- The speaker begins by addressing the audience and expressing gratitude for their attendance.
- The speaker shares statistics about the number of female founders in the current batch of startups accepted by YC.
- The speaker emphasizes that the percentage of female founders funded by YC is directly reflective of the number of female applicants.
- The speaker encourages more women to apply to YC and assures that determination and a potentially big idea are the key qualities sought in founders.
- The speaker mentions the importance of building a great team and culture in a startup and shares their expertise in this area.
- The speaker discusses the origins of Y Combinator's community and culture, highlighting their role in curating the collection of people involved in YC.
- The speaker explains their role in judging the character of applicants during interviews and how it influenced funding decisions.
- The speaker concludes by emphasizing the importance of funding founders who are knowledgeable and determined.

- Y Combinator (YC) values character in founders and filters out those with bad character traits.
- The alumni network of YC is valuable because the filtered founders are nurturing and trustworthy.
- YC's atmosphere is cheery, collegial, supportive, and energizing, creating a sense of home for founders.
- YC initially treated founders like family and put their interests first, which has become part of YC's culture.
- YC continues to provide support and advice to startups even after demo day.
- Startups often face internal problems, and YC helps founders navigate these social issues.
- YC has experience dealing with hundreds of startups, allowing them to recognize and address common problems.

- The speaker has experience with hundreds of startups and can quickly assess their problems and offer advice.
- Founders trust the speaker because they know he wants to help and not judge them.
- The speaker believes it is important for founders to have someone they can talk to.
- The speaker's organization, YC, tries to share as much information as possible through events and open sourcing.
- YC has created investment documents and written essays to help startups.
- The speaker emphasizes the importance of culture in an organization and believes it is a key factor in YC's success.

The speaker at Y Combinator (YC) expresses gratitude for the audience and shares statistics about the number of female founders in the current batch of startups. They encourage more women to apply to YC and emphasize the importance of determination and a potentially big idea. The speaker discusses the importance of building a great team and culture in a startup and shares expertise in this area. They highlight YC's community and culture, explaining their role in judging applicants' character during interviews. The speaker emphasizes the importance of funding knowledgeable and determined founders. YC values character in founders and filters out those with bad traits. The speaker discusses the valuable alumni network and the supportive atmosphere at YC. YC provides ongoing support and advice to startups, helping them navigate internal problems. The speaker's experience with hundreds of startups allows them to quickly assess problems and offer advice. YC strives to share information through events and open sourcing, creating investment documents and essays to assist startups. The speaker highlights the importance of culture in YC's success.

Jessica Livingston speaks at Y Combinator Female Founders Conference 2015.

Jessica Livingston is a founding partner at Y Combinator. She is the organizer of Startup School, the annual startup conference, and the author of Founders at Work, a collection of interviews with successful startup founders. Prior to Y Combinator, she was VP of Marketing at investment bank Adams Harkness, where she managed an award-winning rebranding of the company. Jessica has a BA in English from Bucknell.

I'm so happy to be here today and have you all here.

And I know a lot of you have traveled from really far away, too, so this is just wonderful.

How many of you, can you raise your hand if you were here last year at the conference?

And 1 other question, just because I'm curious.

How many of you have already started working on a startup?

Okay, so I'm going to start off today quickly with an update on some numbers.

Last year I shared this graph with you and we now have a year's worth of new data.

The winter batch that's going on right now was the first time we ever asked for gender on the application.

We knew that fewer women applied than men, but we wanted to know the exact numbers.

Once we'd chosen the batch, we crunched the numbers, and here's what we found out.

23% of the startups who applied to YC for this batch had a female founder.

And 23% of the startups we accepted in this batch have a female founder.

So, let me emphasize again that we didn't know the numbers before we did the interviews.

There wasn't some magic bar we were trying to reach or any kind of quota.

We did what we've always done, which was try to fund promising startups.

And we ended up funding exactly the same percentage of companies with female founders as we had applicants.

So These numbers confirmed what I've always felt, which was that the founders we fund are a direct reflection of our applicant pool.

Which means if we want to fund more women in YC, we need more of you to apply.

Applications are open now and there's like a whole other month to go before the deadline, so you have plenty of time.

If any of you in the audience are thinking something like, I'm not the sort of founder YC would accept.

Let me tell you the sort of founder YC accepts.

Anyone who is determined and has a potentially big idea.

