In entrepreneurship, failure is a process rather than a result. According to related research, the average number of failure experiences an entrepreneur in Silicon Valley faces before achieving success is about 2.8. It is said that one must fail three times before success follows. In South Korea, re-entrepreneurship remains a challenging task due to a societal atmosphere that does not tolerate failure. ChosunBiz sheds light on the value of 'failure' through the stories of entrepreneurs who have risen after failing. What have these entrepreneurs learned from failure, and how did they succeed in their comeback? [Editor’s Note]
Mr. Kim Young-woong, who worked as a planner at major gaming corporations such as Nexon and KRAFTON, was influenced by the mobile game 'Anipang,' which emerged in 2012 and became a national sensation, leading him to venture into entrepreneurship.
Creating an MMORPG typically requires about 300 people working continuously for 4 to 5 years, but Mr. Kim thought a casual puzzle game like Anipang could be developed on a low budget.
◇ Analyzing consumer evaluations through data… “Painful experiences have become my management philosophy”
In 2013, Mr. Kim gathered four team members and established a game production startup called 'Beacon Studio' with a capital of 1 million won, diving into entrepreneurship. The reaction to their first game, 'Mafia Revenge,' was also not bad. Starting with an investment of 1 billion won from a game publisher, they succeeded in securing about 4 billion won in follow-up investments.
However, they had to continue incurring losses as users did not open their wallets for item purchases. Eventually, a large Chinese publisher, with whom they had signed a contract worth $240,000 (approximately 3.5 billion won), canceled the contract, failing to pay the remaining $120,000 (about 1.7 billion won), which sharply worsened the company's financial situation. Ultimately, Mr. Kim had to close the company in 2020 after seven years. He said, “Looking back, the failure factor was not being able to create a good game that connects to revenue.”
After his first failure, Mr. Kim paid off his debts but found his self-esteem at rock bottom, leading him to seek out wine he no longer enjoyed. He reminisced, “One day, I bought an expensive bottle of wine, but it tasted terribly bad,” and added, “It cost a lot of money but failed to do its job, just like me.”
He jumped into re-entrepreneurship just two months after shutting down. This was due to a game production company suggesting the establishment of a subsidiary. Mr. Kim established 'Like It Games' in 2020, prioritizing 'data-driven development' and 'securing production independence' as key tasks. He noted, “In many cases, investors’ influence lowered the quality of the game,” and said, “We, as experts, believed we should take responsibility for the games.” This perspective learned from failure soon became his management philosophy.
Mr. Kim conducted four tests before the official game launch, breaking down the development process by analyzing strategic data like consumer evaluations and retention rate at each stage to decide whether to proceed with further development.
By minimizing investor involvement, he was able to reduce production time and hence lower costs until release. The game 'The Secret of Cat Island' achieved 6.5 million cumulative downloads and generated revenue of 6.3 billion won in about 5 and a half months, which was 1/7th the time of the previous title 'Mafia Revenge' (3 and a half years).
Mr. Kim emphasized, “By breaking down the process to the goal into smaller parts, I could clearly eliminate the risks,” and added, “I still rigorously adhere to this production method.”
In 2023, Mr. Kim launched his third startup, 'Super Rabbit Games.' Within one year of its establishment, he achieved revenue of 2 billion won. With a new game release scheduled for the third quarter of this year, he expressed confidence in future revenues. He advised, “Entrepreneurs should analyze their failures and set their own principles for improvement, rather than getting frustrated for not being among the successful few.”
◇ From performance production company to virtual asset investment solution… “We only followed consumers”
Another serial entrepreneur experienced the difficulty of succeeding with items that disregard consumers. The protagonist is Mr. Kang Seung-gu, co-founder and vice president of the startup 'Uproot Company,' which develops a virtual asset savings investment solution.
Mr. Kang quit his job and founded a performance production company, 'Outspoken,' specializing in creating plays and musicals in early 2016. True to its name, which means 'to speak boldly,' the goal was to create plays that fearlessly express stories. He pooled his severance pay and personal loans to produce the play 'Regenesis Boy,' a story about a boy suffering from aplastic anemia, which particularly held sentimental value for Mr. Kang as it contained autobiographical elements.
However, it was difficult to continue the business as the audience turned away. They poured criticism, saying, “The social message is too strong.” His mistake was focusing solely on conveying 'the story he wanted to tell' rather than commercial viability. “I learned through failure that a producer must be able to persuade the audience.”
At the beginning of 2020, after shutting down the business and left with several hundred million won in debt, Mr. Kang decided to seek resurgence by first finding employment with a foreign distribution company. He thought, “I shouldn’t get stuck in a feeling of defeat, I must do something, no matter what.”
The next item was conceived thoroughly from the consumer's perspective. With the growing demand for stable returns in the increasingly volatile virtual asset investment market, he completed it as an AI-based prediction solution.
Last year, Uproot Company achieved an asset under management (AUM) of 50 billion won, with 10,000 users, marking a satisfactory early performance.
Mr. Kang emphasized, “At the time of closing the business, I felt regretful for what I had done so far, but all my experiences were helpful in the re-entrepreneurship process.”