Pivot power

Embracing a corporate culture of error, failure, and taking risks, can really pay off sometimes.

by Tomas Barazza


Failure. Failing to achieve your intent, not accomplishing your desired goal. In essence, having an idea and not being able to implement it. It’s frustrating and hard to accept, to the point that the fear of negative consequences often dampens the innovative drive of many individuals and organizations. Held back by the fear of failure.

Sometimes, however, missing a target can be a great stroke of luck because perhaps you miss the first one, but you score a bigger one right beside it, or because that mistake has repercussions that enable you to achieve something extraordinary. This must be why people sometimes let themselves go and take risks anyway, and organizations say they want to foster a corporate culture that celebrates error and failure. At least in words.

I wonder if Dharma Jeremy had the same opinion. He was born in Canada, raised in a log cabin without running water and electricity, and later became a computer enthusiast with a master’s degree in philosophy. While playing a video game, he got a crush on a girl who he never got to meet, a circumstance that probably led him to become passionate about the phenomenon of interactions in virtual spaces. 

In the early 2000s, just before the dotcom collapse, he decided to found a startup to develop a game that had no real purpose, except that of helping people interact: and in fact, he called it Game Neverending. The idea was inexplicably unsuccessful, but before shutting down the startup, he drew on a part of the technology that he had developed and created a concept in which people exchanged boxes of photos and then commented on them. After all, this, too, was a social interaction that was not very different from a game that has no real purpose. The idea took off, and within a matter of months, it attracted Yahoo’s attention, which acquired it for a few tens of millions of dollars.

After working at Yahoo for a few years, Dharma Jeremy decided that big business was not for him: too much politics and too many delays, and too little growth. He left and decided to launch another massive game without a real purpose—only it was much nicer and better looking than his first one. This time he thought big; he raised a lot of funds from Venture Capitalists and put together a strong team of game animators, designers, and developers for another shot at what he had failed doing the first time.

But this second attempt didn’t work either. The game didn’t catch on, even if it did build up a small community of diehard gamers. But in order to work together, the team developed an internal chat system that changed the way a team worked together, exchanging messages and documents. After all, this is also a form of social interaction that is not very different from a game that has no real purpose. 

When they shut down the game project, they realized that they wouldn’t be able to use their communication tool anymore, and the fact that this displeased them made them think that maybe they had something in their hands that could capture a market. They asked their venture capitalists if they could use the remaining funds to turn their prototype into a product. They pivoted their focus to the new product and fired 80% of their employees; in style, however, helping them swiftly find new jobs. After a short while, they launched the product and turned it into one of the fastest-growing corporate software applications at the time. In just a few months, the company reached a billion dollars in market value, went public after a few years, and is now worth $16 billion. Not bad for a failure.

Dharma Jeremy Butterfield changed his name to Stewart at the age of 12. Now he is a charismatic CEO, as well as a pleasant and engaging philosopher as he tells his stories. In his interviews, you can see that he has connected the dots of his experiences and that his successes result from his mistakes and failures, but not everything happened by chance. He says that he has always been guided by his passions and his sense of responsibility towards colleagues, investors, and end-users. And following these guidelines, he tried and changed until he found a solution.

By the way, the two failures that Butterfield turned into successes are called Flickr and Slack.