I'm gonna ask all of the YC alumni who are here today, can you stand up if you're here, YC alumni?

Okay, stand up, yeah, wave your hands around.

Okay, so all of the YC alumni have orange strips on their badges.

So they'll be happy to talk to you today and share any experiences that they have with you.

And many of these women have also shared their experiences on the female founders story site too.

So I encourage you to read these if you want to just see how varied their paths were to starting a startup.

Okay, now I'm gonna switch gears and get into my talk.

I have a really bad cold, so if I cough a little bit and clear my throat, I'm so sorry.

This right here is my general advice for founders, And it doesn't usually change that much.

This is the advice that I talk about over and over until I'm blue in the face.

But there's another important component to building a successful company, which is a challenge that every 1 of you in this room are going to face if you start 1.

And that's actually 1 of my areas of expertise.

People and culture have always played an important role at Y Combinator from the very beginning.

And I was the 1 responsible for these things from the very beginning.

Both because I prefer to operate in the background and because people only know the version of YC that they read about in the press.

They know the structure of YC, but not the people it consists of and how they interact.

Softer stuff like values and culture and community is often ignored by the press, and more dangerously, it's sometimes ignored by founders.

Maybe that's because it doesn't seem exciting or it's touchy-feely or it's really hard to measure, or Maybe when you're trying to solve a technical problem that's never been solved before, company culture seems a secondary consideration.

But company culture starts when it's just 2 people working on an idea in the kitchen.

In my experience, the founders who start to care about their culture the soonest also tend to be the ones who build the best companies.

In fact, the reason why C has deliberately never offered office space to founders is precisely because of this insight.

The founders of individual startups drive the culture from a very early stage, and this culture needs to grow organically in the startup's own space.

So Today I'm going to tell you a little bit about the origins of Y Combinator's community and culture that I've never really shared before.

1 of the reasons I've never talked about it is that YC's culture was largely my creation and I didn't want to seem to be bragging.

But if you understand my story, you'll understand what Y Combinator really is.

And I think it's important to understand what YC really is, because while lots of people have copied the structure of Y Combinator, no 1 else has successfully copied the people part, in my opinion.

1, it's a new structure of investment firm.

And 2, it's a collection of people, both founders and partners.

The collection of people has mostly been curated by me over the past decade.

My co-founders, Paul, Robert, and Trevor, are amazing at judging technical ideas.

But as they'd be the first to admit, they're not as good judges of character.

For some reason, I've always been a good judge of character, even as a little kid.

So during the history of YC, for the most part, they judged the ideas and I judged the people.

My co-founders called me the social radar for what seemed to them my uncanny ability to see through fakers and sociopaths.

But it's historically been very important in making YC what it is.

The last step in YC's funding decisions are an in-person interview with YC partners.

Now we have 5 interview tracks, so I only see about 20% of the applicants.

But for the first 7 years, we had a single interview track, and I was always part of it.

In fact, my co-founders respected my opinion about character so much that it would be not far off to say that I had veto over funding decisions.

Most of the people we interviewed didn't realize that, because I don't usually say much during interviews.

The typical interview consisted of my co-founders peppering the applicants with technical questions while I watched how they responded to them.

Most applicants barely even realized I was there.

But after they walked out, my partners would usually turn to me to get my read on applicants as people.

I didn't always understand the details of the questions they'd asked.

And to this day, I cannot tell you about operating systems or distributed databases.

But I can tell things like when people are BSing, or how tough they are, or if they get along.

And surprisingly often considering I only have 10 minutes to observe them, whether they're good people or not.

As I said, Paul, Robert and Trevor are really good at technical stuff.

But it's precisely because they're so good that they often misjudged founders as people.

They'd get excited talking to the applicants about all the different things that they could do, and then afterward, they'd think the interview went well, when sometimes all the applicants did was reflect their own ideas back at them.

But it was second nature to me to notice these things.

Countless times we'd talk to a group of applicants, and my co-founders would say afterward, they seem good, we should fund them.

And I'd have to point out that all this group did during the interview was nod and say yes when we suggested ideas to them.

It's obvious why we'd want to fund founders who are knowledgeable and determined.

But I also found myself filtering for character as well.

I have a very intense reaction to people who I think have bad characters.

And this is probably true for anyone who's a sensitive judge of character, just as anyone with a good sense of smell would be bothered by a particularly ripe dumpster on a summer day.

