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I was wondering how one can get involved in helping out at yc during the batches. sort of a role where you can work and help out the companies with any questions / requests they have. basically additional hands on deck for the yc partners.
One of the things that differentiates us from other programs is we don't have outsourced 'mentors'. the advice you get during yc is from the full-time partners and a small group of part-time partners. i think this is important to maintain--we give good advice largely because we think about advising startups all the time. bringing people in and out to do it occasionally hasn't worked that well for us.
I'm currently on h1b, if we get accepted, will my working visa be a problem?
We will connect you to lawyers that can help, but it can be a real challenge unfortunately :(
Any advice for single founders applying? (other than get a cofounder...)
The burden of proof to show us you can handle starting a startup is higher. so some evidence that you can execute by yourself (i.e. progress) goes a long way.
What was your first personal investment like?
It was /dev/finance, which became stripe. (this was sort of funny years later, when I was sorting through my stock certificates. I momentarily forgot that stripe was originally called something else, and put that stock cert in the "lost cause" pile.)
Based on my friends who have previously applied to yc .. it seems as if applications submitted in the last 3-4 days before the deadline, don't really get reviewed. when submitted early, they would notice yc related views to their website and youtube video. unfortunately, when submitted close to the deadline, there were no views
The youtube counter has never seemed to work well with our reviewing software, so i'd ignore that. that said we do get to spend more time on applications that get submitted early (as we've always said) so there is a slight advantage to submitting early.
Hey sam, what's the status of the yc fellowship? are you going to do another round?
Very likely yes.
Hi @sama. are there any technologies that you would not consider funding?
We will not invest in something that we think will be bad for the world even if we think it will make lots of money.
How long does it typically take the yc team to review an application?
It honestly hugely varies. sometimes 2 minutes. the longest I've ever spent on a single application (where I had to do background research) was probably an hour. but I try for my normal cadence to be 6 per hour. some applications that are really great or really bad are reviewed by only one of us, most are reviewed by about 3, and the ones near the cutoff are reviewed by a lot.
What's the most important question on the application?
The first thing I read is "what is your company going to make?" then I scan everything else quickly for evidence of something exceptional--something the founders have done, a great insight on this idea, or something impressive about progress to date.
What do you think about the economic disruption that is being caused be increased automation? as we develop broader and broader forms of automation, it seems like that disruption can only increase in both speed and quantity. what can yc and silicon valley as a whole to mitigate the problems this will cause?
I think that technology increases wealth but also concentrates it. we are all better off, but the inequality is likely to get worse over time. this has been going to some degree since the first tools were developed. i'm not ready to talk in much detail yet, but I do think yc/sv/me personally can and should help address this.
I've been watching the sf startup scene from afar. in the midwest (cincinnati, oh) we have growing scenes, but my biggest problem is finding true senior engineers and real technical mentorship. do you think this is something one needs to be in sf to attain or are there other ways?
I certainly don't think you need to be in sf for it, though it is easy to find here. if I had no family ties and wanted to be in tech, i'd still move to the bay area even with the cost of living being what it is. but I don't think it's as critical as e.g. moving to la to be in movies or moving to dc to be in politics.
Sam, should everyone's genomes be sequenced? will most americans have their dna sequenced by 2025,2030? when will we see the peak of the commercial and medical results of having a sequenced population? what could prevent us from getting all our genes sequenced? shouldn't we try to facilitate mass sequencing, for all the medical benefits it could provide? what can ycombinator do to influence corporate and political entities to collaborate and reach a solution to expedite this process?
Yes, I think so, and i'd be surprised if it's not commonplace by 2030. i think the best thing yc can do is fund startups enabling this (and offering good applications on top of it).
Do you think a startup could realistically end up being the entity to develop some of the earliest significant agi? what would look like promising, realistic starting points for -- or even attributes of -- such a nascent startup? e.g., chat bots, development platforms, intelligent agents for games?
Yes, for sure. i think the starting points you mention are very promising ones.
How relevant is the old rfs 5 (development on handhelds, http://old.ycombinator.com/rfs5.html) today compared to 2009 when it was published?
Certainly hasn't happened yet. it may be that human/phone i/o is just too slow. it's not the area i'm most focused on, but would be interesting if it happened.
I'm considering applying for yc but I think my idea (a fairly simple time management app for smartwatches) might be a bit too modest. how small of an idea is too small?
We don't mind ideas that start off sounding modest if you have a great answer to how it could possibly develop into something huge. in fact, we like ideas like that.
Name the most influential person in your life! i'm really curious! reply
No huge surprises here, but probably paul graham, peter thiel, and elon musk have done the most to influence my thinking about investing and technology.
Recently a plethora of startups working on new nuclear energy technology have been created: transatomic power, flibe, helion and upower (to name a few). these startups, respectively, have technology based on molten salt reactors (msr), new fuels (thorium), or new modalities (small distributed scale and fusion). most of these startups face a huge challenge (and capital requirement) to go from idea/concept to pilot/demonstration plant. as chairman of helion and upower how do you see these new startups commercializing their technology? will they require partnerships with existing utilities and what is the expected timeline?
I think they should just try to raise large amounts of money rather than partner with large companies for development. however, they will need to partner with utilities for pilot plants. i can't speak to the other companies, but my hope is that upower and helion have prototypes in ~3-5 years.
What are some of the biggest pain points you see early yc companies struggling with (esp. during batches)? are there any unsolved problems for growing companies you wish someone would apply to solve?
The biggest problem is failing to make a product that some users love, but then thinking they will solve their problems by doing everything else well. the second-biggest problem is probably cofounder fallouts. internal communication and management structure are always big problems for growing companies that I wish someone would solve.
Hello sam, I am honduran and applying for the winter 2016 batch with other two co founders. one of my co founders (venezuelan) and I have student f-1 visas. since we cannot work yet until we are at opt we won't be able to make any profits until january or february 2016. beta for our platform is due tomorrow so we can have a demo but users won't be able to use it for now. is this going to affect our application? if so, what would you recommend?
That's ok; we understand
I was excited about the research announcement! I've been thinking about this for a while: - small companies rarely fund university research - the grant application process is complex - grad students get paid so little compared to tech workers - hiring a phd student before they finish means abandoning their research do you think universities and research can be changed to get more companies funding research? I can imagine startups can get some great work done efficiently while increasing private funding of research.
Maybe, but i'm not sure small companies are the best funders for this. one of the nicest surprises about the ycr announcement was how many very rich people and large organizations reached out saying they wanted to give money. it seems there is a lot of potential energy here that's been looking for something to do.
How far do you think new silicon valley companies (and yc companies in particular) have progressed in providing fairer equity grants to employees? in particular i'm interested in what the norms are for "if you leave the company you must exercise in 90 days" type terms. i know that you've been working on this problem personally and a few high profile companies have publicly announced changes. but what's going on with new small companies? what are the current norms? i know that yc takes care of a lot of the legal work when setting up new yc companies. what do you currently recommend for employee option grants?
I mostly only know about yc companies other than what I've read in the press about large companies, but it seems like this has gotten much better. we want to create a new employee option plan with all of our recommended fixes. we've been busy, but we'll hopefully get to it soon. we'll open-source it, of course
So my question is about yc research. you said in that earlier thread you will be hand picking the people. how exactly do you intend to do that if you don't me asking? are you partnering with schools? are they going to be recommended? do you already have a database?
Mostly the algorithm was to ask very smart people "who are the top 3 smartest people you know in area x" and then go after the people whose names kept coming up.
Couple questions regarding ycr: 1. will the model be group-based where there's a head pi setting the research agenda for a group and researchers working under the pi? if so, what level of independence do you expect individual researchers within a group to have? i.e. is it more like the academic model with postdocs enjoying a fair degree of independence, or more akin to national labs where the research agenda is reasonably fixed and everyone is expected to contribute to the same research program? or, are you coming up with an entirely different model? 2. in general how hands-on will ycr be in terms of intra-group management? 3. do you expect to subscribe to all the major publishing houses so that ycr researchers have access to journals like they would at a top-tier university?
1. great question, we've spent a lot of time cycling on this. there will be a "pi" for each group, but the sort of pis we will bring on will be people who will give large amounts of autonomy to their teams--ie, each group will have a goal, and everyone in that group will be directed to work towards that goal in whatever way they see fit. but given the quality of the pis we are planning to bring on, if they think a particular direction is really unfruitful, it is likely worth considering. 2. not very unless asked. 3. whatever the researchers want.
Very broadly speaking, fundamental research can be divided into two categories: (1) developing techniques to accomplish some very difficult, but useful task; and (2) answering questions which are intrinsically interesting.* research in fusion and developing self-driving cars are examples of the first category. finding exoplanets and the higgs boson are examples of the second. will yc research be funding research in both categories, or just the first? * (i know some people like to call the second category "pure" research, but I think that betrays a bias against working on more practical problems.)
Honestly it will mostly be category 1 to start, but there is at least one category 2 project we want to pursue.
Hi @sama, i'm from brazil and ceo of an edtech startup. we're profitable, with 60 employees and a lot consumer traction/revenue, but didn't raise a series a yet. questions: 1) what advice would you give to applicants from brazil and other large countries (india, china, russia), whose products initially target their local markets? 2) what advice would you give to post-seed and pre-series a applicants? when (if at all) would you consider them "too big for yc"? 3) if you select a post seed startup, would yc invest at their latest valuation, or would it only offer the standard deal, even if it would be a "down round" for current investors? heard you are visiting india and know you've been to mexico not long ago. ever thought about coming to brazil? best regards, bernardo
1) no specific advice--we fund lots of companies whose products target far-away markets and are particularly interested in doing so. the only different question we might ask you is "how will you handle being away from your users for 3 months?" 2) we have funded companies that have raised more than $10 million, and they've said they still got a lot of value out of yc. if anything, it's usually the existing investors that have a problem with it. 3) standard deal, but we buy common stock, so it doesn't trigger any anti-dilution stuff. most investors understand that yc is mostly "sweat equity" anyway. i might come to brazil for new years
I was wondering how one can get involved in helping out at yc during the batches. sort of a role where you can work and help out the companies with any questions / requests they have. basically additional hands on deck for the yc partners.
One of the things that differentiates us from other programs is we don't have outsourced 'mentors'. the advice you get during yc is from the full-time partners and a small group of part-time partners. i think this is important to maintain--we give good advice largely because we think about advising startups all the time. bringing people in and out to do it occasionally hasn't worked that well for us.
I'm currently on h1b, if we get accepted, will my working visa be a problem?
We will connect you to lawyers that can help, but it can be a real challenge unfortunately :(
Any advice for single founders applying? (other than get a cofounder...)
The burden of proof to show us you can handle starting a startup is higher. so some evidence that you can execute by yourself (i.e. progress) goes a long way.
What was your first personal investment like?
It was /dev/finance, which became stripe. (this was sort of funny years later, when I was sorting through my stock certificates. I momentarily forgot that stripe was originally called something else, and put that stock cert in the "lost cause" pile.)
Based on my friends who have previously applied to yc .. it seems as if applications submitted in the last 3-4 days before the deadline, don't really get reviewed. when submitted early, they would notice yc related views to their website and youtube video. unfortunately, when submitted close to the deadline, there were no views
The youtube counter has never seemed to work well with our reviewing software, so i'd ignore that. that said we do get to spend more time on applications that get submitted early (as we've always said) so there is a slight advantage to submitting ...This knowledge is worth millions but signing up is free
Hey sam, what's the status of the yc fellowship? are you going to do another round?
Very likely yes.
Hi @sama. are there any technologies that you would not consider funding?
We will not invest in something that we think will be bad for the world even if we think it will make lots of money.
How long does it typically take the yc team to review an application?
It honestly hugely varies. sometimes 2 minutes. the longest I've ever spent on a single application (where I had to do background research) was probably an hour. but I try for my normal cadence to be 6 per hour. some applications that are really g...This knowledge is worth millions but signing up is free
What's the most important question on the application?
The first thing I read is "what is your company going to make?" then I scan everything else quickly for evidence of something exceptional--something the founders have done, a great insight on this idea, or something impressive about progress to date.
What do you think about the economic disruption that is being caused be increased automation? as we develop broader and broader forms of automation, it seems like that disruption can only increase in both speed and quantity. what can yc and silicon valley as a whole to mitigate the problems this will cause?
I think that technology increases wealth but also concentrates it. we are all better off, but the inequality is likely to get worse over time. this has been going to some degree since the first tools were developed. i'm not ready to talk in much d...This knowledge is worth millions but signing up is free
I've been watching the sf startup scene from afar. in the midwest (cincinnati, oh) we have growing scenes, but my biggest problem is finding true senior engineers and real technical mentorship. do you think this is something one needs to be in sf to attain or are there other ways?
I certainly don't think you need to be in sf for it, though it is easy to find here. if I had no family ties and wanted to be in tech, i'd still move to the bay area even with the cost of living being what it is. but I don't think it's as critical...This knowledge is worth millions but signing up is free
Sam, should everyone's genomes be sequenced? will most americans have their dna sequenced by 2025,2030? when will we see the peak of the commercial and medical results of having a sequenced population? what could prevent us from getting all our genes sequenced? shouldn't we try to facilitate mass sequencing, for all the medical benefits it could provide? what can ycombinator do to influence corporate and political entities to collaborate and reach a solution to expedite this process?
Yes, I think so, and i'd be surprised if it's not commonplace by 2030. i think the best thing yc can do is fund startups enabling this (and offering good applications on top of it).
Do you think a startup could realistically end up being the entity to develop some of the earliest significant agi? what would look like promising, realistic starting points for -- or even attributes of -- such a nascent startup? e.g., chat bots, development platforms, intelligent agents for games?
Yes, for sure. i think the starting points you mention are very promising ones.
How relevant is the old rfs 5 (development on handhelds, http://old.ycombinator.com/rfs5.html) today compared to 2009 when it was published?
Certainly hasn't happened yet. it may be that human/phone i/o is just too slow. it's not the area i'm most focused on, but would be interesting if it happened.
I'm considering applying for yc but I think my idea (a fairly simple time management app for smartwatches) might be a bit too modest. how small of an idea is too small?
We don't mind ideas that start off sounding modest if you have a great answer to how it could possibly develop into something huge. in fact, we like ideas like that.
Name the most influential person in your life! i'm really curious! reply
No huge surprises here, but probably paul graham, peter thiel, and elon musk have done the most to influence my thinking about investing and technology.
Recently a plethora of startups working on new nuclear energy technology have been created: transatomic power, flibe, helion and upower (to name a few). these startups, respectively, have technology based on molten salt reactors (msr), new fuels (thorium), or new modalities (small distributed scale and fusion). most of these startups face a huge challenge (and capital requirement) to go from idea/concept to pilot/demonstration plant. as chairman of helion and upower how do you see these new startups commercializing their technology? will they require partnerships with existing utilities and what is the expected timeline?
I think they should just try to raise large amounts of money rather than partner with large companies for development. however, they will need to partner with utilities for pilot plants. i can't speak to the other companies, but my hope is that up...This knowledge is worth millions but signing up is free
What are some of the biggest pain points you see early yc companies struggling with (esp. during batches)? are there any unsolved problems for growing companies you wish someone would apply to solve?
The biggest problem is failing to make a product that some users love, but then thinking they will solve their problems by doing everything else well. the second-biggest problem is probably cofounder fallouts. internal communication and management...This knowledge is worth millions but signing up is free
Hello sam, I am honduran and applying for the winter 2016 batch with other two co founders. one of my co founders (venezuelan) and I have student f-1 visas. since we cannot work yet until we are at opt we won't be able to make any profits until january or february 2016. beta for our platform is due tomorrow so we can have a demo but users won't be able to use it for now. is this going to affect our application? if so, what would you recommend?
That's ok; we understand
I was excited about the research announcement! I've been thinking about this for a while: - small companies rarely fund university research - the grant application process is complex - grad students get paid so little compared to tech workers - hiring a phd student before they finish means abandoning their research do you think universities and research can be changed to get more companies funding research? I can imagine startups can get some great work done efficiently while increasing private funding of research.
Maybe, but i'm not sure small companies are the best funders for this. one of the nicest surprises about the ycr announcement was how many very rich people and large organizations reached out saying they wanted to give money. it seems there is a l...This knowledge is worth millions but signing up is free
How far do you think new silicon valley companies (and yc companies in particular) have progressed in providing fairer equity grants to employees? in particular i'm interested in what the norms are for "if you leave the company you must exercise in 90 days" type terms. i know that you've been working on this problem personally and a few high profile companies have publicly announced changes. but what's going on with new small companies? what are the current norms? i know that yc takes care of a lot of the legal work when setting up new yc companies. what do you currently recommend for employee option grants?
I mostly only know about yc companies other than what I've read in the press about large companies, but it seems like this has gotten much better. we want to create a new employee option plan with all of our recommended fixes. we've been busy, but...This knowledge is worth millions but signing up is free
So my question is about yc research. you said in that earlier thread you will be hand picking the people. how exactly do you intend to do that if you don't me asking? are you partnering with schools? are they going to be recommended? do you already have a database?
Mostly the algorithm was to ask very smart people "who are the top 3 smartest people you know in area x" and then go after the people whose names kept coming up.
Couple questions regarding ycr: 1. will the model be group-based where there's a head pi setting the research agenda for a group and researchers working under the pi? if so, what level of independence do you expect individual researchers within a group to have? i.e. is it more like the academic model with postdocs enjoying a fair degree of independence, or more akin to national labs where the research agenda is reasonably fixed and everyone is expected to contribute to the same research program? or, are you coming up with an entirely different model? 2. in general how hands-on will ycr be in terms of intra-group management? 3. do you expect to subscribe to all the major publishing houses so that ycr researchers have access to journals like they would at a top-tier university?
1. great question, we've spent a lot of time cycling on this. there will be a "pi" for each group, but the sort of pis we will bring on will be people who will give large amounts of autonomy to their teams--ie, each group will have a goal, and eve...This knowledge is worth millions but signing up is free
Very broadly speaking, fundamental research can be divided into two categories: (1) developing techniques to accomplish some very difficult, but useful task; and (2) answering questions which are intrinsically interesting.* research in fusion and developing self-driving cars are examples of the first category. finding exoplanets and the higgs boson are examples of the second. will yc research be funding research in both categories, or just the first? * (i know some people like to call the second category "pure" research, but I think that betrays a bias against working on more practical problems.)
Honestly it will mostly be category 1 to start, but there is at least one category 2 project we want to pursue.
Hi @sama, i'm from brazil and ceo of an edtech startup. we're profitable, with 60 employees and a lot consumer traction/revenue, but didn't raise a series a yet. questions: 1) what advice would you give to applicants from brazil and other large countries (india, china, russia), whose products initially target their local markets? 2) what advice would you give to post-seed and pre-series a applicants? when (if at all) would you consider them "too big for yc"? 3) if you select a post seed startup, would yc invest at their latest valuation, or would it only offer the standard deal, even if it would be a "down round" for current investors? heard you are visiting india and know you've been to mexico not long ago. ever thought about coming to brazil? best regards, bernardo
1) no specific advice--we fund lots of companies whose products target far-away markets and are particularly interested in doing so. the only different question we might ask you is "how will you handle being away from your users for 3 months?" 2) ...This knowledge is worth millions but signing up is free
When should a group of founders raise a seed round or series a?
in general it's nice to wait until you have the idea figured out and initial signs of promise before you raise money. raising money puts some pressure on the company. sometime pressure. and once you've raised money you can't be in this exploratory...This knowledge is worth millions but signing up is free
I have a question related to yc - so I think yc did a fantastic job in promoting partnership in silicon valley. in fact, I plan to invest in some in the next three years. you guys pump 180 companies per year coming to the market it looks like its hard to follow each of the yc company any more. do you think that this will create some - some people will walk away from yc because they cannot follow large batch of companies and the company had to be very polished and the firm had to be think of the world about ideas?
