Michael Seibel discusses why people should start a startup and the different types of individuals who are suited for entrepreneurship. He emphasizes the importance of self-awareness and understanding one's motivations and strengths. Seibel also warns against taking biased advice and encourages individuals to critically evaluate their career choices.

- The speaker discusses the three purposes of big companies like Google: to make money, to prevent competition, and to attract talented individuals.
- Peer advice in school is often helpful, but in college, peers may not have the necessary knowledge or experience to provide good career advice.
- Big companies take advantage of the information gap and orchestrate their recruitment strategies to attract college students.
- While working at a big company may be the right choice for most people, it may not be suitable for those who are different or have unique motivations.
- The world tends to want individuals to be average and fit into predefined boxes, which may not work for everyone.
- Startups and entrepreneurship require irrational motivation and may be frustrating for those who are not strongly motivated.
- Taking a job at a big company like Google may be safer and more financially rewarding, but it may not lead to a fulfilling life for some individuals.
- The speaker encourages trying out different projects and experiences in college to see what works best.

Michael Seibel is a partner and the CEO of YC. He cofounded Justin.tv, which was in the winter 2007 batch and Socialcam, which was in the winter 2012 batch. https://twitter.com/mwseibel

In this video Michael comments on his essay Why Should I Start a Startup? https://blog.ycombinator.com/why-should-i-start-a-startup/

The YC podcast is hosted by Craig Cannon - https://twitter.com/craigcannon

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0:00 - Why Should I Start a Startup?

2:00 - Three types of people: people highly motivated when working for themselves, people that could succeed starting a startup or within a big company, and people that could succeed within a big company.

6:00 - How do you decide what type of person you are?

7:30 - Identify bias in advice givers

10:30 - Peer advice becomes less valuable during college

So today we're going to do something different and talk about a few of the essays you've worked on in the past.

I think these are maybe the past 2 years.

So the first 1 is why should I start a startup?

You start this essay by saying a lot of people ask themselves this question.

They often mull over 1 or more of the following facts.

1, the vast majority of startups are not successful.

2, for talented technical people, it's relatively easy to get a job and make a large salary.

And 3, large companies offer opportunities to work on very difficult problems that only often occur at scale.

My answer to why you should start a startup is simple.

There's a certain type of person who only works at their peak capacity when there is no predictable path to follow.

The odds of success are low, and they have to take personal responsibility for failure, the opposite of most jobs at a large company." Why did you write this essay?

1, I talk to a lot of smart technical people who I think sometimes feel like they should start a startup, but they're conflicted because they either don't know if they have a good idea, don't have an idea, don't have a team.

And I think they're really trying to figure out what should I do with my life?

And when I first started giving people advice, I think that I really assumed that because you could start a startup, you should start a startup.

If you have the money to afford, if you have the time, if you have the ability, you should be doing it.

I quickly realized working at YC, that's a bad idea.

And I think what I quickly realized is that there's probably 3 sets of people.

There's probably the set of people who the only thing they can really do is work in a radically entrepreneurial job.

Like literally they will not enjoy their life inside of a big company, inside a big bureaucracy.

I think back in the day, those are the kinds of people who start small businesses.

And so there's that type of people, and they're relatively few and far between.

I wouldn't be surprised if that's only 1% of the population.

The second group of people are the people who are on the fence.

They want to be really challenged by work, but they can easily apply themselves in either a entrepreneurial world or in a big company world.

And I think those people are the ones where they have some choices to make.

I think a lot of people confuse themselves for this group.

When in reality, I think this group is also probably pretty small.

Yeah, I think it's a really small group who can actually be equally capable in either role, as a founder or as a really effective person inside of a big company.

I think you do see founders who get acquired, who are actually really functional inside of big companies and vice versa, right?

Exactly go out and start companies and they do well.

I think the last group, and by far the biggest group, are the people who are going to operate best within a large company.

And the mindset of this type of person, at least from what I've seen, is they want a system to optimize.

They want an existing system, an existing path, an existing set of rules that they can operate and play by.

And what's interesting is that almost everything up to this point in your life kind of has that.

Like kindergarten through 12 has this, even college has this, and they kind of want to continue that.

Someone else defines what's an A and what's an F, and then I optimize, right?

And I don't think that there's any moral judgment to be passed.

