Here is the full transcript of American businesswoman Barbara Corcoran’s TEDx Talk presentation: Rethinking Failure at TEDxBarnardCollege conference.
Listen to the MP3 Audio: Rethinking failure by Barbara Corcoran at TEDxBarnardCollege
Thank you. Very nice to be here. I’ll start with a story.
I grew up in a small town in New Jersey. It was exactly two blocks wide and one mile long and we had the biggest family in town. My mother took her six girls and put them in the girls room, painted it pink, of course, and then she put her four boys in the boys room, painted it blue. And my parents produced every one of those children from the living room couch that was between the two bedrooms. Lesson in that, by the way, and not on failure.
I first discovered the word ‘failure’ in the classroom. I can distinctly remember being in class and not being able to read or write until I was in third grade, or thereabouts when I started getting the hang of it and being ashamed of myself. But I was kind of OK with it.
I was sent back to the second-grade classroom one day after school. And I knew the moment I walked in that I was in trouble. It was Sister Stella Marie saying that she was a nun from hell. There was also a Ella Maloney that all the kids at school called the retarded girl, and there was Rudy Valentino, not the famous guy but Rudy Valentino, the Italian kid that just came off the boat as we said. And I was asked to have a seat.
When Sister Stella Marie told me if I didn’t learn to pay attention, I would always be stupid. That was the day I first discovered that I had a label, and it was about failure. My idea of hell to this day is being asked to read out loud, to have the shame that you feel reading out loud. And in a situation where education whole system judges a child’s intelligence simply based on how well they could read or write to certain abilities, I learned how to be a loser and I couldn’t wait to get out of that jail house, that everybody loved this school, I couldn’t wait the day I got out of it.
And so when I grew up, I continued to learn a lot about failure, but frankly, I realized that that was the best calling card for the rest of my life, because nothing was going to feel as bad as that for me ever again.
All of my singular phenomenal successes that helped me build my business happened on the heels of failure. I didn’t choose it that way, but somehow it always worked that way. When Ramon Simone who was my first love and business partner left to marry my secretary, I thought I would never walk again, because I was madly in love with him and he had found me at the diner, had taken me out of my home town and he gave me the $1000 to start my business. And so when he left me, I really felt like nothing.
And when I finally built the courage to leave that business partnership two years later, which was two years, too long on the way out the door, he said to me, “You know, you’ll never succeed without me.” And I felt in my heart through every bone in my body that I would rather die than let him see me not succeed. And it was that insult which really became my insurance policy to continue in business no matter what was happening, because I didn’t want to let that guy see me fail.
When I was asked to give my first speech to a group of 300 city bankers, I was honored but as everybody is scared to death, when I got up there at the podium, even though I had practiced every day for three and a half months, I memorized it, knew everything about it, I got out there and as many people, now I learned I lost my voice, and when the moderator for the second time said, “Thank you” and asked me to sit down, I felt such a public shame I swore I would never speak again.
But the following Monday, I realized I had to get over myself and so I volunteered to teach how to sell real estate, the only subject I knew at the Learning Annex which was part of NYU at that time. And I taught for 12 weeks and as luck would have it, as I always found recovering from a failure, the very first night in class, a short Asian woman walks up to me and she says, “Barbara, you know how much money I make?”
I am like “What?”
“You know how much money I make?
And it was: “Do you know how much money I make?” And she proceeded to tell me she made $250,000 in six months. My best salesperson — I had seven of them at the time — was making $42,000; she made $250,000 in six months. I had walked in and discovered the Orient Express, the woman who would become the number one salesperson in all of New York for the next 25 years and be at the head of the whole way of the Asian population moving into New York, I would have never met Carrie Chiang at that class if I hadn’t gotten over myself.
I have found that failure and innovation are kissing cousins. You get one, you work on one you automatically get the other and I was able to make The Corcoran Group the innovator in my industry, because we were so good at failure. I decided when I had my first year where I had a profit many years into the business, I had a great idea and I was going to do it and I knew it was the greatest thing. And the great thing was I was going to take all of our apartments and put them on videotape and now customers don’t have to look at apartments, all I have to do is pop in a videotape and they could pick out an apartment from the lazy boy chair. Oh, it was a great idea.
