by Y Combinator2/26/2016
In this episode of Startup School Radio, host Aaron Harris started by sitting down with Brian Trautschold, the co-founder of sales software company Ambition, which launched out of YC’s Winter 2014 class.
Later in the episode Harris interviewed Jason Kelly, the co-founder of Ginkgo Bioworks, the next-generation synthetic biology company that launched out of YC’s Summer 2014 class.
One especially interesting part of the episode was hearing Brian Trautschold discuss how startups selling to businesses have to balance between catering to their early customers and not becoming a consultancy. This portion begins at 18:54 in the podcast:
Aaron Harris : The thing that can happen when you’re in these B2B conversations or enterprise sales conversations is that you’re talking to one or two customers at the beginning, and they’re just asking for stuff. They want this feature, they want that feature, they want this thing, they want it now, they want it later. How do you avoid getting pulled into being a consultant?
Brian Trautschold : It’s really tough. I think part of what you have to do, unfortunately, to survive early on is you kind of have to toe that line. And you have to always go back and say, “What we’re building is a software product that is going to be scalable, that’s going to be used by multiple companies.” But it also depends on what part of the market you’re selling into, what types of customers you have. If you’re selling $100k enterprise deals, you’re going to bend a little bit more to make sure it works for Oracle or some huge company, versus Bob’s Pizza Shop.
But it’s really delicate. I think we may have taken too stern of a line early on and said, “No thank you” to customers, where we said, “Here’s our vision of what the future is going to be, you need to agree with us.” And over time, maybe as we grew the engineering team, we grew our capability and we could ship features or variations more easily we tried to open our arms a little bit more and bring people in.
But you never want to be truly doing things that are one off. You want to say, “Is this going to be useful for the next 20 customers?”
Aaron Harris : And that’s a really hard thing to figure out, especially when you’re small and getting your first couple customers. Because you don’t know, right?
Brian Trautschold : You have to have — you don’t have the data, so you have to have a gut feeling. Hopefully you’ve had a hundred conversations, and some percent of those people said, “Yeah, I would buy this if…” And they’ll tell you exactly what they’d buy. So you could almost build an invisible MVP and say, “If I do X, Y and Z, will you pay me for this?”
I think you guys encourage Y Combinator companies to do that all the time and it’s super important. Because then you can kind of distill down to what are the most must-have portions of your product.
Y Combinator created a new model for funding early stage startups. Twice a year we invest a small amount of money ($150k) in a large number of startups (recently 200). The startups move to Silicon