Alright so I think the question is do I think investors are going to fund less yc companies as we grow. no. definitely not. like certainly the trend in this is the other way. we have more and more investors saying that half their portfolio is not ...This knowledge is worth millions but signing up is free
There's a certain market that you’re really excited about that don’t necessarily know all about yet - is there a certain track you recommend or ways to?
If there's a market that you’re excited about but don’t a lot about yet what should you do? two schools of thought on this. one is to just jump right in. learn it as you go. that's worked a lot of times. the other is go work at another company in ...This knowledge is worth millions but signing up is free
The statistic you saying now harder to get into ycombinator than getting into harvard. so I am curious the criteria’s that you use to pick up startups. does it change over time?
The question is what criteria to pick startups and has it gotten harder? has it changed? the two things that we need to see are good founders and a good idea. and without both of those we won't fund the company. but that hasn't changed. that is al...This knowledge is worth millions but signing up is free
Is there a way to get involved in the yom community before getting accepted?
Is there a way to get involved with yc before getting funded? no and intestinally not. I say the one thing you can do is if you work at a yc company and then later apply - I think probably like - well not probably that definitely if you get a good...This knowledge is worth millions but signing up is free
What are some of the most common and alarming warning signs you should be looking for when you're trying to make the shift from building great product to building a great company?
What are the most common mistakes to make when you're shifting to building a great company? I think I went through most of them here. I tried to put everything here that I see people mess up most of the time. yes.
So when should the founders start to thinking about hire a professional ceo - a senior guy?
When should the founders think about hiring a professional ceo? never. you - if you look at the most successful companies in tech they are run by their founders for a very long time. sometimes forever. sometimes they even hire professional ceo and...This knowledge is worth millions but signing up is free
Like places outside the us?
I hesitate to make recommendations because I haven't spent enough time in the cities to really have an intuitive feel. but like - you know as well as I do the common ones people talk about start up hubs. I just can't make a personal recommendation...This knowledge is worth millions but signing up is free
I was just thinking - what do you think are the good places to start start ups?
Apart from the valley where do I think are other good places to start a startup. well I still think the valley is the best by a very significant margin. but I think it's finally maybe beginning to weaken a little bit because the costs have just go...This knowledge is worth millions but signing up is free
How many immigrant founders have you seen in ycombinator?
How many immigrant founders have we seen in ycombinator? in the last batch - I think it probably went up for this next batch. in our last batch 41 percent of the founders we founded we're born outside the us. from thirty different countries. so it...This knowledge is worth millions but signing up is free
So we talked a lot about the startups growing but most startups fail. any advice for how to fail gracefully?
Yeah. yeah. great question. we should have covered that. how to fail gracefully. so, most startups fail and silicon valley almost goes too far on how it loves failure. failure still sucks. you should still try not to fail. and this whole like th...This knowledge is worth millions but signing up is free
So what are some examples of ways to make up productivity on a personal level? how do you do that on a personal level and also on an advance level?
How to keep track productivity systems. so, the one I use which I actually thinks works really well is I keep one piece of paper with my goals for sort of three to twelve month time frame. and I look at that every day. and then separately I keep o...This knowledge is worth millions but signing up is free
You hold that diversity is important, but an earlier speaker said that diversity wasn't important and that you should just hire people that are very much like you and trust you...
So the question is how you square the device of diversity being important with earlier speakers saying that you want people that are very similar. the difference is that what you want is diversity of backgrounds. but you don't want diversity of ...This knowledge is worth millions but signing up is free
Do you have any advice or comments on the complexity that comes with working with cryptocurrencies or cryptoequities?
Oh wow. that's a tough question to end with. yes, there are some issues. often banks struggle to deal with companies that are working with cryptocurrencies because they haven't quite figured out how to deal with that sort of thing yet. generally a...This knowledge is worth millions but signing up is free
All things considered, what should be my budget for incorporating, for the lawyer, for getting the deal to buy for my effort seed rounds? and then for hiring the first employees. how much money should I set aside for that?
In terms of incorporation, don't spend a dime on that. you can do that online. well, actually it does cost a little bit. incorporating online using a service like clerky is inexpensive. in the hundreds, not in the thousands. you don't need a lawye...This knowledge is worth millions but signing up is free
How do you find one?
Finding one is tough. the best is through recommendations. with any kind of specialist, a cpa or an accountant or a lawyer, it's always best to use people who are used to dealing with startups. not your aunt who lives in minnesota and doesn't actu...This knowledge is worth millions but signing up is free
What’s the decision making process between making unrelated products and saving space for fitness tracking, for different versions of or jambox. what goes into that?
We have a grand unified theory about how these experiences come together. what happens, it touches a little bit on the context engine, when you have things on your body that can make everything in the world around you smarter. if I know the emotio...This knowledge is worth millions but signing up is free
Should we start focusing on one small thing or should it focus on the system itself?
A system is a mindset. it's not actually a system. there are simple systems. there are complex ones. a plane is a very complex system. a car is a very complex system. there are other products we make that are much simpler. a phone is a complex sys...This knowledge is worth millions but signing up is free
So let's say you have a product. you have all these features that you want to create. you're about to enter to the design process. how do you approach the whole problem? how do you break down how it is going to solve the problem? but then, each design feature is not mutually exclusive. how do you approach it holistically? when you have a number of different features and functions that you are trying to build, how do you look at them on a system level rather than in a silo to understand what the tradeoffs are across the entire system?
That's the answer to your question. you do exactly that. you don't think about it in a silo. when it’s a small team, it's really easy because you all are sitting around the table. you're looking at each other. you are making those decisions in rea...This knowledge is worth millions but signing up is free
How do you give good user feedback if you're a user?
How do you give good user feedback? I want a user to tell me what they are really thinking. what their problems really are. to just sort of ramble. I want someone to just tell me about stuff in their life. the more you learn about them as a person...This knowledge is worth millions but signing up is free
In the beginning the video gaming industry was decentralized. there wasn't a lot of cohesion, but now it's very different. you said you originally spoke to broadcasters and streamers themselves. how has that changed? for example, ? has banned users or professional players from streaming their own stuff. did you try to gain leverage with that?
Yeah, so the question is about the game publishers. game publishers are important people in the space. any big company for that matter isn't going to give you the time of day as a small startup. which is both good and bad. it means you don't need ...This knowledge is worth millions but signing up is free
In finding groups of people that can give different kinds of feedback, is there a group that you should focus on first?
Given that we had very limited resources, we focused on the people using competing products. we knew that they were already interested in the behavior that we needed and they were willing to do it at all. therefore all we had to do was convince th...This knowledge is worth millions but signing up is free
What about onsite user feedback tools?
This is a whole second set of user feedback that's really important. you're talking about when you have a new product and you want to see if it's actually going to work or not. you put it in front of people and see how they use it or not. that is ...This knowledge is worth millions but signing up is free
What channels do you use to reach out to them? and do you ever compensate them?
The channels we used to reach out to them were onsite messaging systems. most websites have some way to contact the user. if they are a visible user of another website, you use that site's messaging system and say, "hey. I was watching your stream...This knowledge is worth millions but signing up is free
What about the international market? you mentioned that you have a lot of users in korea.
That's really hard. to this day twitch works way better in english speaking countries than it does in non-english speaking countries. a big part of that is we are much better at talking to people in english speaking countries and learning what the...This knowledge is worth millions but signing up is free
Since you mentioned recording, did you try to insist on doing skype interviews rather than over email?
You definitely want to skype. you don't want to do interviews over email if you can avoid it, because interviews over email are non-interactive. the most interesting learnings come from the, “interesting. tell me more." the instant you hit this ve...This knowledge is worth millions but signing up is free
How hard was it to get buy in from the rest of your company? you can say, "i'm in charge so you're doing what I say" but that's probably not the best way of doing it.
That's a good question. if you just go to them and say, "i talked to the users. I figured it out. we have to build this," it's really hard because people don't trust you. there's something magic about showing them the interview though. I recommend...This knowledge is worth millions but signing up is free
What do you see startups get most wrong about interviews? most startups don't do them at all, but the ones that do, what are their most common mistakes?
The most common mistake is showing people your product. don't show them your product. it’s like telling them about a feature. you want to learn what's already in their heads. you want avoid putting things there. the other thing is asking about you...This knowledge is worth millions but signing up is free
Putting yourself in other people's shoes is very important. can you give us some tips?
Putting yourself in other people’s shoes is difficult in management. it's hard in daily life. it's even harder in management because it's the stress at the moment. if a great employee is asking you for a raise, it is very hard for not to respond b...This knowledge is worth millions but signing up is free
I am curious to learn how you have built a culture around people and among the entrepreneurs that you work with that has differentiated you in the market from all the other venture capital firms.
Probably not the best question for me. I can ask sam that. I don't know. the question is how we do build a culture out at andreessen horowitz that is differentiated us from all other vc's. I feel like that is certainly the goal. we have been aroun...This knowledge is worth millions but signing up is free
How do you incorporate toussaint's ideology and get people who were previously against you on your side?
What he did in general is the right thing. you have to show them a better way, as a leader, if somebody's your enemy and you need to convert them. this happens in business too. somebody is a competitor and you want to bring them over but you don't...This knowledge is worth millions but signing up is free
I was reading your book yesterday. how did you deal with all the stress? was it meditating? hip hop?
The answer is I used to be 6 foot 4 and good looking so clearly not very well. I get asked that a lot and I have a great answer for it. I have a wonderful wife who is sitting right here. I will oar and he borrowed that technique from him but appli...This knowledge is worth millions but signing up is free
If you have to fire or demote an executive, how do you have the conversation and then how do you explain it to everyone else?
Right, this is great question. clearly it's some kind of failure. you failed on hiring. you failed on integrating. they failed at their job. the first thing when firing the person is to really try to be honest. you're feeling like you failed. comm...This knowledge is worth millions but signing up is free
Can you talk a little about the tactics of how you manage people? how often do you meet with them?
So the canonical advice sounds obvious but was radical back in 1982 when andy wrote his book, is to have a one on one roughly every two weeks. some people say every week, but I wouldn't go longer than two weeks. every week can be ideal in many com...This knowledge is worth millions but signing up is free
So you talked about making compensation transparent. how would you do that, especially when people equate themselves to the value of how much their salary is?
I would do it probably in bands. you can do it, just everybody in the company gets paid the same. or you could have all discipline, all engineers-- or you could do it by experience. how steve did it at next was there was a high band and a low band...This knowledge is worth millions but signing up is free
How do you know when to pivot?
Part of the reason why having an investment thesis and your confidence in the rest of the place and being pretty clear on that is generally speaking the answer I give to people is if your confidence is unmeasured for a fairly long time or is decre...This knowledge is worth millions but signing up is free
So different founders, different areas. how do you identify them?
The talk was aimed at what is unique about the mindset I think of founders. there is great founder across all. all founders-- there are differences. for example, in software speed to market, speed to learning is really key. in hardware if you scre...This knowledge is worth millions but signing up is free
What makes a great co-founding team and what makes a good way to evaluate a co-founder?
The first thing is, it's super important to collaborate really well. that was the point I was making during the team. if in fact you don't have serious trust-- so the key thing is when you are thinking about founders is do you have a diversity of ...This knowledge is worth millions but signing up is free
What is it that gets you wrong about someone who is going to do the distance?
To some degree you can only fully cross these minefields by going and doing it. so you can be wrong about your hypothesis. the kinds of things that frequently get you wrong or you think a person--- for example I frequently use in interaction is I ...This knowledge is worth millions but signing up is free
How do you keep persistence when starting?
Well LinkedIn went through, for those of you who remember we were treated as the little alternative to friendster, then myspace, then Facebook. we had a lot of the, we are the little tiny one next to these respected giants each at the time. ultima...This knowledge is worth millions but signing up is free
Do you believe destiny of insight to be a great signal for great founders?
I would definitely say that the ability to say coherently what you are targeting, to articulate something that isn't trying to boil the ocean, or a swiss army knife approach. one focus, like you are right about this and it works. that is actually ...This knowledge is worth millions but signing up is free
How do you know if someone is a good founder or not?
I'm a huge believer in references. I only meet with someone when they come to me through a reference. so one of the things by the way is after this I have to run off because I have a meeting to get to. if you want to get time and attention with me...This knowledge is worth millions but signing up is free
I'm curious how you targeted, you selected a different strategy to strengthen your investment thesis and help it take off. it seems like every startup faces that same challenge.
So one really fundamental thing is to think about product distribution as key. and for LinkedIn we had a couple things going for us. one, the web was boring in 2003. basically what happened was everyone thought that consumer net was over. so peopl...This knowledge is worth millions but signing up is free
One more question, the question is, in this particular situation with airbnb, a lot of people think it is not necessarily a technology company, but more of a marketing company.
It’s a totally fair question and people have said it so I want to answer it. the guy who owns sequoia capital, his name is doug leone. one day, I think it was a year, year and half ago, he says, your job sucks. and I was all, what the hell does th...This knowledge is worth millions but signing up is free
You talk about conventions, what did you do when you had no money and you only got paid for those who used your site. what did you do to scale that up? how did you get users to the site.
So this is not about culture, but I will answer it anyway. the best advice I ever got was probably from paul graham. paul graham said, I remember he had this line, it's better to have a hundred people that love you than to have a million people th...This knowledge is worth millions but signing up is free
Brian, airbnb has made some great contributions to the open source community. do you have any thoughts on how that contributes to your culture and company values?
Yeah, I think just in general, it may be related to two things about airbnb. we tend to be a pretty open culture just in general, we believe in a shared world where people are giving back, contributing to making communities and industries stronger...This knowledge is worth millions but signing up is free
What is the ideal board structure?
We are fortunate to have, there’s myself and my co-founder and a partner from andreessen horowitz. I think it removes the fear, creates a little more trust. it removes the fear that someone is going to come in and fire you arbitrarily because it's...This knowledge is worth millions but signing up is free
What would convince you to invest in a company with no product to show. what do you make that judgement based on?
What would convince us, is what usually convinces us, is the founder and their team themselves. so we invest in people first, not necessarily the product idea. the product idea tends to morph a lot. so we will invest in the team first. if it’s pre...This knowledge is worth millions but signing up is free
What is the constraint on how many companies you guys have invested in? time, money, or lack of good companies?
Sv angel has kind of got comfortable with one a week. you certainly can’t do more that that, and that is a staff of thirteen. so it's really the number of companies.
What is a sign you should not work with an investor?
Well it is the inverse of what I said about a good investor. if it is an investor that has no domain expertise in your company, does not have a rolodex where they can help you with introductions both for business development and in helping you do ...This knowledge is worth millions but signing up is free
If you intend to start a business that is capital equipment intensive, do you guys have any advice on how to deal with demotivation? so not everything starts in software, viral, or anything else? what should founders do for capital equipment intensive companies?
I would double down on my previous comments on the onion theory of risk and the staging of risk and cash. which is the more capital has the business, the more intense you have to be about exactly what is going to be required to make a business wor...This knowledge is worth millions but signing up is free
So obviously the conventional wisdom of why you raise money is you need it. but the more I get off conventional wisdom the more I hear another story on why you raise money. I am actually hearing founders say it is more to facilitate the big exit. or in the worse case the acqui-hire instead of fizzling out into nothing. to what extent is that accurate thinking?
Well if you pick good investors who have good rolodexes and good domain expertise in what your company does, they are going to add a lot more value than the money. those are the types of investors you should be looking for.
One more question before we open up for the audience to ask questions. for ron and for marc. could you both tell a story about the most successful investment you ever made and how that came to happen?
Other than zenefits.
Is there a maximum in the company that you think founders should sell in their seed round, their a round? beyond what paul was talking about.
I don't know the rules on this stuff. the tricky thing is, it seems like they are particularly rough for a series a. you are probably going to sell somewhere between twenty to thirty percent of the company. below, venture capitalist tend to be a l...This knowledge is worth millions but signing up is free
So how do you think about negotiation? how do you figure out what the right evaluation of their company should be, what are the terms?
Well when I was starting out, I was raising my seed round and I didn’t really know. I mean, we had conversations about this. I probably started a little too high on the valuation side. as you guys know, y combinator starts this thing called demo d...This knowledge is worth millions but signing up is free
Speaking of terms. what term should founders care most about? and how should founders negotiate?
Probably precisely because of what marc said, the most important thing at the seed stage is picking the right seed investors because they are going to lay the foundation for future fundraising events. they’re going to make the right introductions,...This knowledge is worth millions but signing up is free
I want to talk a little more about tactics here. just how does the process go? can people email you directly or do they need to get an introduction? and how many meetings does it take to make a decision? how do you figure out what the right terms are? when can a founder ask you for a check?
Yeah so, sv angel invests in seed stage startups, so we like to be the very first investor. we normally invest today at around the million to two million. it used to only be a million. so if we invest two hundred and fifty k, that means there’s fi...This knowledge is worth millions but signing up is free
What do you guys wish founders did differently when raising money? and specifically, marc, you mentioned this relationship between money and funding?
I think the single biggest thing that people are just missing and I think it’s all of our faults, we are all not talking about it enough, but I think the single biggest thing entrepreneurs are missing both on fundraising and how they run their com...This knowledge is worth millions but signing up is free
Parker, could you talk about your seed round and how that went and what you should have done differently for raising money?
Sure, actually my seed round, most of the stuff with my current company felt like, from a fundraising perspective, felt like it came together relatively quickly. but actually, one of the experiences I had, I started a company before this that I wa...This knowledge is worth millions but signing up is free
What made you decide to invest in a founder company?
So what makes us invest in a company is based on a whole bunch of characteristics. I have been doing this since 1994, right before marc got out of the university of illinois, so sv angel and its entities have invested in over 700 companies. to inv...This knowledge is worth millions but signing up is free
How much of a role did you guys play in getting the pokemon thing out?
Twitch had this thing called "twitch plays pokemon" where developers set up a pokémon gameboy game that was controlled by chat, so millions of people would be typing in a or b, and the character would wander around aimlessly. that was a huge news ...This knowledge is worth millions but signing up is free
Are nonprofits your biggest customer base?
No, today our biggest customer base is entrepreneurs who are trying to build brands and businesses. we have a little over 1000 people who make their full-time living on teespring today via brands they've launched. and the other side is influencers...This knowledge is worth millions but signing up is free
What convinced you to get into the market of t-shirt printing when there is so much competition in this business?
I think there are two factors to it. first, I completely agree. from the outside, people have been telling us that this is a silly idea since day one in every order magnitude we reach. people will come and say, "this is a terrible idea. why are yo...This knowledge is worth millions but signing up is free
Are there any tricks or experiments that didn't work out in your company?
Okay i'll talk about one. so one of the things that we did early on to try to motivate ourselves was - like, we understood the idea of crunch mode, and that it's really bad for people. like if you're doing the subscription business, you need peopl...This knowledge is worth millions but signing up is free
How do you hire people that can work remotely and work in this fashion?
Pretty easily, you have them work on a side project for you. so you contract them out, and have them work remotely as such. usually the projects I like to have them work on are about one month long so you can get a good sense of how people manage ...This knowledge is worth millions but signing up is free
How do we set up accountability for our employees as a manager?
We were profitable nine months after launch, so we had profit-sharing, which makes incentives pretty simple and clear. it would be a multiple of whatever sort of bonus pool that we had, and performance measures would be based on how they did in cu...This knowledge is worth millions but signing up is free
You said you guys all work from home, which usually seems like a nightmare. how did you make that work?
We all work from home, and we all work around the tampa bay area. we would allow anyone to work from anywhere but usually as we tried to recruit them and meet our team, they usually decided to come and move here anyway. remote working is especiall...This knowledge is worth millions but signing up is free
Can you relay the story about how the king for a day thing was good at wufoo?
