Welcome to the Class Reunion

Colorful banners hang over the dance floor. A live band is playing calm 90s classics in anticipation of what should be a night of swaying, twirling, and whirling. There are tenths of big round dining tables clothed in white linens, with fresh flowers in large centerpieces, fancy porcelain plates, gleaming silverware, and, of course, elegant place cards with ex-alumni names. One of those tables is particularly noisy, as people who find themselves reconnecting with college pals are eager to express how successful their lives have turned out, or so they want others to believe.

Dorky-looking David, for example, is discussing how his background in computer sciences qualifies him as an expert on all IT-related matters, from cybersecurity to the metaverse. Isabella, with her designer clothes, bronze-powdered face, and space-looking iPhone, brags about her growing Instagram followers, all of whom she claims are anxious to watch her every move from sunrise to sunset. Then there's Samuel, dressed in a pinstripe suit, who cites a slew of potentially lucrative businesses he's about to launch. Mia, the perpetual hippie, offers a bunch of humorous stories about her award-winning wildlife photography adventures throughout the world. And a skinny-looking Robert, who always struggled with his weight, is now lecturing the rest of the group on how fasting, calorie counting, and juice cleanses keep body fat to a minimum.

All of them, however, hide the fact that, behind their seemingly flawless lives, they continue to fail miserably at things that are essential to them. David squandered his whole life savings trading in cryptocurrencies, and he’s still looking for that lucky digital coin that will allow him to recover and enjoy financial stability. Isabella will not admit that she is lonely because she neglects the relationships she values. Samuel, the self-proclaimed "entrepreneur," is unable to overcome procrastination, and as a result, he continues to pass up opportunities that would make him feel successful. Mia suppresses her sorrow for not being more assertive, reject the frantic schedules, and instead devote time to her family. Finally, Robert has mastered the art of concealing the fact that, beneath his outward appearance, he often binges on junk food without control.

Emily is sitting quietly at the same table. She always managed to stay beneath the radar throughout college, and today is no exception. Her former classmates take it for granted that she has led an average life, free of ups and downs. But that's not the case. After graduating more than a decade ago, Emily invested in the stock exchange the little money she earned working over the summers. She lost virtually everything as a result of bad advice, but she has since managed to construct a small but diverse portfolio that has grown steadily over time. She also noticed that the majority of colleagues who claimed to be her friends were only there because she helped them with their assignments. As a result, she is now paying special attention to her one true friend, who makes her feel accompanied. Emily is a doer, and while she likes to strategize, she understands that without action, nothing happens. Despite her hectic work schedule, she makes time for her loved ones by setting limits. And her curvy body depicts a happy, healthy individual who has discovered that life balance is achieved not through extreme eating practices, but with the occasional ice cream cone.

What differentiates Emily's story from that of the others? Her response to failure. Go back and see how she fails as many times, in similar situations, as the others do. However, when David, Isabella, Samuel, Mia, and Robert merely continue to do the same things in the face of failure, or worse, allow fear to drive them to indecisiveness, Emily learns, adapts, and takes action.

Simply put, failure is the inverse of success; it’s the inability to fulfill our planned goals or objectives. In practice, however, it’s a relative concept. For some, it's an awful blunder and proof of their own shortcomings. Others see it as a state of flux and a prerequisite for human development. The former are frequently numbed by failure, whilst the latter continue to move on. Why is this the case? In his book The Algebra of Happiness, Scott Galloway, a professor at New York University's Stern School of Business, illustrates how success is the ability to grieve our failures and then move on. That resilience required to progress from one stage to the next must come from us, not from anyone else.

In Failing Forward, John C. Maxwell proposes a 15-step process to failing forward, of which I focus on five. First, be aware that there’s one key distinction between average individuals and achievers. The latter learn from each mistake, know failure is a part of progress, maintain a positive attitude, take new risks, and persevere. Second, find a new definition of failure. People mistakenly believe that failure can be avoided. It's also a common misconception that failure is the enemy. And thoughts that failure carries a stigma are unfounded. Third, overcome our fear by acting. Consider what usually occurs to someone who is unable to overcome the fear of failing and becomes mired in the cycle of fear: fear of failure leads to inaction, delay, self-pity, justifications, and hopelessness; this then translates into incompetence and lack of experience; more fear comes as a result. Fourth, change our response to failure by accepting responsibility. This means searching for any shortcomings in the failure for which we should take accountability. Then own it. Finally, say goodbye to yesterday. Leaving past hurts behind is needed for momentum to pick up.

Allow me to expand on two previously discussed concepts: responsibility and fear. On the first point, I believe we can all agree that everything we do is our responsibility. However, Thomas Erikson emphasizes in Surrounded by Setbacks that there are two other situations for which we must be held accountable. First, for what we don't do. It's easy to forget that by choosing not to act, we are also taking a stance for which we should be held accountable. And second, for our reactions to what happens to us. We are not responsible for what others say or do to us, but we are accountable for how we choose to respond. Distinguishing these three scenarios from those over which we have no control will allow us to order our thoughts around what is truly our failure and what is a seatback caused by external events.

As far as fear of failure goes, all we need to do when confronted with a frightening scenario is to identify the fear, accept that it exists, and do what we need to do nonetheless. The Harvard Business Review proposes four strategies that we may all follow to deal with our fear. First, redefine failure. We may be able to avoid some stress and anxiety by framing differently a circumstance we are dreading before we attempt it. Second, set approach goals rather than avoidance goals. Rethinking goals based on what we want to achieve rather than what we want to avoid improves motivation. Third, make a "fear list." It should cover the worst-case scenario, what we can do to avoid it, and what we can do to repair it. And fourth, concentrate on learning. Failure is unavoidable in life. Finding the benefit in a difficult situation is a skill that we need to develop.

When J.K. Rowling, author of the popular and celebrated Harry Potter series, was invited to speak in front of the graduating class of 2008 at Harvard University, she opted to talk about a subject near and dear to her heart: failure. Prior to her international success, she was unemployed, jobless, and relying on welfare to care for her daughter. This was not the life Rowling had envisioned for herself. Many people would understandably choose to give up writing and settle for a life far from their desired career if it meant financial security. Many more would have been consumed by fear and regret, leading to a life away from people who could judge their failures. But not her. She accepted responsibility, learned from her mistakes, and kept moving forward. The outcome is history. In her book Very Good Lives, which includes that day's commencement address, she writes: “It is impossible to live without failing at something unless you live so cautiously that you might as well not have lived at all – in which case, you fail by default.”

Author: Esteban Polidura, CFA. September 3, 2022.