Before Y Combinator, character was not traditionally an important factor for investors.

Investors often funded people who were jerks, but, you know, they might seem likely to succeed.

It's like a family in that we're inviting these people all to our place for dinner every week.

But while this innovation was unintentional, or at least involuntary, it turned out to be super valuable for Y Combinator.

As YC has grown, an increasing amount of the value is in the alumni network.

And the fact that we've filtered out most of the bad people means that they're almost all nurturing and trustworthy when newly funded YC companies approach them.

Starting a startup has traditionally been a really lonely business.

So imagine what it means for there to literally be 2,000 people who will come to your aid if asked.

We continue to filter for character, even now that we have 5 interview tracks, because now this has become part of YC's culture.

And while we, of course, have made some mistakes, for the most part, when you meet a YC founder, you're meeting someone you can trust.

They say that institutions are the shadows of the founders, and that aspect of YC is part of my shadow.

Another area where I had a big effect is the atmosphere of Y Combinator.

Before YC, atmosphere was not something investment firms even had.

But YC was different because after selecting founders, we brought them together for dinner every week.

And there's a very distinct atmosphere at YC dinners.

If I had to put it into words, I'd use words like cheery, collegial, supportive, and energizing.

But it's 1 of those things that's so remarkable it's hard to put into words.

Stripe co-founder Patrick Collison once said that 1 of the best things about YC was, quote, the buzz of walking into Y Combinator on a Tuesday evening and the general energy and excitement of the founders.

That's what comes to mind for me when I think of YC, and it's what I describe to others when they ask why they should do YC." The atmosphere at YC dinners today is a direct descendant of the atmosphere at the very first dinners we had back in the summer of 2005.

I did the grocery shopping and Paul did all the cooking.

And our first headquarters was in a building Paul owned and had been using as his office.

So it felt as if we were inviting people over to our house every week.

We had a fireplace, and I used to build fires sometimes, and I'd splurge on fancy cheeses from a local gourmet cheese shop.

It was basically a dinner party for our friends.

This feeling has inevitably been diluted as YC has grown.

There are 116 startups in this current batch.

And YC now has its own 12,000 square foot building.

So it can't quite feel as much as if founders are coming into our house, over to our house for dinner, but it still feels a lot more intimate than you would imagine an event for 116 companies could be.

1 of the reasons it still feels like home is that the same architect who made our first headquarters has done every space since, Kate Courteau.

She's part of the family, and she knows we want to keep that family feeling.

It's amazing what she's been able to achieve.

You walk into our new building, and it simultaneously feels magnificent and homey.

Paul once wrote an essay called, Do Things That Don't Scale.

The idea is that even if you want to be big, when you're small, you should give your customers a level of attention you can only give them when you're small.

This will set the standards for your customer service very high and you'll be able to maintain those standards Better than you might expect as you grow We followed our own advice at YC and 1 of the most important things we did that didn't scale was to treat the founders as if they were family.

It was easy to do during that first summer batch because there were so few founders.

Plus, in the beginning, the founders were mostly young because they were the only ones who'd applied to something like YC.

I knew where everyone was from, who their significant others were, and I worried about stuff like whether they were getting enough nutrients in their diet.

Someone got scurvy that summer, actually.

Perhaps even more importantly, we did not expect those startups to make money.

YC has been so successful since that it's hard for people to realize, but the first batch of startups we funded was just for us to learn how to be investors.

We quickly realized that funding startups in batches was a great idea and that we should do all of our investing that way, but the first batch was just an experiment that we expected to lose money on.

And since we thought of that first batch as a sort of non-profit social project, it affected the way we acted toward the founders.

It was natural for us when advising the companies just to ask, what's best for the founders?

Even our original investment paperwork was novel in how founder-friendly the terms were.

We didn't ask for any special powers that investors normally do, and we still don't.

This is actually 1 of those counterintuitive things about startups, but 1 of the keys to being successful is not to be too immediately driven by money.

If he'd been driven by money, he'd have taken Yahoo's billion-dollar acquisition offer back in 2006 and most of you probably wouldn't even recognize his name.

After we saw how much it helped founders to have colleagues, we decided to do all of our investing in batches.

And gradually, we started to have hopes that YC might make money.

But by this time, the idea of treating founders like family and putting their interests first had become part of YC's culture.

