The Value of Setbacks

The Value of Setbacks

A system for gaining the most value from mistakes

You may have heard the story of the young female surfer, Bethany Hamilton, from the island of Kauai, Hawaii. In 2003, she carried her surfboard down to the beach, as she did so many mornings, and paddled out into the surf.

At age 13, she was already an accomplished competitive surfer, with great dreams ahead of her. But that morning was not like other mornings. In the surf with her was a 14-foot Tiger shark that quickly struck her and her board. As a result of the attack, she ended up having her right arm amputated.

Bouncing back

How would you react to such a horrific turn of events? Your dreams of being a world-class surfer vanished. Learning how to live in this world with one arm, how to eat, write, and even brush your teeth. It’s hard to imagine such an incredible setback.

Bethany responded with unbelievable determination, optimism, and resiliency. She immediately wanted to get back on her surfboard. One month later, she was riding the waves. In 2007, she realized her surfing dream and turned pro. Her strength of spirit inspired a movie entitled Soul Surfer about her ordeal—and her comeback.

A system for setbacks

For many people, the shark attack would have been the excuse to quit, not just on surfing but also on life. But Bethany had optimism, a sense of purpose, and one huge dose of resiliency. (No more grumbling about lost luggage!)

Resiliency, the ability to recover from setbacks, should be at the core of your support structure. You create your own system that allows you to deal with the inevitable setbacks and stumbling blocks along your journey.

I have had some remarkable setbacks in my life—broke and homeless in 1985, lawsuits, bad partners, people stealing from me, people cheating me, mistakes that literally cost me millions, not to mention public humiliation. That, of course, does not include the hundreds of smaller mistakes and mishaps I’ve experienced. And here I am, still standing.

I have two things I say to myself whenever I’m hit with a disaster. First, I remind myself, “This too shall pass.” The next thing I say is, “Something good will come from this.” I cannot say I’m smiling when I repeat those words, but I say them until I actually believe them.

It is obvious that statement number one is true because every setback I’ve had is behind me and here I am, still standing. For my second mantra, that too has come to be true. My marriage, my company, and I are stronger due to the results of the setbacks.

The value of setbacks

There is an English proverb that says: A smooth sea never made a skillful mariner.

A setback may be a small mistake, a disappointment, a problem, or a failure. A mistake points out something I didn’t know. The key is distilling the “something I didn’t know” out of the mistake.

I hate mistakes and setbacks as much as anyone. But once I get over the initial yelling and screaming, then I step back and ask, “What do I need to learn from this?” Sometimes the answer is crystal clear, and other times it takes a while. I do know this, however: if I do not discover the lesson out of the setback, then that specific problem will occur again and again until I get the message.

In the world of investing, most people fear making a mistake. Why? Because the result is often a loss of money. Does anyone like losing money? No one I know of, me especially! Yet, herein lies the dilemma. If you are so afraid of making a mistake or experiencing a setback that you do nothing, then two things happen:

1. You don’t learn.

2. You make zero money.

Please know you will make mistakes and there will be setbacks. It’s all part of the process. Instead of looking at them as devastating events that must be avoided at all costs, step back and see them as possible opportunities to learn, to grow, to be a more successful investor, and to make more money. If you get the lesson, you will be smarter.

Original publish date: December 05, 2013

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