Good Failure vs. Bad Failure

Not all failures are equal. Good failures test core assumptions quickly and cheaply, producing clear answers. Bad failures scale effort before validation—consuming time and resources while avoiding the real risk.

Carter Cathey

3/27/20261 min read

Not all failures are equal.

Some failures build capability.
Others just burn time, money, and credibility.

I saw this play out at a company I worked with years ago.

The business was largely project-based, and there was a push to shift toward a more predictable, subscription-style model.

On paper, it made sense:

  • more recurring revenue

  • more predictability

  • better valuation profile

The problem was the customer behavior didn’t match the model.

Clients:

  • valued flexibility

  • couldn’t predict future demand

  • didn’t want long-term commitments

Those issues were visible early.

But instead of pressure-testing them quickly, the organization spent months:

  • building pricing models

  • designing packaging

  • developing GTM strategies

  • preparing rollout plans

Eventually, the model launched.

And within weeks, it was clear:
the core issues hadn’t been solved.

The initiative was scrapped.

That’s not a failure problem.
That’s a process problem.

A good failure:

  • tests the hardest assumption early

  • minimizes time and resource exposure

  • produces a clear answer quickly

A bad failure:

  • avoids the core risk

  • scales investment before validation

  • hopes the market will adapt

Most companies say they want innovation.

But what they actually need is:
discipline in how they fail.

Related Articles by Carter Cathey

  1. Why Some Failures are Worth Chasing?

  2. Bad Hires

  3. The Process Paradox: When Growth Slows You Down

  4. The Time I spent Months Selling to the Wrong Company

  5. Essential Roles vs. Necessary Evils

About Carter Cathey

Carter Cathey is a sales and revenue leader with more than 20 years of experience helping market research, technology, and private-equity-backed businesses scale revenue, improve operations, and build predictable growth systems.

Throughout his career, he has led sales transformation initiatives, pricing strategy projects, subscription business model transitions, operational redesign efforts, and commercial growth programs.

He writes about leadership, organizational design, business systems, data-driven decision making, and the challenges companies face as they scale.

Learn more about Carter Cathey