The Right Way to Take Risks in Business: How to Avoid Crushing Failure

When you're starting your own business, one of the biggest questions you'll face is: How much risk should I take?

Everyone has different levels of risk tolerance. Some people are willing to go all-in, while others are scared to bet even a little. In this chapter, we're diving deep into the art and science of risk management in business—based on lessons I painfully learned the hard way.

My Early Days: Reckless Risk-Taking

Back when I started my entrepreneurial journey, I was an all-out risk-taker. I didn’t care if I lost everything. I was so optimistic that I’d bet the farm without blinking. That same wild optimism, I now realize, was a major reason why my early ventures failed one after another.

Don’t get me wrong—being a risk-taker is part of being an entrepreneur. Google “traits of successful entrepreneurs,” and you’ll always see that. But here’s what I believe now:

There's a limit to how much risk you should take. Go beyond that line, and it doesn’t matter how driven or passionate you are—you’ll fall so hard it might take years to recover.

I learned this the painful way—after falling into millions of pesos in debt from risks that didn't pay off. And that’s the lesson I want to pass on to you today.

The 0–1–Negative 1 Risk Formula

Let me simplify this concept with a visual framework:
(1 → 0 → -1)

When you're starting a business, you're at level 0. You’re about to take a risk—whether that’s your time, money, or talent. If your risk pays off, great! You go up to 1. That means success.

But what if it fails?

Here’s the big lesson:
A healthy failure means falling back to 0—not to -1.

Unfortunately, most entrepreneurs make the mistake of going all-in. When the business fails, they don’t just go back to where they started—they fall to negative 1. That’s when you’re drowning in debt, humiliation, and pressure. That’s when it's really hard to bounce back.

And I know this because I’ve been there. I risked everything during my first 10 years in business. I didn’t land on 1. I didn’t even land back at 0. I crashed straight into -1.

Why Negative 1 is Dangerous

When you fall into -1, it's not just financial—it becomes emotional and mental. You feel ashamed. You’re buried in debt. You lose momentum. And worse, it takes months or even years to recover and try again.

Successful entrepreneurs, on the other hand, fail too—but they always fall back to 0. They know how to protect their baseline so they can try again tomorrow. That's what I eventually learned, and it completely changed how I take risks today.

Now, in every venture, our team always asks: If this fails, can we fall back to 0—not -1? That’s our filter for risk.

Don’t Start a Business with Debt

One of the worst ways to risk is starting your business with borrowed money.

Why?

Because if it fails, you’re automatically at -1. You owe someone. You're under pressure. Even before you made your first sale, you're already in the red.

If you’re going to take a risk, ask yourself:
What’s the worst that can happen?
If your answer is something you can handle—go ahead. If not, dial the risk down.

Sadly, many Filipinos treat business like a teleserye. We think if we bet everything—our savings, our house, our future—the universe will reward our boldness. But that’s not how business works.

Even if you risk it all, the world owes you nothing. If you’re not ready, it won’t go easy on you. You'll end up in -1.

Real Talk: Risk is a Process, Not a Jackpot

The truth is, success doesn’t come from the size of your bet. It comes from how long you can keep playing the game.

Bet smart. Fail small. Learn fast. And keep going.

All of my first three businesses failed. My fourth one worked. My fifth and sixth businesses? Failed again. But here’s the difference: by the time I failed in my fifth and sixth ventures, I had already learned to manage my risks.

Even when we lost, we only fell back to 0—not -1. That allowed us to recover quickly and try again.

Failing Isn’t Heroic—Learning Is

Let me be clear:
I don’t glorify failure. I hate it. It hurts. It makes you feel like a loser.

Failure is only useful if you turn it into success. If not, it's still just failure.

So instead of romanticizing failure, we should study how to fail the right way. That’s the real secret:
Fail smart. Fall only to 0. Then bounce back and keep pushing toward 1.

Final Words: Learn as You Go

There are lessons you won’t find on Google—lessons you can only learn by doing. This idea of managing your risk level? No one taught me that. I discovered it in the trenches.

And just like me, you’ll figure out your own truths as you take action.

So take the risk. But do it wisely.

Don’t aim for dramatic failure. Aim for repeatable learning. And whatever happens, just make sure:
Don’t fall to negative 1.

Let’s build your first-world future—one smart risk at a time.