And while it's harder to make 116 startups feel like family than 8, there's still a lot of that feeling.

And it might seem impossible for a group of over 2,000 alumni to feel like family, but you'd be surprised at how much it does.

And While this will inevitably sound corny, to the extent that it does feel like family, I'm its mom.

The dinners end, but we continue helping the startups for years after that.

We still give advice to startups we funded 5 or 8 years ago.

Sometimes they're trying to figure out what to build or how to grow.

Other times they're dealing with more social problems, like whether to take an acquisition offer or to fire an employee who isn't working out.

And those are the questions I tend to give advice about.

Being the social radar helps me get to the root of the problems within the startups, just as it helps me to evaluate founders during interviews.

Now let me tell you something about startups.

If you've ever started or worked for 1, you're probably familiar with this phenomenon, but many people who haven't are surprised by it.

Most startups behind the scenes are shit shows.

You're laughing because you know it's true.

They mostly conceal this from the outside world because they're trying to seem legit so that they can get customers.

But there are always disasters happening.

I'd say around 10% of startups have life-threatening co-founder disputes, for example.

So though this tends to be concealed from the world, the sort of problems I help founders with are probably more common and more dangerous than technical ones.

On top of my social radar, I now have experience dealing with literally hundreds of startups.

So when I see a problem, I've usually seen the same problem 10 times before.

It must seem to founders that I'm a mind reader, but actually what's going on is that their problems are less unique than they think.

1 of the most important things I know about is how much to worry.

Having dealt with hundreds of startups, I can look at a problem and tell founders immediately, like, don't worry, this is normal, it's just startup growing pains, or you are now operating in failure mode and I have no hopes for your company, which occasionally I have said.

And I think people trust that I'm not going to judge them like some of their other investors might.

Beyond giving practical advice, though, I think it helps for founders just to have someone they can talk to.

I mean, All people need someone they can talk to.

Though we can't fund every startup, we do make an effort to open source as much of we can as what we do for the companies that we do fund.

Like this conference today, we try to host events that share the same kind of information that's shared at YC.

And we're 1 of the few organizations that's always done the events for free, since We know startup founders don't always have a lot of money to spend on conferences.

Now there's a group of us who work on events, and thank you, Tara Perillo, who single-handedly managed this whole event.

But in the beginning, yes, shout out for Tara.

Back in the beginning of YC, I used to do these events single-handedly.

And we were remarkably ambitious about them.

We did our first startup school in the fall of 2005, when YC was only 6 months old and our portfolio consisted of 8 startups.

In addition to events, we've created and open sourced several types of investment documents, like the SAFE, to make it easier and less expensive for startups to get funding.

Paul has written lots of essays on helpful subjects for startups, many of which originated from advice he gave at YC.

Kat and I launched the Female Founders Story site as a way to inspire and educate women about startups.

Again, we can't advise or meet with everyone, but we've always had a philosophy of sharing as much of what YC does with the world as we can.

It's which people you have in your organization, how you act within it, and even how you act to the outside world.

And I can tell you from my own experience how important culture is.

When outsiders talk about YC, they talk about its novel structure.

The other half is our people and our culture.

And that's what I've focused on for the last decade.

And that's the half of YC that no one's been able to duplicate.


Speaker 0: Hello, everyone. Hi. I'm so happy to be here today and have you all here. Wow. There are a lot of you.

Oh, that's better. And I know a lot of you have traveled from really far away, too, so this is just wonderful. I have a quick question. How many of you, can you raise your hand if you were here last year at the conference? OK, so It's like a little reunion.

This is going to be good. And 1 other question, just because I'm curious. How many of you have already started working on a startup? Oh, wow. OK.

Wow, a lot of you. That's great. That's awesome. OK. So we're going to get started.

000, God. Yes, okay, sorry. Got to get the nerves out a little bit. Okay, so I'm going to start off today quickly with an update on some numbers. Last year I shared this graph with you and we now have a year's worth of new data.

The winter batch that's going on right now was the first time we ever asked for gender on the application. We knew that fewer women applied than men, but we wanted to know the exact numbers. Once we'd chosen the batch, we crunched the numbers, and here's what we found out. Okay. All right.

23% of the startups who applied to YC for this batch had a female founder. And 23% of the startups we accepted in this batch have a female founder. So, let me emphasize again that we didn't know the numbers before we did the interviews. There wasn't some magic bar we were trying to reach or any kind of quota. We did what we've always done, which was try to fund promising startups.