Well, one month later, I’m standing at the basement of one of my shops on right next to Zabar’s, it’s still there, in a wet basement with $77,000 of money I blew stupidly on tapes nobody wanted. And they didn’t want them because I put my salespeople’s faces and phone numbers on, and they didn’t want to hand them to the customer and haven’t called the next salesperson. So that idea was dead on arrival.
And as I was starting to cry in my soup, my husband Bill Higgins who was a Navy captain came home from a war exercise in South Korea where he was blowing up the North Koreans, this is what boys do on weekends, that would pay with our tax money. And he was all excited telling me, ‘Oh my gosh! It was amazing’
And I said, “You do it every year; what’s the big deal?”
And he said, “This time we did in real time on this new thing called the internet.”
And so I took all my videos, I shoved them on the Internet, I put them online, I didn’t even know what online meant then, and boom, boom, within the first week I had two sales out of London. So I immediately registered every one of my competitors’ URL so that they would have to call me and ask for the URL. As they discovered, the thing that was about to change the real estate industry as we knew it then and can you imagine the advantage I had having a two-year heads up and a head start on all of my competitors to horse around and discover what I could do online. I would have never discovered online if I hadn’t failed with the $77,000. And that was my reward.
I’ve learned some tricks about building a culture of innovation and they’re not very sophisticated but I share them with you. My first is that I made a habit of rewarding efforts more than results. And so each of my offices had a good idea box, a big bright yellow box with a slot on the top is always made for a child — and children — salespeople, excuse me, we’re expected to put their ideas in a box. I can tell you when I opened those boxes every Monday morning at the sales meeting, most of the ideas were terrible, but I gave out a dollar for the good ideas and a dollar for the bad ideas. And by doing that the message was just keep the ideas coming.
I made a habit of making a public spectacle of anything that I failed at. I remember I had tried to be a host of a new reality TV show years back before it became the big thing. And I thought I am the most qualified person to do it and I tried, I auditioned, I worked at it and they gave it to a young neophyte salesperson who only worked for me for a month, she was 21, 22 maybe and drop dead gorgeous; I hated her. But I was mortified more than anything else that she was going to be the host and everybody knew how hard I had worked. So I decided to make her the hero, told the story about how she beat the old boss out of the whole gig and how she was amazing and let’s give her cheers. And by making a public spectacle of myself, I gave people permission to fail publicly.
I always gave my salespeople, my sales manager, a budget to make mistakes; sounds like a simple thing but it worked like a dream. And I copied what my mother do as my father — he worked two jobs his whole life to support us. But when he came home he handed my mother his paycheck and she always handed him a $20 bill, she called it dad’s mad money. He was allowed to take the 20 bucks and do whatever he wanted, until the next $20 came seven days later. And you know what we learned from my father? He was so happy to have that $20, and so I dedicated 5% of all operating budgets at every office I ever opened as mad money, fund money. And what their job was to spend it — to spend it before the year ended, so that they could discover new things and everybody spent that 5%. And with that 5% we discovered so many new things. It would have never happened if it wasn’t pre-funded.
I’ve learned about people who know how to fail, because I was in a failure business. If you’re in real estate, it’s a business of rejection, a lot of Noes and very few Yeses. And I made a study my whole life of trying to figure out why I had certain salespeople earning $3 million or $4 million a year selling apartments. And then I had someone on average making $65,000. What’s the difference? I studied and studied and this is what I found: it was never the contacts that came in to the business with, which is what the common culture believed, because that evened out after the first year. It was never how hard they worked, because some of my worst salespeople worked the hardest. The only difference between the people that were usually successful and those that were not, were they took less time feeling sorry for themselves. They almost had a lower IQ so that if you smack them and hit them down they pop back up and said “I’m so stupid, hit me again.”
And you know what, I learned as a hirer to lead a good team, I look for that characteristic in every one I hired, because you could take the hit and keep coming back at, you always hit the finish line. And that was a singular difference between my Superstars and everybody else.
