Before Genna Tatu launched a successful business, she had three false starts: a polymer clay shop, a fashion brand, and a plushie dropshipping ecommerce operation. Each failed to gain enough momentum and folded after just a few months.
But Crochet by Genna proved to be different. It didn’t start as a business idea; rather, it started as a hobby. Genna began crocheting amigurumi—small, stuffed plushies—and fell in love with the craft. Once she realized the business potential, she took a different approach and invested as many resources as possible from the beginning. Five years later, it’s a six-figure business that allowed her to quit her corporate job.
Genna is part of the 23% of US entrepreneurs who have at least one unsuccessful business under their belt, but she knows she wouldn’t be the owner she is today without those setbacks. “Had I not started all those other businesses, I wouldn’t have the same knowledge going into the crochet business,” she says.
Below, three founders discuss starting businesses that didn’t work out and how the insights they gained propelled their new ventures.
Seek visibility early, despite imposter syndrome
Jaz Fenton and Jamil Bhuya are the cofounders of design agency Otherhalf Studio. But before they found their niche, they had another venture that didn’t reach the level of success they’d hoped. In 2016, Jaz and Jamil cofounded Yellow Beauty, a turmeric-based skin care line inspired by Jamil’s mother’s home remedies. Despite early traction, the pair never felt equipped to level up the brand.
“I think we were caught up in the weeds of doing everything ourselves and not asking people for advice—and not even just advice, but not talking about what we were doing at all,” Jaz recalls. “So we were holed up at home working on things, but not really telling people about it.”
For example, Jaz and Jamil opted out of trade shows, feeling like the brand wasn’t on par with more recognized companies. However, this meant they missed out on retail buyers with high purchase intent, as well as supportive peers and potential collaborators.
“You become your own worst critic,” Jamil says. “Our standards became too high for us to ever meet because we were comparing ourselves to eight- and nine-figure brands that we adore. But there are so many people out there who you’ve never heard of who are killing it and crushing it. When you’re never connecting with those people, you actually don’t learn anything.”
“The first time, we were really building in a silo,” Jaz says. “This time around, we’re much better at talking about what we’re doing and building in public and going to events. A huge lesson is that if you’re just there and you’re in the room, people will remember you.”
Now, Jaz focuses on day-to-day work, while Jamil spends much of his time on promotion. “Literally all he does is he goes to events, talks about us, speaks on stages, posts on LinkedIn,” Jaz says. “The more you show up, the more word spreads.”
Seeking visibility—even if your business feels like a work in progress—can help you grow, cultivate a fan base, and attract talent who can bring new skills to the table. “With Otherhalf, I have no problem telling people how we’re doing,” Jamil says. “Whereas before it was like, maybe trying to put on a front of how well we’re doing, now it’s like, ‘Yeah, I think we’re doing good, but these are the areas we can improve in.’ It’s shocking how many people are down to help when you ask.”
Invest in marketing from day one
When Genna launched her first three businesses, she didn’t spend any money on advertising. She had little cash to spare and didn’t realize how much paid marketing could grow her brand. “All I wanted was to make money quickly,” she says. “I didn’t want to invest money upfront. So I started my website, and I was like, ‘Wait, why am I not getting sales? The website’s up. It’s live.’”
For Crochet by Genna, she took a different approach. “People don’t know about me,” she recalls. “People don’t know about my shop. How do I get the word out?” Genna, who began her business on Etsy before integrating it with Shopify, went with Etsy ads.
“From my previous businesses that didn’t go anywhere, I learned that when you do start a business, people aren’t going to be attracted to your products right away,” she says. “You have to either build up your reputation and get people to trust your brand and products, or use paid marketing tools.” She notes that on marketplaces like Etsy, search ads are especially important. “Exposure is everything. If your listing isn’t on the first page, you probably will not get that many eyes on your shop.”