I think that if most people didn't feel that way, the world wouldn't work.

But there's a smug of people who feel like, I want to make the rules, I don't want to follow them.

And so I think that when someone's thinking about whether they should start a startup, they should really be intellectually honest with themselves about which of these groups they're in.

And anyone who's trying to kind of guilt trip them into 1 group or another, it goes both ways.

I in the past would guilt trip people to be a founder.

A lot of people's parents will guilt trip them into being a big company or being a doctor or yada yada yada.

I just think this is 1 of these things where you have to actually have some personal, you have to go deep and really understand.

So I read it in college, so it's been a while.

But basically the concept was a lot of people who are, you could say craftsmen, so in our context, like a developer, often think that they want to become entrepreneurs so they could do just their craft in just the way they want to, but they don't realize that as soon as they enter the entrepreneurial realm, most of their job is no longer there.

And so I think this is a common thing, and it's why these indie hackers are so, like people love them so much.

an interesting point, because like artists and craftsmen doesn't equal founder, isn't it?

And even more so, what's so sad is that as a founder, almost by definition, the thing that you're good at is the thing that you stop doing.

And you have to keep on doing things that you suck at.

that the founder who's really good at something can delegate so well that the thing they love is still the thing they do forever.

What are the questions, you know, that we've had some time since you wrote this 1.

So what are the questions that you ask yourself when you have to decide if you're in that, you know, 2% of people?

The questions that I asked myself was, where am I at my best?

And where do I feel like I'm organically applying effort?

And like, I think Anyone who is 22, 25 has enough life experience to know.

And certainly anyone who's 30 or 30 plus definitely has enough life experience to know, in what types of situations am I just naturally extremely motivated?

The other kind of question I'd ask, which is an extension of this, is if I think about the moments where I outperformed, so not only was I really extremely motivated, but actually delivered the best results, I did the best, Where does that happen?

And when I think about those moments for myself, they never really happened in the truly structured things.

In the K-12 setting I did final at stuff, of course, I did all the classes and got all the grades.

But it wasn't when I was like really like kicking into high gear.

So I think if you're like super honest with like, when do you really kick it into high gear?

That's when like you can start asking this question of yourself, like, okay, who should I be?

I think that 1 tricky bit here is you have to be really careful about taking advice from biased people.

Like When I was giving founders this advice originally, I was so biased.

I was like, well, I'm at YC, I want you to be a founder.

I was previously giving advice that was very self-serving.

I think that a lot of young people are looking for advice givers and are not doing a good job of identifying bias.

And so I see a lot of people who are generally believing the information that they get from either their peers or from companies that they work at.

And they don't realize those people are biased.

A perfect example, my brother's at MIT right now.

The most prestigious jobs are jobs at Facebook and Google.

And that prestige has actually very little to do with any facts.

It actually reminds me of when I was in high school and the crew that I was in, the job everyone wanted to do was be a lawyer.

And because we were all government kids, everyone wanted to be a lawyer.

But then if you ask people, do you actually want to do the work of a lawyer?

Paul Anderson Yeah, and just make a bunch

Kevin Kwan Yeah, and I want to change the laws and I want to debate the Constitution and all these things.

It's like, Yeah, but do you actually want to do the lawyer work?

And so I think similarly, when I talk to my brother and I go to MIT, I meet all these people who have this, who've created this imaginary world where when they get to go to Google, they're going to be on the machine learning team and they're going to have high impact from day 1.

Needless to say, Google loves to pitch this story, And people love to eat it.

But the reality is when you're on the other side, that's often very rarely the case.

And so what I would encourage people to do, having been an offender myself, is to just really look for the bias in the person who's presenting you with options and advice.

And understand that, like, Google is operating a machine.

1 purpose is to get the smartest people to work on the hardest tasks.

But the other purpose is to get people who are smart and talented so that they're not working for Google's competitors.

And then the last purpose is to get people who are smart and talented so they're not creating companies that will compete with Google.

And everyone understands the first 1 and they don't think about 2 and 3.

And also when I find college kids, and I'm totally a offender of this as well, they seek people for advice until the person gives them an advice that corroborates with what they want to hear.

And so you just look around and you're like, sometimes it feels like you gotta do some living.

Like you can only listen to advice for so long.

