'Bar Rescue' host Jon Taffer explains the valuable lesson he learned from losing $600,000 early in his career

Jon Taffer has spent four seasons of "Bar Rescue" turning around failing bars across the US.

The show is filled with plenty of yelling, fighting, and weirdos that make for great television, but the principles Taffer teaches are all based on lessons he's learned over his nearly 40 years in the bar and nightlife business.

Taffer tells Business Insider that even though he was one of the first inductees into the Nightclub Hall of Fame and has worked with more than 800 businesses in his career, he's never had formal management training. Instead, he's learned through trial-and-error, and there have been plenty of errors.

Taffer says that after he lost $600,000 - all of his money - on his first partnership, he learned that when deciding to do business with someone, character is just as important as business acumen.

In Chicago in the late 1980s, Taffer entered into his first business partnership. He declines to give further identifying details but explains the situation:

The guy was sort of a player. He cheated on his own wife and his own family. And when I was about to do business with the guy, a friend of mine said, "Listen, Jon. You don't do business with a guy who cheats on his own family. If he cheats on them, he'll cheat on you in a minute."

I didn't listen. I did the deal. I got ripped off for $600,000 - every dime I had. And I've been very conscious about ever having a partner since.

That was a serious mistake.

Entrepreneurs like Silicon Valley power player Peter Thiel often liken business partnerships to marriages, and stress that not only do the partners need complementary skill sets, they need to like and trust each other.

Taffer has extended this lesson to the way he hires, as well.

"If a person's personality and interpersonal skills seem right, then (and only then) does his past experience become relevant to the discussion," Taffer writes in his book "Raise the Bar."

Taffer says that over his long career, he doesn't regret all of the money and opportunities he's lost because the lessons he gleaned allowed him to perform at a higher level.

"I've made stupid investments. I've made stupid decisions as an employee. I've made foolish decisions as a manager. I've gotten fired. I've lost businesses. I went through all of those things," he says.

"I think the greatest mistakes have been my greatest lessons."