Yeah, okay so I don't like hackathons. I think they sort of suck in terms of those done inside of companies because you spend like 48 hours working really hard on something that you're really passionate about, and 99% of them never make it out to ...This knowledge is worth millions but signing up is free
How do you make a decision on product and communicate that with your engineering team when there are lots of different directions to go?
We just looked at customer support, which is really easy because you see what people are having the most amount of trouble with. you cannot help but get feature requests from people. no matter whatever openings you have in your product or app, peo...This knowledge is worth millions but signing up is free
How do we balance being obsessed with working on product with all the other skills that are needed by a company, such as marketing, branding, etc?
If you're working on product, you should also always have this flip-side where you're talking to users. for us inside of wufoo, the way we got people to talk to users was through customer support. they got to see firsthand whether the features wor...This knowledge is worth millions but signing up is free
So what do you do when you have a product with many different types of users? how do you build one product that all these users love?
There is an interesting fine line for that. what I usually tell people is focus on those who are the most passionate, especially in the early stages. whatever niche it's going to be in, that's where i'm going to focus on completely. I think ben si...This knowledge is worth millions but signing up is free
If someone worked at goldman sachs out of college and left after six months and is now studying cs at stanford, how would you recommend rethinking their competitive advantage?
I am not great at the psychotherapy stuff, so I don't quite know how to solve this. there are these very odd studies they have done on people who go to business school, this one was done at the harvard business school where it's sort of the anti-a...This knowledge is worth millions but signing up is free
Doesn't the last mover advantage already imply that there's competition to begin with?
Yes, there's always a terminology thing. I would say that there are categories in which people sort of are bundled together. the monopoly business, I think they really were a big first mover. in some sense you can say Google was not the first sear...This knowledge is worth millions but signing up is free
What do you think about lean startups?
So the question is what do I think about lean startups and iterative thinking where you get feedback from people versus complexity that may not work. i'm personally quite skeptical of all the lean startup methodology. I think the really great com...This knowledge is worth millions but signing up is free
How does this apply to palantir and square?
That's sort of a set of companies that are doing different copycat payment systems, on mobile phones, there's square, there's paypal, they have different shapes that's how they differentiate themselves, one is a triangle, one is a square. maybe at...This knowledge is worth millions but signing up is free
So which of the aspects, of all these you mentioned, you would you say is applicable to Google?
Well, they have they have network effects with the ad network, they had proprietary technology that gave them the initial lead because they had the page rank algorithm, which was an order of magnitude better than any other search engine. they had ...This knowledge is worth millions but signing up is free
Do you have any ways to determine the difference [between a monopoly and a non monopoly] when looking at an idea or thinking about your own idea?
I would say the question I always focus on is what is the actual market? so not what's the narrative of the market, because you can always tell a fictional story about a market: it's much bigger much or smaller, but what is the real objective mark...This knowledge is worth millions but signing up is free
So one question online was if your users already have a product that they are already comfortable with how do you get them to switch to yours?
There is always a switchover cost. I will tell you the example of homejoy. we were actually creating a new market in the sense that a lot of our initial users had never had cleanings before so it was pretty simple to get them on board. and a lot o...This knowledge is worth millions but signing up is free
If you hire people you like, you might get a monoculture and how do you deal with the blind spots that arise?
Starting a startup is where many things will be going wrong. you can't expect it to be perfect. the advantage is of hiring people you know and like are far greater than the small disadvantage of having some monoculture. you look at it empirically,...This knowledge is worth millions but signing up is free
Do you like snapchat?
Snapchat? what do I know about snapchat? we didn't fund them. I want another question.
You mentioned that it's good advice to learn a lot about something that matters, what are some good strategies to figure out what matters?
If you think of technology as something that’s spreading as a sort of fractal stain. anything on the edge represents an interesting idea, sounds familiar. like I said that was the problem, you have correctly identified the thing I didn't really an...This knowledge is worth millions but signing up is free
What kind of startup should not go through incubation, in your opinion?
Definitely any that will fail. or if you'll succeed but you're an intolerable person. that also sam would probably sooner do without. short of that, I cannot think of any, because a large percentage, founders are often surprised by how large a per...This knowledge is worth millions but signing up is free
I know you talked a lot, earlier, about you'll know when your start up is doing extremely well, but I feel like in a lot of cases it's a gray line, where you have some users but not explosive growth that is up and to the right, what would you do or what would you recommend in those situations? considering allocating time and resources, how do you balance?
When a start up is growing but not much. didn't you tell them they were supposed to read do things that don't scale? you sir have not done the readings, you are busted. because there are four, I wrote a whole essay answered that question and that ...This knowledge is worth millions but signing up is free
When is a good time to turn a side project into a startup?
You will know, right. so the question is when you turn a side project into a startup, you will know that it is becoming a real startup when it takes over a alarming large percentage of your life, right. my god I've just spent all day working on th...This knowledge is worth millions but signing up is free
What are your reoccurring systems in your work and personal life that make you efficient?
Having kids is a good way to be efficient. because you have no time left so if you want to get anything done, the amount of done you do per time is high. actually many parents, start up founders who have kids have made that point explicitly. they ...This knowledge is worth millions but signing up is free
What would you learn in college right now?
Literary theory, no just kidding. honestly, I think I might try and study physics that’s the thing I feel I missed. for some reason, when I was a kid computers were the thing, maybe they still are. I got very excited learning to write code and you...This knowledge is worth millions but signing up is free
No, like idealab, garrett camp’s new one...
It probably is true that women have a harder time raising money. I have noticed this empirically and jessica is just about to publish a bunch of interviews on female founders and a lot of them said that they thought they had a harder time raising ...This knowledge is worth millions but signing up is free
I am seeing a trend among young people and successful entrepreneurs where they don’t want to start one great company but twenty. you are starting to see a rise in these labs attempts were they are going to try to launch a whole bunch of stuff, I don't have any stellar examples yet.
Do you mean like ideo?
Do you think we are currently in a bubble?
I’ll give you two answers to this question. one, ask me questions that are useful to this audience because these people are here to learn how to start startups, and I have more data in my head than anybody else and you're asking me questions a rep...This knowledge is worth millions but signing up is free
So is it just a big no no, someone has to be managed no way they should be on the founding team.
In the case were you are doing something were you need some super advanced technical thing and there is some boffin that knows this thing and no one else in this world including on how to wipe his mouth. it may be to your advantage to hire said bo...This knowledge is worth millions but signing up is free
Management is a problem only if you are successful. what about those first two or three people?
Ideally you are successful before you even hire two or three people. ideally you don't even have two or three people for quite awhile. when you do the first hires in a startup they are almost like founders. they should be motivated by the same thi...This knowledge is worth millions but signing up is free
Do you see any value in business school for people who want to pursue entrepreneurship?
Basically no, it sounds undiplomatic, but business school was designed to teach people management. management is a problem that you only have in a startup if you are sufficiently successful. so really what you need to know early on to make a start...This knowledge is worth millions but signing up is free
Sure we will start with two questions. how can a nontechnical founder most efficiently contribute to a startup?
If the startup is, if the startup is working in some domain, if it’s not a pure technology startup but is working in some very specific domain, like if it is uber and the non technical founder was an expert in the limo business then actually then ...This knowledge is worth millions but signing up is free
How do you deal with burnout while still being productive and remaining productive.
The answer to this is just that it sucks and you keep going. unlike a student where you can throw up your hands and say you know i'm really burnt out and i'm just going to get bad grades this quarter, one of the hard parts about running a startup ...This knowledge is worth millions but signing up is free
How do I identify if a market has a fast growth rate now and also for the next ten years?
The good news about this is this is one of the big advantages students have. you should just trust your instincts on this. older people have to basically guess about the technologies young people are using. but you can just watch what you're doing...This knowledge is worth millions but signing up is free
Hi sam, I am a 28 year old project manager. how can I help ycombinator?
Work at a yc startup!
Does yc fund stealth startups?
Maybe we do and maybe we don't...
How many companies/startups will actually be chosen to enter the batch?
We never set this ahead of time--it really depends on how many companies apply that we want to fund, subject to the constraints of how hard the parters can work. i'd guess in the range of 100-130, based on current application volume. we had a big ...This knowledge is worth millions but signing up is free
Most people fund ideas, some fund founders. what do you think about funding dreams?
Isn't that what ideas are?
Why don't even the best vcs publish returns? does yc plan to?
I don't know why most don't. ours sound silly. the irr is way over 100%, but on a relatively small amount of capital.
Hi sam, is it ok to seek advice from partners and get feedback and improve on the application? just would like to increase the odds. thank you.
Out of fairness, the partners can't really give you feedback. you can reach out to alumni, though.
Hello sam how do you get the (gut) feeling that you should definitely invest in a particular idea (or company)? (how do you make such a decision)?
One thing I always think about is if I would take the ceo job at the company if they offered it to me.
I'm still working on building a prototype so I can earn a cofounder and future employees. i'd say i'm 2-3 months off from having the mvp done. should I apply to yc?
You could, there's not much downside and you can reapply if you don't get it. but your chances sound significantly higher for the the next batch.
Do you accept some teams without a business model?
Yes, but not without an idea. we tried funding teams with no ideas at one point. it didn't work. it turns out that good founders always have ideas.
What must one do to acquire one of those cool y combinator sweatshirts I see floating around san francisco? store.ycombinator.com in the works? :)
One gets made for each batch. apply!
Any plans to host a startup school conference in asia ?
Yes, this year.
Is it common that you fund startups with big/growing competitors?
All the time.
What advice do you have for junior devs who want to work at an early stage startup?
Join a rocketship. (ideally one in the yc portfolio :) )
What's yc's valuation?
A lot, but it's very illiquid.
Sam, does every application submitted, before the deadline, get seen and on average by how many reviewers?
It at least gets seen by our alumni reviewers, and at least 3 of them. they pass about half the applications on to the yc partners.
Dunno if this has been asked already, ever think about doing a yc in in dublin, ireland?
We fund companies from all over the world. the sacrifice of moving for 3 months pales in comparison to other sacrifices you have to make to start a successful startup.
I know a lot of yc alumni, are endorsements about quality or quantity? are they important?
Quality far above quantity. a large number of weak endorsements really hurts your chances.
Any interest in a y combinator ipo?
No. that got a quick involuntary shudder out of me.
What does it mean to be president of yc?
Blah blah something about herding cats blah blah
For people with immigration issues, does yc have any plans on expanding to asia or europe in the coming few years?
No, but we help with immigration issues.
Is there a chance to be approved if my startup is an incubator/accelerator a la yc in another region of the world?
Definitely a chance, but if you want to get into yc you should just apply to yc. it usually hurts you if you've gone through another accelerator because our bar is much higher. in that case, we expect you to be already accelerated, and we find tha...This knowledge is worth millions but signing up is free
Do you start reading the application on the 27th? if someone was to submitted early but was continuously updating till the deadline, which application do you see? thanks.
We start right after demo day (the 24th). it's possible we'd read an earlier version--if you're going to make big changes, hold off on submitting.
What do you think of similar structures burgeoning in europe? - are they a good first step before applying to yc?
In general, no. if you want to apply to yc, just apply to yc. going through some other program first is a negative--the advice is usually bad, there's extra dilution, etc.
How about health drinks / food? do you know if yc would have any interest or expertise to help natural food companies? like kambucha is $600m company now.
It's out of our area of expertise, but again, if we can understand why it might be a $10b company, we'll fund it.
I was curious what types of tools or applications yc uses to operate (manage applications, track feedback, or schedule meetings, etc.)? can you share your stack?
We build our own tools mostly.
Does the current partnership explicitly cap the partner count or is there some point in the future where you think it would make sense to cap the number of partners?
No and probably not.
Hello! are partners chosen specifically for each interview (e.g. people with knowledge of the market), or are the tracks split up between groups of partners randomly?
We randomize everything first, and then look through each morning to see if some interviewees need domain expertise, and then swap those around as best we can.
When should a startup start to monetize? currently we are building a user base and iterating the product based on feedback. what do you think about delaying monetization?
Totally depends on the startups. in general it's good to monetize early, but there are very important exceptions. this is the sort of thing we have to give individualized advice about to every yc company.
What's your thoughts on teams that are applying from london?
We are excited about teams applying for anywhere in the world! a huge percentage of the startups we fund come from outside the us.
Which do you prefer most in an application: what the app currently does (or will do in three months)? what the future app might look like in five years? and/or: how it will get there?
Both. clearly explain what you do right now, and where you want to be in five years.
Have you ever considered funding enough to attract people who have financial obligations, such as kids, a spouse and a mortgage? it seems like a huge, untapped, resource that no one else is going after.
People in that situation usually save up money before applying to yc. I think this is the right answer--it seems important to startup's health that they get started on little capital.
What is the ratio between the businesses that yc funds that have revenue and don't have revenue? what about having a significantly large amount of traction (i.e. few thousand users in the first week of beta)
Most have no revenue, or very little. most companies we fund have some sort of prototype, but some of the best ones don't.
I know there was one aerospace startup in w15 but are space startups out of yc's scope?
That particular startup is building rockets, so no.
How often does yc fund early stage companies that don't even have a functional prototype?
Somewhat frequently, but we always ask why the company doesn't have a prototype.
Hey sam, i'm getting married in july, if I were accepted into yc, is there anything like deferring enrollment?
We've done it once or twice, but why not just apply for the next batch?
Would you ever consider investing startups in defense industry? for example a startup that builds anti-drone systems etc?
Yes, definitely.
Thanks for the ama. you haven't answered the hardware related questions in this thread yet, so i'll try: do you think you'll see the day when yc funds a hardware startup that develops custom asics or semi ip for licensing? if so, what type of startup would be a good fit for yc?
I predict that will happen in the non-distant future.
Hi sam, i'm currently a highschool junior and the co - founder of enerscore. i'm aware that yc has a semi-preference for younger founders as you said so yourself, but I wanted to know how yc might view me being this young. will it count against me in my application, or is yc more focused on the product itself?
The only hard disqualifier is if no founders are 18 or older, because you can't sign contracts in that case. i generally do not think it's a good life decision to start a company when you're 16 or 17, and i'd suggest waiting a couple of years.
I've been closely following yc and the startup scene in sf. what's your advice to a startup, applying to yc this season, and is from a foreign country? I've read most your writings and watched few interviews as well. it'd be great if you have something to add! and thanks for the ama!
It doesn't hurt or help--we fund lots of founders from foreign countries (more than 40% of the last batch was born outside the us).
What do you think are the most difficult problems, or types of problems, yc as its own organization will face in the future?
Scaling up the number of people in an organization and maintaining innovation is always, always hard.
The yc application asks teams to discuss their current equity split / legal situation. what happens to teams who haven't figured that out, or are looking for advice on those matters from ycombinator? will an uncertain equity plan or organizational structure kill an otherwise exciting application, if they are open to advice?
No, you can just say "we're still figuring this out, but here is about what we're thinking". leaving this question unanswered for a long time is a sign of badness, though. it's important to resolve this quickly and move on to the real work.
How does the partnership structure work at yc? what does it mean to be a part-time partner? do all partners get carry?
It's a flat partnership--we all get the same economics (including me). if you want a salary, it trades off against your equity. part-time partners get less equity and spend less time on yc.
Do you think that yc's batch model will one day be eschewed in favor of something more seamless and less dependent on timing? one could argue that, for certain startups, the optimal play right now is to launch just prior to submitting a yc application. it takes advantage of the high traction surrounding launch, and avoids applying in the midst of a typical post-launch slump, if timed correctly.
We might do something like rolling admissions, but the advantage of the batch model are huge. it's so helpful to the startups to be around other startups at roughly the same stage.
How do you spot grit and perseverance in an entrepreneur?
We ask about when they've done the impossible. you also get a pretty good feel for this after asking someone hard questions for 10 minutes. not pushing back at all is bad, and pushing back too hard is also bad.
Is yc interested investing in international remittance startup?
Yes! sendwave.com is one of our companies, and they are doing phenomenally well. they have a chance of being the best pivot in the history of yc.
Hi sam! as a high school student / developer with a (seemingly great) idea and no same-age peers, would you suggest waiting until college to find a cofounder, or going through with the idea now alone?
Tough one. i'd probably suggest going to college to meet cofounders.
What should founders do about the rent?
It's really just way too damn high. live in somewhere like sunnyvale or san jose, maybe.
Do you anticipate that putting together a structure for companies looking to perform long-term technology development ( i.e. three years, five years) is something yc would have on the board?
We fund a lot of 3-5 year horizon companies. 10-20 years is harder. this does not work for startups. I have a few ideas I want to try, though.
Where do you see yc 10 years from now?
The evolution of the university. but I think it's a much better model--it's got just the right amount of decentralization, it attracts the best people in the world to one place because of the network effect, we pay you instead of the other way aro...This knowledge is worth millions but signing up is free
What frustrates you the most about yc? what would you like to see change?
It seems like a bad thing that yc has gotten to the point where people stop me on street and ask to take a selfie. i'm not sure what to do about it, though.
When applying to yc, if you have a four or five person start-up team, if one member isn't able to come to silicon valley, but the rest are (3/4 or 4/5), how much does that penalize you?
The big problem is a 4 or 5 person founding team. that's a high bar to get over (but possible, one startup I really like in this batch has 5 founders). be so good we can't ignore you.
What is your favorite interview question to ask?
Why do you want to spend the next 10 years of your life working on this?
Hello sam, any plans to open up a yc hub in mexico. the startup scene is in an infant stage but it seems to be growing very fast. 500 startup is already funding companies here[1]. thank you! [1] http://500mexicocity.com/
No--but we are delighted when founders come here, learn and make connection in sv, and then go back to their home country!
How would you spend this week if you were applying?
Talking to users, and telling us what you've learned from them.
Are you going to do another semester of "how to start a startup" classes at stanford?
I might do a sort of graduate school version--i.e. "how to scale a startup"
What are the chances of getting funding if I want to focus on my home country (brazil) as my main market?
That's a feature, not a bug.
Had you not been accepted into yc, what was your plan of action?
I was going to work on my startup either way. I had a plan b investor that would have been not nearly as good.
What is the most critical element in driving growth for a startup?
Making a product that users love. http://blog.samaltman.com/the-only-way-to-grow-huge
I think most of the yc funded startups have good ideas, but some of the more recent batches (past three years) seem to have a much smaller market than the earlier batches. has there been a conscious decision to move to more niche markets, or has that just been where the chips fell? also, why has the average age of the founders yc funded slowly been rising?
Ideas look niche when the companies are starting out. as peter thiel says, you first want to dominate a small market. most great companies were derided for focusing on a small niche when they first started. i think the average age has risen someth...This knowledge is worth millions but signing up is free
For hardware cos applying to this batch, the bolt collaboration sounds awesome. since bolt has super expertise in prototyping, is it an indication that hardware ideas with an idea only or partial prototype can get accepted? how can such co.s improve their chances further, compared to software co.s where making a proof of concept barely costs any money?
Yes, we will fund hardware companies with only an idea in some cases. however, the cost and time required to make a prototype has come down so much that most applicants have something built.
What stage would be ideal for considering moving a project from research (at the graduate university level) to a startup? in this case i'm referring to a project that is based on custom nanoscale hardware components that rely on some pretty groovy physics. the applications are pretty immediate and the market already exists in the biotech/healthcare field.
I think startups are not well-suited for open-ended r+d unfortunately (hoping to do something about this). the best time to move from research to a startup is when you've developed technology and have a plan to make it into a product people will w...This knowledge is worth millions but signing up is free
Could you elaborate on what external factors and/or internal improvements are driving you and the team to again develop a larger number of companies per yc batch? is the scale-up going well? background: http://blogs.wsj.com/venturecapital/2014/05/05/y-combinator-... thanks!