And we ended up funding exactly the same percentage of companies with female founders as we had applicants. So These numbers confirmed what I've always felt, which was that the founders we fund are a direct reflection of our applicant pool. Which means if we want to fund more women in YC, we need more of you to apply. Please! Applications are open now and there's like a whole other month to go before the deadline, so you have plenty of time.

If any of you in the audience are thinking something like, I'm not the sort of founder YC would accept. Let me tell you the sort of founder YC accepts. Anyone who is determined and has a potentially big idea. I'm gonna ask all of the YC alumni who are here today, can you stand up if you're here, YC alumni? Okay, stand up, yeah, wave your hands around.

Okay, so all of the YC alumni have orange strips on their badges. These are the type of people we fund. So they'll be happy to talk to you today and share any experiences that they have with you. And many of these women have also shared their experiences on the female founders story site too. So I encourage you to read these if you want to just see how varied their paths were to starting a startup.

Okay, now I'm gonna switch gears and get into my talk. And I need to apologize in advance. I have a really bad cold, so if I cough a little bit and clear my throat, I'm so sorry. This right here is my general advice for founders, And it doesn't usually change that much. This is the advice that I talk about over and over until I'm blue in the face.

But there's another important component to building a successful company, which is a challenge that every 1 of you in this room are going to face if you start 1. Building a great team and culture. And that's actually 1 of my areas of expertise. People and culture have always played an important role at Y Combinator from the very beginning. And I was the 1 responsible for these things from the very beginning.

Most people don't know this. Both because I prefer to operate in the background and because people only know the version of YC that they read about in the press. They know the structure of YC, but not the people it consists of and how they interact. Softer stuff like values and culture and community is often ignored by the press, and more dangerously, it's sometimes ignored by founders. Maybe that's because it doesn't seem exciting or it's touchy-feely or it's really hard to measure, or Maybe when you're trying to solve a technical problem that's never been solved before, company culture seems a secondary consideration.

But company culture starts when it's just 2 people working on an idea in the kitchen. In my experience, the founders who start to care about their culture the soonest also tend to be the ones who build the best companies. In fact, the reason why C has deliberately never offered office space to founders is precisely because of this insight. The founders of individual startups drive the culture from a very early stage, and this culture needs to grow organically in the startup's own space. So Today I'm going to tell you a little bit about the origins of Y Combinator's community and culture that I've never really shared before.

1 of the reasons I've never talked about it is that YC's culture was largely my creation and I didn't want to seem to be bragging. But if you understand my story, you'll understand what Y Combinator really is. And I think it's important to understand what YC really is, because while lots of people have copied the structure of Y Combinator, no 1 else has successfully copied the people part, in my opinion. Y Combinator is 2 things. 1, it's a new structure of investment firm.

And 2, it's a collection of people, both founders and partners. The collection of people has mostly been curated by me over the past decade. My co-founders, Paul, Robert, and Trevor, are amazing at judging technical ideas. But as they'd be the first to admit, they're not as good judges of character. That's my department.

For some reason, I've always been a good judge of character, even as a little kid. So during the history of YC, for the most part, they judged the ideas and I judged the people. My co-founders called me the social radar for what seemed to them my uncanny ability to see through fakers and sociopaths. But it's historically been very important in making YC what it is. The last step in YC's funding decisions are an in-person interview with YC partners.

Now we have 5 interview tracks, so I only see about 20% of the applicants. But for the first 7 years, we had a single interview track, and I was always part of it. In fact, my co-founders respected my opinion about character so much that it would be not far off to say that I had veto over funding decisions. Most of the people we interviewed didn't realize that, because I don't usually say much during interviews. What I do during interviews is watch.

The typical interview consisted of my co-founders peppering the applicants with technical questions while I watched how they responded to them. Most applicants barely even realized I was there. But after they walked out, my partners would usually turn to me to get my read on applicants as people. I didn't always understand the details of the questions they'd asked. And to this day, I cannot tell you about operating systems or distributed databases.

But I can tell things like when people are BSing, or how tough they are, or if they get along. And surprisingly often considering I only have 10 minutes to observe them, whether they're good people or not. As I said, Paul, Robert and Trevor are really good at technical stuff. But it's precisely because they're so good that they often misjudged founders as people. They'd get excited talking to the applicants about all the different things that they could do, and then afterward, they'd think the interview went well, when sometimes all the applicants did was reflect their own ideas back at them.

