Nic Haralambous does not shy away from failures. In fact, he believes that the ability to fail and learn from those experiences is the single most important factor in achieving success. Here’s how he’s leveraging his own failures and successes to build a R100-million business from a R5 000 online start-up.
Side hustles. Some of the biggest brand names we know today started out as them, including Apple, Instagram, Udemy, Whatsapp and Airbnb.
For Nic Haralambous, founder of NicHarry.com and author of Do.Fail.Learn.Repeat: The Truth Behind Building Businesses, the side hustle is one of the most critical factors in entrepreneurial success - mainly because it teaches entrepreneurs to fail, which teaches them to grow, which ultimately gives them the tools they need to succeed.
NicHarry.com was originally launched as NicSocks.com in 2013. It started out as a side hustle and remained that way for two years while Nic focused on building a consulting firm that was earning him significantly more money than his R5 000 online start-up, but was also becoming increasingly more complicated with new partners.
That’s right - NicSocks.com was launched with R5 000. It took 30 days to build, and six weeks to find traction. At the time, Nic had exited his first big success, Motribe (which he still views as one of his failures), and he wanted to prove to himself that it’s possible to launch a viable business with limited funds.
Motribe was a tech company. It took over a year to develop the tech, and VC funds were required prelaunch. Nic was looking for the exact opposite of that experience, because for him, the Motribe story had not ended well. It had been sold out from under him and had left a bitter experience.
Nic could have walked away from entrepreneurship altogether following the exit. Many South African entrepreneurs do. In America, the re-entry rate of entrepreneurs is 3,6 times on average. This means that entrepreneurs will fail 3,6 times before they give up and return to what they were doing before. In South Africa, it’s 1,1 times. Most entrepreneurs fail and never come back.
Selling your business for millions might not sound like a failure - the exact opposite, in fact. But as Nic himself is quick to point out, failure is personal and has far more to do with ego and reputation than financial gains or losses.
It’s also the most fundamental building block of success. If you can get back up and try again after failure, you’ll learn a few important lessons that you can carry into your next venture. Which makes ‘failability’ the single most important factor in ultimate success.
Success lies in one’s ability to fail
“The word failure has been failing me for my entire life,” says Nic. “When we speak about failure, we tend to get a knot in our stomachs because we know that we’re doing something right now that will come to an end. We physically fear failure, and that’s because we view it as the opposite of success.”
Nic firmly believes that entrepreneurs should not think like that. Instead, failure should be embraced, and a re-entry rate that nears or surpasses that of the US should be the goal.
“I have failed so many times I’ve lost count,” he says. “I failed at my first business while I was still in school. I failed my learners license three times and my motorbike learners license about twenty times. I was in a failed band and I launched a failed blog while I was at university. I’ve had two successful businesses that I regard as failures. Failure isn’t the end. It’s the period before the next thing - if you let it be.”
This philosophy has become a way of life for Nic - do, fail, learn, repeat. The foundation of it is what he has coined ‘failability,’ which is an index that tracks how likely an entrepreneur is to embrace failure.
“Failability is the ability to fail. We spend so much time focusing on avoiding failure that we don’t go out and try. I don’t believe that failure is the opposite of success. Not trying is the opposite of success.”
Nic points to the US’s re-entry rate as a prime example of the importance of failure. “If a business takes between three and five years to succeed or fail, most South African entrepreneurs have walked away from entrepreneurship within five years. In the US, this is closer to 15 years. That time in the market learning unbelievably valuable lessons is a gamechanger. It gives entrepreneurs the tools they need to eventually succeed. It’s why there are these incredible success stories like Richard Branson in the world.
“Branson is the perfect example of someone who talks about all of his failures, because failure is always the precursor to success - the problem is that by the time we hear about those failures these entrepreneurs are larger than life and we almost can’t believe the stories. They’re too far away. We need to move away from that and share our failures with each other now. We need to embrace failure, learn from it and try the next thing - always, the next thing.”
Grow your failability index
Nic’s advice in this regard is simple: grow your failability index. It doesn’t need to happen all at once. NicHarry.com is the perfect example of taking early small bets to keep failures (and wins) small. The key is to embrace those failures though.
“We are limited by fear. Our ambition is large, but so is our fear and it holds us back. We need to get used to failing, and the way to do that is to lose a little bit. Smaller ambition, smaller fear and smaller failures. Remember, you don’t have to win or lose everything - it will always be a mixed bag of both, so learn to survive the failures.”
