I lost $30,000 on my first business. Two years later, I built a business worth over $9 million — these are the lessons I learned.

• Michelle Hu shares lessons from her failed beauty app and success with Étoile products.
• Étoile, a beauty accessories brand, grew after Hu focused on product-market fit and passion.
• Hiring experienced talent and adapting strategy helped Étoile reach over $9 million in revenue.

This as-told-to essay is based on a conversation with Michelle Hu, a 30-year-old business owner based in New York City. It's been edited for length and clarity.

My first business died as quickly as it started.

In 2017, I was working as an investment banking analyst at Citi when I launched Mei, a beauty app where users could filter through and book appointments with makeup artists, hair stylists, and more. It was a one-year process of trying to scale and pouring in about $30,000 in the process, but we ultimately never launched.

In the meantime, I was selling handmade acrylic makeup holders online under the brand name Étoile. Mei failed, but I saw Étoile gaining traction on its own. I realized it could take off — and it did.

Two years later, I quit my job and went all in on Étoile. I transformed it into a world for beauty enthusiasts, crafting accessories that elevate daily rituals. We made over $9 million in revenue last year and recently launched our products in nearly 30 Anthropologie stores across the US.

Here's what I learned from my failed business that helped me the second time around.

Start a business in an industry you love

I was so in love with the beauty industry that I jumped right in with Mei, but I had no tech background and no idea what really went into building an app. I remember thinking the idea of creating this techy business app sounded cool, but it just wasn't a fit for my skill set or interests. I had no business creating an app.

When time's got hard, and the app required more time, energy, and money than I bargained for, I didn't have the passion for my product to drive me. Starting Étoile, a consumer product business, felt a lot more aligned with me.

I learned it's important to start a business in an industry you love, because when things get difficult, you need the passion to fuel you. I'm not passionate about tech, but I am passionate about designing products. That passion fuels me to work through the hurdles.

You must have product-market fit in order for your business to succeed

I now realize that I never had product-market fit with Mei. Most people text or DM to book makeup artists or hairstylists, and I learned the hard way that it's difficult to change consumer behavior.

My initial vision for Étoile was for it to be an "everything store" for beauty, featuring items such as ring lights and vanity tables. However, our customer base was fragmented.

That's when I took what I learned from Mei and scaled back on items that weren't driving a significant amount of revenue, focusing on what worked: our travel range of products. Since then, we've developed a strong customer base that's excited about our product. I can feel the difference between having headwinds in the business versus having tailwinds.

When we hit that product-market fit magic, everything seemed to move a lot more efficiently in the business.

Hiring the right people makes all the difference

I think the biggest financial mistake I made was not vetting the people we chose to build the app. It sounds silly because it seems so obvious, but I think I was just so new to the world of business and thought, "If they've made one app before, then they can make any app."

We hired college students from around the world and basically threw money at them without meeting them or vetting them. We couldn't afford people with a strong portfolio, so we just filtered through others who were just as scrappy as us. I didn't realize there was such a big scope of different app developers.

I've always lived by the saying, "move fast and break things," but when you're spending so much money to hire people, do more research.

I think hiring is still a tricky one. The thing that helps is that we have a much bigger budget than we did with Mei. The people we choose to work with have a strong portfolio of brands that they've previously worked with. I think bigger budgets have allowed for better opportunities.

Shutting things down when they're not working can actually lead to better things

When I shut down Mei, I had to admit that things weren't working and even learn to be OK with failure.

At the start of Étoile, I held onto our product strategy so tightly, even when it wasn't working. My thought process was that we had our products ready to go, stored in a warehouse, and marketed to our audience, so I thought it would be a bad look to pull back on them, even when they weren't working.

When I finally made the shift and pulled back on items like mirrors and tables, the business made a complete 180. It reaffirmed that it's important to admit when things aren't working and not to have so much pride when it comes to my business.

Do you have a story to share about lessons learned from a failed business? If so, please contact the reporter at tmartinelli@businessinsider.com.