But it was second nature to me to notice these things. Countless times we'd talk to a group of applicants, and my co-founders would say afterward, they seem good, we should fund them. And I'd have to point out that all this group did during the interview was nod and say yes when we suggested ideas to them. It's obvious why we'd want to fund founders who are knowledgeable and determined. But I also found myself filtering for character as well.

This was not a deliberate decision. I have a very intense reaction to people who I think have bad characters. And this is probably true for anyone who's a sensitive judge of character, just as anyone with a good sense of smell would be bothered by a particularly ripe dumpster on a summer day. Before Y Combinator, character was not traditionally an important factor for investors. Investors often funded people who were jerks, but, you know, they might seem likely to succeed.

But I couldn't do it. YC is not just an investment firm. It's like a family in that we're inviting these people all to our place for dinner every week. But while this innovation was unintentional, or at least involuntary, it turned out to be super valuable for Y Combinator. As YC has grown, an increasing amount of the value is in the alumni network.

Now there are over 2,000 alumni. And the fact that we've filtered out most of the bad people means that they're almost all nurturing and trustworthy when newly funded YC companies approach them. Starting a startup has traditionally been a really lonely business. So imagine what it means for there to literally be 2,000 people who will come to your aid if asked. We continue to filter for character, even now that we have 5 interview tracks, because now this has become part of YC's culture.

And while we, of course, have made some mistakes, for the most part, when you meet a YC founder, you're meeting someone you can trust. They say that institutions are the shadows of the founders, and that aspect of YC is part of my shadow. Another area where I had a big effect is the atmosphere of Y Combinator. Before YC, atmosphere was not something investment firms even had. They just had portfolios.

But YC was different because after selecting founders, we brought them together for dinner every week. And there's a very distinct atmosphere at YC dinners. If I had to put it into words, I'd use words like cheery, collegial, supportive, and energizing. But it's 1 of those things that's so remarkable it's hard to put into words. Stripe co-founder Patrick Collison once said that 1 of the best things about YC was, quote, the buzz of walking into Y Combinator on a Tuesday evening and the general energy and excitement of the founders.

That's what comes to mind for me when I think of YC, and it's what I describe to others when they ask why they should do YC." The atmosphere at YC dinners today is a direct descendant of the atmosphere at the very first dinners we had back in the summer of 2005. There were only 8 companies then. I did the grocery shopping and Paul did all the cooking. And our first headquarters was in a building Paul owned and had been using as his office. So it felt as if we were inviting people over to our house every week.

We had a fireplace, and I used to build fires sometimes, and I'd splurge on fancy cheeses from a local gourmet cheese shop. It was basically a dinner party for our friends. This feeling has inevitably been diluted as YC has grown. There are 116 startups in this current batch. And YC now has its own 12,000 square foot building.

So it can't quite feel as much as if founders are coming into our house, over to our house for dinner, but it still feels a lot more intimate than you would imagine an event for 116 companies could be. 1 of the reasons it still feels like home is that the same architect who made our first headquarters has done every space since, Kate Courteau. She's part of the family, and she knows we want to keep that family feeling. It's amazing what she's been able to achieve. You walk into our new building, and it simultaneously feels magnificent and homey.

Paul once wrote an essay called, Do Things That Don't Scale. The idea is that even if you want to be big, when you're small, you should give your customers a level of attention you can only give them when you're small. This will set the standards for your customer service very high and you'll be able to maintain those standards Better than you might expect as you grow We followed our own advice at YC and 1 of the most important things we did that didn't scale was to treat the founders as if they were family. It was easy to do during that first summer batch because there were so few founders. Plus, in the beginning, the founders were mostly young because they were the only ones who'd applied to something like YC.

So we literally felt like their parents. I knew where everyone was from, who their significant others were, and I worried about stuff like whether they were getting enough nutrients in their diet. I did. Someone got scurvy that summer, actually. It was very, very upsetting.

Perhaps even more importantly, we did not expect those startups to make money. YC has been so successful since that it's hard for people to realize, but the first batch of startups we funded was just for us to learn how to be investors. We quickly realized that funding startups in batches was a great idea and that we should do all of our investing that way, but the first batch was just an experiment that we expected to lose money on. And since we thought of that first batch as a sort of non-profit social project, it affected the way we acted toward the founders. It was natural for us when advising the companies just to ask, what's best for the founders?

