- The partners at YC are answering questions from viewers
- They discuss when is the best time to start a startup and recommend starting now and becoming a domain expert over time
- They advise finding problems that interest you and thinking about your startup as your life's work
- They suggest being passionate about an idea rather than trying to impress others
- Choosing between a passion project and a product with revenue potential is difficult, and there is no clear answer
- YC accepts solo founders if they have unique qualities or insights
- Having a co-founder can help with the emotional roller coaster of starting a company
- Tools and services like Clerky, Gusto, and Ironclad can help early-stage founders with legal and operational tasks
- Founders should avoid wasting time on unnecessary complexities and being secretive about their ideas
- They should be aware of competition but not necessarily follow or copy them
- It is more important to move fast than to perfect your product, as execution is key.

- Founders often ask binary questions, wanting a clear answer on whether to focus on growth or making money, but the answer is usually both.
- It is important to zoom out and realize that life is not black and white, and many decisions are not zero-sum.
- For startups, it is crucial to focus on the product and retention before trying to grow rapidly.
- The growth rate of a startup depends on various factors and differs for each business.
- YC looks for unique customer acquisition strategies and the ability to communicate ideas concisely in their application process.
- Action-oriented founders who have evidence of progress are more likely to succeed.
- YC does not have a checklist for successful applications, but looks for concise explanations and understanding of the company's purpose.
- It is recommended to apply to YC regardless of the stage of the company, as they can provide assistance at any stage.
- If not accepted initially, it is encouraged to apply again after further progress.
- In the last batch of 100 companies, some started coding only two weeks before submitting their application.

- Many companies in the last batch of YC had different levels of preparation and success, but all gained value from the program.
- Around 50 out of 100 companies in the last batch had previously been rejected and were accepted on their second or third application.
- Advice from alumni includes the rewards of entrepreneurship, the importance of letting go of certain tasks when scaling a company, the value of asking for help, and not conforming to startup culture expectations.
- It is important to find trusted individuals to discuss challenges and struggles with, rather than always presenting a positive image.
- The speaker thanks those involved in organizing the event and expresses gratitude to attendees and participating startups.

- YC partners answer questions about starting a startup and recommend starting now and becoming a domain expert over time.
- They advise finding problems that interest you and treating your startup as your life's work.
- Being passionate about an idea is more important than impressing others.
- Choosing between a passion project and a product with revenue potential is difficult.
- YC accepts solo founders with unique qualities or insights.
- Having a co-founder can help with the emotional roller coaster of starting a company.
- Tools like Clerky, Gusto, and Ironclad can assist early-stage founders with legal and operational tasks.
- Founders should avoid unnecessary complexities and secrecy about their ideas.
- They should be aware of competition but not necessarily follow or copy them.
- Execution is key, and it's more important to move fast than to perfect the product.
- Founders often ask binary questions about growth or making money, but the answer is usually both.
- Life is not black and white, and many decisions are not zero-sum.
- Startups should focus on product and retention before rapid growth.
- The growth rate of a startup depends on various factors and differs for each business.
- YC looks for unique customer acquisition strategies and concise communication in applications.
- Action-oriented founders with evidence of progress are more likely to succeed.
- YC has no checklist for successful applications but looks for concise explanations and understanding of the company's purpose.
- It is recommended to apply to YC regardless of the stage of the company.
- If not accepted initially, it is encouraged to apply again after further progress.
- Many companies in the last batch of YC had different levels of preparation and success.
- Around 50 out of 100 companies in the last batch had previously been rejected and were accepted on their second or third application.
- Alumni advice includes the rewards of entrepreneurship, delegating tasks when scaling a company, asking for help, and not conforming to startup culture expectations.
- It is important to have trusted individuals to discuss challenges and struggles with.
- The speaker expresses gratitude to organizers, attendees, and participating startups.

We pulled together eleven of the most frequently asked questions from Startup School attendees and had YC partners answer them on stage. 

