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Picking up the pieces: Earning success after failure
Codefi launched three years ago this month. The business incubator, co-founded by Chris Carnell, has since become arguably the most visible element of Cape Girardeau's nascent tech culture.
But before Codefi, there was NTHfluence. Launched in April 2012, it was Carnell's first startup and it folded in six months.
Plenty of entrepreneurs suffer early failure; eight out of 10 new businesses don't survive 18 months, according to Bloomberg. And plenty more find success in subsequent enterprise. But those who do are often tempted to recast their early failures as merely anecdotal -- a lovable flop. Carnell is not among them.
"The failure part is dumb," he says, flatly.
With his tousled hair and blue jeans and his office sidekick Luke the poodle mix, Carnell isn't totally divorced from the popular trappings of startup culture. And he is, after all, sitting at a conference table made of LEGOs in Codefi's sixth-floor offices. But he sees a tendency among entrepreneurs to romanticize failure, which he says is at best counterproductive.
"A lot of the messages out there are the very successful people, so you have the Mark Zuckerberg and Elon Musk and stuff like that," he says. "When you look at those, those are the guys in the media. Those are the outliers."
"Unfortunately ... I think we have this 'failure porn' going on," he says. "'Look how big I can fail, look how fast I can fail,' and stuff like that."
Those stories, when offered as encouragement or as a salve to faltering businesspeople, often neglect an alarming possibility.
"You don't always learn from failure," he says.
But it does always hurt.
Purposefully or not, Carnell's attitude echoes a sentiment found in the writings of "Think and Grow Rich" author Napoleon Hill, whom Carnell credits with changing much of his attitude toward achievement.
"Every adversity, every failure, every heartache," Hill writes, "carries with it the seed of an equal or greater benefit."
Carnell speaks of failure not as a blessing, but a trauma. Nothing more than a seed. For it to be anything else takes work. And you can't take the experience for granted.
In 2009, Carnell was in college in St. Louis, studying business administration and nursing what was, at the time, an admittedly nebulous entrepreneurial ambition. He'd seen his father run a body shop in Sikeston for decades. His grandfather was a master mechanic and restaurateur.
"It was like everyone was doing something," he says.
So he assumed he'd also find a way to start something. One night, he got a text from his dad about Hill's book "Think and Grow Rich." The text said, "Don't walk; run and go get this book."
"Which, I didn't have to do that," he says. "I just downloaded it."
Regardless, he had it read within a day. It was more philosophical than practical, detailing a process of visualizing and goal-setting designed to achieve desired outcomes.
"That's kind of my turning point, I guess you could say," he recalls. "At the time I worked hard and stuff like that because just from [my] family that's just what you do, but I'd never -- everything was just kind of, 'This is what happens to me and just kind of go with it.' And reading that book made me realize you can take fate in your own hands."
He set his first goal -- to make $100,000 by 2014 -- and started a blog that used crowdfunding principles to raise money for charity. That blog, eventually turned into Carnell's first startup, NTHfluence.
"It was basically, give to the N-th degree, and then 'influence,'" he says with a slight squirm. "It was a horrible name."
But that was around the same time Gofundme and Kickstarter were blooming, and after writing up a business plan, he found investors surprisingly eager to back him.
"Everything moved really quickly," he says. "It seemed like every person I went to was offering money ... then it was, 'Holy crap. We're actually doing what we're doing."
They had partners in the United Way, Red Cross, Southeast Missouri State University, Tailor Institute for Autism, and others, but Carnell says that in retrospect, there were signs of trouble as early as a month before launching in April 2012.
"Basically spent too much money. I just didn't know better. Should have started on a smaller scale," he says. "The expenses just went out the roof."
He also neglected to adequately coach the charity partners in how to run a successful crowdfunding campaign, he says. He counts those two shortcomings as the areas he ought to have acted differently.
Things fell apart a third way that spring in the form of a family emergency. From February to April of that year, Carnell's mother attempted suicide on multiple occasions. He remembers telling almost no one at the time, and it weighed on him heavily. He later made a point to mention the National Suicide Prevention Lifeline number, (800) 273-8255.
"It was, 'That's going to go wrong? OK. That's going to go wrong?' and eventually ... it felt like the business and my personal life, nothing is working right now," he recalls.
Carnell said the best advice he got during that time came from his mentor James Stapleton -- also a Codefi co-founder -- over breakfast.
"He told me someone told him [that] as you go through life, things aren't always as great as they seem or as bad as they feel," he says. Stapleton, it turned out, had experienced failure of his own. "The more you talk to people, they've gone through similar stuff."
And Carnell says his relationship with Stapleton was -- and continues to be -- vital. But like his attitude toward failure, he says having a mentor isn't useful if you don't learn from them.
"People think you can just email somebody and say, 'Hey, can you be my mentor?' That's not how it works. Do stuff. Work. Get something accomplished," he says. "You'll actually start to attract some of those people. They want to give back to people who are actually going to take their advice and grow with it."
Stapleton, in addition to being a mentor, was also an investor in NTHfluence. That, Carnell says, made the losses personal.
"September, October of 2012 was when I was just like, 'Man, this is just not working.' I was out of money. I had lost the money James had invested in the company. I'd lost all my life savings," he says, putting the total loss at between $40,000 and $50,000. "It wasn't a lot of money, but when you're young and it's someone else's money, it kind of hurts."
After NTHfluence, he jumped right back in and started working on a new venture, but also struggled with self-doubt.
"As recently as last year, I was still having really bad trouble overcoming the psychological effects of a failure like that," he says. "But you can get some positive things out of failure when you can use it to your advantage. Could I have done something different? We're going on three years here [at Codefi] and it feels like a cycle of every six months or something, I kind of buckle down and say I could be doing so much more. ... I don't want to fail again, so I'm going to work as hard as I can."
He objects to being labeled a workaholic. Not because he isn't one -- rather, "because it feels kind of arrogant when people say that."
"But sure," he concedes. "There's times."
Eventually, Carnell says, he learned how to let that failure go.
"Where you were at in your worst of times does not define who you are," he said. "Actually, it's 'I can be or I want to be, or I am this person that's a lot better than what I was feeling and [what] I was doing at the time.'"