Even our original investment paperwork was novel in how founder-friendly the terms were. We didn't ask for any special powers that investors normally do, and we still don't. This is actually 1 of those counterintuitive things about startups, but 1 of the keys to being successful is not to be too immediately driven by money. Mark Zuckerberg is a good example. If he'd been driven by money, he'd have taken Yahoo's billion-dollar acquisition offer back in 2006 and most of you probably wouldn't even recognize his name.

After we saw how much it helped founders to have colleagues, we decided to do all of our investing in batches. And gradually, we started to have hopes that YC might make money. But by this time, the idea of treating founders like family and putting their interests first had become part of YC's culture. And while it's harder to make 116 startups feel like family than 8, there's still a lot of that feeling. And it might seem impossible for a group of over 2,000 alumni to feel like family, but you'd be surprised at how much it does.

And While this will inevitably sound corny, to the extent that it does feel like family, I'm its mom. Now YC doesn't end after demo day. The dinners end, but we continue helping the startups for years after that. We still give advice to startups we funded 5 or 8 years ago. Startups need different types of advice.

Sometimes they're trying to figure out what to build or how to grow. Other times they're dealing with more social problems, like whether to take an acquisition offer or to fire an employee who isn't working out. And those are the questions I tend to give advice about. Being the social radar helps me get to the root of the problems within the startups, just as it helps me to evaluate founders during interviews. Now let me tell you something about startups.

If you've ever started or worked for 1, you're probably familiar with this phenomenon, but many people who haven't are surprised by it. Most startups behind the scenes are shit shows. You're laughing because you know it's true. Even the most successful ones. They mostly conceal this from the outside world because they're trying to seem legit so that they can get customers.

But there are always disasters happening. I'd say around 10% of startups have life-threatening co-founder disputes, for example. So though this tends to be concealed from the world, the sort of problems I help founders with are probably more common and more dangerous than technical ones. On top of my social radar, I now have experience dealing with literally hundreds of startups. So when I see a problem, I've usually seen the same problem 10 times before.

It must seem to founders that I'm a mind reader, but actually what's going on is that their problems are less unique than they think. 1 of the most important things I know about is how much to worry. Having dealt with hundreds of startups, I can look at a problem and tell founders immediately, like, don't worry, this is normal, it's just startup growing pains, or you are now operating in failure mode and I have no hopes for your company, which occasionally I have said. And I think people trust that I'm not going to judge them like some of their other investors might. They know I just want to help.

Beyond giving practical advice, though, I think it helps for founders just to have someone they can talk to. I mean, All people need someone they can talk to. And early on, companies are people. Though we can't fund every startup, we do make an effort to open source as much of we can as what we do for the companies that we do fund. Like this conference today, we try to host events that share the same kind of information that's shared at YC.

And we're 1 of the few organizations that's always done the events for free, since We know startup founders don't always have a lot of money to spend on conferences. Now there's a group of us who work on events, and thank you, Tara Perillo, who single-handedly managed this whole event. You're awesome. But in the beginning, yes, shout out for Tara. Thank you.

Back in the beginning of YC, I used to do these events single-handedly. And we were remarkably ambitious about them. We did our first startup school in the fall of 2005, when YC was only 6 months old and our portfolio consisted of 8 startups. In addition to events, we've created and open sourced several types of investment documents, like the SAFE, to make it easier and less expensive for startups to get funding. Paul has written lots of essays on helpful subjects for startups, many of which originated from advice he gave at YC.

Sam now writes a ton of great stuff too. Kat and I launched the Female Founders Story site as a way to inspire and educate women about startups. Again, we can't advise or meet with everyone, but we've always had a philosophy of sharing as much of what YC does with the world as we can. So you can see there's a lot to culture. Culture is not just a mission statement.

It's which people you have in your organization, how you act within it, and even how you act to the outside world. And I can tell you from my own experience how important culture is. When outsiders talk about YC, they talk about its novel structure. But that's only half of what YC is. The other half is our people and our culture.

And that's what I've focused on for the last decade. And that's the half of YC that no one's been able to duplicate. Thank you. Thank you. You

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Jessica Livingston Speaks at Female Founders Conference 2015