Here are the questions:

1. If you know you want to eventually start a startup, when should you do it? Should you wait to become a domain expert or start now? 0:50

2. What’s a good process for discovering and vetting new ideas that might be worth building? 1:48

3. How do you choose between an idea you love but might be tough to monetize and an idea that has great revenue potential? 3:19

4. YC generally recommends having a cofounder. Ooshma Garg of Gobble didn’t have a cofounder. What convinced you about her application? 3:42

5. What are tools or services you’d recommend for founders that are just starting? 6:20

6. What kinds of things do new founders waste time on? 7:37

7. Is it more important to move fast or perfect your product? 9:46

8. For a startup that’s recently launched, what would you consider a good growth rate? 12:40

9. What do you look for when you’re reading a YC application? What do you look for when you’re interviewing companies? 13:44

10. Is there an optimal time in the lifecycle of a company to apply for YC? 18:48

11. Is there anything you wish you’d known when you first started? 20:56

I'm Kat, 1 of the partners at YC, and I'm going to bring on a bunch of the partners with me today to help answer some of the questions that you sent us.

So let's have everyone introduce themselves really quick.

And so we just took all of your questions and are gonna probably get through hopefully about 10.

And then If there's any that we can't get to today, we'll try to answer them online for you.

But let's start with, if you know you want to eventually start a startup, when should you do it?

And how do you navigate the trade-off between becoming a domain expert and just doing it now?

If you want to start and you have an idea, I think you should just start now instead of trying to figure out the trade-offs.

I think when you start, even if you're not an expert, you should be on your way to becoming the domain expert.

And you can do a lot by going in the field and doing the actual job itself or whatever research you need to do to make yourself a domain expert.

But in 1 or 2 years' time, you better be the domain expert in that field.

If you don't have an idea, I thought Mark Andreessen's advice was really good.

Go join a hot startup for a couple of years.

Get an idea of what a well-run startup looks like so when you do have your idea, you're kind of ahead of the game.

So, what is a good process for discovering and vetting new ideas that might be worth building?

1, look in their lives and look in the lives of their family and their community and their work and find problems that interest them.

And the other thing I say is think about what you want the first line of your Wikipedia article to be.

Because every startup has the potential to be your life's work.

Think about going out and doing your life's work, solving a problem in the world you care about.

Sometimes people come up with ideas that seem impressive to other people.

You're going to tell someone about your startup idea.

You try really hard to make it sound fancy and to use buzzwords.

And I think a better way to do that instead of that is to find something that you're deeply passionate about and you can't stop thinking about.

And it may not actually sound impressive to anyone.

There's a good chance that when you try to tell people about the thing you're actually excited about, it sounds stupid and they laugh at you and say it's a bad idea.

If your only criteria is what impresses other people or impresses authority figures, that's, you know, you can go way off track following that criteria.

So this segues into another question that came up, which is how do you choose between an idea that you love, that you're super passionate about, but might be impossible to monetize?

How do you choose between that and a product that has great revenue potential?

So, 1 of the things that YC has emphasized over and over again is how hard it is to be a solo founder.

So there's a question, you know, do you have any advice for solo founders or how did Ushma, for example, convince YC to accept Gobble?

What was it in her application that convinced you?

I think all things equal, it's better to have a co-founder.

But quite frankly, at YC, we've accepted many companies with solo founders.

And I think then you just have to come with us with something that's very unique to you.

So I'm not sure exactly what Ujma had in her application, but if you have traction, if you have some really unique insight on how you're going to acquire users, retain users, all these things, and you just know your shit, and you come across as very competent, you know, more than competent, then we would definitely would like to talk to you.

And I think the other thing to bear in mind is that startups are hard for 2 founders, for 3 founders, for everybody.

And so coming in as a single founder, you have to be pretty much superhuman because you have to do everything.

You either are out selling, or you're out building the product, or you're out fundraising.

And so you have to be able to combine all of those things.

Whereas if you have a co-founder, and 1 of you is great at sales, and 1 of you is very technical, there's more of an obvious split there.

So, you know, there is definitely a superhuman element to being a single founder.

Yeah, I'd also add to that that starting a company is an emotional roller coaster.

It's always nice when there's someone else next to you that feels the same pain that you can commiserate with.

Because it takes that to get through some pretty tough times.

If you're in a room alone kind of absorbing all the pain yourself, it can be overwhelming sometimes.

Specifically, I remember when Ushma came through YC and when she'd applied.

And I remember that we just said throughout, all of us said like, Ushma never gives up.

Ushma will keep on fighting until this works.

And I think we'd seen, you know, she'd already been working on Gobble for a number of years before she'd applied.