For Nic, failure is largely about ego and reputation. “There’s always a cost to starting a business, but often it’s not a monetary cost. It’s a time cost, an ego cost. This gives entrepreneurs the opportunity to fail without losing their house though - which means failure won’t kill you. We have far too much fear for something that isn’t life threatening.”
According to Nic, there are six questions that every entrepreneur should ask before they launch something new. Answering these questions is an important first step in building your own personal failability index:
- Can I start right now? If I don’t let fear outweigh ambition, can I get something simple into the market right now?
- What is the actual cost? Is it time away from family and work or monetary, or both?
- What will I lose? What do you actually lose if this doesn’t work out? For most of us, it’s just ego. The truth is that no one really cares if you failed except you, so get over it.
- What will I gain? This is the big question - the upside. Remember, even failure in this context is a gain, as long as you learn some valuable lessons.
- What will it look like if I fail? Will you lose your house? Live in the street? Can this actually kill you? There are very few businesses you can start that will actually kill you.
- What does life look like after you succeed? Bring this front and centre and let it help you overcome your fear.
Failing, learning and achieving staggering success
Let’s get back to NicHarry.com. Nic speaks a lot about failure, but many of these lessons have been used to take NicSocks.com from a small online start-up to a sophisticated retail brand that Nic aims to build into a R100-million business.
So, how has he done it? First, he kept things small when he launched. He built the ecommerce site on Wordpress, an opensource platform. That’s the beauty of tech. You don’t need to be a tech company to make use of all the free and inexpensive tools available to start-ups today.
The business began to grow nicely. “I focused on expanding our subscriber base. Initially, I wanted to meet our customers, so I set up a pick-up point in Woodstock, Cape Town. Meeting customers while they picked up their orders gave me incredible insights. I got an understanding of exactly why they purchased a subscription, who it was for, how they heard about us, what they thought about our socks and so on.”
This wasn’t a sustainable way to build the brand into a large business, but one of the biggest lessons that Paul Graham, founder of Y-Combinator in Silicon Valley always shares is that if you want to grow, you need to do things that don’t scale.
Airbnb’s founders, Brian Chesky and Joe Gebbia, went door to door in New York, recruiting new users and helping existing ones improve their listings.
Locally, Albé Geldenhuys launched USN from his flat, mixing his product in a hand-cranked washing machine, and Yuppiechef’s founders personally wrote a thank you note to every customer who purchased something from their online store.
Eventually these practices become completely unsustainable, but by then you have a very good understanding of who your customer base is and what they need from you.
It was the same for Nic. The more he learnt about his customers, the better the business did, although he did have some help from traditional media channels.
“I discovered that the more exposure I received in magazines and on radio and TV shows, the better our website did. There was a direct correlation. So, I started to work my way into as many shows and publications as possible.”
By this stage, Nic was desperate to change the status of NicSocks.com from side hustle to full-time focus, but like many entrepreneurs, he was unsure about when to make the full-time leap. He was still playing it small - small wins and small losses. At some point he would need to take the leap.
“There was a very consistent feeling that kept nagging at me. The feeling that I was neglecting the most important thing that I was building. I would be sitting with Resolve Mobile clients in Kenya and sneaking in work on NicSocks.”
Resolve Mobile was a consultancy that Nic had started building following his exit from Motribe. It was doing extremely well, but he was realising that his heart wasn’t in it.
“I would be talking to the biggest mobile networks on the continent and thinking about the customer support request I had left unanswered for too long about how to wash bamboo socks. My focus was always on NicSocks. That was the feeling. That was the indication that it was time to devote my attention to my tiny sock start-up. It sounds nuts, but I knew it was time to follow my passion.
“I left a consulting firm that I started and that was paying me a six-figure salary to build a sock company in Cape Town. What could I do? I was dreaming about socks.”
So, when asked the question, ‘When do I focus on my side project?’ Nic’s answer is simple: When you can think of nothing else but your side project, it’s time to take it from side hustle to full-time project. But on the way, build up your failability index, and follow these three rules:
1. Everything has to start somewhere. Nothing comes from nothing. Success and building a side hustle business takes time and energy. It’s also important to stay encouraged, even if things aren’t as quick as you’d think. Be consistent. Enjoy small wins but embrace small failures and build up your ability to fail and learn from the experience.
2. It’s not about where you start. It’s about what you’re doing and where you want to go. Nothing starts nowhere, but something starts somewhere. If you never try, you’ll never succeed. This is a fundamental truth. So, start. Start today. Take the leap.
3. Fix your eyes on the future but prioritise the present. More often than not, successful businesses don’t focus on the problems of the present but rather look to solve future concerns. At the same time, what you do now has a massive impact on your future, so it’s important to recognise potential consequences for current actions.