Vinod Khosla at SXSW: 11 Ways Failure Can Empower You

For entrepreneurial legend Vinod Khosla, failing with one startup business is a step to succeeding with another.
Freelance Writer, Self-employed
March 14, 2013

When Vinod Khosla talks about failure, it’s a little like Michael Jordan talking about missing layups. Neither the Sun Microsystems co-founder nor the all-time basketball All-Star is closely associated with coming up short. So hearing Khosla wax nearly rhapsodic about failure at SXSW Interactive was something of a shock.

“I probably have more experience screwing up than anybody in this room,” Khosla announced, more proudly than wryly, to a large auditorium full of SXSW attendees. The 58-year-old Indian-born entrepreneur and investor probably had more experience with many things than his generally youthful listeners. One of those is success. 

Khosla was the first CEO at Sun, which pioneered open standards and other technology innovations from 1982 until its 2010 acquisition by Oracle for $7.4 billion. Before that, he started Daisy Systems, creator of an early computer-aided engineering solution.

Since joining Kleiner, Perkins, Caulfield and Byers in 1986, Khosla has been a venture capitalist and advisor to entrepreneurs. Among his current posts is a member of the board of directors at mobile payments star Square.

Along the way Khosla has, indeed, been associated with some massive failures. Perhaps the most notable is the $6.7-billion Kleiner-engineered merger of the Excite portal and the @Home Internet service in 1999. The venture was bankrupt and liquidated two years later.

SXSW had its share of star power. Bill Gates delivered the closing address at SXSWEdu, the educational portion of the gathering, in the same building the previous day. Al Gore would give the Interactive keynote the next day. And latter-day entrepreneurial icons like Foursquare founder Dennis Crowley abounded.

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Vinod Khosla at the 2011 TechCrunch Disrupt SF conference (Photo: Getty Images)

But Khosla held his own. In part, that’s because few if any in attendance had the length and breadth of his experience, with both failure and success. Here are 11 valuable tips he shared on how to turn failure into success:

1. Take risks. “I've always felt my willingness to fail is what has given me the willingness to succeed. If I didn't have that willingness to try anything new and risky, I wouldn't succeed.”

2. Weigh risk and reward. “Most people start changing what they do to reduce the risks. That in general is a good thing. But if you reduce risk to the point of not doing anything consequential or new, you may have reduced the consequences of success too. Many people reduce risks so much that what they achieve doesn’t matter.”

3. Don't fear failure, but don't let it roll off your back, either. “Don't take failure lightly. Don't be afraid to fail. But that doesn't mean be casual about it. A license to fail isn't a license to not work hard.”

4. Make the most of failure. “The key is to make the consequences of each failure small and the learning from each failure large. So as you try startups, be cognizant that what you're trying to do is learn as much as possible for the least amount of money and resources spent.”

5. Start your business for the right reasons. “There are a lot of different valid goals. It may be important to not have to answer to somebody else. That's a reasonable goal. Maybe you want to make enough money to not have to balance your checkbook. Maybe you want to work with friends. All those are valid goals to be an entrepreneur. The trouble is when you confuse those goals.”

6. Curate the best management team. “If [entrepreneurs] want to build a kickass team, you know they'll start doing some interesting things. A company becomes the people it hires. If you're just using a bunch of consultants to get to a place, you're not going to build that team.”

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7. Value different perspectives and debate. "It's really important not to have everybody come from the same background or have the same point of view. It's important that everybody respects everybody in the team, but that they be very different. It think it's really important to have disagreement, diversity and the ability to debate.”

8. Focus, focus, focus. “The CEOs who make it a long way have a lot of flexibility and surround themselves with really great people. And really diverse people and multiple points of view. A good CEO's job is to build a team and make sure it stays on vision. A good CEO's job involves very little else.”

9. Rethink your schedule. “If you look at what you're doing next week on Sunday night, half your calendar should be free. If it's not, you're being reactive. You’re not being proactive. You’re not being there to help your team succeed.”

10. Be disruptive. “If you look at a thousand startups, 50 of them will be good and disruptive and 950 will be doing pretty routine things. The same is true of the venture business. The bulk of the industry just likes to follow. There's a huge lemming effect. It's unfortunate.”

11. Be available. “I'm very accessible. My email address is and I look at all my email. Not always immediately. Sometimes it takes me a week or so to get to it. But I always eventually get to my email.”

Photo: Getty Images