And it was clear that this was something that she was very passionate about and that she was just going to keep working on it.

Like the story was similar to, you have to be a cockroach.

Reminded a lot of people, I think, of how the Airbnbs almost failed 3 times before they actually got things up and running.

So 1 question maybe for you, Kirstie, is what are some tools or services that you would recommend for founders who are just starting?

Yeah, there's loads of things out there to help.

And so as some background, I work on more of the financial and operational side with with startups.

And there's so much out there that can help with that.

So from right from the very start, when you're incorporating your company, there's services like Clerky that can help you do that, that creates very standard paperwork that all the YC startups use.

There are services like Gusto that you can use to help you run payroll properly and make sure that you're withholding and paying taxes over.

There's services like Ironclad, which helps you store all your NDAs and sales contracts all in the same place.

So There's loads of resources out there to help you.

And I think it's really important that those are the things that you shouldn't be trying to reinvent the wheel.

You know, use all your brain power to figure out your product and to figure out how you're going to make your company grow.

With all of these other things, that's not going to make your company a success.

So just do the basic, simple, vanilla option and move on to other things.

So on that note, is there anything that you find really early stage founders wasting a lot of time on that you wish they would just like automate and move on?

Or just are there any specific things that you wish founders would spend less time on early on?

So for me, it's things like, they try to come up with funky voting structures, or weird vesting schedules, or they're trying to protect themselves from some unknown company that's going to come in and steal all their ideas.

Those kind of things you just don't need to worry about in the early days.

Just keep it all simple and concentrate on everything else because as you start to grow, if other things come up and need to be fixed, you can afford to pay lawyers at that point, and they can help you fix

I'd add to that being secretive and trying to protect your idea.

Sometimes I meet founders who think they have this secret idea and the idea is super valuable and if they tell anyone, they'll create 100 copycats.

In fact, the more common problem as a startup is that you'll tell your idea to 100 people and all of them will kind of shrug their shoulders and be like, whatever.

And so as a startup, in most cases, you should be telling your idea to literally anyone who will sit and listen, because they might have some valuable piece of feedback.

Do you have thoughts on how people should think about competition beyond that.

I think you should be highly aware of it and what they're doing and sometimes they are doing some things right.

And when they are failing you shouldn't assume, you know, that they're incompetent.

In fact, they came up with the same idea as you did.

So I think, again, just be aware of what they're doing.

And don't assume that when they do something wrong, that That's a bad idea.

And sometimes a good idea is just badly executed.

And so, yeah, just follow, but don't copy, necessarily.

So is it more important to move fast or perfect your product?

Talk to us a little bit about perfection.

Sometimes when we do office hours, founders ask us these binary questions like, you know, should we grow really fast or should we make a lot of money?

Or like, should I hire a hundred people or should I, you know?

And the point is they want us to give them an answer.

And what's so frustrating is 99.9% of the time when we're in office hours and founders are pushing us for a binary answer, the answer is like, well, you know, both, you know, people always say, well, should I be focusing on the product or growing faster?

That's, and unfortunately that is how most of life is.

It's a lot of gray area, and you're going to have to do the impossible.

And so that particular question, we're all chuckling because we're used to hearing that sort of thing.

And whenever we hear that, it's someone kind of asking for permission to not work on the thing they don't want to work on, right?

And unless I'm really feeling sorry for them, usually I don't give them permission to, you know, oh, don't worry, don't work on the product.

You know, I think that's what they want to hear.

And so if you find yourself with these kinds of dichotomies, right, if you're like, should I be working on revenue or should I be doing what I'm passionate about?

You know, if you're trapped in these sorts of chains of thought, I think it's always good to try to zoom out and realize that life is not black and white, and these are not usually zero-sum decisions, and that if you get to the root of what you're concerned about or what you're trying to solve for and realize that you kind of, you always have to do both.

If you have a retention problem with your product, if only 10% of your people are returning on a monthly basis, don't spend a lot of time on PR, right?

So don't try to grow super fast if people aren't sticking around.

Focus on the product, but focus on your real problem, which is retention, before you go try to tell the world.

Very similarly, the 1 rule I tell a lot of people is, like, everyone wants to know, should I keep growing fast, or, you know, should I work on the product and make it really good?

It's, I think, you know, in the early days, acquiring users is, shows that this is something people want.