Well, and I think the peer advice thing is actually really tricky.

It's really hard to go from, like I'd argue that like, in school, especially like K to 12, a lot of peer advice is very helpful.

Like I learned how to apply to a good school from my peers.

I learned which classes to take, which teachers were good.

My peers were this great intelligence source for so long.

And then it turns out that With career advice, they almost are horrible.

And I think it's so hard to go from a situation where someone goes from a good source of information to a bad source of information so fast.

Your peers are no longer, because I think what the reality is is that in many ways there's a simple track and a simple set of rails all the way up through college.

And then college, it goes from 1 track to 1,000 tracks.

And your peers don't even know anything about any of the 8,000 tracks.

So suddenly they're not the experts anymore.

Suddenly the kid who's 1 year ahead of you really just doesn't actually know anything more than you do.

But your whole old system is still there.

Your old system of relying on that is still there.

And what's funny is the big companies know this.

That's the cool thing is they are actually relying on you having poor sources of information.

Everything that a big company does to attract a college kid is 100% orchestrated.

Again like you can go and have fun at these jobs.

What I'd argue, for most people, that is the job they should take.

But man, if you're 1 of those different people, don't believe the hype.

And yeah, I don't know if it's 100% accurate, but my impression is that the world just kind of tends toward wanting you to be average.

You ask someone for advice, they're like, these are the known outcomes based on all the inputs you just gave me, you should go work at this company.

And I wouldn't say average, I would say wants to put you in a box.

It could be a ridiculously productive box, but a well laid out, well understood box.

They want to plug you in somewhere and move on.

Or more importantly, for some people that's not how you get their best.

For some people it's almost a guarantee you won't get their best in that environment.

And so yeah, so what's so weird is we're not talking about like, do you see a good business opportunity?

Those things are important, but man, if you are not irrationally motivated to do startups and be entrepreneurial, it's going to be frustrating, And you're not going to understand the risk reward.

Because from a pure money-making perspective, it's probably better to take the job at Google.

But from a will I enjoy my life perspective, that's the 1 where for some people, absolutely not.

But on the other hand, I'd just say, try it out, see how you feel.

Like, you can do plenty of projects in college.


Speaker 0: All right, Michael Seibel. So today we're going to do something different and talk about a few of the essays you've worked on in the past. I think these are maybe the past 2 years. Yes. So the first 1 is why should I start a startup?

You start this essay by saying a lot of people ask themselves this question. They often mull over 1 or more of the following facts. 1, the vast majority of startups are not successful. 2, for talented technical people, it's relatively easy to get a job and make a large salary. And 3, large companies offer opportunities to work on very difficult problems that only often occur at scale.

My answer to why you should start a startup is simple. There's a certain type of person who only works at their peak capacity when there is no predictable path to follow. The odds of success are low, and they have to take personal responsibility for failure, the opposite of most jobs at a large company." Why did you write this essay?

Speaker 1: So I think that there are 2 reasons. 1, I talk to a lot of smart technical people who I think sometimes feel like they should start a startup, but they're conflicted because they either don't know if they have a good idea, don't have an idea, don't have a team. And I think they're really trying to figure out what should I do with my life? What should my real career path be? And when I first started giving people advice, I think that I really assumed that because you could start a startup, you should start a startup.

If you have the money to afford, if you have the time, if you have the ability, you should be doing it. I quickly realized working at YC, that's a bad idea. And I think what I quickly realized is that there's probably 3 sets of people. There's probably the set of people who the only thing they can really do is work in a radically entrepreneurial job. Like literally they will not enjoy their life inside of a big company, inside a big bureaucracy.

I think back in the day, those are the kinds of people who start small businesses. And so there's that type of people, and they're relatively few and far between. I wouldn't be surprised if that's only 1% of the population. The second group of people are the people who are on the fence. They want to be really challenged by work, but they can easily apply themselves in either a entrepreneurial world or in a big company world.

And I think those people are the ones where they have some choices to make. I think a lot of people confuse themselves for this group. When in reality, I think this group is also probably pretty small. And then there's the last group.

Speaker 0: Peter. Pretty small, how small?

Speaker 1: I bet 1%. I bet there's only really 1. Yeah, I think it's a really small group who can actually be equally capable in either role, as a founder or as a really effective person inside of a big company. And I think you do see this. I think you do see founders who get acquired, who are actually really functional inside of big companies and vice versa, right?

