Four successful companies that overcame early setbacks

Business failures are an unfortunate, but fairly common part of business. According to government data, the rate of UK businesses closing has risen by 15% since 2012. While failure can be incredibly difficult to move on from, especially when a lot of time, money and effort has been exhausted, some companies have managed to leverage their learnings to come back stronger. Phil Hammett, Marketing Director at MPA Group shares four case studies of successful companies that overcame early setbacks to reach their current heights.

Richard Branson

Richard Branson is arguably one of the most well-known British businessmen and is the founder of the Virgin Group, which controls more than 400 companies. However, his road to success was not without obstacles. Branson attempted to get a foothold in the beverage industry in 1994 with the launch of Virgin Cola, a product designed to compete with the biggest market players Coke and Pepsi. But he hit an unexpected roadblock – his new product was not unique enough to stand out in an oversaturated market and the company folded after a few years. 

This failure forced Branson to re-evaluate his business plans and change the direction of his brand – a move which has led to his unquestionable success today. 

Pop-Bio Imaging

By creating the revolutionary medical device Vü, Paul Ellwood, Phil Atkin and Richard Maskell filled a gap in the market and transformed scientific digital imaging. But their route to success was far from straightforward and the inventors, working for Pop-Bio Imaging in Cambridge, had to resolve a variety of issues along the way.

With significant financial investment behind the project, there was a lot of pressure on the engineers, but they overcame early technical difficulties to eventually finalise a gel and blot imaging system that is cheaper, faster and simpler than the previous technology. Pop-Bio Imaging was able to persevere through the financial pressure largely thanks to funding from the R&D Tax Credit scheme, ultimately producing a product which has helped drive science forward. 

Paul Ellwood, Managing Director at Pop-Bio Imaging, said: “We knew how successful Vü could be. We had identified real opportunity and demand for the product, and we worked relentlessly for four years to get it to market. We worked under a huge amount of pressure with multiple setbacks along the way.”

Innocent Drinks

In 1998, Cambridge graduates Adam Balon, Jon Wright and Richard Reed set up a smoothie stall at a music festival and asked customers to dispose of the empty bottles in either a bin which said ‘yes’ or a bin which said ‘no’. The ‘yes’ bin overflowed, a confirmation that ‘yes’ they would give up their jobs to start a smoothie company – Innocent Drinks. This fairytale beginning has now led to remarkable success, but the company’s journey has been far from straightforward.

Reed told the BBC: "When we started out we had one company which made our plastic bottles, and one company which bottled the crushed fruit. They were totally unconnected businesses, but at separate stages both rang us and said they would no longer be able to manufacture our bottles or pack our smoothies. They only gave us 24 hours' notice. Overnight we would cease to have a business.”

"We manoeuvred our way through it, but it definitely taught us: focus on your Plan A, but know what to do if there's an emergency. If you sit around waiting until you are 100% certain or 100% confident, I don't think it's ever going to happen.” Innocent has overcome logistical crises, challenges to its famous ethics and competition from global corporations, to grow into one of the most respected and successful companies in its industry.

Phones International Group

Peter Jones is the longest-serving ‘Dragon’ on the BBC show ‘Dragon’s Den’, but his seat at the table was certainly hard-earned. During his twenties, Jones founded a computer company which collapsed soon after some initial success, leaving the entrepreneur with nothing. Jones had to give up his home and possessions, before taking a job at Siemens to get back on his feet. It was here where the future Dragon’s entrepreneurial prowess began to emerge, and within a year he was running the company’s UK business.

Using his new experience and ever-growing list of contacts, Jones invested £1,000 to help set up Phones International Group, a wireless communications company. It quickly became one of the fastest-growing businesses in Europe and with Jones at the helm its turnover in the first year was a staggering £13.9 million. By the end of the second year, this had more than trebled to £44 million. Jones used the skills and knowledge he picked up early in his entrepreneurial career to eventually reach business superstardom.

From the selected case studies, Hammett concluded: “Even the most successful business people hit difficulties on their journey to success, and some of the most famous products were born from failure. As Thomas Edison said: ‘I didn’t fail 1,000 times. The lightbulb was an invention with 1,000 steps.’ To truly innovate, it’s necessary to take risks and learn quickly. It’s encouraging to know that the government supports this approach through the R&D Tax Credit Scheme, helping British businesses to compete through investment in innovation.”