“Too many failures to count.”
That’s how Gary Hoover describes his experience with failure in business. From the outside looking in, that may seem hard to believe. Hoover made his name by starting one good company after another. Bookstop, one of the first book superstore chains, was an early success. Hoover opened its doors in 1982, and seven years later, Barnes and Noble bought the company on its way to becoming the country’s dominant retail bookseller.
His next venture, the Reference Press, a small business information publisher, opened in 1990. It evolved into Hoover’s, Inc. (where I have worked for nearly a decade) and went public in 1999. Dun and Bradstreet bought the company in 2003.
Two successful startups and multimillion dollar buyouts are more than most people can claim in a lifetime. But for Hoover, the first entrepreneur-in-residence at the Herb Kelleher Center for Entrepreneurship in the McCombs School of Business, things haven’t always been this rosy. He is candid about his failures and their impact on him, both personally and professionally.
“The biggest one [came] when my third ‘child,’ TravelFest Superstores, went down,” he says. TravelFest, which opened in 1993, had three stores that sold tickets, reservations, luggage, books, maps and travel accessories—and won industry awards. “More important,” Hoover adds, “customers loved us and we were really cranking [out] the revenues.”
Then disaster struck. “Our largest business was airline tickets,” Hoover says, “and one day the airlines up and decided they no longer needed travel agents—especially leisure agencies like us—and cut out the commissions paid to agencies.”
Hoover took emergency measures that went well beyond the four walls of TravelFest: among other things, he stopped taking a paycheck and “borrowed to the hilt” on the house he owned on Lake Austin. Selling the TravelFest stores to a competitor saved the jobs of the company’s employees—for about a year.
“I had thrown everything into this. What Hoover’s stock I had not given away, I sold or borrowed against to make TravelFest work.”
But after six years the business folded. The impact of the company’s failure on Hoover himself was hardly over.
“When Hoover’s was sold for more than $100 million, I got about $60,000, all of which was owed to other folks,” he says.
Hoover had borrowed $1 million to try to save TravelFest. He narrowly escaped personal bankruptcy and sold the big house on the lake. In the end, TravelFest lost more than $12 million of investors’ money. Hoover summarizes the whole experience sardonically: “That was not what I would call ‘fun.’”
What keeps someone going after a setback like that? Talk to Hoover or any other successful businessperson, and you’ll hear failure stories to make your hair stand on end—whether the subject is New Coke or the Ford Edsel or Apple’s Newton tablet. But you’ll also detect a parallel theme of resilience tied to self-belief.
“I think most all successful people have the ability to bounce back,” Hoover says. “What makes you go on especially strongly is your inner fire and confidence.”
Read more about Hoover’s passion and resilience.
Web extra: How do you survive failure? Watch Gary Hoover’s vodcast, “Eight Keys to Building a Successful Enterprise,” to learn what keeps him moving forward in business.