Exactly go out and start companies and they do well. But few and far between. I think the last group, and by far the biggest group, are the people who are going to operate best within a large company. And the mindset of this type of person, at least from what I've seen, is they want a system to optimize. They want an existing system, an existing path, an existing set of rules that they can operate and play by.

And what's interesting is that almost everything up to this point in your life kind of has that. Like kindergarten through 12 has this, even college has this, and they kind of want to continue that. Someone else defines what's an A and what's an F, and then I optimize, right? And I don't think that there's any moral judgment to be passed. I think that if most people didn't feel that way, the world wouldn't work.

So it's a good thing. But there's a smug of people who feel like, I want to make the rules, I don't want to follow them. And so I think that when someone's thinking about whether they should start a startup, they should really be intellectually honest with themselves about which of these groups they're in. And anyone who's trying to kind of guilt trip them into 1 group or another, it goes both ways. I in the past would guilt trip people to be a founder.

A lot of people's parents will guilt trip them into being a big company or being a doctor or yada yada yada. I just think this is 1 of these things where you have to actually have some personal, you have to go deep and really understand.

Speaker 0: Paul Wittman Yeah. Did you ever read the book, The E-Myth?

Speaker 1: Have you heard

Speaker 0: of this book?

Speaker 1: No, no, no.

Speaker 0: So I read it in college, so it's been a while. But basically the concept was a lot of people who are, you could say craftsmen, so in our context, like a developer, often think that they want to become entrepreneurs so they could do just their craft in just the way they want to, but they don't realize that as soon as they enter the entrepreneurial realm, most of their job is no longer there. And so I think this is a common thing, and it's why these indie hackers are so, like people love them so much. Kyle Yonemura It's

Speaker 1: an interesting point, because like artists and craftsmen doesn't equal founder, isn't it? And even more so, what's so sad is that as a founder, almost by definition, the thing that you're good at is the thing that you stop doing. And you have to keep on doing things that you suck at. And be totally okay with it. Yeah, no, it's rare

Speaker 0: that the founder who's really good at something can delegate so well that the thing they love is still the thing they do forever.

Speaker 1: Really, really, really hard.

Speaker 0: So, okay, you get to this at the end. What are the questions, you know, that we've had some time since you wrote this 1. Yep. So what are the questions that you ask yourself when you have to decide if you're in that, you know, 2% of people?

Speaker 1: I can answer this for myself better. The questions that I asked myself was, where am I at my best? And where do I feel like I'm organically applying effort? Like I'm 100% self-motivated. And like, I think Anyone who is 22, 25 has enough life experience to know.

And certainly anyone who's 30 or 30 plus definitely has enough life experience to know, in what types of situations am I just naturally extremely motivated? The other kind of question I'd ask, which is an extension of this, is if I think about the moments where I outperformed, so not only was I really extremely motivated, but actually delivered the best results, I did the best, Where does that happen? And when I think about those moments for myself, they never really happened in the truly structured things. In the K-12 setting I did final at stuff, of course, I did all the classes and got all the grades. But it wasn't when I was like really like kicking into high gear.

So I think if you're like super honest with like, when do you really kick it into high gear? That's when like you can start asking this question of yourself, like, okay, who should I be? And what career track should I take? I think that 1 tricky bit here is you have to be really careful about taking advice from biased people.

Speaker 0: I.e., everyone. Yeah, right?

Speaker 1: Like When I was giving founders this advice originally, I was so biased. I was like, well, I'm at YC, I want you to be a founder. You should be a founder, right? I was previously giving advice that was very self-serving. I think that a lot of young people are looking for advice givers and are not doing a good job of identifying bias.

And so I see a lot of people who are generally believing the information that they get from either their peers or from companies that they work at. And they don't realize those people are biased. A perfect example, my brother's at MIT right now. The most prestigious jobs are jobs at Facebook and Google. And that prestige has actually very little to do with any facts.

It actually reminds me of when I was in high school and the crew that I was in, the job everyone wanted to do was be a lawyer. And because we were all government kids, everyone wanted to be a lawyer. But then if you ask people, do you actually want to do the work of a lawyer? They'll be like, no, of course not.

