Why Failing Fast and Betting Big is the Secret to Venture Success

Discover the counterintuitive mindset that powers the world’s top investors—and how you can apply it to your own life and business.

When most people think of investing, they imagine careful analysis, risk avoidance, and steady returns. But in the world of venture capital, the rules are dramatically different. Here, the best investors are not those who avoid losses at all costs, but those who are willing to fail—and fail often—on the way to finding a single, world-changing success. This is the paradox at the heart of the venture mindset: you have to lose many times to win big once. The math is simple but profound. In a typical venture fund, 90% of investments may return nothing, but the remaining 10%—or even just one company—can generate returns that dwarf all the losses combined. This is why VCs talk about ‘home runs’ and ‘unicorns’—they’re not just buzzwords, they’re the only way the economics work.



But how do you build a culture that not only tolerates failure, but actively encourages it? The answer lies in speed and learning. The best VCs and founders move quickly, running experiments, launching products, and making decisions before all the data is in. They know that in a fast-moving world, waiting for certainty means missing the next big thing. In fact, some of the most successful startups were initially dismissed or misunderstood, only to become household names because someone saw their potential and bet boldly.

Take the story of a small messaging app that was rejected by dozens of investors, or an online marketplace that seemed like a long shot. In each case, it was the willingness of a few to take a chance—to accept the likelihood of failure in pursuit of massive upside—that made all the difference.

So, what can you learn from this? First, embrace the idea of a portfolio: don’t put all your eggs in one basket, but don’t be afraid to bet big when the right opportunity comes along. Second, cultivate resilience. Failure is not the end, but a necessary step on the path to success. Finally, always be on the lookout for the outlier—the idea that seems crazy, but just might change everything.

In life as in venture, it’s not about how many times you fall—it’s about having the courage to stand up, swing hard, and aim for the fences.

For more on this approach, check out classic VC books and resources that highlight these lessons in action, and learn how to apply the venture mindset to your own journey.



Sources: The Venture Mindset, 4Degrees blog, JoinLeland library