Why Stephen Schwarzman Tells His Scholars to Embrace Failure First

Every year, Schwarzman stands before a room full of the world’s most ambitious young leaders — people who have spent their lives winning — and tells them something they did not expect to hear.

“Failures, I want them to know, can teach us more than any success.”

— Stephen A. Schwarzman, What It Takes

The setting is the annual Schwarzman Scholars graduation — a program Schwarzman founded to develop the next generation of global leaders. These are not ordinary students. They are Rhodes Scholar-caliber achievers, selected from thousands of applicants worldwide. And yet, in his epilogue, Schwarzman singles out failure as the most important lesson he can pass on. Not deal-making. Not capital allocation. Not network-building. Failure.

The context matters. Schwarzman built Blackstone from a $400,000 startup into the world’s largest alternative asset management firm. He has seen countless deals collapse, partnerships fracture, and market crises threaten everything he built. His conviction about failure is not philosophical posturing — it is drawn from decades of hard experience in one of the most unforgiving industries on earth. In the same passage, he tells his scholars that resilience in the face of adversity — not the adversity itself — is what ultimately defines a person.

What makes Schwarzman’s position so instructive is the audience he chose to deliver it to. He was not speaking to people who had stumbled. He was speaking to people who were conditioned to avoid stumbling at all costs. High achievers are often the worst at processing failure precisely because they have so rarely had to. By naming failure as a teacher in that room, Schwarzman was delivering a preemptive warning: the skills that got you here are not sufficient for what comes next. Success in business at the highest level requires the ability to extract signal from things going wrong — and to keep moving anyway.

The broader principle is one that separates good operators from great ones. Anyone can learn from a win. The craft is in learning from a loss without letting it calcify into fear or avoidance. Schwarzman’s framing — that failure can teach us more than success — is not consolation. It is a competitive advantage hiding in plain sight.

The Memo

• Debrief your failures with the same rigor you apply to your wins. Most people do post-mortems when things go wrong but skip them when things go right. Schwarzman’s logic demands the reverse discipline: treat failure as the richer data set.

• Measure your resilience, not just your outcomes. Schwarzman explicitly separates adversity from the response to it. Track how you respond under pressure — that pattern will tell you more about your ceiling than any single result.

• Pursue what you are enthusiastic about, not what looks impressive. Schwarzman also warns his scholars that doing anything solely for prestige rarely leads to success. Excellence follows enthusiasm — start there.