“I think that the minute that you have a backup plan, you’ve admitted that you’re not going to succeed.” – Elizabeth Holmes, CEO Theranos

In 2015, Elizabeth Holmes was named America’s richest self-made woman by Forbes magazine. Forbes valued Holmes’ blood-testing company at $9 billion — making Holmes’ net worth an estimated $4.5 billion.

Yesterday, it was announced that Holmes’ net worth is now zero.

How is that possible?

Ever since The Wall Street Journal published an expose, putting into question the effectiveness of Theranos’ blood tests, the company has been under fire.

In light of allegations of fraud and several ongoing investigations, Forbes decided to revalue Theranos. “Forbes spoke to a dozen venture capitalists, analysts and industry experts and concluded that a more realistic value for Theranos is $800 million, rather than $9 billion,” says Forbes.

Because Holmes owns common stock in Theranos, while her investors own preferred stock, which get paid out first if Theranos decides to liquidate, Holmes stake is essentially nothing.

Now it’s not every day you see someone’s net worth plummet like Holmes’ just did so I can understand the media frenzy. Everyone wants their schadenfreude. What I can’t understand is why some people are calling Holmes ‘worthless.’

Some tactless writer at Vanity Fair went as far to write this emotionally-driven headline:

Elizabeth Holmes, Once Worth Billions, Is Now Worthless.”

Seriously!?

I noticed this morning the headline changed to “Theranos Founder Elizabeth Holmes, Once Worth $4.5 Billion, Is Now Worth Nothing.” Not as bad, but still pretty gutless.

I shouldn’t have to say this but I will, a person’s net worth does not determine that person’s value in the world. Every human being is worth something regardless of how much money is in their bank account.

Now that we’ve cleared that up, I want to talk to you about backup plans.

Holmes said publicly in an interview that she doesn’t believe in having a backup plan. Does she regret saying this now?

It depends what you think of the value of having a backup plan?

Former professional boxer and undisputed world heavyweight champion, Mike Tyson, famously said, “Everyone has a plan ‘till they get punched in the mouth.”

I agree with Tyson, for the most part.

You can try and predict as many possible outcomes as you can think of but it’s not until you’re in the ring and someone starts throwing punches that you know what course you need to take.

That said, having preplanned solutions to possible outcomes, I think better prepares you to make smarter and faster decisions when you’re thrown into unfamiliar situations.

Though the solution you may have thought of solves a slightly different problem than the one you’re faced with now, the combination of maybe two or more of your preplanned solutions could be what ends up solving your problem.

Dwight D. Eisenhower once said, “In preparing for battle I have always found that plans are useless, but planning is indispensable.”

The value of planning is it builds neuropathways in your brain that can lead to potential solutions. It’s why the world’s top creatives immerse themselves in all different forms of art, not just their own. It’s why athletes cross-train. The more experiences you have at your disposal, the more potential solutions.

So does Holmes regret not having made a backup plan?

Probably. It was also probably a good sound bite at the time, especially coming from one of the youngest female billionaires.

What could Holmes have done differently?

This is a tough question, especially considering the lack of information that has been released to the public, but I can tell you what most CEOs should do before any major product launch or public offering. Follow what Ryan Holiday calls a Premortem, explained here.

As far as rebuilding her reputation and Theranos’ image, Holmes might consider taking a page out Donald Trump’s book. Trump has had some of the worst favorability ratings in history. But, he recently just passed Hilary Clinton in favorability in National Polls, and some pundits are now predicting his favorability is only going to climb as we approach November. If that’s true, there are some lessons to be learned about turning a bad reputation around. But for now, the best advice I’ve read on how to turn a bad reputation around comes from the Harvard Business Reviewthey recommend you follow these three steps.

Finally, remember what Craig Ballantyne has said for years, for every obstacle in life you should have two solutions planned.

Have a great day!

Nick Papple
Managing Editor
Success Formula Daily

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6 Most Useful Skills Every Entrepreneur Needs

Starting a business – and being successful at it – requires the right amount of talent, knowledge and skills. You must have the knowledge about your industry, about general business principles, as well as about the laws and regulations that affect your operation.

Additionally, you must have nerves of steel and a heavy dose of patience to take chances and navigate the ups and downs that come with any new venture.

Although success often requires you to have ambition and clear goals, it also requires a certain set of personal skills. Here you will read about six useful skills that entrepreneurs need on their way to success.

1. Ability to listen

Great communicators make great businesspeople. In the business world, you must establish rapport with partners and suppliers. You also need to be there for your employees.