There are just so many good companies applying. as long as we can keep upping the quality bar, i'm happy for us to fund more companies. i think there is good chance that there are more than 1 billion-plus dollar companies in the current batch. yc ...This knowledge is worth millions but signing up is free
How has the relationship between mentors/companies changed since the batches have grown? are there still ample opportunities for office hours, etc?
Unlike most other programs, yc does not have mentors--just partners that spend all their time advising startups (and some part-time partners). this is really important--most people give terrible startup advice, and people that do nothing but selec...This knowledge is worth millions but signing up is free
Do you think the increasing cost of living in the valley is detrimental to starting up?
Yes, I think it's the biggest long-term risk to the valley's continued startup dominance. http://paulgraham.com/marginal.html
Hi sam altman, what would you suggest to a new college grad? should I go work for a big companies, save some money and then go into start ups or just go into start ups ?
I wrote something related: http://blog.samaltman.com/advice-for-ambitious-19-year-olds if you have a low personal burn, you can jump right into a startup. if you have a lot of personal expenses, you probably need to save money before starting a st...This knowledge is worth millions but signing up is free
Sam, whats your take on startups targeting opportunities in developing countries ( difficult to operate terrains)? these are of course markets that have the potential of affecting billions of people.
Really depends on the specifics, but generally it's something we like.
There's a well known theory that non-competes stifles innovation and in particular ca's ban on these has allowed sv to flourish. there have been moves afoot in ma to enact a similar ban, although recently it seems to have been somewhat defanged through lobbying by the likes emc (despite still being protected by copyright, trade secrets and patents!). what are your thoughts on this; if ma is able to pass a ban on non-competed of any substance, how do you think it'll change the startup/vc scene in boston.
I think it'd be good to do this, but that the startup scene is really broken in boston for many other reasons. i'm not very optimistic this would be enough to fix it.
Does more than 1 partner review an application? and how do you maintain quality in screening applications and interview teams? is recommendations from current partners have weight-age in the screening process (from instacart application hack)?
Yes, in general about 3 partners, sometimes many more. we are very rigorous about maintaining quality and compute lots of statistics on this.
Independent of the fact that there's currently a tech bubble or not. if it hypothetically exploded, would y combinator stop its investment activities?
No, I totally ignore this. we'll keep funding good companies no matter what the macro does.
Hey sam, what is the problem/market that you think about most when you aren't at work?
Energy, existential risks to humanity, and wealth inequality.
What is the most common mode of failure in the interview stage?
Unclear communication. it's surprising how often we get 5 minutes into an interview without being able to really understand what a startup does.
Honest question on how profitable y combinator really is. what is y combinator's average portfolio return before management fees and carry?
We don't have outside investors, so there isn't fee or carry. our returns are very good (triple digit irr) but still mostly unrealized.
Having slow organic growth for our startup reduce our chances of an interview? what is the average growth week-over-week yc looks at?
Slow growth is bad, yes. a lot of our questions will be about why it's slow and how you plan to make it faster. we tell startups during yc to shoot for 10% weekly growth in their key metric.
Does yc have any initiatives planned for a founders conference that revolves around founders from urm groups, i'd love to see a conference for urm founders, similar to the female founders conference.
One of my partners is planning to do something here, but i'm not sure exactly what it's going to look like. (we run an extremely decentralized partnership.)
Hi sam, in the winter 15 class there was not a single startup from the african continent. are you guys interested in startups that are targeting emerging markets?
Yes!
What do you and the rest of yc think of dynamic equity splits? they're described in slicing the pie: http://www.slicingpie.com/ http://www.bloomberg.com/bw/articles/2012-12-18/grunt-funds-...
In general, I think fixed equity splits with vesting are the way to go. probably the optimal split is something like 51/49 (to prevent deadlocking) or 33.3/33.3/33.3 but anything near even is good enough.
Hi sam, i'd like to apply to yc, but my market is not in the us. is it something rational? does it worth?
We've funded many companies working only on non-us markets. razorpay is an example of one in the current batch.
What are your thoughts on drug use among the entrepreneur/tech communities? specifically modafinil, amphetamines, psychedelics.
The only one of those (not counting caffeine) I've tried is modafinil. the side effects are weird, but man do you get a productivity boost. personally, i'm scared to screw with my brain chemistry too much and am supersensitive to psychoactive drug...This knowledge is worth millions but signing up is free
Is there a lower preference for college-dropouts today in yc? the average yc founder age has increased considerably and I think there might be some relation.
No, if anything it's higher. I think the median age increase has more to do with us funding companies in different spaces that require more experience. if you're starting an internet company, i'm more convinced than ever that you don't need to fin...This knowledge is worth millions but signing up is free
Hi sam, how does yc look to foreign applications? do you have any plan to make improvements for participation of foreigners like visa support, logistics etc.
We help with visas. but part of being a founder is figuring out how to overcome obstacles by yourself.
Have you guys followed the alternative lending ipos recently? (lending club and ondeck in december, both with billion dollar valuations). what does yc think of the industry?
Personally, I think it's super interesting. lendup is a company we funded a few years ago, and we've done more recently.
Your recent stats blog post told us that 32 yc companies are worth more than $100 million. how many yc companies, including those acquired, are worth more than $10 million?
Counting companies that have raised with safes but not equity rounds, probably about 250-300.
I forget which speaker, it may have been peter thiel, was discussing how difficult starting a startup is at one of the startup school talks, and said "there are easier ways to make a lot of money". I would be curious if you knew what he (or whomever said that) would consider easier.
I think I was the one to say that. working in finance is an easier and more predictable way to make a lot of money, as long as you can deal with the deep existential angst the comes from adding no value to the world :)
As a proportion, how much of the value of yc is in the advice partners give, how much in the 'brand name' and network, and how much is just being around tons of smart focused people for 3 months?
I tell founders it's about 50% advice and 50% network value.
Hi sam. if the company applies for the second time with some progress made, is it treated differently, like "ahhh... the same guys. let's see what they have done since last time"? does it matter at all?
Yes. if you reapply with the same idea, the first thing we look at is progress since last time.
Hey sam, I have a product which is a direct competitor of one of yc11 companies. we have pretty decent traction, and we are solving the same problem significantly different from them. what are our chances? does yc accept competing companies?
We won't accept a direct clone, but competing companies are fine.
Competition is a tricky concept. if there is competition, that can be seen as verification of the concept, but at the same time it offers valid counterpoints. if there is no competition, it might be because the idea is so hard that nobody else has figured it out or so unpromising that everyone else dismissed it. what role does competition play in your evaluation of a startup?
I have never cared too much about "validation" or "verification of the concept". I trust my own judgment, and the companies I've made the most money on had far, far more people saying the idea was stupid than validating it. i just try to evaluate ...This knowledge is worth millions but signing up is free
What are your thoughts on advertising as _the_ way to make great services available for free (Google, reddit, Facebook, stack overflow)? what problems do you see with this model? when should this be preferred? does it only work for massive sites?
It does indeed only work for big sites. it's not the only model, but it was one that is proven and easy to understand.
Some of the advice yc partners give seems harmful because of survivorship bias (basic for the altair -> microsoft). I've seen some people criticise you for it, but I've never seen any of you address it directly. do you mind doing so now?
Most startups don't work--everyone understands the odds are long. what makes it worth it is that when they work, they really, really work. so we try to give advice about how to maybe become a huge company.
If we get an interview but aren't accepted, will you still reimburse the traveling expenses for us poor people?
Yes, of course. we reimburse travel expenses for everyone who comes to interview with us, and I think it's shameful when other accelerators don't. i probably would not have interviewed at yc if I had to pay for the trip--i was super poor at the time.
Sam, what would you say is the average amount of times a company applies before a. getting an interview at yc and b. actually getting in?
It is often on the first time. the 7th time is the highest count I know of. it's common for it to be on the second or third time. if we reject a company at interviews, we'll say what our objection is. if you reapply and that isn't fixed, you're un...This knowledge is worth millions but signing up is free
How much do you think moving to the valley improves the odds of a startups success as opposed to another city, say atlanta or raleigh on the east coast?
At least 10x
Funds need a 10x return from one company to cover the entire fund. is that a philosophy yc subscribes to, and if so, how long until it becomes evident which (if any) company in a given class will be the 10x ?
10x returns don't help us much. our entire model is driven by occasional 10,000x returns. it usually takes about 2 years to have a good sense for who is on a trajectory to maybe get there, and then about 10 years to see if they actually do.
Hi sama, you have a cs degree from stanford and you're now running yc. do you wish you had a mba or management degree or some sort? how did you learn about management even at your previous startup? in general how do founders specially who come right out of college without business degree learn to manage team as a leader? just wondering as i'm a programmer myself and would like to be in management role someday but don't plan to get degree like an mba.
No, I don't (i don't have a cs degree either--i dropped out after two years). i'm skeptical about how much one actually learns in business school, and I think it's a bad investment of time and money. I think management is one of those things where...This knowledge is worth millions but signing up is free
On evaluating applications: assuming you're looking at a solid team and a seemingly good idea, how much does having a working prototype and early traction help a startup's chances of getting into yc? is there some level of traction that makes any application a shoo-in? are there categories of startups that you won't even consider without demonstrated traction? on the flip side, what does it take to make you consider a team that has nothing built and no users yet?
A prototype helps a lot. traction helps too, but we tried not to get fooled by graphs. in fact, I always ask the other interviewers "would we fund this company if they had no traction at all?" to fund a company with nothing built and no users, we ...This knowledge is worth millions but signing up is free
I am currently applying to the summer batch and I was wondering about my setup. I came to the u.s. about four years ago and immediately built a marketing agency and after a year added software development services to it. we grew rapidly to a stable stage and now I am at the point where I can step back from taking care of the company and let my other partners manage it (we are four partners). my question is, I am applying as the only founder and was wondering if having a company already might be a deal-breaker, due to you thinking that I would not be able to invest 100% of my time into the startup? my reason for not having a co-founder yet, is because I want to make sure that I really add somebody that will 100% benefit the startup. I do have a pool of people available from my current company, but would also like to branch out first. any thought from you would be really appreciated.
Make it clear in your application you're going to spend 100% of your time on this new business.
What is the #1 cause of failure of yc startups and how long does it usually take to materialise?
The apparent cause is running out of money, but the real cause is failing to build something users love. it is usually apparent in the first 6 months, but not always. another big cause is cofounder tension.
Do you think if zuck applied to yc today with Facebook as it was in 2005 he'd make it in? (assuming the 'social network' landscape still looked like it had in 2005).
Yes. there are certain people that you cannot sit across from and let yourself not invest. he is one of them, for sure. he also had great growth. (zuck comes to speak to the yc batch every year or so. pg used to say that when he talked to zuck he'...This knowledge is worth millions but signing up is free
Hey sam, i'm working on this idea on my free time but for now it's in an early stage. we believe strongly in it but we don't have yet a ready prototype which means we don't have any structure, users, revenue, etc.. i'm wondering if ycombinator's goal is to encourage people from initial concept or help existent startups to grow and go further ? knowing our story, do you honestly think we have a chance at this time to be selected by ycombinator ? thanks.
Why don't you have a prototype? that'll be an important question. that said, we make most of our money backing companies at the "initial concept" stage, so we'd love to hear from you.
Hello sam, amid a never-ending war between anti-ai and pro-ai , you've recently shown strong positions( http://blog.samaltman.com/machine-intelligence-part-1) about it. as an 'ai applicant', I can't stop wondering whether such position could influence an application decision. what's your take on it?
I still want to fund a lot of ai companies.
What's the most exciting non-traditional segment (bio, energy, manufacturing, etc) you're looking forward to funding startups in?
I imagine each partner will have different answers. one thing I say is that we should be willing to fund anything that could be a $10b company, and that is such a difficult restriction we shouldn't have any other restriction. personally, I am very...This knowledge is worth millions but signing up is free
We are a bootstrapped ~2.5yr old company that is doing $5m in revenue and ~$2m in pbt. we have fallen into a bit of a funk in the past 6-12m or so growth-wise and basically flat-lined. we are talking to a few funds to raise a ~$10m round (mostly secondary) to bring the pbt down to 0 and really swing for the fences. we've thought about applying to yc but the 7% seems high for us at this stage. is yc interested in co-investing the standard yc amount in such a round at the market valuation instead of standard yc valuation?
Unfortunately we don't do that--it just doesn't fit our model. plenty of companies have done yc at a later stage and still thought we increased their value far more than the 7% we take, though.
Could you comment on why start ups with remote teams anecdotally do poorly but many open source projects with very remote teams succeed? do you see any tools on the horizon to help people coordinate remotely at a new level?
I think it's because startups have to make small changes to their idea several times per day. very short cycle times do best with in-person interaction.
How do you feel about what the constant influx of 22-year-olds making six-figure salaries is doing to the culture and social fabric of san francisco?
I think the biggest problem is that it's making housing totally unaffordable. I think it's critical sf fix this, and that the only real solution is more supply. unfortunately, homeowners are the ones that vote, and they are loving the increase in ...This knowledge is worth millions but signing up is free
If the product is good and if the product has a single co-founder, what are the chances of getting accepted? the reason is that I live in a place where it's very hard to find a good co-founder and I don't want to team up with the only options that I have. I don't want to make wrong choices. in my place, people tend to join companies and look for jobs rather than start companies.
We will fund a company with 1 founder, but the bar is very high. have you thought about working at a startup first as a way to meet potential cofounders?
In terms of "how will you make money", are you interested in the market for the initial product/use case or what we think the product can eventually grow into? ie: we think our total initial market has the potential to be around $30m/yr but can grow to take on other use cases.
Both. the best answer is something like "we have a path to be be doing enough revenue to cover our expenses in a year, but if things really work, here is how we could make $1b a year in 10 years."
When you held startup class in nyc. you brought up a few founders who were invested in... and what struck me was that each of them had previous relationships to their investors. for example I heard at least twice from an investor: "I've known john for years prior to him coming to me with [insert company name here]." so my question is, do you think there exists a "good ol boy's club" in sv that increases the chances by a great deal of getting funded? or do you believe the playing field is even for those who don't have those kind of connections?
For sure it helps to get to know investors over long periods of time. however, the investors that invested in my company knew me for 45 minutes (yc), a few weeks (sequoia), and a few months (nea). it's important as a founder not to make excuses fo...This knowledge is worth millions but signing up is free
Yc is famous for funding startups at a very early stage, even at a pre-traction stage, which seems to contradict the popular knowledge that an idea without a good execution is worth nothing. with just an application form and a 10 minute interview, how can you tell if the founders will be able to execute the idea properly? what are the most important traits that you look for in an application from a very early stage startup?
Even if the company is only a few weeks old, we look for signs that the founders are determined, getting things done week by week, and improving quickly. if it's just an idea, then we look at what the founders have done in the past. most people do...This knowledge is worth millions but signing up is free
What's something common that partners have to repeat over and over until founders 'get it' ?
The most common thing is getting founders to focus on the right thing. at this stage, nothing but building a product that users love matters. founders want to focus on anything else, and have wonderfully detailed excuses for why whatever it is is ...This knowledge is worth millions but signing up is free
Possibly naive question: i'm a married guy in his 30s working at a major investment bank in nyc (lead quantitative role). I have a graduate degree from a non-elite school. no experience at top tech firms (had offers but didn't go). now, I have some cool side projects that I believe could become great consumer apps given enough care and resources. is there any reason for me to apply to yc, and any chance of getting seed funding from you, or am I completely out of your profile for typical candidates / startups?
We have funded lots of people with similar backgrounds. what will matter is the quality of your idea and progress so far.
Thanks for doing this ama sam. as a follow-up, what would you recommend applicants who are in this position do before the end of next week to increase their chances of being interviewed/accepted? (i.e. get feedback from as many yc alum as possible, iterate on their video, etc). obviously without specifics, i'm sure your answer may be similar to the above, but any general recommendations here?
Talk to users, and tell us what you learn from them.
I frequently see the stat that yc companies are worth 30 billion in total. while this is very impressive, it's still less than say uber at 40 billion for a single company that's about the median age of the group--so it seems like a fair comparison, though an obvious outlier. for the uber, Twitter, Facebook, Google, etc. outlier startups, how much pure luck do you think plays into their success? airbnb and dropbox are yc's biggest outliers. have you found any actionable patterns in the way the founders of these outliers work/think/operate compared with the more moderately successfully and unsuccessful founders?
We haven't updated our numbers in awhile. current total is more than uber. we'll update again at some point. it's not a perfect correlation, but the founders that build huge companies are extremely determined and smart, they have a very clear visi...This knowledge is worth millions but signing up is free
Do you think that yc could ever invest or advise startups / founders that can't move to silicon valley for 3 months for one reason or another? is there something inherent in the in-person experience that cannot be overcome by technology (in general too I suppose, rather than just the type of work ycombinator does)? personally I believe we're not quite there yet. I have some hope, that within our life time communication and collaboration tools can become both sophisticated and intuitive enough to make physical presence for most type of work completely irrelevant)
There is for sure something about in-person interaction that cannot be replaced by any current technology. alan kay recently told me he thinks it's something biological. our model just doesn't work well for people that can't move to the valley for...This knowledge is worth millions but signing up is free
Since you probably can't spend too much time on each yc application, what is the most common issue you see that causes companies to not get further attention?
Great question! the biggest mistake founders make is burying whatever it is that's exceptional about them or their company deep in the application. we are optimists. we want to believe. help us by putting whatever it is that is going to make us wa...This knowledge is worth millions but signing up is free
What is your advice for people who don't have co-founder material friends (mostly non-technical/non-sales people, or conservative) and are out of college? I've experience starting companies with acquaintances, something that, predictably, didn't go so well. is there any alternative - that you have seen in yc - to getting new friends, getting to know them really well, and starting a company in a few years time?
I have a good answer for this! go work at a breakout medium sized tech company (i.e. a couple of hundred to a couple of thousand people). you'll meet lots of potential cofounders. the people that are attracted to these companies are usually 1) rea...This knowledge is worth millions but signing up is free
Hello sam, first, thank you so much for taking the time to answer our questions. my question is about confidentiality of applications. today I am working at a yc startup. I (and two other friends) have a project in mind. but what prevents me from applying to yc is the fear that my application would fall in the inbox of our founders. obviously I would prefer our application to remain confidential until if they we get accepted (which, I understand, is against the odds :)). how can I ensure that this won't happen? how private and confidential are our conversations with yc partners and team? i have also heard that yc alumni sometimes help filtering/interviewing the teams/projects that apply. is this correct? to be completely transparent, I have heard from 2 persons closed to yc that there is no way our founders won't know that I have applied. so this point really worries me a lot. thank you for your answer and again, thank you for taking the time to answer the questions of the hn community
We do have some alumni help us review applications. there is a chance the founders of your startup would randomly see your application. however, you should not only start a startup if you get into yc. if you're into this startup, you should be doi...This knowledge is worth millions but signing up is free
Hey sam, can you give please tell us about the time you, sama, most successfully hacked some (non-computer) system to your advantage?
Sure. when I was running my startup, we got catastrophic news that the first big customer in the space (boost mobile) was signing a deal with a competitor instead of with us. this would have killed us. the competitor was a much larger and better f...This knowledge is worth millions but signing up is free
On that note, would you ever consider starting a yc 'minor league' farm? it'd be interesting to do 12-15k investments on young, very scrappy founders, a la original summer founders program. perhaps mentored by alumni rather than full-time partners for bandwidth purposes.
I think so, yes. but also, it's a different time now. i'd have had more progress by the time I applied to yc. for some companies, in a week, good hackers can get a prototype built and have a few initial users. if that's possible, we expect it. if ...This knowledge is worth millions but signing up is free
If you had applied now with loopt, do you think you would have been accepted into yc? or alexis ohanian / steve huffman with reddit in its primordial phase? it seems like yc has become so competitive that it cuts out some of those promising (risky) founders that don't have as much to show.