When the stock market crashed in Taiwan, I forget what year was, I saw it on the eleven o’clock news and what do you think I thought of — Carrie Chiang, my number one salesperson, all of her business came out of Taiwan. And so I called her, couldn’t reach, I called her through the day, called her assistance, called her cell phones, I thought she committed hari-kari for sure but at six o’clock, now this is like what, 20 hours later, she rumbles into my office, she is very put together woman, her hair was a mess, her mascara was smeared, like somebody had beat her up. And what do you think she said, “Barbara, exhausted, I up all night, I get 168 new listings.”
What did she do? She talked to everyone she ever sold in listening to the sky is falling, you’re losing your money, you better sell now. And then she immediately went out and she hired two Japanese speaking assistants and sold those units to the Japanese that was starting to move into New York City. Poetry in motion on failure; Carrie Chiang, no surprise that today she — how much money did she make last year? I’ll tell you exactly what she makes. She calls me every January and says, “You know how much money I make?” But now she says, “I make more money than you”, she’s right. OK, she made last year 6 million eight hundred, some odd thousand to the penny she tells me.
OK, how does she do it? I can tell you how she does it. She is great at failure; she doesn’t have the failure bone in her body. She doesn’t even know it exists.
I remember I got a call from Mark Burnett Productions and even felt familiar to me and I don’t watch TV and I — ooh, looked him up and I realized he’s the biggest Hollywood producer and his office was asking me if I would consider being on this new TV show called Shark Tank. I heard what the show is about. I said, “It’s perfect for me; send me the contract.” I never read the contract, didn’t know what I was getting paid at. I signed the contract, expressed it right back. I didn’t want to lose that spot to anyone else. I was so thrilled that ran right out to [Buck Stores] for three autograph-signing outfits, I was goo in the Hollywood, I was cool, so happy.
And then only a week before I was going or five days before I go — I got another call from his assistant who says, “I’m so sorry, Mrs. Corcoran. We have changed our mind. We’ve hired another woman.” I couldn’t believe it but I was already in the habit of failing. And so I sat down and banged out the best email, I think I have a role in my life, I really start digging into.
“Dear Mark, I understand you asked another girl to dance instead of me. Although I appreciate being reserved as a fullback, how insulting we’ll use you as a fullback. I am much more accustomed to coming in first but I consider your rejection a lucky charm as everything good in my life happened on the heels of rejection” and I cited of course Sister Stella Marie said I’d be stupid, Ramon Simone said I’d never succeed with that and he was wrong, Donald Trump said I’d never see a penny of his $4 million commission that I had to sue him in state court to collect, and I got the commission. And then I went on to say, “I think you should consider inviting both women who have to compete for the seat” and that’s exactly what he did and I won that seat.
Now today I have invested in 24 — or 22 or 24, I was getting mixed up — businesses on Shark Tank working with those entrepreneurs every day and helping people’s dreams come true. What would have happened if I hadn’t stood up and wrote that email and not accepted the rejection, I wouldn’t have had the job, number one. I wouldn’t have known these people and all those lives would have been changed, how important it was that I stand up.
I also learned, after I was on the set for almost two months that they have rejected three times more people, have them all signed contracts, and only picked 25%, and my producer said no one wrote a letter, no one sent an email, no one objected, couldn’t they be in those seats today? Probably but I’m so thankful I wrote my email.
I’ve learned to think of failure after everything I’ve done in life as a lucky charm, as a little like a heads up, a little bright light, because you know what I have never had it. Where I haven’t seen that the flip side of that is always the biggest opportunity; it just has happened that way for me, my whole life, right? And I feel that to build my own personal ability to handle rejection is more largely responsible for every success I’ve had than anything else I’ve done in business and believe me I’ve learned a lot. I can do a lot of other stuff but the one thing I do so well is I fail well. And so I happen to — no, I can’t say I love rejection, that would be lying. I accept your — what, give me a word, let’s hear for rejection. There we go, that’s it.
Thank you very much.