Amazon executive Panos Panay has a direct message for startup founders and product creators everywhere: failure is not just a possibility, but an inevitable and required part of building a truly successful product.

Panay, who serves as Amazon’s senior vice president of Devices, Alexa, and Leo, shared his hard-earned advice onstage at TechCrunch Disrupt in San Francisco. Drawing deeply on his extensive career—including more than 19 years at Microsoft, where he weathered one of the most expensive and public hardware missteps in modern tech history—Panay argued that trying to avoid failure altogether is the surest way to guarantee stagnation.

"You have to be willing to fail, and actually, not just willing, you actually have to go fail," Panay told the audience during his keynote appearance. "If you haven’t failed, you probably haven’t pushed the boundary. It’s literally about harvesting the lessons learned when you fail. You have to be willing to face it, and as you face it, learn from it."

According to the veteran tech executive, founders and developers must fundamentally reframe how they view setbacks. Rather than treating an error or a poor market response as the end of the road, leaders need to recognize that recovering from all sorts of failures—even catastrophic ones—is entirely possible. To prove his point, Panay reflected candidly on a massive miscalculation from his tenure at Microsoft: the launch of the Surface RT.

As Microsoft’s first proprietary tablet computer, the Surface RT was heavily anticipated, but ultimately became a significant commercial and strategic failure that resulted in a nearly $1 billion inventory write-down for the tech giant. The fallout was immediate, painful, and very public for the team involved.

"I remember being on the front cover of a newspaper, and it just said failure," Panay recalled, describing the heavy psychological and professional toll of the moment. "But, here’s the thing, it was easy to admit failure. The trick was, and always is, did you harvest the learnings and understand what happened? All right. What did you learn? Because the failure wasn’t that moment. It was decisions that led up to it two years before that, whether the software wasn’t complete or the inventory was wrong or how we balanced into retail. There were all these steps along the way."

Panay emphasized that true accountability requires founders to understand precisely what went wrong without leaning on excuses. Accepting responsibility for the misstep is the necessary baseline requirement before any meaningful recovery can begin.

However, accepting failure does not mean abandoning the overarching mission. For Panay, the key to eventual triumph lies in holding fast to the initial vision while dramatically improving execution based on the lessons absorbed from the wreckage.

"Here’s the other side of it," he noted. "You want to succeed, yeah? You take that failure, but you don’t let go of your vision. That’s it. Surface has done pretty well. You don’t let go of your vision. You don’t break it."

The trajectory of the Surface line itself stands as a testament to this philosophy. Despite the catastrophic launch and multi-million-dollar write-down of the original Surface RT, Microsoft persisted, iterating on the hardware and software concept over subsequent years. The Surface brand eventually evolved into a respected, viable, and profitable hardware ecosystem for the company, proving that a catastrophic debut does not dictate a product’s permanent legacy if the leadership is willing to adapt.

Throughout his discussion at TechCrunch Disrupt, Panay consistently returned to the themes of unwavering vision, experiential learning, and operational agility. He argued that by truly embracing failure and dissecting the root causes of their setbacks, founders can adapt and make progress much faster, even when they find themselves navigating entirely new and unpredictable obstacles in the marketplace.

The danger, according to Panay, rarely lies in the mistake itself, but rather in the inability or refusal to acknowledge it quickly enough to pivot. Entrepreneurs and corporate leaders alike often fall into the trap of clinging to a failing strategy for far too long, simply because they have not mentally accepted the initial moment of failure.

"It goes back to the same fundamental, like, have you learned?" Panay explained. "Were you learning along the way? Because if you were learning, then you just change your vector. Usually, it’s not 180 degrees. Usually, it’s just 30 degrees. Take your lessons learned, change a little bit, adapt your vision where it needs to be, and then go. I believe there’s people that hang on too long, but it’s because they haven’t accepted the moment of failure at all."

By shifting the vector slightly—adjusting the strategy by thirty degrees rather than executing a panicked, complete reversal—teams can utilize the momentum of their hard-fought experience to course-correct effectively. For the startup founders listening in San Francisco, Panay’s message served as both a sobering reminder of the realities of hardware and software development and an encouraging roadmap for transforming costly mistakes into enduring innovation.