Yes, I've thought about trying something like that.
I interviewed for a company once that had different kinds of offers, ranging from low-salary/high-equity, to high-salary/low-equity. I thought that was an interesting idea :d they had 5 options total, and the middle option wasn't awful. i'd like to see more of this in the valley.
I always used to make offers like this--i think it's a good way to do it.
You have suggested that silicon valley is successful, in part, because workers accept a notion of "long-term compensation" [1]. long-term compensation, perhaps better called maybe-someday compensation, requires sv software engineers to work for relatively less (factoring in cost-of-living) than many other skilled professionals, with hopes that they'll be rewarded with a big windfall in the future. with the rising cost of living in sf/sv, young engineers are expected to shoulder much the risk of startups while putting their long-term financial stability on the line. all in hopes of maybe-someday being compensated. and let's face it, the lion's share of these rewards will not be passed to these workers who put all their eggs in one basket, but to financially-secure vc's who have hedged their risk across many companies. if this is how sv works, do you truly believe this is a strong foundation for the industry? obviously it's good for founders and vcs, but i'm considering the perspective of engineers. we seem to be enjoying go-go years of investment and profits, everyone is starry eyed, and the system is working. what happens when the present-day strain on workers exceeds the allure of maybe-someday compensation? also, why shouldn't talented workers move to an industry that provides guaranteed compensation for hard work in real time? of course, start-ups have a much different risk profile than banks, consulting agencies, large corporations, etc. and as a result, the long-term compensation model may be a necessity. but in the end, it sounds like sv works because there's a large supply of people willing to gamble on their future financial stability. [1] http://blog.samaltman.com/why-silicon-valley-works
It's a personal choice for workers. if you're an engineer and you want a guaranteed $250k per year, go work for a financial firm. nothing wrong with that decision. everyone gets to make his or her own. engineers at startups make $100k+, sometimes ...This knowledge is worth millions but signing up is free
This answer by adam d'angelo on quora blows my mind: "what was hot in silicon valley in march 2013?" http://www.quora.com/what-was-hot-in-silicon-valley-in-march… every one of those blew up. so I ask you the same question: what is hot in silicon valley in march, 2015?
Adam is super smart. in fact, I asked him for an updated list at dinner a couple of weeks ago and I predict he will be right again. i'm not going to share my list because I've found that people put too much stock in it. I don't mind talking about ...This knowledge is worth millions but signing up is free
If you don't use alien blue (the mobile app for reddit) then you might not know they have been testing "sponsored" posts. it didn't take a genius to know people would complain, but the ads are getting a lot of pushback from users. I supposed you can put this in context and look at how Facebook gets crap for changing anything, but is this really the most creative idea reddit can come up with to generate more revenue?
I don't use it (i just read reddit in mobile safari) but I will pass this along to the reddit team.
With you recently leading a round of investment for reddit, it seems you are quite optimistic about its success but as of late 2013 (and maybe now too), reddit remains in red even after nearly a decade of its inception[1]. reddit ceo once said, that ads are the reasons digg failed[2], so I believe the site would be wary of using ads to the fullest. how do you think reddit would become profitable and would be able to sustain itself? [1]: http://www.businessinsider.in/reddit-ceo-admits-were-still-i… [2]: http://techcrunch.com/2012/11/08/reddit-digg/
I am an extremely patient investor. I just invested in a company that I believe will take 20-30 years to work. if reddit gets to a billion users, which I believe it will, the company will have many, many interesting monetizations opportunities. it...This knowledge is worth millions but signing up is free
Parker conrad of zenefits was also still a solo founder in his application video. if a founder intends to add a co-founder before the batch starts, how much does that impact your view on them as a solo founder during the application process?
Parker and I spoke about a cofounder then. he was very receptive to adding one, and that helped his case.
It seems like you really need to know the potential cofounder as a person, though, otherwise you won't be sure what they're like when stressed or making mistakes. doesn't this limit it to people you already know fairly well?
Yes, you do. we always ask how long the cofounders have known each other.
Question re solo founders: "a startup is too much work for one person" and if you can't convince even one friend to join you, that doesn't speak well for your idea! on the other hand, a bad hire/partnership can ruin the company. yc gives signal it really prefers to look at teams than individual applications. q: do you have have advice or rules of thumb re how much time a solo founder should put into finding partner(s)? or thoughts re how much to prioritise this, vs. just writing code and talking to users to finish initial version yourself? I don't mean this to be just focused on "getting into yc" but more in general: what's the right way to think about fixing this problem (being a solo founder) vs tackling other things like actually building something initial users can be using? for software ideas surely it is occasionally sensible to make at least a prototype and actually get some users before ever buddying up? or if I've got this far but am basically still going it alone, am I doing something wrong?
We really prefer at least two founders, but it's not a deal-breaker. we funded drew houston of dropbox as a solo founder, but he got a cofounder before the batch started. a bad cofounder is far, far worse than no cofounder. i'd spend maybe 20% o...This knowledge is worth millions but signing up is free
I was wondering how one can get involved in helping out at yc during the batches. sort of a role where you can work and help out the companies with any questions / requests they have. basically additional hands on deck for the yc partners.
One of the things that differentiates us from other programs is we don't have outsourced 'mentors'. the advice you get during yc is from the full-time partners and a small group of part-time partners. i think this is important to maintain--we give good advice largely because we think about advising startups all the time. bringing people in and out to do it occasionally hasn't worked that well for us.
I'm currently on h1b, if we get accepted, will my working visa be a problem?
We will connect you to lawyers that can help, but it can be a real challenge unfortunately :(
Any advice for single founders applying? (other than get a cofounder...)
The burden of proof to show us you can handle starting a startup is higher. so some evidence that you can execute by yourself (i.e. progress) goes a long way.
What was your first personal investment like?
It was /dev/finance, which became stripe. (this was sort of funny years later, when I was sorting through my stock certificates. I momentarily forgot that stripe was originally called something else, and put that stock cert in the "lost cause" pile.)
Based on my friends who have previously applied to yc .. it seems as if applications submitted in the last 3-4 days before the deadline, don't really get reviewed. when submitted early, they would notice yc related views to their website and youtube video. unfortunately, when submitted close to the deadline, there were no views
The youtube counter has never seemed to work well with our reviewing software, so i'd ignore that. that said we do get to spend more time on applications that get submitted early (as we've always said) so there is a slight advantage to submitting ...This knowledge is worth millions but signing up is free
Hey sam, what's the status of the yc fellowship? are you going to do another round?
Very likely yes.
Hi @sama. are there any technologies that you would not consider funding?
We will not invest in something that we think will be bad for the world even if we think it will make lots of money.
How long does it typically take the yc team to review an application?
It honestly hugely varies. sometimes 2 minutes. the longest I've ever spent on a single application (where I had to do background research) was probably an hour. but I try for my normal cadence to be 6 per hour. some applications that are really g...This knowledge is worth millions but signing up is free
What's the most important question on the application?
The first thing I read is "what is your company going to make?" then I scan everything else quickly for evidence of something exceptional--something the founders have done, a great insight on this idea, or something impressive about progress to date.
What do you think about the economic disruption that is being caused be increased automation? as we develop broader and broader forms of automation, it seems like that disruption can only increase in both speed and quantity. what can yc and silicon valley as a whole to mitigate the problems this will cause?
I think that technology increases wealth but also concentrates it. we are all better off, but the inequality is likely to get worse over time. this has been going to some degree since the first tools were developed. i'm not ready to talk in much d...This knowledge is worth millions but signing up is free
I've been watching the sf startup scene from afar. in the midwest (cincinnati, oh) we have growing scenes, but my biggest problem is finding true senior engineers and real technical mentorship. do you think this is something one needs to be in sf to attain or are there other ways?
I certainly don't think you need to be in sf for it, though it is easy to find here. if I had no family ties and wanted to be in tech, i'd still move to the bay area even with the cost of living being what it is. but I don't think it's as critical...This knowledge is worth millions but signing up is free
Sam, should everyone's genomes be sequenced? will most americans have their dna sequenced by 2025,2030? when will we see the peak of the commercial and medical results of having a sequenced population? what could prevent us from getting all our genes sequenced? shouldn't we try to facilitate mass sequencing, for all the medical benefits it could provide? what can ycombinator do to influence corporate and political entities to collaborate and reach a solution to expedite this process?
Yes, I think so, and i'd be surprised if it's not commonplace by 2030. i think the best thing yc can do is fund startups enabling this (and offering good applications on top of it).
Do you think a startup could realistically end up being the entity to develop some of the earliest significant agi? what would look like promising, realistic starting points for -- or even attributes of -- such a nascent startup? e.g., chat bots, development platforms, intelligent agents for games?
Yes, for sure. i think the starting points you mention are very promising ones.
How relevant is the old rfs 5 (development on handhelds, http://old.ycombinator.com/rfs5.html) today compared to 2009 when it was published?
Certainly hasn't happened yet. it may be that human/phone i/o is just too slow. it's not the area i'm most focused on, but would be interesting if it happened.
I'm considering applying for yc but I think my idea (a fairly simple time management app for smartwatches) might be a bit too modest. how small of an idea is too small?
We don't mind ideas that start off sounding modest if you have a great answer to how it could possibly develop into something huge. in fact, we like ideas like that.
Name the most influential person in your life! i'm really curious! reply
No huge surprises here, but probably paul graham, peter thiel, and elon musk have done the most to influence my thinking about investing and technology.
Recently a plethora of startups working on new nuclear energy technology have been created: transatomic power, flibe, helion and upower (to name a few). these startups, respectively, have technology based on molten salt reactors (msr), new fuels (thorium), or new modalities (small distributed scale and fusion). most of these startups face a huge challenge (and capital requirement) to go from idea/concept to pilot/demonstration plant. as chairman of helion and upower how do you see these new startups commercializing their technology? will they require partnerships with existing utilities and what is the expected timeline?
I think they should just try to raise large amounts of money rather than partner with large companies for development. however, they will need to partner with utilities for pilot plants. i can't speak to the other companies, but my hope is that up...This knowledge is worth millions but signing up is free
What are some of the biggest pain points you see early yc companies struggling with (esp. during batches)? are there any unsolved problems for growing companies you wish someone would apply to solve?
The biggest problem is failing to make a product that some users love, but then thinking they will solve their problems by doing everything else well. the second-biggest problem is probably cofounder fallouts. internal communication and management...This knowledge is worth millions but signing up is free
Hello sam, I am honduran and applying for the winter 2016 batch with other two co founders. one of my co founders (venezuelan) and I have student f-1 visas. since we cannot work yet until we are at opt we won't be able to make any profits until january or february 2016. beta for our platform is due tomorrow so we can have a demo but users won't be able to use it for now. is this going to affect our application? if so, what would you recommend?
That's ok; we understand
I was excited about the research announcement! I've been thinking about this for a while: - small companies rarely fund university research - the grant application process is complex - grad students get paid so little compared to tech workers - hiring a phd student before they finish means abandoning their research do you think universities and research can be changed to get more companies funding research? I can imagine startups can get some great work done efficiently while increasing private funding of research.
Maybe, but i'm not sure small companies are the best funders for this. one of the nicest surprises about the ycr announcement was how many very rich people and large organizations reached out saying they wanted to give money. it seems there is a l...This knowledge is worth millions but signing up is free
How far do you think new silicon valley companies (and yc companies in particular) have progressed in providing fairer equity grants to employees? in particular i'm interested in what the norms are for "if you leave the company you must exercise in 90 days" type terms. i know that you've been working on this problem personally and a few high profile companies have publicly announced changes. but what's going on with new small companies? what are the current norms? i know that yc takes care of a lot of the legal work when setting up new yc companies. what do you currently recommend for employee option grants?
I mostly only know about yc companies other than what I've read in the press about large companies, but it seems like this has gotten much better. we want to create a new employee option plan with all of our recommended fixes. we've been busy, but...This knowledge is worth millions but signing up is free
So my question is about yc research. you said in that earlier thread you will be hand picking the people. how exactly do you intend to do that if you don't me asking? are you partnering with schools? are they going to be recommended? do you already have a database?
Mostly the algorithm was to ask very smart people "who are the top 3 smartest people you know in area x" and then go after the people whose names kept coming up.
Couple questions regarding ycr: 1. will the model be group-based where there's a head pi setting the research agenda for a group and researchers working under the pi? if so, what level of independence do you expect individual researchers within a group to have? i.e. is it more like the academic model with postdocs enjoying a fair degree of independence, or more akin to national labs where the research agenda is reasonably fixed and everyone is expected to contribute to the same research program? or, are you coming up with an entirely different model? 2. in general how hands-on will ycr be in terms of intra-group management? 3. do you expect to subscribe to all the major publishing houses so that ycr researchers have access to journals like they would at a top-tier university?
1. great question, we've spent a lot of time cycling on this. there will be a "pi" for each group, but the sort of pis we will bring on will be people who will give large amounts of autonomy to their teams--ie, each group will have a goal, and eve...This knowledge is worth millions but signing up is free
Very broadly speaking, fundamental research can be divided into two categories: (1) developing techniques to accomplish some very difficult, but useful task; and (2) answering questions which are intrinsically interesting.* research in fusion and developing self-driving cars are examples of the first category. finding exoplanets and the higgs boson are examples of the second. will yc research be funding research in both categories, or just the first? * (i know some people like to call the second category "pure" research, but I think that betrays a bias against working on more practical problems.)
Honestly it will mostly be category 1 to start, but there is at least one category 2 project we want to pursue.
Hi @sama, i'm from brazil and ceo of an edtech startup. we're profitable, with 60 employees and a lot consumer traction/revenue, but didn't raise a series a yet. questions: 1) what advice would you give to applicants from brazil and other large countries (india, china, russia), whose products initially target their local markets? 2) what advice would you give to post-seed and pre-series a applicants? when (if at all) would you consider them "too big for yc"? 3) if you select a post seed startup, would yc invest at their latest valuation, or would it only offer the standard deal, even if it would be a "down round" for current investors? heard you are visiting india and know you've been to mexico not long ago. ever thought about coming to brazil? best regards, bernardo
1) no specific advice--we fund lots of companies whose products target far-away markets and are particularly interested in doing so. the only different question we might ask you is "how will you handle being away from your users for 3 months?" 2) ...This knowledge is worth millions but signing up is free
When should a group of founders raise a seed round or series a?
in general it's nice to wait until you have the idea figured out and initial signs of promise before you raise money. raising money puts some pressure on the company. sometime pressure. and once you've raised money you can't be in this exploratory...This knowledge is worth millions but signing up is free
I have a question related to yc - so I think yc did a fantastic job in promoting partnership in silicon valley. in fact, I plan to invest in some in the next three years. you guys pump 180 companies per year coming to the market it looks like its hard to follow each of the yc company any more. do you think that this will create some - some people will walk away from yc because they cannot follow large batch of companies and the company had to be very polished and the firm had to be think of the world about ideas?
Alright so I think the question is do I think investors are going to fund less yc companies as we grow. no. definitely not. like certainly the trend in this is the other way. we have more and more investors saying that half their portfolio is not ...This knowledge is worth millions but signing up is free
There's a certain market that you’re really excited about that don’t necessarily know all about yet - is there a certain track you recommend or ways to?
If there's a market that you’re excited about but don’t a lot about yet what should you do? two schools of thought on this. one is to just jump right in. learn it as you go. that's worked a lot of times. the other is go work at another company in ...This knowledge is worth millions but signing up is free
The statistic you saying now harder to get into ycombinator than getting into harvard. so I am curious the criteria’s that you use to pick up startups. does it change over time?
The question is what criteria to pick startups and has it gotten harder? has it changed? the two things that we need to see are good founders and a good idea. and without both of those we won't fund the company. but that hasn't changed. that is al...This knowledge is worth millions but signing up is free
Is there a way to get involved in the yom community before getting accepted?
Is there a way to get involved with yc before getting funded? no and intestinally not. I say the one thing you can do is if you work at a yc company and then later apply - I think probably like - well not probably that definitely if you get a good...This knowledge is worth millions but signing up is free
What are some of the most common and alarming warning signs you should be looking for when you're trying to make the shift from building great product to building a great company?
What are the most common mistakes to make when you're shifting to building a great company? I think I went through most of them here. I tried to put everything here that I see people mess up most of the time. yes.
So when should the founders start to thinking about hire a professional ceo - a senior guy?
When should the founders think about hiring a professional ceo? never. you - if you look at the most successful companies in tech they are run by their founders for a very long time. sometimes forever. sometimes they even hire professional ceo and...This knowledge is worth millions but signing up is free
Like places outside the us?
I hesitate to make recommendations because I haven't spent enough time in the cities to really have an intuitive feel. but like - you know as well as I do the common ones people talk about start up hubs. I just can't make a personal recommendation...This knowledge is worth millions but signing up is free
I was just thinking - what do you think are the good places to start start ups?
Apart from the valley where do I think are other good places to start a startup. well I still think the valley is the best by a very significant margin. but I think it's finally maybe beginning to weaken a little bit because the costs have just go...This knowledge is worth millions but signing up is free
How many immigrant founders have you seen in ycombinator?
How many immigrant founders have we seen in ycombinator? in the last batch - I think it probably went up for this next batch. in our last batch 41 percent of the founders we founded we're born outside the us. from thirty different countries. so it...This knowledge is worth millions but signing up is free
So we talked a lot about the startups growing but most startups fail. any advice for how to fail gracefully?
Yeah. yeah. great question. we should have covered that. how to fail gracefully. so, most startups fail and silicon valley almost goes too far on how it loves failure. failure still sucks. you should still try not to fail. and this whole like th...This knowledge is worth millions but signing up is free
So what are some examples of ways to make up productivity on a personal level? how do you do that on a personal level and also on an advance level?
How to keep track productivity systems. so, the one I use which I actually thinks works really well is I keep one piece of paper with my goals for sort of three to twelve month time frame. and I look at that every day. and then separately I keep o...This knowledge is worth millions but signing up is free
You hold that diversity is important, but an earlier speaker said that diversity wasn't important and that you should just hire people that are very much like you and trust you...
So the question is how you square the device of diversity being important with earlier speakers saying that you want people that are very similar. the difference is that what you want is diversity of backgrounds. but you don't want diversity of ...This knowledge is worth millions but signing up is free
Do you have any advice or comments on the complexity that comes with working with cryptocurrencies or cryptoequities?
Oh wow. that's a tough question to end with. yes, there are some issues. often banks struggle to deal with companies that are working with cryptocurrencies because they haven't quite figured out how to deal with that sort of thing yet. generally a...This knowledge is worth millions but signing up is free
All things considered, what should be my budget for incorporating, for the lawyer, for getting the deal to buy for my effort seed rounds? and then for hiring the first employees. how much money should I set aside for that?
In terms of incorporation, don't spend a dime on that. you can do that online. well, actually it does cost a little bit. incorporating online using a service like clerky is inexpensive. in the hundreds, not in the thousands. you don't need a lawye...This knowledge is worth millions but signing up is free
How do you find one?
Finding one is tough. the best is through recommendations. with any kind of specialist, a cpa or an accountant or a lawyer, it's always best to use people who are used to dealing with startups. not your aunt who lives in minnesota and doesn't actu...This knowledge is worth millions but signing up is free
What’s the decision making process between making unrelated products and saving space for fitness tracking, for different versions of or jambox. what goes into that?
We have a grand unified theory about how these experiences come together. what happens, it touches a little bit on the context engine, when you have things on your body that can make everything in the world around you smarter. if I know the emotio...This knowledge is worth millions but signing up is free
Should we start focusing on one small thing or should it focus on the system itself?
