Very few businesses are successful right away. Even the most recognizable brands and industry giants have had their ups and downs. There are stories of startups that have struggled to make it big, and stories of major companies that encountered difficulties when their industries changed.
Here are four stories to get you inspired about businesses that overcame significant obstacles and became successful even though the odds were stacked against them.
How Apple Almost Went Bankrupt
After 12 years of financial losses, Apple found itself on the verge of bankruptcy in 1997. Major changes were needed if the company was to survive.
Steve Jobs, the original co-founder of the company, came back to replace the previous CEO. Microsoft agreed to invest $150 million in the company, and project Newton, a line of digital assistant devices, was axed due to its cost and lack of profits.
Apple took a new direction by introducing the iMac in 1998 and revolutionizing the home computer market with a product that stood out thanks to its transparent design. The acquisition of Macromedia’s Final Cut was another fortuitous decision by the company since this product added video editing capacities to the home computers sold by Apple.
Apple survived by establishing new leadership. The company moved beyond its competitive relationship with Microsoft and adopted a new direction better aligned with how the electronics market was evolving at the time. Apple made a successful bet on home computing and, in a way, eventually circled its way back to personal assistant devices with the iPhone.
Years Of Experience Doesn’t Mean Success: How FedEx Got Back Up
FedEx founder and CEO Frederick W. Smith came up with the idea to offer an overnight parcel delivery service by operating a fleet of planes. He built the company with his personal wealth and secured additional funding from investors.
However, rising fuel costs eventually caused the company to lose approximately $1 million a month. The company accounts dwindled to their last $5,000, which wasn’t sufficient to keep the company running much longer.
Smith decided to take this last $5,000 and head to Las Vegas. He essentially bet the house on his company. He spent a weekend playing blackjack and turned $5,000 into $32,000. FedEx was able to open again on Monday and resume operations. Smith kept the company afloat long enough to raise an additional $11 million from investors.
Playing blackjack with business funds isn’t something we can recommend in good conscience, but the important lesson here is that taking a risk sometimes pays off. Smith was in a desperate situation and knew the remaining $5,000 wasn’t enough to keep operating. There were no guarantees that this risk would pay off, but he didn’t give up and managed to keep FedEx afloat long enough to get through the tough times.
Don’t Give Up Easily: How Airbnb Got Investors To Agree To Their Idea
Airbnb has changed the way vacation rentals work. However, convincing investors that people would want to use this service was a challenge. Airbnb was conceived in the early days of the sharing economy, and people had doubts about the model.
Airbnb is a brilliant idea in hindsight, but founder and CEO Brian Chesky had to be creative to fund his project. Chesky and co-founders created presidential-themed breakfast cereal during the 2008 campaign and sold these products to raise money.
The startup eventually joined San Francisco-based incubator Y Combinator where Chesky and his team focused on getting more people to use the platforms, sometimes by taking pictures and creating the listings themselves.
The startup moved to New York, and the Airbnb team focused on developing an ideal experience with the app and service instead of working on getting more people to use the platform.
There are three noteworthy lessons to learn from Airbnb’s story. The first one is that a change of market can make a huge difference. The second is that scalability shouldn’t be a priority. It is best to work on creating an attractive business proposition and scalability will happen by itself. The third lesson is that investors don’t always recognize great ideas. There are other ways to raise capital and working on side projects can be a means to a successful end.
Fake It ‘til You Make It: How Reddit Faked Its Way To The Top
Reddit, the homepage of the internet, is one of the largest and most successful online communities. The site has had its share of controversies, but there is no denying that it plays an important part in making content go viral.
The site was launched in 2005 and initially failed to attract users. Reddit co-founder Steve Huffman has confessed that the site was initially full of fake accounts used to generate discussions and keep the site active. These accounts were used to shape how content was shared and to control the direction in which the online community grew. The team behind the creation of Reddit gradually stopped using these fake profiles as an organic community formed on the site.
This approach is controversial, but there is an important lesson about thinking outside of the box and developing a creative solution to a problem with which all online social platforms have struggled. Having each member of the Reddit team create several fake accounts and use them to generate activity and guide conversations is an excellent example of how available resources can be leveraged to achieve a goal.
These four stories have one thing in common. They are stories of transformation, and they show that transformation is needed for survival and growth.
Apple was able to survive and become successful by transforming its relationship with Microsoft, its leadership and its product selection. FedEx transformed a conservative strategy into an approach that relied on risk-taking. Airbnb kept transforming its offer until the experience was perfected and they tapped into the right market. Reddit leveraged available resources to transform stagnation into momentum.
Entrepreneurs can learn a lot from these stories of transformation. Besides valuing change, entrepreneurs should get into the habit of constantly assessing their current strategy and asking what needs to change and which new direction would make sense for the company.
HJR Global enables companies to transform, perform and grow to be successful. We help business owners overcome those bumps in the road, from the planning stage through the securing of financing. Contact HJR Global today for more information.
To read the previous blog, click here.