What’s the price when you fail?

This week, Elon Musk watched his latest Falcon Heavy rocket takeoff, launching 24 separate spacecraft into orbit in what Elon called his "Most difficult launch ever".

The launch was successful, the two side boosters landed back safely, and the $6 million nose cone landed safely in a giant net for the first time - after a year of trial and error.

The centre booster, however missed and plunged in the ocean. But Elon wasn't phased. Because over the years he has worked out how to profit from his failures. How?

When an attempt to landing his $60 million Falcon 9 rocket went wrong, with the entire rocket toppling over and exploding, Elon famously tweeted, “Well, at least the pieces were bigger this time!”

Then he posted: “My best guess for 2016: ~ 70% landing success rate (so still a few more RUDs to go), then hopefully improving to ~90% in 2017.”

“RUD” stands for “Rapid Unscheduled Disassembly” which is another way of saying “it blew up”…

What can we learn from Elon's history of joking when his rockets blew up?

Most people would see these as expensive failures, but Elon is a master of learning by failing, and he expects to fail epically and often.

It didn’t cost Elon to fail as he builds it into his business model. Each Falcon rocket is expected to be lost anyway if he wasn’t testing how to land them.

Every year there's around 20 falcon rockets scheduled for take-off, each already paid for by the companies and governments paying Elon to send their cargos to space. With revenue secure, he focuses his time on how to test new innovations (like landing the rockets back safely).

We’ve moved from the industrial age where product development and testing took place BEFORE delivery, to the technological age where product development and testing takes place DURING delivery.

How can you increase the testing you can do? When in front of customers? When serving your customers? When delivering an existing product to develop the next product?

In the old paradigm, it was easy to dismiss testing as being too costly.

In the new paradigm, it’s NOT testing that’s far more expensive.

Now that Elon has finally works out how to return his rockets (most of the time), he’s saving himself over a billion dollars of lost rockets each year - and so he’s now able to cost his trips to be far ahead of the competition. That's after years of testing.

You don’t need to be a billionaire like Elon to test like him.
But you do need to test like Elon to be a billionaire like him.

Failing isn’t where the price is.
Failing is where the profit is.

“If things aren’t failing, you are not innovating enough.” ~ Elon Musk