Melissa Bernstein, the co-founder of educational-toy company Melissa & Doug, was a perfectionist from the start. As a kid, everything she tried, she wanted to master. Every grade should be an A. “Life was very black and white. It was success or it was failure,” she said on Inc.’s What I Know podcast. “I believed once something was put in the ‘failure’ bucket, it was there forever.”

She was terrified of taking risks, because she was terrified of failing.

But she was also a very creative individual, who wrote poetry as a way to express feelings she now describes as “existential depression.” And once she quit her investment-banking job to start a toy company with her then-partner, now-husband Doug Bernstein, she began to feel the power of channeling her creativity into making educational, fun products that could help kids explore the world or find joy.

Once she first started designing, she says: “These products just flowed out of me. I had dozens of ideas every week.” But when a product would hit the shelves and not sell out, she’d feel crushed. “I’d like want to hide my head because I was so embarrassed…it was because I was terrified of looking at the failure honestly.”

Over the years she came to see there was no amount of market research–and no amount of scrutinizing her competitors’ offerings–that could predict whether a product would succeed or fail. And sometimes, an ideas might bomb at first and surge in popularity years later. As her company grew, she began to realize that she would design thousands of products–and very few of them would become such huge commercial successes that they’d remain on shelves for years. That helped her shift the way she conceptualized “failure.”

“Those failures, if I had the courage to look them straight in the eye and see them for what they were, were actually these beautiful lessons that could help me get to success,” she says. They could teach her what worked–and what needed further tinkering.

Today, behind her desk at Melissa & Doug, is a shelf and display of her “failure” toys that didn’t sell, or that didn’t even make it to market. And she’s proud of seeing them every day.

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