and emerge stronger than ever.
People like to believe that Nvidia was an overnight success and they simply got lucky.
However, in reality, people don’t realize they nearly went out of business several times.
Nvidia and Jesse Huang are a prime example that overnight success stories don’t exist.
2. Airbnb
Airbnb is another household name that seemingly creeped up out of nowhere but eventually became a staple in the travel world.
However, Brian Chesky, Joe Gebbia, and Nathan Blecharczyh, founders of Airbnb, might not have realized how tough their journey was going to be.
Despite their initial success in 2008 they were struggling to attract new users to the platform.
Needing cash to remain afloat, they reached out to potential investors.
After meeting with 15 angel investors, all of them ended up passing on the idea, with half not even replying to Airbnb’s introductory email.
Out of desperation, they decided to use a credit card for short-term funding leading them to rack up around $30,000 in credit card debt.
Hoping to get more users, they targeted the 2008 Democratic National Convention in Denver, Colorado where Obama was set to speak in front of 80,000 people.
Although usage spiked for the event, they didn’t gain the day-to-day traction necessary to pay off their outstanding debt and become a profitable business.
So they found an ingenious solution to raise money:
Cereal boxes.
As presidential campaigns gained momentum, they made use of their designer skills to develop custom-designed Obama and McCain-themed cereal boxes with the catchy titles “Obama O’s: The Breakfast of Change” and “Capn’ McCains: A Maverick in Every Bite.”
They ended up selling $30,000 worth of cereal.
I know…
Crazy, strange, and lucky all wrapped up into one but it worked.
People like to fall in love with the overnight success story.
They don’t want to hear stories about the years of hard work required to reach that level of success.
They love the idea of just making it.
We live in a society filled with instant gratification. A microwave society plagued by internet gurus.
The "overnight success" we see today in reality is filled with:
- Countless roadblocks
- Decades of expertise built
- 30 years of consistent growth and failure
Real success isn't sexy.
It's showing up every day when no one's watching.
It's making the hard choices when easier options exist.
Success isn’t built in a day, a month, or even a year.
It’s built through consistent execution and strategic growth.
🧑🎓 The Lessons:
1. Perseverance through adversity is crucial
Nvidia and Airbnb faced significant challenges, such as antitrust allegations, the dot-com collapse, and struggles to attract investors and users. However, their founders persevered, making tough decisions and finding creative solutions to keep their businesses afloat.
2. Adaptability and innovation are key to survival
When faced with challenges, Nvidia restructured its business and focused on core technologies, while Airbnb's founders sold cereal boxes to raise funds and generate buzz.
3. Overnight success is a myth
Nvidia and Airbnb's stories dispel this notion, as both companies faced years of hard work, setbacks, and uncertainty before achieving their goals. Real success is built through consistent effort, strategic growth, and making hard choices. The idea of instant gratification is a misconception; true success requires patience, dedication, and a long-term perspective.
📅 Next Week:
In next week's newsletter, we'll examine an example or two of what I would consider to be 'bad' private equity.
Keep building,
Nick
P.S.
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