Of course, in order to succeed, you need to commit to customer service excellence, which involves hearing what your customers have to say. All these types of interaction involve one common skill – the ability to listen.

Without the capacity to interact with other people, you will have difficulty getting your new business off the ground. If you have little practice with interpersonal relationships, don’t lose hope.

By learning how to listen, you take one of the best shortcuts available on the path to becoming a great communicator.

When people have something to say, never interrupt them. People often have feelings, opinions, and interests that differ from yours, but if you learn to hear them out, you can quickly win people over.

As you listen attentively, notice the non-verbal cues that contribute to the conversation. When you intentionally communicate with customers and other people through listening, you gain their trust, loyalty, and admiration.

2. Assertiveness and confidence

Though listening skills are undeniably important, that doesn’t mean you have to keep quiet. Quite the contrary, being a good businessperson implies believing in yourself and being able to speak your mind with confidence. After all, communication goes two ways.

As an aspiring entrepreneur, you will often find yourself in situations that require assertiveness. Whether you are dealing with a pushy business partner or a demanding employee, you should never let others dictate your actions.

So, when you need to express your opinion – even if it includes disagreeing with the other party – try to do it assertively and confidently.

Take a deep breath, and articulate your thoughts. Sometimes it might seem overwhelming, as if you are on the verge of a conflict, but eventually you will learn to relax and project self-assurance. You will also gain the trust and respect of those around you.

3. Willingness to Learn

Being a businessperson requires an ongoing willingness to learn. Even after building a successful business, you have not finished your job. In fact, when it comes to learning and improving, you are never quite finished.

Continuous learning will help you evolve both personally and professionally. An insatiable appetite for learning through the Internet, books, documentaries, and seminars will deepen your knowledge and help you maintain your creative edge.

You should also remember to stay up-to-date with all the relevant development in your industry. Pay attention to trends and issues that affect your line of business and learn from the people who have already succeeded in businesses similar to yours.

Talk to industry leaders to get their advice, and apply their insight to your own business. Whatever you do, make learning an ongoing process both in your personal and professional life.

4. Creativity 

When it comes to keeping your business fresh and competitive, creativity is an essential skill. To innovate, you need to be creative. Being creative means doing things differently and thinking not only outside the box but also without that box!

This goes for both your personal life and business. In fact, those two are interconnected – when you spark creativity in your personal life, it will inevitably reflect on your business. So, what can you do?

What you can do is shake up your routine by trying new ways of doing things. Even small changes such as rearranging your office, driving home via a new route, ordering an unusual meal and talking to strangers can help you develop habits that can lead to innovation.

You should also attempt to think about things from new perspectives and apply new ways of solving problems. A little bit of creativity can go a long way in terms of your business growth, so do everything you can not to stifle it with convention and routine.

5. Courage and risk taking 

Entrepreneurs take risks, and you will surely find yourself in situations that require quick and risky decision making. You should never act recklessly, but you should always have the courage to try new ideas and to take little risks. If you don’t try, you will not succeed – it is that simple.

People are often held back by the fear of failure. Rather than fearing failure, embrace it. Sometimes the best experiences in business come from ideas that didn’t work.

Follow your creativity by implementing new ideas and making bold decisions even when you lack clear direction. As an entrepreneur, you should have the guts to take chances and have faith. As John Burroughs once said, “Leap, and the net will appear.”

6. Perseverance 

Last but not least, entrepreneurs must never give up. Remember this – never give up! There will be numerous obstacles and challenges along your way, but if you persevere in spite of them, you will reap success.

Sometimes this means having to accept failure. Even when your failures are expensive and embarrassing, they can still lead to success. Forgive yourself when you make mistakes and look for lessons you can learn from every seemingly negative experience.

As a business owner, you must also develop patience. Success usually does not come overnight, and setbacks do not magically resolve themselves. In the face of adversity, maintain optimism. When you believe in yourself and persevere, you become a prime candidate for success.

Difficulties along the road to entrepreneurial success can seem discouraging. However, if you regard every situation as a learning experience, you can develop the much needed personal skills that will help you build a successful business when you combine them with your expert knowledge.

Begin with the six useful skills listed here, and look for other tips for personal and professional growth along your pathway to success. Most importantly, remember to always improve and challenge yourself – there is no success for those who stand still.

Author bio: Natalie Smith, a freelance writer from Seattle, follows topics related to entrepreneurship, leadership, marketing, social media, and business in general. You can reach her @Natalie Smith

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