Failure to fortune: 7 Lessons from iconic businesses that almost didn't make it

Starting a business can feel like walking a tightrope—full of risk, uncertainty, and the looming possibility of failure. But failure, it turns out, doesn’t always mean the end. In fact, some of the world’s most iconic companies started with stumbles, near-collapses, and flat-out failures. Their journeys to success are not just tales of triumph but invaluable lessons for small business owners on navigating adversity. Keep reading as we spotlight six legendary companies – and one beloved author – that failed first but eventually made it big—and what you can learn from their stories.

👀 SPOILER: Be sure to read to the end – don’t miss the incredible words of wisdom in the closing paragraph.

Walt Disney: Turning rejection into magic

Walt Disney didn’t have an enchanted beginning. His first venture, Laugh-O-Gram Studios, crumbled into bankruptcy in 1923. Despite his creative vision, the studio faced poor financial management and couldn’t stay afloat. Penniless, Disney packed his bags and moved to Hollywood, determined to start over.

Out of this disappointment came Mickey Mouse, the character that changed everything. The massive success of Mickey allowed Disney to build a company that would revolutionize entertainment and define childhood for generations to come.

📌 Lesson for small business owners: Never stop believing in your vision. Rejection isn’t a signal to quit; it’s a cue to find a new way forward.

Apple: Reinvention through innovation

Apple’s road to success wasn’t a smooth one. After early success with the Apple II, the company struggled throughout the 1990s. Products like the Newton were expensive flops, and co-founder Steve Jobs was ousted in a boardroom power struggle. By the time Jobs returned in 1997, Apple was weeks away from bankruptcy.

Rather than letting the company fall into obscurity, Jobs introduced a new focus on innovation and sleek design, launching products like the iMac and, eventually, the iPod, which became a cultural phenomenon. And what would life be like today without the ubiquitous iPhone? Apple's transformation from nearly bankrupt to global tech titan is now the stuff of legend.

📌 Lesson for small business owners: Sometimes, the path to success requires radical change. Don’t be afraid to evolve your business when things aren’t working.

📢 Related: Empowering small business quotes for entrepreneurs

Milton Hershey: From bankruptcy to sweet success

Before Milton Hershey became synonymous with chocolate, he was a struggling caramel maker. After several failed attempts at running a candy business, Hershey was down to his last few dollars. His luck turned when a British importer took a chance on him, ordering a large shipment of caramels. The problem? Hershey didn’t have enough money to produce the order. Hershey fulfilled it by scraping together everything he had, and the success of that single order paved the way for his chocolate empire.

Hershey then shifted his focus to perfecting milk chocolate, which was a rarity at the time. His gamble paid off, and the Hershey Chocolate Company became a household name. Today, it’s hard to imagine a world without Hershey’s bars and kisses.

📌 Lesson for small business owners: Persistence is key, but so is finding the right opportunity. Sometimes, it’s that one big break that turns everything around—just make sure you’re prepared when it comes.

Amazon: The patience behind overnight success

What began as a modest online bookstore in Jeff Bezos’s garage has become one of the most powerful companies in the world. But Amazon didn’t turn a profit for years, and early on, Bezos faced constant doubt from investors. Skeptics couldn’t see the vision behind Amazon’s mission to become more than just a bookstore.

Rather than bowing to pressure, Bezos focused on building infrastructure and expanding into new markets. His patience paid off, and Amazon transformed into the "everything store," forever changing how we shop, consume media, and even store data.

📌 Lesson for small business owners: Long-term vision is invaluable. Focusing on quick wins is tempting, but sustainable success often requires building the foundation for something much bigger.

📢 Related: 8 Tips for creating a business plan

Carvel: Breakdown to breakthrough

Tom Carvel, whose real name was Athanasios Karvelas, had a quintessentially American dream success story. In 1934, after borrowing a small amount of money from his future wife, he began selling ice cream from a truck. One day, disaster struck when his truck blew a tire in Hartsdale New York, and his ice cream started to melt. Rather than seeing it as a failure, Carvel set up a makeshift shop on the property of a nearby pottery shop and began selling his softened treats to passersby. Turns out, the people loved the softer, creamier treat.

This stroke of luck led him to buy the pottery shop where he first began selling the softer ice cream, and converted it into the very first Carvel store, pioneering the concept of soft-serve ice cream and ice cream cakes. His brand became a franchise empire, and Carvel became a household name. Carvel has over 300 franchise locations today, with frozen treats available in about 9,500 supermarkets across the United States.

📌 Lesson for small business owners: When things don’t go according to plan, look for the hidden opportunity. Sometimes, a setback can lead to an unexpected breakthrough.

FedEx: Betting it all on overnight delivery

When Fred Smith founded FedEx in 1971, he had a bold vision for an overnight delivery service. Operations began in 1973 but soon after the company experienced financial difficulties. FedEx was on the brink of bankruptcy, and it’s estimated that it was losing nearly a million dollars a month by 1974. However, there was an incredible turnaround moment when Smith gambled his last $5,000 in Las Vegas and won enough to keep the company afloat.

Through innovation, determination, and a belief in the necessity of his service, Smith managed to keep FedEx going. He secured crucial funding, improved operations, and created what would become one of the largest logistics companies in the world.

📌 Lesson for small business owners: When the stakes are high, you need to bet on yourself. Believe in your business model and be willing to take calculated risks when the time comes.

📢 Related: Need business capital? Here's how to apply for a grant

Dr. Seuss: From “No” to “Whoa”

The beloved children’s author, Dr. Seuss, born Theodor Seuss Geisel, didn’t have an easy start to fame. When he wrote his first book it was rejected not once, not twice, but 27 times by publishers including big names like Random House and Simon & Schuster. With each rejection, his chances of success declined, and he was on the verge of quitting his dream of writing children’s books.

Then, a chance encounter with an old friend, Marshall “Mike” McClintock, changed everything. McClintock happened to work for Vanguard Press, a smaller publishing company. After hearing about Seuss’ struggles, he agreed to take a chance on the author’s book. In 1937, Vanguard Press published And to Think That I Saw It on Mulberry Street. This launched Dr. Seuss’ career and eventually led to him becoming one of the most adored children’s authors of all time.

📌 Lesson for small business owners: Even when facing repeated failure, the right opportunity or connection – sometimes unexpected – can turn everything around. Success often comes to those who don’t give up, even when the road is tough.

Protecting Your Business from Unforeseen Setbacks

While these iconic businesses rose from failure, their stories also remind us of the unpredictable nature of entrepreneurship. Success doesn’t always come easy, and the journey can be filled with unexpected twists, turns, and bumps. That’s where small business insurance becomes a key player. The right insurance gives you the safety net to take risks and learn from mistakes—without losing everything. Because in business, as these iconic companies illustrate, your story doesn’t have to end with failure.

Final thoughts

💡✍ In closing, in the style of Dr. Seuss, we leave you with these parting words…

Failures are phoenixes, in training to rise, 
From the ashes of setbacks, they’ll soar to the skies.

Each stumble, each fall, is fuel for the fire, 
A lesson, a spark to lift dreams even higher.

So, keep pushing forward, don’t fear the unknown, 
For even through failure, your greatness is shown.

Small business or big, your dreams will ignite, 
Like a phoenix reborn, you’ll rise to new heights.