A system is a mindset. it's not actually a system. there are simple systems. there are complex ones. a plane is a very complex system. a car is a very complex system. there are other products we make that are much simpler. a phone is a complex sys...This knowledge is worth millions but signing up is free
So let's say you have a product. you have all these features that you want to create. you're about to enter to the design process. how do you approach the whole problem? how do you break down how it is going to solve the problem? but then, each design feature is not mutually exclusive. how do you approach it holistically? when you have a number of different features and functions that you are trying to build, how do you look at them on a system level rather than in a silo to understand what the tradeoffs are across the entire system?
That's the answer to your question. you do exactly that. you don't think about it in a silo. when it’s a small team, it's really easy because you all are sitting around the table. you're looking at each other. you are making those decisions in rea...This knowledge is worth millions but signing up is free
How do you give good user feedback if you're a user?
How do you give good user feedback? I want a user to tell me what they are really thinking. what their problems really are. to just sort of ramble. I want someone to just tell me about stuff in their life. the more you learn about them as a person...This knowledge is worth millions but signing up is free
In the beginning the video gaming industry was decentralized. there wasn't a lot of cohesion, but now it's very different. you said you originally spoke to broadcasters and streamers themselves. how has that changed? for example, ? has banned users or professional players from streaming their own stuff. did you try to gain leverage with that?
Yeah, so the question is about the game publishers. game publishers are important people in the space. any big company for that matter isn't going to give you the time of day as a small startup. which is both good and bad. it means you don't need ...This knowledge is worth millions but signing up is free
In finding groups of people that can give different kinds of feedback, is there a group that you should focus on first?
Given that we had very limited resources, we focused on the people using competing products. we knew that they were already interested in the behavior that we needed and they were willing to do it at all. therefore all we had to do was convince th...This knowledge is worth millions but signing up is free
What about onsite user feedback tools?
This is a whole second set of user feedback that's really important. you're talking about when you have a new product and you want to see if it's actually going to work or not. you put it in front of people and see how they use it or not. that is ...This knowledge is worth millions but signing up is free
What channels do you use to reach out to them? and do you ever compensate them?
The channels we used to reach out to them were onsite messaging systems. most websites have some way to contact the user. if they are a visible user of another website, you use that site's messaging system and say, "hey. I was watching your stream...This knowledge is worth millions but signing up is free
What about the international market? you mentioned that you have a lot of users in korea.
That's really hard. to this day twitch works way better in english speaking countries than it does in non-english speaking countries. a big part of that is we are much better at talking to people in english speaking countries and learning what the...This knowledge is worth millions but signing up is free
Since you mentioned recording, did you try to insist on doing skype interviews rather than over email?
You definitely want to skype. you don't want to do interviews over email if you can avoid it, because interviews over email are non-interactive. the most interesting learnings come from the, “interesting. tell me more." the instant you hit this ve...This knowledge is worth millions but signing up is free
How hard was it to get buy in from the rest of your company? you can say, "i'm in charge so you're doing what I say" but that's probably not the best way of doing it.
That's a good question. if you just go to them and say, "i talked to the users. I figured it out. we have to build this," it's really hard because people don't trust you. there's something magic about showing them the interview though. I recommend...This knowledge is worth millions but signing up is free
What do you see startups get most wrong about interviews? most startups don't do them at all, but the ones that do, what are their most common mistakes?
The most common mistake is showing people your product. don't show them your product. it’s like telling them about a feature. you want to learn what's already in their heads. you want avoid putting things there. the other thing is asking about you...This knowledge is worth millions but signing up is free
Putting yourself in other people's shoes is very important. can you give us some tips?
Putting yourself in other people’s shoes is difficult in management. it's hard in daily life. it's even harder in management because it's the stress at the moment. if a great employee is asking you for a raise, it is very hard for not to respond b...This knowledge is worth millions but signing up is free
I am curious to learn how you have built a culture around people and among the entrepreneurs that you work with that has differentiated you in the market from all the other venture capital firms.
Probably not the best question for me. I can ask sam that. I don't know. the question is how we do build a culture out at andreessen horowitz that is differentiated us from all other vc's. I feel like that is certainly the goal. we have been aroun...This knowledge is worth millions but signing up is free
How do you incorporate toussaint's ideology and get people who were previously against you on your side?
What he did in general is the right thing. you have to show them a better way, as a leader, if somebody's your enemy and you need to convert them. this happens in business too. somebody is a competitor and you want to bring them over but you don't...This knowledge is worth millions but signing up is free
I was reading your book yesterday. how did you deal with all the stress? was it meditating? hip hop?
The answer is I used to be 6 foot 4 and good looking so clearly not very well. I get asked that a lot and I have a great answer for it. I have a wonderful wife who is sitting right here. I will oar and he borrowed that technique from him but appli...This knowledge is worth millions but signing up is free
If you have to fire or demote an executive, how do you have the conversation and then how do you explain it to everyone else?
Right, this is great question. clearly it's some kind of failure. you failed on hiring. you failed on integrating. they failed at their job. the first thing when firing the person is to really try to be honest. you're feeling like you failed. comm...This knowledge is worth millions but signing up is free
Can you talk a little about the tactics of how you manage people? how often do you meet with them?
So the canonical advice sounds obvious but was radical back in 1982 when andy wrote his book, is to have a one on one roughly every two weeks. some people say every week, but I wouldn't go longer than two weeks. every week can be ideal in many com...This knowledge is worth millions but signing up is free
So you talked about making compensation transparent. how would you do that, especially when people equate themselves to the value of how much their salary is?
I would do it probably in bands. you can do it, just everybody in the company gets paid the same. or you could have all discipline, all engineers-- or you could do it by experience. how steve did it at next was there was a high band and a low band...This knowledge is worth millions but signing up is free
How do you know when to pivot?
Part of the reason why having an investment thesis and your confidence in the rest of the place and being pretty clear on that is generally speaking the answer I give to people is if your confidence is unmeasured for a fairly long time or is decre...This knowledge is worth millions but signing up is free
So different founders, different areas. how do you identify them?
The talk was aimed at what is unique about the mindset I think of founders. there is great founder across all. all founders-- there are differences. for example, in software speed to market, speed to learning is really key. in hardware if you scre...This knowledge is worth millions but signing up is free
What makes a great co-founding team and what makes a good way to evaluate a co-founder?
The first thing is, it's super important to collaborate really well. that was the point I was making during the team. if in fact you don't have serious trust-- so the key thing is when you are thinking about founders is do you have a diversity of ...This knowledge is worth millions but signing up is free
What is it that gets you wrong about someone who is going to do the distance?
To some degree you can only fully cross these minefields by going and doing it. so you can be wrong about your hypothesis. the kinds of things that frequently get you wrong or you think a person--- for example I frequently use in interaction is I ...This knowledge is worth millions but signing up is free
How do you keep persistence when starting?
Well LinkedIn went through, for those of you who remember we were treated as the little alternative to friendster, then myspace, then Facebook. we had a lot of the, we are the little tiny one next to these respected giants each at the time. ultima...This knowledge is worth millions but signing up is free
Do you believe destiny of insight to be a great signal for great founders?
I would definitely say that the ability to say coherently what you are targeting, to articulate something that isn't trying to boil the ocean, or a swiss army knife approach. one focus, like you are right about this and it works. that is actually ...This knowledge is worth millions but signing up is free
How do you know if someone is a good founder or not?
I'm a huge believer in references. I only meet with someone when they come to me through a reference. so one of the things by the way is after this I have to run off because I have a meeting to get to. if you want to get time and attention with me...This knowledge is worth millions but signing up is free
I'm curious how you targeted, you selected a different strategy to strengthen your investment thesis and help it take off. it seems like every startup faces that same challenge.
So one really fundamental thing is to think about product distribution as key. and for LinkedIn we had a couple things going for us. one, the web was boring in 2003. basically what happened was everyone thought that consumer net was over. so peopl...This knowledge is worth millions but signing up is free
One more question, the question is, in this particular situation with airbnb, a lot of people think it is not necessarily a technology company, but more of a marketing company.
It’s a totally fair question and people have said it so I want to answer it. the guy who owns sequoia capital, his name is doug leone. one day, I think it was a year, year and half ago, he says, your job sucks. and I was all, what the hell does th...This knowledge is worth millions but signing up is free
You talk about conventions, what did you do when you had no money and you only got paid for those who used your site. what did you do to scale that up? how did you get users to the site.
So this is not about culture, but I will answer it anyway. the best advice I ever got was probably from paul graham. paul graham said, I remember he had this line, it's better to have a hundred people that love you than to have a million people th...This knowledge is worth millions but signing up is free
Brian, airbnb has made some great contributions to the open source community. do you have any thoughts on how that contributes to your culture and company values?
Yeah, I think just in general, it may be related to two things about airbnb. we tend to be a pretty open culture just in general, we believe in a shared world where people are giving back, contributing to making communities and industries stronger...This knowledge is worth millions but signing up is free
What is the ideal board structure?
We are fortunate to have, there’s myself and my co-founder and a partner from andreessen horowitz. I think it removes the fear, creates a little more trust. it removes the fear that someone is going to come in and fire you arbitrarily because it's...This knowledge is worth millions but signing up is free
What would convince you to invest in a company with no product to show. what do you make that judgement based on?
What would convince us, is what usually convinces us, is the founder and their team themselves. so we invest in people first, not necessarily the product idea. the product idea tends to morph a lot. so we will invest in the team first. if it’s pre...This knowledge is worth millions but signing up is free
What is the constraint on how many companies you guys have invested in? time, money, or lack of good companies?
Sv angel has kind of got comfortable with one a week. you certainly can’t do more that that, and that is a staff of thirteen. so it's really the number of companies.
What is a sign you should not work with an investor?
Well it is the inverse of what I said about a good investor. if it is an investor that has no domain expertise in your company, does not have a rolodex where they can help you with introductions both for business development and in helping you do ...This knowledge is worth millions but signing up is free
If you intend to start a business that is capital equipment intensive, do you guys have any advice on how to deal with demotivation? so not everything starts in software, viral, or anything else? what should founders do for capital equipment intensive companies?
I would double down on my previous comments on the onion theory of risk and the staging of risk and cash. which is the more capital has the business, the more intense you have to be about exactly what is going to be required to make a business wor...This knowledge is worth millions but signing up is free
So obviously the conventional wisdom of why you raise money is you need it. but the more I get off conventional wisdom the more I hear another story on why you raise money. I am actually hearing founders say it is more to facilitate the big exit. or in the worse case the acqui-hire instead of fizzling out into nothing. to what extent is that accurate thinking?
Well if you pick good investors who have good rolodexes and good domain expertise in what your company does, they are going to add a lot more value than the money. those are the types of investors you should be looking for.
One more question before we open up for the audience to ask questions. for ron and for marc. could you both tell a story about the most successful investment you ever made and how that came to happen?
Other than zenefits.
Is there a maximum in the company that you think founders should sell in their seed round, their a round? beyond what paul was talking about.
I don't know the rules on this stuff. the tricky thing is, it seems like they are particularly rough for a series a. you are probably going to sell somewhere between twenty to thirty percent of the company. below, venture capitalist tend to be a l...This knowledge is worth millions but signing up is free
So how do you think about negotiation? how do you figure out what the right evaluation of their company should be, what are the terms?
Well when I was starting out, I was raising my seed round and I didn’t really know. I mean, we had conversations about this. I probably started a little too high on the valuation side. as you guys know, y combinator starts this thing called demo d...This knowledge is worth millions but signing up is free
Speaking of terms. what term should founders care most about? and how should founders negotiate?
Probably precisely because of what marc said, the most important thing at the seed stage is picking the right seed investors because they are going to lay the foundation for future fundraising events. they’re going to make the right introductions,...This knowledge is worth millions but signing up is free
I want to talk a little more about tactics here. just how does the process go? can people email you directly or do they need to get an introduction? and how many meetings does it take to make a decision? how do you figure out what the right terms are? when can a founder ask you for a check?
Yeah so, sv angel invests in seed stage startups, so we like to be the very first investor. we normally invest today at around the million to two million. it used to only be a million. so if we invest two hundred and fifty k, that means there’s fi...This knowledge is worth millions but signing up is free
What do you guys wish founders did differently when raising money? and specifically, marc, you mentioned this relationship between money and funding?
I think the single biggest thing that people are just missing and I think it’s all of our faults, we are all not talking about it enough, but I think the single biggest thing entrepreneurs are missing both on fundraising and how they run their com...This knowledge is worth millions but signing up is free
Parker, could you talk about your seed round and how that went and what you should have done differently for raising money?
Sure, actually my seed round, most of the stuff with my current company felt like, from a fundraising perspective, felt like it came together relatively quickly. but actually, one of the experiences I had, I started a company before this that I wa...This knowledge is worth millions but signing up is free
What made you decide to invest in a founder company?
So what makes us invest in a company is based on a whole bunch of characteristics. I have been doing this since 1994, right before marc got out of the university of illinois, so sv angel and its entities have invested in over 700 companies. to inv...This knowledge is worth millions but signing up is free
How much of a role did you guys play in getting the pokemon thing out?
Twitch had this thing called "twitch plays pokemon" where developers set up a pokémon gameboy game that was controlled by chat, so millions of people would be typing in a or b, and the character would wander around aimlessly. that was a huge news ...This knowledge is worth millions but signing up is free
Are nonprofits your biggest customer base?
No, today our biggest customer base is entrepreneurs who are trying to build brands and businesses. we have a little over 1000 people who make their full-time living on teespring today via brands they've launched. and the other side is influencers...This knowledge is worth millions but signing up is free
What convinced you to get into the market of t-shirt printing when there is so much competition in this business?
I think there are two factors to it. first, I completely agree. from the outside, people have been telling us that this is a silly idea since day one in every order magnitude we reach. people will come and say, "this is a terrible idea. why are yo...This knowledge is worth millions but signing up is free
Are there any tricks or experiments that didn't work out in your company?
Okay i'll talk about one. so one of the things that we did early on to try to motivate ourselves was - like, we understood the idea of crunch mode, and that it's really bad for people. like if you're doing the subscription business, you need peopl...This knowledge is worth millions but signing up is free
How do you hire people that can work remotely and work in this fashion?
Pretty easily, you have them work on a side project for you. so you contract them out, and have them work remotely as such. usually the projects I like to have them work on are about one month long so you can get a good sense of how people manage ...This knowledge is worth millions but signing up is free
How do we set up accountability for our employees as a manager?
We were profitable nine months after launch, so we had profit-sharing, which makes incentives pretty simple and clear. it would be a multiple of whatever sort of bonus pool that we had, and performance measures would be based on how they did in cu...This knowledge is worth millions but signing up is free
You said you guys all work from home, which usually seems like a nightmare. how did you make that work?
We all work from home, and we all work around the tampa bay area. we would allow anyone to work from anywhere but usually as we tried to recruit them and meet our team, they usually decided to come and move here anyway. remote working is especiall...This knowledge is worth millions but signing up is free
Can you relay the story about how the king for a day thing was good at wufoo?
Yeah, okay so I don't like hackathons. I think they sort of suck in terms of those done inside of companies because you spend like 48 hours working really hard on something that you're really passionate about, and 99% of them never make it out to ...This knowledge is worth millions but signing up is free
How do you make a decision on product and communicate that with your engineering team when there are lots of different directions to go?
We just looked at customer support, which is really easy because you see what people are having the most amount of trouble with. you cannot help but get feature requests from people. no matter whatever openings you have in your product or app, peo...This knowledge is worth millions but signing up is free
How do we balance being obsessed with working on product with all the other skills that are needed by a company, such as marketing, branding, etc?
If you're working on product, you should also always have this flip-side where you're talking to users. for us inside of wufoo, the way we got people to talk to users was through customer support. they got to see firsthand whether the features wor...This knowledge is worth millions but signing up is free
So what do you do when you have a product with many different types of users? how do you build one product that all these users love?
There is an interesting fine line for that. what I usually tell people is focus on those who are the most passionate, especially in the early stages. whatever niche it's going to be in, that's where i'm going to focus on completely. I think ben si...This knowledge is worth millions but signing up is free
If someone worked at goldman sachs out of college and left after six months and is now studying cs at stanford, how would you recommend rethinking their competitive advantage?
I am not great at the psychotherapy stuff, so I don't quite know how to solve this. there are these very odd studies they have done on people who go to business school, this one was done at the harvard business school where it's sort of the anti-a...This knowledge is worth millions but signing up is free
Doesn't the last mover advantage already imply that there's competition to begin with?
Yes, there's always a terminology thing. I would say that there are categories in which people sort of are bundled together. the monopoly business, I think they really were a big first mover. in some sense you can say Google was not the first sear...This knowledge is worth millions but signing up is free
What do you think about lean startups?
So the question is what do I think about lean startups and iterative thinking where you get feedback from people versus complexity that may not work. i'm personally quite skeptical of all the lean startup methodology. I think the really great com...This knowledge is worth millions but signing up is free
How does this apply to palantir and square?
That's sort of a set of companies that are doing different copycat payment systems, on mobile phones, there's square, there's paypal, they have different shapes that's how they differentiate themselves, one is a triangle, one is a square. maybe at...This knowledge is worth millions but signing up is free
So which of the aspects, of all these you mentioned, you would you say is applicable to Google?
Well, they have they have network effects with the ad network, they had proprietary technology that gave them the initial lead because they had the page rank algorithm, which was an order of magnitude better than any other search engine. they had ...This knowledge is worth millions but signing up is free
Do you have any ways to determine the difference [between a monopoly and a non monopoly] when looking at an idea or thinking about your own idea?
I would say the question I always focus on is what is the actual market? so not what's the narrative of the market, because you can always tell a fictional story about a market: it's much bigger much or smaller, but what is the real objective mark...This knowledge is worth millions but signing up is free
So one question online was if your users already have a product that they are already comfortable with how do you get them to switch to yours?
There is always a switchover cost. I will tell you the example of homejoy. we were actually creating a new market in the sense that a lot of our initial users had never had cleanings before so it was pretty simple to get them on board. and a lot o...This knowledge is worth millions but signing up is free
If you hire people you like, you might get a monoculture and how do you deal with the blind spots that arise?
Starting a startup is where many things will be going wrong. you can't expect it to be perfect. the advantage is of hiring people you know and like are far greater than the small disadvantage of having some monoculture. you look at it empirically,...This knowledge is worth millions but signing up is free
Do you like snapchat?
Snapchat? what do I know about snapchat? we didn't fund them. I want another question.
You mentioned that it's good advice to learn a lot about something that matters, what are some good strategies to figure out what matters?
If you think of technology as something that’s spreading as a sort of fractal stain. anything on the edge represents an interesting idea, sounds familiar. like I said that was the problem, you have correctly identified the thing I didn't really an...This knowledge is worth millions but signing up is free
What kind of startup should not go through incubation, in your opinion?
Definitely any that will fail. or if you'll succeed but you're an intolerable person. that also sam would probably sooner do without. short of that, I cannot think of any, because a large percentage, founders are often surprised by how large a per...This knowledge is worth millions but signing up is free
I know you talked a lot, earlier, about you'll know when your start up is doing extremely well, but I feel like in a lot of cases it's a gray line, where you have some users but not explosive growth that is up and to the right, what would you do or what would you recommend in those situations? considering allocating time and resources, how do you balance?
When a start up is growing but not much. didn't you tell them they were supposed to read do things that don't scale? you sir have not done the readings, you are busted. because there are four, I wrote a whole essay answered that question and that ...This knowledge is worth millions but signing up is free
When is a good time to turn a side project into a startup?
You will know, right. so the question is when you turn a side project into a startup, you will know that it is becoming a real startup when it takes over a alarming large percentage of your life, right. my god I've just spent all day working on th...This knowledge is worth millions but signing up is free
What are your reoccurring systems in your work and personal life that make you efficient?
