How to Recover from a Bad Business Decision (and Rebuild Trust) | Entrepreneur

One of the first things you notice when you start working for yourself is that you work for yourself. It’s not just a motivational poster anymore. It’s you, alone, steering the ship. Every decision matters. Every mistake is yours. This realization can feel exhilarating — and terrifying.

Over time, you get better at managing the chaos. The panic subsides, and the wins get bigger. But the mistakes? They don’t stop. They just change shape.

I still remember standing up during an all-hands meeting at Nav, the company I co-founded, to reaffirm our commitment to equality across gender, race, and identity. I referenced our generous maternity leave policy as a proud example. A young dad in the back raised his hand. Calmly, he pointed out that our paternity leave was dramatically shorter. It hit me immediately: he was right. Without realizing it, we had built inequality into our policy.

Right there in the meeting, I made the call — we’d change the policy to make it equitable for all parents. It wasn’t a small move. It caused chaos in HR and finance. But it was the right thing to do.

The experience taught me something every founder eventually learns: it’s not whether you’ll make bad calls — it’s how you respond when you do.

Here’s a framework I’ve used and seen work repeatedly — for solo founders, small teams and even larger companies navigating costly missteps.

1. Own it — out loud

The instinct to hide or downplay a mistake is strong. Resist it. Whether it’s a pricing misstep, a bad hire or an ineffective product rollout, the fastest way to regain trust is to say: “I made the wrong call — and here’s what I’m doing about it.” Blame kills credibility. Accountability builds it.

2. Understand what actually happened

Look deeper than the surface. Was the decision based on incomplete data? A rushed timeline? A blind spot in your understanding of the customer? Map out not just what went wrong, but why. This is where long term growth happens — not just in cleaning up, but in preventing repeat mistakes.

3. Bring in real feedback

You don’t have to go through it alone. Talk to your team, customers or peers. Ask them what they saw. What would they have done differently? Mistakes are humbling, yes — but they’re also an opportunity to listen in a way you might not have before.

4. Fix what you can — fast

Not every mistake can be undone. But most can be softened. Offer refunds. Roll back changes. Update your policy or product. Even symbolic actions — like a personal message to an affected customer — can carry massive weight. The goal isn’t perfection. It’s restoration.

5. Document the lesson

Take 20 minutes to write down what happened and what you’d do differently next time. Share it with your team if you have one. You’re not just solving a short-term issue — you’re building a culture that’s resilient and self-correcting. That’s a huge advantage.

6. Refocus on what’s working

A mistake can knock you off balance. That’s normal. Once the cleanup is underway, shift your attention back to your strengths — what your customers love, what your team does best, what you know works. Recovery isn’t just about fixing the wrong move — it’s about re-centering on the right direction.

Mistakes will follow you at every stage of your business, whether you’re solo and scrappy or managing dozens of employees. The key is to treat each one like a checkpoint, not a dead end. If you can develop the habit of learning quickly, responding clearly and acting with integrity, those mistakes will actually build trust rather than erode it.

You may not be facing HR-level headaches yet. But that mindset — of owning your decisions, course-correcting fast, and staying human throughout — is one of the most powerful assets you can bring to the table.

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