Speaker 0: Paul Anderson Yeah, and just make a bunch

Speaker 1: of money and be a lawyer. Kevin Kwan Yeah, and I want to change the laws and I want to debate the Constitution and all these things. It's like, Yeah, but do you actually want to do the lawyer work? Peter.

Speaker 0: You're like describing Model UN.

Speaker 1: Yeah, exactly. That was like Model UN in the T, right? And so I think similarly, when I talk to my brother and I go to MIT, I meet all these people who have this, who've created this imaginary world where when they get to go to Google, they're going to be on the machine learning team and they're going to have high impact from day 1. Needless to say, Google loves to pitch this story, And people love to eat it. But the reality is when you're on the other side, that's often very rarely the case.

And so what I would encourage people to do, having been an offender myself, is to just really look for the bias in the person who's presenting you with options and advice. Like, understand where their biases are. And understand that, like, Google is operating a machine. And the machine has multiple purposes. 1 purpose is to get the smartest people to work on the hardest tasks.

But the other purpose is to get people who are smart and talented so that they're not working for Google's competitors. And then the last purpose is to get people who are smart and talented so they're not creating companies that will compete with Google. And everyone understands the first 1 and they don't think about 2 and 3.

Speaker 0: No, not at all. And also when I find college kids, and I'm totally a offender of this as well, they seek people for advice until the person gives them an advice that corroborates with what they want to hear. And so you just look around and you're like, sometimes it feels like you gotta do some living. Like you can only listen to advice for so long.

Speaker 1: Well, and I think the peer advice thing is actually really tricky. It's really hard to go from, like I'd argue that like, in school, especially like K to 12, a lot of peer advice is very helpful. Like I learned how to apply to a good school from my peers. Like My parents hadn't done it in years. I learned which classes to take, which teachers were good.

My peers were this great intelligence source for so long. And then it turns out that With career advice, they almost are horrible. And I think it's so hard to go from a situation where someone goes from a good source of information to a bad source of information so fast. But that's what happens in college. Your peers are no longer, because I think what the reality is is that in many ways there's a simple track and a simple set of rails all the way up through college.

And then college, it goes from 1 track to 1,000 tracks. And your peers don't even know anything about any of the 8,000 tracks. So suddenly they're not the experts anymore. Suddenly the kid who's 1 year ahead of you really just doesn't actually know anything more than you do. But your whole old system is still there.

Your old system of relying on that is still there. And what's funny is the big companies know this. That's the cool thing is they are actually relying on you having poor sources of information. Everything that a big company does to attract a college kid is 100% orchestrated.

Speaker 0: Yeah. I mean there's an information gap there. Yes. Yeah. And that's how the business works.

Which I mean it's fine. Again like you can go and have fun at these jobs. You can go and feel purposeful. Of

Speaker 1: course. What I'd argue, for most people, that is the job they should take. But man, if you're 1 of those different people, don't believe the hype.

Speaker 0: I mean, this is kind of harsh. And yeah, I don't know if it's 100% accurate, but my impression is that the world just kind of tends toward wanting you to be average. You ask someone for advice, they're like, these are the known outcomes based on all the inputs you just gave me, you should go work at this company. Peter Collins

Speaker 1: And I wouldn't say average, I would say wants to put you in a box. It could be a very productive box. It could be a ridiculously productive box, but a well laid out, well understood box. They want to plug you in somewhere and move on. That doesn't work for some people.

Speaker 0: Yeah.

Speaker 1: Or more importantly, for some people that's not how you get their best. For some people it's almost a guarantee you won't get their best in that environment. And so yeah, so what's so weird is we're not talking about like, do you see a good business opportunity? Or do you have this burning problem? Those things are important, but man, if you are not irrationally motivated to do startups and be entrepreneurial, it's going to be frustrating, And you're not going to understand the risk reward.

Because from a pure money-making perspective, it's probably better to take the job at Google. It's definitely safer. Definitely safer. But from a will I enjoy my life perspective, that's the 1 where for some people, absolutely not.

Speaker 0: Right. Yeah. But on the other hand, I'd just say, try it out, see how you feel. Like, you can do plenty of projects in college.

Speaker 1: You can. And see

Speaker 0: if

Speaker 1: it works out. You

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Why Should I Start a Startup? by Michael Seibel