The cycle of repetitive failure is a line of trial and error. With every error comes an increased chance of success in the next trial. So, optimal chance of success is a function of frequency of trial. This frequency of trial, in the real world, translates to trying often (i.e. testing often) and, in order to get more tests accomplished before a certain time, you must test as early as is possible (and most likely, fail). Hence, 'fail early, test often' is the logical prerequisite of optimized chance of success.

I have heard enough successful people tell me to fail early that I now believe that awareness that you might fail and the ability to tell that you have failed may be essential components of success.  Mr. Hoffman talked about the people he sees who continue to throw good years after bad at ideas which will never succeed.  Could it be that part of the reason these people fail is that they can't tell that they HAVE failed?  One component of a strong, traditional work ethic is persistence and tenacity: keep at it until you succeed.  But, if I understand what Mr. Hoffman and other speakers in this series have said, dogged persistence can be more a liability than a virtue if it prevents you from seeing reality objectively.  Mr. Hoffman also said that every startup goes through a "valley of shadows," when it seems that failure is inevitable and the entrepreneur wonders why he started the company.  Clearly, it is important to persist through this phase, as Mr. Hoffman did at PayPal, but then how do you know when to quit?  The ability to realistically assess failure may be a crucial quality of those who eventually experience success.