Having kids is a good way to be efficient. because you have no time left so if you want to get anything done, the amount of done you do per time is high. actually many parents, start up founders who have kids have made that point explicitly. they ...This knowledge is worth millions but signing up is free
What would you learn in college right now?
Literary theory, no just kidding. honestly, I think I might try and study physics that’s the thing I feel I missed. for some reason, when I was a kid computers were the thing, maybe they still are. I got very excited learning to write code and you...This knowledge is worth millions but signing up is free
No, like idealab, garrett camp’s new one...
It probably is true that women have a harder time raising money. I have noticed this empirically and jessica is just about to publish a bunch of interviews on female founders and a lot of them said that they thought they had a harder time raising ...This knowledge is worth millions but signing up is free
I am seeing a trend among young people and successful entrepreneurs where they don’t want to start one great company but twenty. you are starting to see a rise in these labs attempts were they are going to try to launch a whole bunch of stuff, I don't have any stellar examples yet.
Do you mean like ideo?
Do you think we are currently in a bubble?
I’ll give you two answers to this question. one, ask me questions that are useful to this audience because these people are here to learn how to start startups, and I have more data in my head than anybody else and you're asking me questions a rep...This knowledge is worth millions but signing up is free
So is it just a big no no, someone has to be managed no way they should be on the founding team.
In the case were you are doing something were you need some super advanced technical thing and there is some boffin that knows this thing and no one else in this world including on how to wipe his mouth. it may be to your advantage to hire said bo...This knowledge is worth millions but signing up is free
Management is a problem only if you are successful. what about those first two or three people?
Ideally you are successful before you even hire two or three people. ideally you don't even have two or three people for quite awhile. when you do the first hires in a startup they are almost like founders. they should be motivated by the same thi...This knowledge is worth millions but signing up is free
Do you see any value in business school for people who want to pursue entrepreneurship?
Basically no, it sounds undiplomatic, but business school was designed to teach people management. management is a problem that you only have in a startup if you are sufficiently successful. so really what you need to know early on to make a start...This knowledge is worth millions but signing up is free
Sure we will start with two questions. how can a nontechnical founder most efficiently contribute to a startup?
If the startup is, if the startup is working in some domain, if it’s not a pure technology startup but is working in some very specific domain, like if it is uber and the non technical founder was an expert in the limo business then actually then ...This knowledge is worth millions but signing up is free
How do you deal with burnout while still being productive and remaining productive.
The answer to this is just that it sucks and you keep going. unlike a student where you can throw up your hands and say you know i'm really burnt out and i'm just going to get bad grades this quarter, one of the hard parts about running a startup ...This knowledge is worth millions but signing up is free
How do I identify if a market has a fast growth rate now and also for the next ten years?
The good news about this is this is one of the big advantages students have. you should just trust your instincts on this. older people have to basically guess about the technologies young people are using. but you can just watch what you're doing...This knowledge is worth millions but signing up is free
Hi sam, I am a 28 year old project manager. how can I help ycombinator?
Work at a yc startup!
Does yc fund stealth startups?
Maybe we do and maybe we don't...
How many companies/startups will actually be chosen to enter the batch?
We never set this ahead of time--it really depends on how many companies apply that we want to fund, subject to the constraints of how hard the parters can work. i'd guess in the range of 100-130, based on current application volume. we had a big ...This knowledge is worth millions but signing up is free
Most people fund ideas, some fund founders. what do you think about funding dreams?
Isn't that what ideas are?
Why don't even the best vcs publish returns? does yc plan to?
I don't know why most don't. ours sound silly. the irr is way over 100%, but on a relatively small amount of capital.
Hi sam, is it ok to seek advice from partners and get feedback and improve on the application? just would like to increase the odds. thank you.
Out of fairness, the partners can't really give you feedback. you can reach out to alumni, though.
Hello sam how do you get the (gut) feeling that you should definitely invest in a particular idea (or company)? (how do you make such a decision)?
One thing I always think about is if I would take the ceo job at the company if they offered it to me.
I'm still working on building a prototype so I can earn a cofounder and future employees. i'd say i'm 2-3 months off from having the mvp done. should I apply to yc?
You could, there's not much downside and you can reapply if you don't get it. but your chances sound significantly higher for the the next batch.
Do you accept some teams without a business model?
Yes, but not without an idea. we tried funding teams with no ideas at one point. it didn't work. it turns out that good founders always have ideas.
What must one do to acquire one of those cool y combinator sweatshirts I see floating around san francisco? store.ycombinator.com in the works? :)
One gets made for each batch. apply!
Any plans to host a startup school conference in asia ?
Yes, this year.
Is it common that you fund startups with big/growing competitors?
All the time.
What advice do you have for junior devs who want to work at an early stage startup?
Join a rocketship. (ideally one in the yc portfolio :) )
What's yc's valuation?
A lot, but it's very illiquid.
Sam, does every application submitted, before the deadline, get seen and on average by how many reviewers?
It at least gets seen by our alumni reviewers, and at least 3 of them. they pass about half the applications on to the yc partners.
Dunno if this has been asked already, ever think about doing a yc in in dublin, ireland?
We fund companies from all over the world. the sacrifice of moving for 3 months pales in comparison to other sacrifices you have to make to start a successful startup.
I know a lot of yc alumni, are endorsements about quality or quantity? are they important?
Quality far above quantity. a large number of weak endorsements really hurts your chances.
Any interest in a y combinator ipo?
No. that got a quick involuntary shudder out of me.
What does it mean to be president of yc?
Blah blah something about herding cats blah blah
For people with immigration issues, does yc have any plans on expanding to asia or europe in the coming few years?
No, but we help with immigration issues.
Is there a chance to be approved if my startup is an incubator/accelerator a la yc in another region of the world?
Definitely a chance, but if you want to get into yc you should just apply to yc. it usually hurts you if you've gone through another accelerator because our bar is much higher. in that case, we expect you to be already accelerated, and we find tha...This knowledge is worth millions but signing up is free
Do you start reading the application on the 27th? if someone was to submitted early but was continuously updating till the deadline, which application do you see? thanks.
We start right after demo day (the 24th). it's possible we'd read an earlier version--if you're going to make big changes, hold off on submitting.
What do you think of similar structures burgeoning in europe? - are they a good first step before applying to yc?
In general, no. if you want to apply to yc, just apply to yc. going through some other program first is a negative--the advice is usually bad, there's extra dilution, etc.
How about health drinks / food? do you know if yc would have any interest or expertise to help natural food companies? like kambucha is $600m company now.
It's out of our area of expertise, but again, if we can understand why it might be a $10b company, we'll fund it.
I was curious what types of tools or applications yc uses to operate (manage applications, track feedback, or schedule meetings, etc.)? can you share your stack?
We build our own tools mostly.
Does the current partnership explicitly cap the partner count or is there some point in the future where you think it would make sense to cap the number of partners?
No and probably not.
Hello! are partners chosen specifically for each interview (e.g. people with knowledge of the market), or are the tracks split up between groups of partners randomly?
We randomize everything first, and then look through each morning to see if some interviewees need domain expertise, and then swap those around as best we can.
When should a startup start to monetize? currently we are building a user base and iterating the product based on feedback. what do you think about delaying monetization?
Totally depends on the startups. in general it's good to monetize early, but there are very important exceptions. this is the sort of thing we have to give individualized advice about to every yc company.
What's your thoughts on teams that are applying from london?
We are excited about teams applying for anywhere in the world! a huge percentage of the startups we fund come from outside the us.
Which do you prefer most in an application: what the app currently does (or will do in three months)? what the future app might look like in five years? and/or: how it will get there?
Both. clearly explain what you do right now, and where you want to be in five years.
Have you ever considered funding enough to attract people who have financial obligations, such as kids, a spouse and a mortgage? it seems like a huge, untapped, resource that no one else is going after.
People in that situation usually save up money before applying to yc. I think this is the right answer--it seems important to startup's health that they get started on little capital.
What is the ratio between the businesses that yc funds that have revenue and don't have revenue? what about having a significantly large amount of traction (i.e. few thousand users in the first week of beta)
Most have no revenue, or very little. most companies we fund have some sort of prototype, but some of the best ones don't.
I know there was one aerospace startup in w15 but are space startups out of yc's scope?
That particular startup is building rockets, so no.
How often does yc fund early stage companies that don't even have a functional prototype?
Somewhat frequently, but we always ask why the company doesn't have a prototype.
Hey sam, i'm getting married in july, if I were accepted into yc, is there anything like deferring enrollment?
We've done it once or twice, but why not just apply for the next batch?
Would you ever consider investing startups in defense industry? for example a startup that builds anti-drone systems etc?
Yes, definitely.
Thanks for the ama. you haven't answered the hardware related questions in this thread yet, so i'll try: do you think you'll see the day when yc funds a hardware startup that develops custom asics or semi ip for licensing? if so, what type of startup would be a good fit for yc?
I predict that will happen in the non-distant future.
Hi sam, i'm currently a highschool junior and the co - founder of enerscore. i'm aware that yc has a semi-preference for younger founders as you said so yourself, but I wanted to know how yc might view me being this young. will it count against me in my application, or is yc more focused on the product itself?
The only hard disqualifier is if no founders are 18 or older, because you can't sign contracts in that case. i generally do not think it's a good life decision to start a company when you're 16 or 17, and i'd suggest waiting a couple of years.
I've been closely following yc and the startup scene in sf. what's your advice to a startup, applying to yc this season, and is from a foreign country? I've read most your writings and watched few interviews as well. it'd be great if you have something to add! and thanks for the ama!
It doesn't hurt or help--we fund lots of founders from foreign countries (more than 40% of the last batch was born outside the us).
What do you think are the most difficult problems, or types of problems, yc as its own organization will face in the future?
Scaling up the number of people in an organization and maintaining innovation is always, always hard.
The yc application asks teams to discuss their current equity split / legal situation. what happens to teams who haven't figured that out, or are looking for advice on those matters from ycombinator? will an uncertain equity plan or organizational structure kill an otherwise exciting application, if they are open to advice?
No, you can just say "we're still figuring this out, but here is about what we're thinking". leaving this question unanswered for a long time is a sign of badness, though. it's important to resolve this quickly and move on to the real work.
How does the partnership structure work at yc? what does it mean to be a part-time partner? do all partners get carry?
It's a flat partnership--we all get the same economics (including me). if you want a salary, it trades off against your equity. part-time partners get less equity and spend less time on yc.
Do you think that yc's batch model will one day be eschewed in favor of something more seamless and less dependent on timing? one could argue that, for certain startups, the optimal play right now is to launch just prior to submitting a yc application. it takes advantage of the high traction surrounding launch, and avoids applying in the midst of a typical post-launch slump, if timed correctly.
We might do something like rolling admissions, but the advantage of the batch model are huge. it's so helpful to the startups to be around other startups at roughly the same stage.
How do you spot grit and perseverance in an entrepreneur?
We ask about when they've done the impossible. you also get a pretty good feel for this after asking someone hard questions for 10 minutes. not pushing back at all is bad, and pushing back too hard is also bad.
Is yc interested investing in international remittance startup?
Yes! sendwave.com is one of our companies, and they are doing phenomenally well. they have a chance of being the best pivot in the history of yc.
Hi sam! as a high school student / developer with a (seemingly great) idea and no same-age peers, would you suggest waiting until college to find a cofounder, or going through with the idea now alone?
Tough one. i'd probably suggest going to college to meet cofounders.
What should founders do about the rent?
It's really just way too damn high. live in somewhere like sunnyvale or san jose, maybe.
Do you anticipate that putting together a structure for companies looking to perform long-term technology development ( i.e. three years, five years) is something yc would have on the board?
We fund a lot of 3-5 year horizon companies. 10-20 years is harder. this does not work for startups. I have a few ideas I want to try, though.
Where do you see yc 10 years from now?
The evolution of the university. but I think it's a much better model--it's got just the right amount of decentralization, it attracts the best people in the world to one place because of the network effect, we pay you instead of the other way aro...This knowledge is worth millions but signing up is free
What frustrates you the most about yc? what would you like to see change?
It seems like a bad thing that yc has gotten to the point where people stop me on street and ask to take a selfie. i'm not sure what to do about it, though.
When applying to yc, if you have a four or five person start-up team, if one member isn't able to come to silicon valley, but the rest are (3/4 or 4/5), how much does that penalize you?
The big problem is a 4 or 5 person founding team. that's a high bar to get over (but possible, one startup I really like in this batch has 5 founders). be so good we can't ignore you.
What is your favorite interview question to ask?
Why do you want to spend the next 10 years of your life working on this?
Hello sam, any plans to open up a yc hub in mexico. the startup scene is in an infant stage but it seems to be growing very fast. 500 startup is already funding companies here[1]. thank you! [1] http://500mexicocity.com/
No--but we are delighted when founders come here, learn and make connection in sv, and then go back to their home country!
How would you spend this week if you were applying?
Talking to users, and telling us what you've learned from them.
Are you going to do another semester of "how to start a startup" classes at stanford?
I might do a sort of graduate school version--i.e. "how to scale a startup"
What are the chances of getting funding if I want to focus on my home country (brazil) as my main market?
That's a feature, not a bug.
Had you not been accepted into yc, what was your plan of action?
I was going to work on my startup either way. I had a plan b investor that would have been not nearly as good.
What is the most critical element in driving growth for a startup?
Making a product that users love. http://blog.samaltman.com/the-only-way-to-grow-huge
I think most of the yc funded startups have good ideas, but some of the more recent batches (past three years) seem to have a much smaller market than the earlier batches. has there been a conscious decision to move to more niche markets, or has that just been where the chips fell? also, why has the average age of the founders yc funded slowly been rising?
Ideas look niche when the companies are starting out. as peter thiel says, you first want to dominate a small market. most great companies were derided for focusing on a small niche when they first started. i think the average age has risen someth...This knowledge is worth millions but signing up is free
For hardware cos applying to this batch, the bolt collaboration sounds awesome. since bolt has super expertise in prototyping, is it an indication that hardware ideas with an idea only or partial prototype can get accepted? how can such co.s improve their chances further, compared to software co.s where making a proof of concept barely costs any money?
Yes, we will fund hardware companies with only an idea in some cases. however, the cost and time required to make a prototype has come down so much that most applicants have something built.
What stage would be ideal for considering moving a project from research (at the graduate university level) to a startup? in this case i'm referring to a project that is based on custom nanoscale hardware components that rely on some pretty groovy physics. the applications are pretty immediate and the market already exists in the biotech/healthcare field.
I think startups are not well-suited for open-ended r+d unfortunately (hoping to do something about this). the best time to move from research to a startup is when you've developed technology and have a plan to make it into a product people will w...This knowledge is worth millions but signing up is free
Could you elaborate on what external factors and/or internal improvements are driving you and the team to again develop a larger number of companies per yc batch? is the scale-up going well? background: http://blogs.wsj.com/venturecapital/2014/05/05/y-combinator-... thanks!
There are just so many good companies applying. as long as we can keep upping the quality bar, i'm happy for us to fund more companies. i think there is good chance that there are more than 1 billion-plus dollar companies in the current batch. yc ...This knowledge is worth millions but signing up is free
How has the relationship between mentors/companies changed since the batches have grown? are there still ample opportunities for office hours, etc?
Unlike most other programs, yc does not have mentors--just partners that spend all their time advising startups (and some part-time partners). this is really important--most people give terrible startup advice, and people that do nothing but selec...This knowledge is worth millions but signing up is free
Do you think the increasing cost of living in the valley is detrimental to starting up?
Yes, I think it's the biggest long-term risk to the valley's continued startup dominance. http://paulgraham.com/marginal.html
Hi sam altman, what would you suggest to a new college grad? should I go work for a big companies, save some money and then go into start ups or just go into start ups ?
I wrote something related: http://blog.samaltman.com/advice-for-ambitious-19-year-olds if you have a low personal burn, you can jump right into a startup. if you have a lot of personal expenses, you probably need to save money before starting a st...This knowledge is worth millions but signing up is free
Sam, whats your take on startups targeting opportunities in developing countries ( difficult to operate terrains)? these are of course markets that have the potential of affecting billions of people.
Really depends on the specifics, but generally it's something we like.
There's a well known theory that non-competes stifles innovation and in particular ca's ban on these has allowed sv to flourish. there have been moves afoot in ma to enact a similar ban, although recently it seems to have been somewhat defanged through lobbying by the likes emc (despite still being protected by copyright, trade secrets and patents!). what are your thoughts on this; if ma is able to pass a ban on non-competed of any substance, how do you think it'll change the startup/vc scene in boston.
I think it'd be good to do this, but that the startup scene is really broken in boston for many other reasons. i'm not very optimistic this would be enough to fix it.
Does more than 1 partner review an application? and how do you maintain quality in screening applications and interview teams? is recommendations from current partners have weight-age in the screening process (from instacart application hack)?
Yes, in general about 3 partners, sometimes many more. we are very rigorous about maintaining quality and compute lots of statistics on this.
Independent of the fact that there's currently a tech bubble or not. if it hypothetically exploded, would y combinator stop its investment activities?
No, I totally ignore this. we'll keep funding good companies no matter what the macro does.
Hey sam, what is the problem/market that you think about most when you aren't at work?
Energy, existential risks to humanity, and wealth inequality.
What is the most common mode of failure in the interview stage?
Unclear communication. it's surprising how often we get 5 minutes into an interview without being able to really understand what a startup does.
Honest question on how profitable y combinator really is. what is y combinator's average portfolio return before management fees and carry?
We don't have outside investors, so there isn't fee or carry. our returns are very good (triple digit irr) but still mostly unrealized.
Having slow organic growth for our startup reduce our chances of an interview? what is the average growth week-over-week yc looks at?
Slow growth is bad, yes. a lot of our questions will be about why it's slow and how you plan to make it faster. we tell startups during yc to shoot for 10% weekly growth in their key metric.
Does yc have any initiatives planned for a founders conference that revolves around founders from urm groups, i'd love to see a conference for urm founders, similar to the female founders conference.
One of my partners is planning to do something here, but i'm not sure exactly what it's going to look like. (we run an extremely decentralized partnership.)
Hi sam, in the winter 15 class there was not a single startup from the african continent. are you guys interested in startups that are targeting emerging markets?
Yes!
What do you and the rest of yc think of dynamic equity splits? they're described in slicing the pie: http://www.slicingpie.com/ http://www.bloomberg.com/bw/articles/2012-12-18/grunt-funds-...
In general, I think fixed equity splits with vesting are the way to go. probably the optimal split is something like 51/49 (to prevent deadlocking) or 33.3/33.3/33.3 but anything near even is good enough.
Hi sam, i'd like to apply to yc, but my market is not in the us. is it something rational? does it worth?
We've funded many companies working only on non-us markets. razorpay is an example of one in the current batch.
What are your thoughts on drug use among the entrepreneur/tech communities? specifically modafinil, amphetamines, psychedelics.
The only one of those (not counting caffeine) I've tried is modafinil. the side effects are weird, but man do you get a productivity boost. personally, i'm scared to screw with my brain chemistry too much and am supersensitive to psychoactive drug...This knowledge is worth millions but signing up is free
Is there a lower preference for college-dropouts today in yc? the average yc founder age has increased considerably and I think there might be some relation.
No, if anything it's higher. I think the median age increase has more to do with us funding companies in different spaces that require more experience. if you're starting an internet company, i'm more convinced than ever that you don't need to fin...This knowledge is worth millions but signing up is free
Hi sam, how does yc look to foreign applications? do you have any plan to make improvements for participation of foreigners like visa support, logistics etc.
We help with visas. but part of being a founder is figuring out how to overcome obstacles by yourself.
Have you guys followed the alternative lending ipos recently? (lending club and ondeck in december, both with billion dollar valuations). what does yc think of the industry?
Personally, I think it's super interesting. lendup is a company we funded a few years ago, and we've done more recently.
