HARRY: We had nothing going for us. But it's still hard. And if you're starting cold and you don't have an endorsement of a famous individual, you don't have all the advantages, you have limited capital, and maybe, if it runs out, nowhere to go for additional capital, it really pays to understand that you could be in for a few really rough years before you finally turn the corner and that that's OK because that's what most companies go through, and not to get discouraged. And if you...

HATTIE: So it's OK to feel like you're a failure?

HARRY: Yes. If you don't, you're probably blind to what's going on. You know, there are going to be things you're going to do wrong. When you're new at something, you make mistakes. And the first two to five years of a new company can be really, really tough.

And the thing you should recognize as an entrepreneur is that that is OK, that it's OK to be really struggling, to be spending all your time managing cash flows, to be thinking about, you know, `How did I ever get into this? When am I going to come out? When is it finally going to turn the corner?' because most new businesses go through that.

Some of the most successful businesses in the world went through a rocky start-up period and that it's OK to go through that period, and don't be discouraged, don't feel like a failure.

It's better to be really in tune with what's going on and understand you have problems to overcome than be living in a fool's paradise and wake up one day with a train wreck.

In The Studio

HATTIE: Since we taped this story, Harry Rosenthal left for another start up and Brent Breck retired. The good news is that these men built this company to last. Even without them, Sundance Catalog has nearly doubled in revenues and is now mailing 24 milion catalogues a year. This drives shoppers to the web and Rick Turrick, the IT driector you just met, says the Internet ordering is growing up to 300% per year. Today Sundance might be considered the godfather of its catagory. Many competitors have emerged but those competitors have actually grown Sundances' business by increasing the awareness of their niche.

Redford's advice is: know what you don't know. Hire the right people then step back and let them do their magic. I'll see you next time.