Mental Readiness: Plan for Failure from Day One
Most founders spend Day One imagining how successful their company will be. Lei Jun spent Xiaomi's Day One thinking about how it might die. This lesson covers his motivation to start over at 40, his clear-eyed view of failure rates, and three concrete survival strategies.
In 1987, as a first-year university student, Lei Jun read Fire in the Valley at the library. The book told how Silicon Valley heroes like Steve Jobs built companies and defined eras — "it made your blood boil." Driven by the idea of building a world-class company, he went on to found Kingsoft.
By the time he turned 40, he felt he had accomplished most of what he set out to do — yet his childhood dream remained unfulfilled. "My life is basically winding down. In this final stretch, can I try something truly different?"
"You can call me arrogant, but isn't every founder arrogant at heart? Without that arrogance, how could they have any confidence?" Xiaomi's original driving force was simple: build a world-class company.
After several years of angel investing, Lei Jun concluded: "I don't think entrepreneurship is great at all. And I'm almost certain that over 90% of startups will die." So unlike most founders, he started from Day One thinking about how Xiaomi might fail: "I told myself we're definitely going to run into problems." When rallying his team, he didn't talk about grand visions — he said: "Can you trust me and work alongside me for four years? If we lose, we part ways."
This was the complete opposite of his Kingsoft days. Back then he had done the motivational work "extremely thoroughly," and felt betrayed whenever someone left — "betraying our great mission." Everyone lived in a state of impossible tension. Later he realized: you cannot turn your venture into every single person's lifelong, unwavering cause.
Once you've accepted that failure is likely, how do you survive? Lei Jun set three rules for Xiaomi. Click each one to see his exact words and the logic behind them.
It sounds like a joke, but it's actually a psychological fortification: no public announcements, no hype — so losing face isn't part of the cost of failure. Lei Jun says your mental strength must be immense; you need a complete logic system to convince yourself. The first rule in that system is to build your escape route first.
Dying isn't scary — dying slowly is. Pushing through in the wrong direction burns more than money; it burns your most valuable asset: time. Shutting down and starting over isn't failure — it's saving your bullets for the next shot.
Setting a deadline for a project isn't giving up — it's acknowledging that time has an opportunity cost. Four years was Lei Jun's budget when he was 40: "Maybe I don't have forty years left." Use the slider below to see his formula for different ages.
All three done. Xiaomi turned out to be "remarkably lucky" — strategically, almost every major move was right. But Lei Jun's reflection holds no relief; the next question he asks is: What hardships will we face in the future? At the end of every survival strategy is an enduring sense of crisis.
Lei Jun's time budget is tied to age: "If I had started a business at 20, I would tell you to keep going for forty years. If I started at 40, I'd say four years is enough." Drag the slider to see the formula applied to your age.
"I've seen so many cases of second ventures failing. Having succeeded once, the probability of failure in the next venture is actually higher than the first time. Why? Because you think you're amazing. And when you're most proud of yourself, you're often closest to death. Someone like me — who thinks they're pretty good at entrepreneurship and often plays the role of startup mentor — I think I'm even more likely to die. So when I founded Xiaomi, I reminded myself: I'm definitely going to die."
Lei Jun is very fond of a quote from Ren Zhengfei: a company must die three times before it can be called truly successful — "the bird that survives the fire is the phoenix." Life has good times and bad, and in the intensely competitive internet industry, the most important thing for any company is a sense of crisis. His two "bloody, vivid" examples:
Yahoo
"Who could have imagined that Yahoo, once at its peak, would face the struggles it did?" A company that defined the web portal era went from benchmark to cautionary tale within just a few years.
Nokia
"Who thought that just a few years ago, Nokia would face such pressure today?" The absolute dominant force of the feature phone era was brought down by the smartphone wave it had dismissed.
- Keep It Quiet: Before your product is validated, you don't need to build in public everywhere. The most expensive part of failing publicly is the self-doubt it generates.
- Fail Fast: In the AI era, rebuilding an MVP might take only a week or two. The threshold for killing a project is much lower than in Lei Jun's time — if data proves the direction is wrong, cut it. Never settle.
- Give Yourself a Deadline: Set a validation deadline for each product — e.g., if no first paying users within three months, change direction. Turn "let's hold on a bit longer" from an emotion into a time-bound decision.
For a solo developer, the crisis is platform dependency. Yahoo and Nokia died from waves they couldn't see; a solo developer's "Yahoo moment" is: model API prices jump 10x, platform algorithms change, or a big tech company one day makes your feature a free built-in.
On Day One, think through "how will my product die" — the answer is usually the single point of failure you should diversify away from.
Passion is the admission ticket; clarity is the survival talisman: Over 90% of startups will die, so think about how you'll die from Day One.
Three survival strategies: Keep it quiet, fail fast when direction is wrong, give yourself only four years.
Prior success makes you more dangerous: "When you're most proud, you're closest to death."
The bird that survives the fire is the phoenix: A sense of crisis is itself the key to entrepreneurial success.
Source: Compiled from Lei Jun's public entrepreneurship lectures