Failure: it’s as important for entrepreneurs as success.

That was the message from Steve Case, the co-founder of AOL, at his Entrepreneurship Week (E-Week) lecture Wednesday afternoon, where he discussed the ups and downs of entrepreneurship and the essential principles for success of any initiative — business or otherwise.

Case kept his message simple, summarizing his perspective on ingredients for success with the “three P’s”: people, passion, and perseverance.

“If you have all of those things in the right balance, anything is possible,” said Case, who is also the CEO of the investment firm Revolution. “If you don’t, nothing is possible.”

Case explained the role of the “three P’s” in his own career, focusing on the excitement of founding AOL. According to Case, perseverance was an especially crucial component of AOL’s early stages, eventually leading to its success.

“Perseverance really does matter,” he said. “AOL seemed to come out of nowhere…but really, we were a 10-year-in-the-making overnight sensation.”

Case said that despite many detractors and “ups and downs” in the early days, “thankfully there were enough people that believed in it and stuck with it.”

He also called AOL’s merger with Time Warner in 2000 “the worst merger in history,” describing it as a “great idea with failed execution.”

Those in attendance appreciated the range of Case’s entrepreneurial wisdom, which stems from a background of both triumphs and pitfalls.

“He was in the boom time and he was also there for the failure with the worst merger in history,” said Salak Syed ’10, an officer for the Entrepreneurial Thought Leaders Seminar (ETL). “He has that really vast perspective of being in the good and the bad times.”

“I really liked how he talked about his successes, but he also acknowledged that his failure was a really big failure, and he was able to laugh about it,” said Nikil Viswanathan ’10, ETL co-president.

ETL and E-Week are both sponsored in part by the Business Association of Stanford Entrepreneurial Students (BASES).

A sense of philanthropic responsibility permeated Case’s discussion on entrepreneurship’s function in the world today, as he emphasized its role in solving some of today’s economic troubles.

“Our country is struggling a bit with an economic malaise and only one thing will get it back on track” he said. “Entrepreneurship really is critical in this country…it’s not just something to do to make a buck. It really is the underlying engine of innovation that will ensure a better future.”

Attendees were impressed by what they saw as Case’s own dedication to his work.

“He’s more focused on what’s going to make a difference and what’s going to solve problems,” said Lionel Guillou, a graduate student in biomechanical engineering. “I respect him so much more than the people that do short term and incremental advances that are profitable, but don’t help the society they’re part of.”

“He has enough money to just chill out, but he still values being in the game. That self-awareness is very unique,” agreed Alan Guo ’11.

Case’s lecture was one of many events of Stanford’s E-Week, which is an annual event sponsored by local businesses and business-oriented student groups.