Yes, many famous authors were rejected before their books became a success. J.K. Rowling was rejected by at least one literary agent before she was taken on by the Christopher Little Literary. Her agent sent the first Harry Potter book, 'Harry Potter and the Philosopher's Stone, to 12 publishers, each of which turned it down.

Eoin Colfer, author of the Artemis Fowl books, had one of his first books rejected, and it took him ten years before he went down the author route again, after which the first Artemis Fowl book was published.

Many other successful authors have been rejected before their books became best-sellers. G.P. Taylor, author of 'Shadowmancer' and 'Wormwood', decided to go down the self-publishing route due to rejections and vanity publishing, and his books turned out to be international successes.

It is very rare for a manuscript to be accepted straight away.

Not always, but the market for books is a very tough one and very few are really successful anyway. Much must be said for an author who researches who he sends his manuscript to, and minimises the chances of rejection.