But you should always have this metric, or this threshold.

Usually it's something like retention, or it's MPS, or something.

But once it gets below a certain point, stop.

And really focus on the product, and why people are not retaining, why the NPS is so low, and don't even focus on growth at all.

So for a startup that's recently launched, what would you consider a good growth rate?

When I talk to startups, I try to give them a rule of thumb around growth, what I try to tell them is like, what I look for when I read a YC application.

And basically, what I look for is, how long have you been working on this project and am I impressed with what you've done?

And so the growth rate is very, very dependent on a business and different businesses have very different growth rates.

I still think a better way of thinking about it is that like, if you had to be super intellectually honest with yourself about how fast you're moving and how much progress you're getting in the amount of time that you've had to work on this, compared to other people, that's a good way to kind of start figuring out, oh, am I impressive?

And I think that having us reduce that to 7% or 15% is not really going to be that helpful for you.

So this might be a good segue to the question, what do you look for when you're reading a YC application?

And another question that came up was, what do you look for when you're reading a YC application?

And another question that came up was you know what do you look for when you're interviewing the companies?

In reading the applications I look for do they have unique insight on how they're going to acquire customers?

I mean, there are many factors, but that's the 1 thing I look for.

Then, in terms of interview, it's how can they communicate their ideas in a very brief manner such that I understand it.

If you spend the entire 10 minutes of the interview trying to tell us what you do, that's really a bad sign that you don't really understand the product quite yet.

Yeah, I think my biggest thing when reading an application or evaluating a founder is to be biased towards people that are action-oriented and actually do stuff.

A very large percentage of people that have startups haven't done anything.

They haven't made a thing, they haven't given the thing to other people, and their application is basically asking for permission from us as authority figures to let them work on their startup so they can quit their job or whatever.

And on the other hand, you have folks like Usman we talked about earlier that, hey, I've shipped the service.

And the more there's evidence that someone is action-oriented as opposed to conceptual in their approach to startups, that is highly correlated with success across the board.

And so that'd be my advice to everyone on this.

I mean, if you have evidence that you've made a thing and given the thing to people and gotten money for the thing that you made, that makes your application 10x better than spending more time rewriting your prose to seem a little fancier or something.

There's all these things people spend a lot of time on their application, and actual evidence of action is infinitely better than, you know, getting better camera angles or something in your video.

You know, there's a lot of things, like people have all these tricks they try to do, and those are...

It's much easier to just like do your startup than make progress on it.

I think the other thing that people often ask about this is they think we have kind of a checklist that says, oh, if they have 10% growth, and they have revenue, and they have this, then great, they're in.

It's a balance of a number of different things, and a number of different things that we're looking for.

And so it's very difficult to say, you know, this is what makes a successful application in terms of concrete things.

It's much more about, can you concisely explain your idea?

Can we get to the end of the application and we actually understand what the company is doing?

Which you'd be surprised at how many applications we don't.

And so it's much softer things than just being able to say, yes, I've achieved this specific thing.

For me, what's helpful is if you don't bury the lead.

You know, we're humans, and we have to read literally hundreds of applications.

So, don't wait for the last question of the application to say, and we have 150,000 users, we're making $2 million in revenue a month and growing 50% month over month.

You can knock that up probably into the, like, what does my company do?

And, and then I think the second thing is that I think a lot of these things actually service filters.

Like, what I would say is like, you should apply.

The only way you know you're gonna get into YC is if you apply.

And it doesn't cost anything and it's open and it's pretty easy, I would say, like the software's good, so just apply.

Like the number of founders who tell us that even in the not getting in, answering those questions helps them build their business is so high.

So you should never hear any of these answers and say, Oh, that means that I shouldn't apply to YC.

Even if you think you're a single non technical co-founder with a horrible idea and you haven't quit your job, apply and roll the dice.

You don't need to know us, you don't need an intro, you don't need a warm intro.

Just apply on our website, there's a link.

The vast, vast, vast majority, I don't know the stat off down my head, of people we have no contact with whatsoever.

Yeah, and 40% I know of the startups we funded in the last batch have never had a single touch point with YC.

Like, they haven't come to any events, they've never exchanged an email with a partner or an alumni, and it's kind of cool.

I mean, it's unlike other VC funding type situations where you need the warm intro.