Your recent stats blog post told us that 32 yc companies are worth more than $100 million. how many yc companies, including those acquired, are worth more than $10 million?
Counting companies that have raised with safes but not equity rounds, probably about 250-300.
I forget which speaker, it may have been peter thiel, was discussing how difficult starting a startup is at one of the startup school talks, and said "there are easier ways to make a lot of money". I would be curious if you knew what he (or whomever said that) would consider easier.
I think I was the one to say that. working in finance is an easier and more predictable way to make a lot of money, as long as you can deal with the deep existential angst the comes from adding no value to the world :)
As a proportion, how much of the value of yc is in the advice partners give, how much in the 'brand name' and network, and how much is just being around tons of smart focused people for 3 months?
I tell founders it's about 50% advice and 50% network value.
Hi sam. if the company applies for the second time with some progress made, is it treated differently, like "ahhh... the same guys. let's see what they have done since last time"? does it matter at all?
Yes. if you reapply with the same idea, the first thing we look at is progress since last time.
Hey sam, I have a product which is a direct competitor of one of yc11 companies. we have pretty decent traction, and we are solving the same problem significantly different from them. what are our chances? does yc accept competing companies?
We won't accept a direct clone, but competing companies are fine.
Competition is a tricky concept. if there is competition, that can be seen as verification of the concept, but at the same time it offers valid counterpoints. if there is no competition, it might be because the idea is so hard that nobody else has figured it out or so unpromising that everyone else dismissed it. what role does competition play in your evaluation of a startup?
I have never cared too much about "validation" or "verification of the concept". I trust my own judgment, and the companies I've made the most money on had far, far more people saying the idea was stupid than validating it. i just try to evaluate ...This knowledge is worth millions but signing up is free
What are your thoughts on advertising as _the_ way to make great services available for free (Google, reddit, Facebook, stack overflow)? what problems do you see with this model? when should this be preferred? does it only work for massive sites?
It does indeed only work for big sites. it's not the only model, but it was one that is proven and easy to understand.
Some of the advice yc partners give seems harmful because of survivorship bias (basic for the altair -> microsoft). I've seen some people criticise you for it, but I've never seen any of you address it directly. do you mind doing so now?
Most startups don't work--everyone understands the odds are long. what makes it worth it is that when they work, they really, really work. so we try to give advice about how to maybe become a huge company.
If we get an interview but aren't accepted, will you still reimburse the traveling expenses for us poor people?
Yes, of course. we reimburse travel expenses for everyone who comes to interview with us, and I think it's shameful when other accelerators don't. i probably would not have interviewed at yc if I had to pay for the trip--i was super poor at the time.
Sam, what would you say is the average amount of times a company applies before a. getting an interview at yc and b. actually getting in?
It is often on the first time. the 7th time is the highest count I know of. it's common for it to be on the second or third time. if we reject a company at interviews, we'll say what our objection is. if you reapply and that isn't fixed, you're un...This knowledge is worth millions but signing up is free
How much do you think moving to the valley improves the odds of a startups success as opposed to another city, say atlanta or raleigh on the east coast?
At least 10x
Funds need a 10x return from one company to cover the entire fund. is that a philosophy yc subscribes to, and if so, how long until it becomes evident which (if any) company in a given class will be the 10x ?
10x returns don't help us much. our entire model is driven by occasional 10,000x returns. it usually takes about 2 years to have a good sense for who is on a trajectory to maybe get there, and then about 10 years to see if they actually do.
Hi sama, you have a cs degree from stanford and you're now running yc. do you wish you had a mba or management degree or some sort? how did you learn about management even at your previous startup? in general how do founders specially who come right out of college without business degree learn to manage team as a leader? just wondering as i'm a programmer myself and would like to be in management role someday but don't plan to get degree like an mba.
No, I don't (i don't have a cs degree either--i dropped out after two years). i'm skeptical about how much one actually learns in business school, and I think it's a bad investment of time and money. I think management is one of those things where...This knowledge is worth millions but signing up is free
On evaluating applications: assuming you're looking at a solid team and a seemingly good idea, how much does having a working prototype and early traction help a startup's chances of getting into yc? is there some level of traction that makes any application a shoo-in? are there categories of startups that you won't even consider without demonstrated traction? on the flip side, what does it take to make you consider a team that has nothing built and no users yet?
A prototype helps a lot. traction helps too, but we tried not to get fooled by graphs. in fact, I always ask the other interviewers "would we fund this company if they had no traction at all?" to fund a company with nothing built and no users, we ...This knowledge is worth millions but signing up is free
I am currently applying to the summer batch and I was wondering about my setup. I came to the u.s. about four years ago and immediately built a marketing agency and after a year added software development services to it. we grew rapidly to a stable stage and now I am at the point where I can step back from taking care of the company and let my other partners manage it (we are four partners). my question is, I am applying as the only founder and was wondering if having a company already might be a deal-breaker, due to you thinking that I would not be able to invest 100% of my time into the startup? my reason for not having a co-founder yet, is because I want to make sure that I really add somebody that will 100% benefit the startup. I do have a pool of people available from my current company, but would also like to branch out first. any thought from you would be really appreciated.
Make it clear in your application you're going to spend 100% of your time on this new business.
What is the #1 cause of failure of yc startups and how long does it usually take to materialise?
The apparent cause is running out of money, but the real cause is failing to build something users love. it is usually apparent in the first 6 months, but not always. another big cause is cofounder tension.
Do you think if zuck applied to yc today with Facebook as it was in 2005 he'd make it in? (assuming the 'social network' landscape still looked like it had in 2005).
Yes. there are certain people that you cannot sit across from and let yourself not invest. he is one of them, for sure. he also had great growth. (zuck comes to speak to the yc batch every year or so. pg used to say that when he talked to zuck he'...This knowledge is worth millions but signing up is free
Hey sam, i'm working on this idea on my free time but for now it's in an early stage. we believe strongly in it but we don't have yet a ready prototype which means we don't have any structure, users, revenue, etc.. i'm wondering if ycombinator's goal is to encourage people from initial concept or help existent startups to grow and go further ? knowing our story, do you honestly think we have a chance at this time to be selected by ycombinator ? thanks.
Why don't you have a prototype? that'll be an important question. that said, we make most of our money backing companies at the "initial concept" stage, so we'd love to hear from you.
Hello sam, amid a never-ending war between anti-ai and pro-ai , you've recently shown strong positions( http://blog.samaltman.com/machine-intelligence-part-1) about it. as an 'ai applicant', I can't stop wondering whether such position could influence an application decision. what's your take on it?
I still want to fund a lot of ai companies.
What's the most exciting non-traditional segment (bio, energy, manufacturing, etc) you're looking forward to funding startups in?
I imagine each partner will have different answers. one thing I say is that we should be willing to fund anything that could be a $10b company, and that is such a difficult restriction we shouldn't have any other restriction. personally, I am very...This knowledge is worth millions but signing up is free
We are a bootstrapped ~2.5yr old company that is doing $5m in revenue and ~$2m in pbt. we have fallen into a bit of a funk in the past 6-12m or so growth-wise and basically flat-lined. we are talking to a few funds to raise a ~$10m round (mostly secondary) to bring the pbt down to 0 and really swing for the fences. we've thought about applying to yc but the 7% seems high for us at this stage. is yc interested in co-investing the standard yc amount in such a round at the market valuation instead of standard yc valuation?
Unfortunately we don't do that--it just doesn't fit our model. plenty of companies have done yc at a later stage and still thought we increased their value far more than the 7% we take, though.
Could you comment on why start ups with remote teams anecdotally do poorly but many open source projects with very remote teams succeed? do you see any tools on the horizon to help people coordinate remotely at a new level?
I think it's because startups have to make small changes to their idea several times per day. very short cycle times do best with in-person interaction.
How do you feel about what the constant influx of 22-year-olds making six-figure salaries is doing to the culture and social fabric of san francisco?
I think the biggest problem is that it's making housing totally unaffordable. I think it's critical sf fix this, and that the only real solution is more supply. unfortunately, homeowners are the ones that vote, and they are loving the increase in ...This knowledge is worth millions but signing up is free
If the product is good and if the product has a single co-founder, what are the chances of getting accepted? the reason is that I live in a place where it's very hard to find a good co-founder and I don't want to team up with the only options that I have. I don't want to make wrong choices. in my place, people tend to join companies and look for jobs rather than start companies.
We will fund a company with 1 founder, but the bar is very high. have you thought about working at a startup first as a way to meet potential cofounders?
In terms of "how will you make money", are you interested in the market for the initial product/use case or what we think the product can eventually grow into? ie: we think our total initial market has the potential to be around $30m/yr but can grow to take on other use cases.
Both. the best answer is something like "we have a path to be be doing enough revenue to cover our expenses in a year, but if things really work, here is how we could make $1b a year in 10 years."
When you held startup class in nyc. you brought up a few founders who were invested in... and what struck me was that each of them had previous relationships to their investors. for example I heard at least twice from an investor: "I've known john for years prior to him coming to me with [insert company name here]." so my question is, do you think there exists a "good ol boy's club" in sv that increases the chances by a great deal of getting funded? or do you believe the playing field is even for those who don't have those kind of connections?
For sure it helps to get to know investors over long periods of time. however, the investors that invested in my company knew me for 45 minutes (yc), a few weeks (sequoia), and a few months (nea). it's important as a founder not to make excuses fo...This knowledge is worth millions but signing up is free
Yc is famous for funding startups at a very early stage, even at a pre-traction stage, which seems to contradict the popular knowledge that an idea without a good execution is worth nothing. with just an application form and a 10 minute interview, how can you tell if the founders will be able to execute the idea properly? what are the most important traits that you look for in an application from a very early stage startup?
Even if the company is only a few weeks old, we look for signs that the founders are determined, getting things done week by week, and improving quickly. if it's just an idea, then we look at what the founders have done in the past. most people do...This knowledge is worth millions but signing up is free
What's something common that partners have to repeat over and over until founders 'get it' ?
The most common thing is getting founders to focus on the right thing. at this stage, nothing but building a product that users love matters. founders want to focus on anything else, and have wonderfully detailed excuses for why whatever it is is ...This knowledge is worth millions but signing up is free
Possibly naive question: i'm a married guy in his 30s working at a major investment bank in nyc (lead quantitative role). I have a graduate degree from a non-elite school. no experience at top tech firms (had offers but didn't go). now, I have some cool side projects that I believe could become great consumer apps given enough care and resources. is there any reason for me to apply to yc, and any chance of getting seed funding from you, or am I completely out of your profile for typical candidates / startups?
We have funded lots of people with similar backgrounds. what will matter is the quality of your idea and progress so far.
Thanks for doing this ama sam. as a follow-up, what would you recommend applicants who are in this position do before the end of next week to increase their chances of being interviewed/accepted? (i.e. get feedback from as many yc alum as possible, iterate on their video, etc). obviously without specifics, i'm sure your answer may be similar to the above, but any general recommendations here?
Talk to users, and tell us what you learn from them.
I frequently see the stat that yc companies are worth 30 billion in total. while this is very impressive, it's still less than say uber at 40 billion for a single company that's about the median age of the group--so it seems like a fair comparison, though an obvious outlier. for the uber, Twitter, Facebook, Google, etc. outlier startups, how much pure luck do you think plays into their success? airbnb and dropbox are yc's biggest outliers. have you found any actionable patterns in the way the founders of these outliers work/think/operate compared with the more moderately successfully and unsuccessful founders?
We haven't updated our numbers in awhile. current total is more than uber. we'll update again at some point. it's not a perfect correlation, but the founders that build huge companies are extremely determined and smart, they have a very clear visi...This knowledge is worth millions but signing up is free
Do you think that yc could ever invest or advise startups / founders that can't move to silicon valley for 3 months for one reason or another? is there something inherent in the in-person experience that cannot be overcome by technology (in general too I suppose, rather than just the type of work ycombinator does)? personally I believe we're not quite there yet. I have some hope, that within our life time communication and collaboration tools can become both sophisticated and intuitive enough to make physical presence for most type of work completely irrelevant)
There is for sure something about in-person interaction that cannot be replaced by any current technology. alan kay recently told me he thinks it's something biological. our model just doesn't work well for people that can't move to the valley for...This knowledge is worth millions but signing up is free
Since you probably can't spend too much time on each yc application, what is the most common issue you see that causes companies to not get further attention?
Great question! the biggest mistake founders make is burying whatever it is that's exceptional about them or their company deep in the application. we are optimists. we want to believe. help us by putting whatever it is that is going to make us wa...This knowledge is worth millions but signing up is free
What is your advice for people who don't have co-founder material friends (mostly non-technical/non-sales people, or conservative) and are out of college? I've experience starting companies with acquaintances, something that, predictably, didn't go so well. is there any alternative - that you have seen in yc - to getting new friends, getting to know them really well, and starting a company in a few years time?
I have a good answer for this! go work at a breakout medium sized tech company (i.e. a couple of hundred to a couple of thousand people). you'll meet lots of potential cofounders. the people that are attracted to these companies are usually 1) rea...This knowledge is worth millions but signing up is free
Hello sam, first, thank you so much for taking the time to answer our questions. my question is about confidentiality of applications. today I am working at a yc startup. I (and two other friends) have a project in mind. but what prevents me from applying to yc is the fear that my application would fall in the inbox of our founders. obviously I would prefer our application to remain confidential until if they we get accepted (which, I understand, is against the odds :)). how can I ensure that this won't happen? how private and confidential are our conversations with yc partners and team? i have also heard that yc alumni sometimes help filtering/interviewing the teams/projects that apply. is this correct? to be completely transparent, I have heard from 2 persons closed to yc that there is no way our founders won't know that I have applied. so this point really worries me a lot. thank you for your answer and again, thank you for taking the time to answer the questions of the hn community
We do have some alumni help us review applications. there is a chance the founders of your startup would randomly see your application. however, you should not only start a startup if you get into yc. if you're into this startup, you should be doi...This knowledge is worth millions but signing up is free
Hey sam, can you give please tell us about the time you, sama, most successfully hacked some (non-computer) system to your advantage?
Sure. when I was running my startup, we got catastrophic news that the first big customer in the space (boost mobile) was signing a deal with a competitor instead of with us. this would have killed us. the competitor was a much larger and better f...This knowledge is worth millions but signing up is free
On that note, would you ever consider starting a yc 'minor league' farm? it'd be interesting to do 12-15k investments on young, very scrappy founders, a la original summer founders program. perhaps mentored by alumni rather than full-time partners for bandwidth purposes.
I think so, yes. but also, it's a different time now. i'd have had more progress by the time I applied to yc. for some companies, in a week, good hackers can get a prototype built and have a few initial users. if that's possible, we expect it. if ...This knowledge is worth millions but signing up is free
If you had applied now with loopt, do you think you would have been accepted into yc? or alexis ohanian / steve huffman with reddit in its primordial phase? it seems like yc has become so competitive that it cuts out some of those promising (risky) founders that don't have as much to show.
Yes, I've thought about trying something like that.
I interviewed for a company once that had different kinds of offers, ranging from low-salary/high-equity, to high-salary/low-equity. I thought that was an interesting idea :d they had 5 options total, and the middle option wasn't awful. i'd like to see more of this in the valley.
I always used to make offers like this--i think it's a good way to do it.
You have suggested that silicon valley is successful, in part, because workers accept a notion of "long-term compensation" [1]. long-term compensation, perhaps better called maybe-someday compensation, requires sv software engineers to work for relatively less (factoring in cost-of-living) than many other skilled professionals, with hopes that they'll be rewarded with a big windfall in the future. with the rising cost of living in sf/sv, young engineers are expected to shoulder much the risk of startups while putting their long-term financial stability on the line. all in hopes of maybe-someday being compensated. and let's face it, the lion's share of these rewards will not be passed to these workers who put all their eggs in one basket, but to financially-secure vc's who have hedged their risk across many companies. if this is how sv works, do you truly believe this is a strong foundation for the industry? obviously it's good for founders and vcs, but i'm considering the perspective of engineers. we seem to be enjoying go-go years of investment and profits, everyone is starry eyed, and the system is working. what happens when the present-day strain on workers exceeds the allure of maybe-someday compensation? also, why shouldn't talented workers move to an industry that provides guaranteed compensation for hard work in real time? of course, start-ups have a much different risk profile than banks, consulting agencies, large corporations, etc. and as a result, the long-term compensation model may be a necessity. but in the end, it sounds like sv works because there's a large supply of people willing to gamble on their future financial stability. [1] http://blog.samaltman.com/why-silicon-valley-works
It's a personal choice for workers. if you're an engineer and you want a guaranteed $250k per year, go work for a financial firm. nothing wrong with that decision. everyone gets to make his or her own. engineers at startups make $100k+, sometimes ...This knowledge is worth millions but signing up is free
This answer by adam d'angelo on quora blows my mind: "what was hot in silicon valley in march 2013?" http://www.quora.com/what-was-hot-in-silicon-valley-in-march… every one of those blew up. so I ask you the same question: what is hot in silicon valley in march, 2015?
Adam is super smart. in fact, I asked him for an updated list at dinner a couple of weeks ago and I predict he will be right again. i'm not going to share my list because I've found that people put too much stock in it. I don't mind talking about ...This knowledge is worth millions but signing up is free
If you don't use alien blue (the mobile app for reddit) then you might not know they have been testing "sponsored" posts. it didn't take a genius to know people would complain, but the ads are getting a lot of pushback from users. I supposed you can put this in context and look at how Facebook gets crap for changing anything, but is this really the most creative idea reddit can come up with to generate more revenue?
I don't use it (i just read reddit in mobile safari) but I will pass this along to the reddit team.
With you recently leading a round of investment for reddit, it seems you are quite optimistic about its success but as of late 2013 (and maybe now too), reddit remains in red even after nearly a decade of its inception[1]. reddit ceo once said, that ads are the reasons digg failed[2], so I believe the site would be wary of using ads to the fullest. how do you think reddit would become profitable and would be able to sustain itself? [1]: http://www.businessinsider.in/reddit-ceo-admits-were-still-i… [2]: http://techcrunch.com/2012/11/08/reddit-digg/
I am an extremely patient investor. I just invested in a company that I believe will take 20-30 years to work. if reddit gets to a billion users, which I believe it will, the company will have many, many interesting monetizations opportunities. it...This knowledge is worth millions but signing up is free
Parker conrad of zenefits was also still a solo founder in his application video. if a founder intends to add a co-founder before the batch starts, how much does that impact your view on them as a solo founder during the application process?
Parker and I spoke about a cofounder then. he was very receptive to adding one, and that helped his case.
It seems like you really need to know the potential cofounder as a person, though, otherwise you won't be sure what they're like when stressed or making mistakes. doesn't this limit it to people you already know fairly well?
Yes, you do. we always ask how long the cofounders have known each other.
Question re solo founders: "a startup is too much work for one person" and if you can't convince even one friend to join you, that doesn't speak well for your idea! on the other hand, a bad hire/partnership can ruin the company. yc gives signal it really prefers to look at teams than individual applications. q: do you have have advice or rules of thumb re how much time a solo founder should put into finding partner(s)? or thoughts re how much to prioritise this, vs. just writing code and talking to users to finish initial version yourself? I don't mean this to be just focused on "getting into yc" but more in general: what's the right way to think about fixing this problem (being a solo founder) vs tackling other things like actually building something initial users can be using? for software ideas surely it is occasionally sensible to make at least a prototype and actually get some users before ever buddying up? or if I've got this far but am basically still going it alone, am I doing something wrong?
We really prefer at least two founders, but it's not a deal-breaker. we funded drew houston of dropbox as a solo founder, but he got a cofounder before the batch started. a bad cofounder is far, far worse than no cofounder. i'd spend maybe 20% o...This knowledge is worth millions but signing up is free