Genna invested just $1 a day, but it was enough to gain her first sales and customer reviews—which ultimately led to more sales. She then reinvested that money back into her brand and gradually increased her ad spend. “I made sure to reinvest it into the business because, ultimately, that is what helped my business grow,” she says. “If you don’t keep reinvesting into it, it’s hard to grow. You need to keep feeding it.”
Ensure your cash flow covers your debt obligations
Before cofounding Yellow Beauty and Otherhalf with Jaz, Jamil launched his first business, Burgers n’ Fries Forever, a restaurant dishing up smash burgers and hand-cut fries. For nearly a decade, the business grew steadily, and by the early 2020s, Jamil was focused on rapid scaling and franchising. When the pandemic lockdowns began, the company took on significant debt—more than Jamil even realized. Although the company’s profit and loss statements were looking good, its balance sheet was in dire straits.
“We were in a lot of debt because this was COVID,” Jamil says on an episode of the Shopify Masters podcast. “I had to basically figure out how much cash we had left. We had enough for maybe a couple more months at best.” While this situation is far from unusual—almost 40% of small businesses have less than a month’s worth of operating expenses saved—it’s not sustainable.
Jamil made the call to offload an underperforming store for less than its fair market value, and he got the company on a payment plan for a six-figure debt that had been sent to collections. “Long story short, we were able to get back into profitability,” he says. “It took a year and a half of just clawing out of it. That eventually led to our acquisition because, profitability-wise, we were doing great, but our balance sheet was so messed up that I had to restructure. That’s what led to the acquisition.”
This experience shifted Jamil’s approach to spending to scale. “Cash flow, preserving cash, having access to credit—these are super important to me,” Jamil says. “Whereas before it was like, take on as much debt as possible and grow at an unsustainable pace for the sake of growth. Now it’s like, let’s try to be profitable. Let’s try to take on as little debt as possible.”
For a new business, debt is typical—and, more often than not, necessary. But an overemphasis on debt-fueled expansion can lead founders to scale a successful business to the point of unsustainability.
Care for yourself and try again
It can be hard to bounce back when a business doesn’t work out as expected, but according to Jaz, Jamil, and Genna, it’s worth the effort. Jamil recommends first making the time to take care of yourself mentally and emotionally before you launch into another venture.
“Suddenly, you’ve lost that passion and energy that you had on the first business,” he says. “I think it’s really important to—I don’t want to sound cheesy, but—find your passion again.” This sentiment is shared by many entrepreneurs: According to a 2025 Shopify survey,* 77% of US business founders strongly agree that they started their business to turn a passion into a reality. Following your passion can help you remain motivated during the challenges and give you a sense of direction.
Jaz also suggests using a fresh start as an opportunity to refocus on your own interests and desires, asking: “What were some things I didn’t enjoy the first time around? How can I do it differently the second time so that it fits into the life I want to create?” For Jaz, this meant knowing that to successfully run a business, she has to play to her strengths as a team leader and lean into her passion as a designer.
Genna also took her first businesses’ lack of traction as an indicator that she hadn’t yet found her passion. “The business not working out is just a good sign that you’re not doing what you’re supposed to,” she says. “You’re feeling this way for a reason. It’s not working for a reason. Ask yourself: ‘Do I truly believe in this business? Do I want to run this business 24/7? Could I imagine running this full-time for several years? If those answers are, ‘I don’t know,’ or ‘I don’t really feel passionate about this,’ I would follow that feeling and pivot to something else.”
When you get your next business idea, Jamil says to pay attention to how it makes you feel and let yourself get excited. “Whatever the next thing is should keep you up at night where you can’t sleep but not, like, the unhealthy way,” he says. “It’s OK to be emotional and not detach yourself from those feelings. Those feelings are going to power you through the uncertainty and difficulty when you start up again.”
*These findings are from a survey by The Harris Poll for Shopify, conducted online between August 22 and 31, 2025. It included 519 U.S. business owners and senior decision-makers from companies selling products online.