You have the ability to just apply, and it's free, and it's open to anyone.

The thing that I think a lot of us tell a lot of people who are thinking about applying is that the application is very simple, the questions are very simple, and it's actually a really good way to think about your business.

And so, even if you don't, I mean, just fill out the questions, and I think it'll actually help you think about your product and business better.

So a question that always comes up and that came up today is at what point should a company apply?

Is there like an optimal time in the life cycle of a company?

I think people use this as an excuse to not apply because their company is too early or their company is too late.

And they're like, oh, I can't possibly apply to Y Combinator.

There is no too early and there is no too late.

We can be helpful to companies at all different stages.

And this also comes back to the, should you polish your product a little bit more?

And the other thing to bear in mind is if you do apply and you're not successful first time around, then no problem, you know, apply again.

There's no black marks against you for doing that, there's no problems with that.

So just even if you're a little bit early to the first time, 6 months of more working on the company could totally change things.

Just to put facts on that, in the last batch of 100 companies, there was a company that literally didn't, or multiple companies, that didn't start writing code until 2 weeks before their application was submitted.

There was a company that had a $40 million revenue run rate.

And they all got tons of value out of YC.

So everyone is probably somewhere between those 2 points.

And to add a final stat to that question, out of the 100 companies in the last batch of YC, about 50 of them had previously applied and been rejected and they were being accepted on their second, third, fourth application.

I was on a panel with a bunch of alumni and the question came up from the audience and literally everyone, all the alumni on the panel had applied more than once.

I applied 4 times or 3 times And I was like, whoa, really?

So I kind of wanted to go down the lines and ask, is there anything you wish you'd known when you first were getting started?

Any particularly helpful advice that you got or would like to pass on?

Or someone can volunteer if you're thinking.

I wish someone had told me it was as rewarding as it ended up being, right?

I just kind of did it because it sounded like it was interesting and I was passionate about the idea.

But looking back on having started several companies, it, unbelievably rewarding because it's so hard and to get through it and be successful at it on many many different levels you know just look back at as some of the best experiences of my life.

I Wished Someone told me To let go of Like of Being in the nitty-gritty so much because when you're starting to especially like for myself I went through for 2 like 3 or 4 years of just nothingness.

And so I was always the 1 coding and building the product.

And then as my company started scaling up fast, I didn't let go of that stuff fast enough.

So I think there's a lot to learn in terms of scaling a company and what you should be managing and what your priorities should be.

And yeah, I wish I had learned that faster.

When I started my first company, I was 21, and I dropped out of college to do it, and I'd never actually had a real job before, so I only had this sort of dim understanding of how companies actually worked on the inside, gleaned maybe from TV shows.

And all of a sudden, I was managing like 30 people, and I had no idea how to do it, and I actually felt like very isolated and alone, and I didn't know who to ask for help.

And I've learned since then that, particularly in Silicon Valley, people are incredibly willing to help, even if there's like no, even if there isn't anything apparently in it for them, they'll just help you just because.

And so I really wish I had just asked like lots of people for help.

Best piece of advice I got was actually this guy named Gideon Yu yelling at us and telling us that we were stupid.

We had got Justin.tv profitable, and we actually were making a couple million dollars a month, I mean a year, sorry, in profit.

And we were kind of sitting back and patting ourselves on the back and Gideon said, you've built something that's useless, it will fade from the internet in the next 3 years and nothing you've done will ever be known ever again.

And after we kind of like picked up our egos, we started thinking about new things to build and a couple of them worked out.

So, yeah, that's probably the best piece of advice I got.

Yeah, I think my piece of advice is just to watch out for cargo culting on a lot of the aspects of startup culture that you may or may not agree with.

I think a lot of people have all these ideas about how they're supposed to act, or they're supposed to go to meetups, and you're supposed to go to this, and you're supposed to hang out, and you're supposed to network, and You don't have to do any of that stuff.

Like that's totally not, if anything, that can be a signal of being distracted from your startup.

And instead, I would suggest the way to think about this is, in most jobs in life, you have to conform to someone else's, you know, culture or someone else's company.

You get to control every aspect of things if you're designing your own job.

You get to choose what your work style is like.

See all Y Combinator transcripts on Youtube

Q&A with YC Partners at Startup School SV 2016