James Altucher on Failure and Experimentation

TL;DR

Failure is painful, but small experiments and early exits can limit the damage when an idea no longer feels viable. James Altucher argues against romanticizing failed startups, emphasizing the real losses they can cause, while showing how candid evaluation, fast decisions, and responsibility toward investors can make entrepreneurial setbacks more manageable.

Transcript

Hey, everybody. How's it going? I'm Chase Jarvis. Welcome to another episode of Chase Jarvis Live, specifically on CreativeLive in the 30 Days of Genius series. Super happy to have you here. Um, man, we got something in store. If you're new to the 30 Days of Genius series, it's where I talk to the top creatives, entrepreneurs, and thought leaders i... Read More

Key Insights

• Entrepreneurial failure is painful rather than inherently admirable. Altucher challenges the tendency to celebrate failed startups only after a founder achieves later success, because that polished narrative often omits lost money, damaged relationships, disappointment, and the emotional cost experienced while the failure was unfolding.
• Experimentation is one reason a founder can start many companies. Altucher says he created 20 companies, 17 of which failed, partly because he treats ventures as experiments and is willing to stop quickly when disappointed instead of preserving every project indefinitely.
• Giving up quickly can reduce losses, but it is not automatically a virtue. Altucher admits that he may abandon projects too easily, recognizing that an early decision to stop can reflect either useful judgment or insufficient persistence depending on the circumstances.
• Responsible closure means protecting stakeholders when possible. After doubting a dating service immediately after raising funds, Altucher returned about half a million dollars to friends and family, paid one participant's lawyer fees, and personally absorbed the money already spent on development.
• A functional product does not prove that a business should continue. Altucher's dating site had been developed for about four or five months and was operational, yet he shut it down because he no longer believed in the idea and wanted to avoid disappointing investors later.
• Failure narratives can become misleading when they highlight only later success. Altucher criticizes stories that treat several failed startups as evidence that the next venture must work, because prior failure does not itself guarantee future success or erase the harm caused.
• Creative photography begins with personal concern and a distinctive perspective. Jarvis advises identifying whether one cares about people, buildings, nature, or another subject, then applying an individual lens to make a photograph that another person could not create in exactly the same way.
• Intimate portraits depend on brief trust rather than distant observation. Jarvis recommends approaching a stranger, honestly explaining the emotional purpose of the photograph, establishing a mutual connection, and giving simple direction so the subject can remain natural instead of adopting a conventional smile.

Questions & Answers

Q: How does James Altucher approach startup experimentation?

James Altucher approaches startups as experiments that can be ended when they become disappointing or appear unpromising. This helps explain how he started 20 companies, including 17 that failed. He believes fast abandonment can prevent a weak project from consuming more resources, although he candidly admits that he may sometimes give up too easily and that this is not necessarily a good quality.

Q: Why does James Altucher reject romanticized failure stories?

Altucher rejects romanticized failure stories because failure itself can be deeply painful and damaging. He says polished entrepreneurial narratives often mention an unsuccessful startup only as a prelude to later success, while leaving out lost investor money, broken friendships, failed relationships, and other consequences. Learning may follow a setback, but that does not make the original loss pleasant or automatically valuable.

Q: What does James Altucher's dating startup reveal about failing fast?

Altucher's dating service shows that failing fast can mean stopping even after substantial preparation. He had spent about four or five months developing a functional service built roughly on top of Twitter and had raised about half a million dollars. The next day, he decided the idea felt wrong, returned the investment, covered one person's lawyer fees, absorbed the development expense, and closed it.

Q: When should an entrepreneur consider closing a startup early?

The interview suggests considering an early closure when honest reassessment produces serious doubt about the underlying idea and continuing would expose investors to greater disappointment. Altucher acted despite having a working site and newly raised funding. His example emphasizes evaluating conviction and downside promptly, then treating stakeholders responsibly, rather than continuing merely because time, labor, or money has already been invested.

Q: Does previous startup failure guarantee future success?

Previous startup failure does not guarantee that a founder's next company will succeed. Altucher criticizes the idea that several unsuccessful ventures automatically make someone a safer or more deserving investment. Failures can provide lessons, but they also create real losses and do not establish a predictable sequence leading to a successful company. Each new venture still requires independent judgment and evaluation.

Q: How can someone take a meaningful portrait of a stranger?

Chase Jarvis recommends approaching the person instead of photographing them secretly from far away. The photographer should briefly explain the personal mission or emotion behind the picture and identify a sincere point of connection. That short exchange can create mutual trust within about 10 to 15 seconds, making an intimate image more likely than a detached photograph captured without engagement.

Q: How can a photographer keep a portrait subject from posing unnaturally?

Jarvis suggests clearly telling the subject what the photograph is trying to express. If the goal is to portray someone who appears to carry a particular emotion, the photographer can say that no smile or formal pose is needed and ask the person simply to be themselves. Specific, honest direction gives the subject permission to respond naturally while preserving the intended emotional context.

Q: What should a beginner look for when taking a photograph?

A beginner should first identify what they genuinely care about, such as people, buildings, nature, or a particular emotional quality. Jarvis says that personal concern becomes the photographer's context or lens. The next goal is to find a scene with enough visual or emotional stopping power to make someone pause, then interpret it through a perspective unique to the photographer.

Summary & Key Takeaways

• James Altucher describes entrepreneurship as a process of experimentation rather than a single uninterrupted commitment. Having started 20 companies, 17 of which failed, he attributes that volume partly to abandoning disappointing projects quickly. He acknowledges that this tendency may sometimes make him quit too easily, so speed alone does not guarantee sound judgment.

• Altucher rejects the polished treatment of startup failure as an automatic credential for future success. He says failure can involve lost investor money, damaged friendships, broken relationships, and intense personal pain. Although people can learn from setbacks, presenting only the eventual success conceals the consequences that made the original experience genuinely difficult.

• One dating service illustrates Altucher's approach to limiting downside. After developing a working site for several months and raising about half a million dollars from friends and family, he reconsidered the idea. He returned the funds, covered one investor's legal fees, absorbed the development costs, and closed the company before risking further losses.