by Y Combinator11/6/2019
We’ve cut down the tenth week of lectures to be even shorter and combined them into one podcast.
Then a lecture from Kevin Hale and Adora Cheung. Kevin and Adora are both partners at YC. Their lecture breaks down this year’s Startup School by the numbers and they share tips on what helped companies most.
00:00 – Intro
00:36 – Ali Rowghani – How to Lead
1:36 – Ali’s background
2:56 – There’s no single archetype for a great leader so be yourself
5:16 – Great leaders think and communicate clearly
9:56 – Great leaders have good judgement about people
12:56 – Great leaders have strong personal integrity and commitment
13:46 – The transparency test
14:41 – The best way to measure great leaders is in terms of the amount of trust they engender in the people that work with them
15:21 – The science of trust
16:08 – The art of trust
16:36 – Optimize for trust
17:40 – Kevin Hale and Adora Cheung – Startup School 2019 by the Numbers
19:24 – Startup School grew during the course
20:24 – Did SUS make a difference?
21:14 – 106 SUS companies were accepted into YC
23:17 – How can you replicate their success?
23:44 – Be clear and concise
26:59 – Edit your company description
28:04 – Weekly updates submitted
28:39 – Top 7 biggest obstacles for SUS companies
29:04 – Top 7 KPI movers
29:59 – Top 7 user insights
31:04 – Average startup weeks to launch
31:54 – Average hard tech or biotech startup weeks to launch
32:54 – % of weekly updates from launched startups
33:34 – Group sessions
33:59 – Companies got better at explaining their ideas, selling themselves, and getting others excited
35:09 – Founders like qualitative feedback
36:09 – No shows
37:19 – Morale
37:49 – Technical, launched, full-time, revenue generating, non-flaky, non-solo founder startups that talk to users are happier
41:14 – Summary
Craig Cannon [00:00] – Hey, how’s it going? This is Craig Cannon, and you’re listening to Y Combinator’s podcast. Today’s episode is a recap of the 10th week of Startup School. I’ve cut down the 10th week of lectures to be even shorter and combined them into one podcast. First, we’ll have a lecture from Ali Rowghani. Ali’s a partner at YC. His lecture covers how to lead, then we’ll have a lecture from Kevin Hale and Adora Cheung. Kevin and Adora are both partners at YC. Their lecture breaks down this year’s Startup School by the numbers and they share tips on what helped companies most. All right, here we go.
Ali Rowghani [00:36] – Good morning, everyone. My name is Ali Rowghani. I’m a partner at Y Combinator, and it’s a pleasure to welcome you guys to this lecture and I understand it’s one of the last ones in Startup School which in a way is really appropriate because my talk is about leadership, which is something important, but probably not top of mind for everyone in here. You’ve probably got more burning concerns as you’re getting your startup off the ground and figuring out what to build and working through product fit and fundraising and so on. It’s a really, really important long-term question because if any of you is going to succeed in building a big company in the long term, you’ve got to really get good at leading, motivating, retaining great people. And so I just wanted to take some time this morning to share some of my experiences and hopefully help you guys develop a bit of a early mental model for how to think about leadership at your startups. First, a quick word about me. Prior to Y Combinator, I had a 15-year career as an executive at two companies. The first was at Pixar, the animation studio where I spent almost 10 years and I was the CFO of Pixar for the last four. Then I spent about five years at Twitter where I started as the CFO and then I was the COO. During that time, I had the amazing good fortune of getting a chance to work with and observe some really amazing leaders in action. People like the founder of Pixar, Ed Catmull, the CEO of Pixar, Steve Jobs, Twitter’s founders, Jack Dorsey and Ev Williams, Biz Stone,
Ali Rowghani [02:22] – and now some of the really amazing founder CEOs at YC, people like Patrick Collison and Peter Reinhart and Drew Houston and so on. I’ve had sort of a front-row seat, being able to observe some great leaders in action and so what I wanted to do was to share three observations on leadership that I’ve learned in my career. As I said before, this may not be pertinent exactly today, if you’re just a couple of people working on an idea but hopefully for most of you it’ll be pertinent very, very soon. Three observations on leadership. The first one is that there’s no single archetype for a great leader. No single archetype. Great leaders come in all shapes and sizes, all personality types and characteristics. I say this from personal experience because it was a big lesson for me. I used to think that there was kind of a single leadership persona, like a way you had to be, a way you had to act in order to be a great leader, to be followed by people. It turns out that all of the great leaders that I worked with and got to observe, they were all really different. Some were introverts, some were extroverts, some were technologists, others were storytellers, some were diplomatic and very calm and others were emotional and a little bit hard-headed. Some were nerds and some were cool kids. If you think about it, it’s kind of a liberating idea actually that leaders come in all shapes and sizes because it means that anyone fundamentally, has the capabilities to become a great leader. The other implication
Ali Rowghani [03:58] – which I think is also really important and I’ll touch on again later, is that in your quest to become a great leader, in your quest to have other people follow you, you have to be yourself. You have to be authentic to who you are. You can’t try to be someone else if you want to be a great leader. You can’t try to imitate Steve Jobs and hope that people will just kind of think that you are Steve Jobs. I remember reading a quote some years ago from Reed Hastings, the amazing CEO of Netflix who basically said the same thing. He said for the first few years of his career as a CEO, he was just trying to imitate Steve Jobs and he realized no, that’s impossible, I have to be Reed. It was that simple sort of realization that helped him become a much better leader. You can only be yourself in the end because humans are very good at detecting inauthenticity, are really good at telling when someone is being fake and we don’t generally follow or trust those that we find inauthentic. First observation on leadership is that there’s not a single archetype. Anyone can be a great leader. But in order to do so, you have to be yourself. Second, while there’s no single archetype, great leaders nevertheless share three fundamental attributes. You kind of got to be really good at these three things if you want to be a great leader. The first is that great leaders think and communicate clearly. This really makes all the sense in the world. If you’re going to have other people follow you, if you’re going to have other people want to do the thing you’re compelling them to do,
Ali Rowghani [05:44] – you have to be able to paint a clear and compelling vision of the future for them to be able to follow. As a company grows, as any organization grows, your communication has to get better and better and better because you’ve got more and diverse, more diverse people who are hearing it and your processes that you use to communicate can no longer be one-on-one but they have to scale as the organization itself scales. The biggest lesson in good, clear communications to me, the most sort of important thing is that great communication needs to be simple. Simplicity in communication is really hard and to communicate simply takes a lot of time and preparation. There is an example here of Woodrow Wilson, President Woodrow Wilson who was once asked how long it would take him, he was asked to give a speech and was asked how long would he need to prepare. And he said, “Well, it depends how long you guys want me to talk. If it’s a 10-minute speech, then I may need two weeks to prepare for it. If I can talk for half an hour, I only need a week. But if I can talk as long as I want to, then I don’t need any preparation at all. I can speak right now.” That from one of the presidents of the United States, in a fact captures the point. If you want to communicate simply, if you want to express things that are memorable and that can be repeated, it takes time to prepare. Another great example here from business for me is from Jeff Bezos when he was asked about Amazon’s retail strategy. What is Amazon’s retail strategy? And he said that, “Yhe way we think about our retail strategy
Ali Rowghani [07:37] – is that there are three things that will never change in our world. In other words, customers will always wants three things from Amazon. They’ll always want lower prices, they’ll always want bigger selection of merchandise and they’ll always want faster delivery.” So lower prices, more merchandise, more selection and faster delivery. Yhen he could never imagine that a consumer would ever want the opposite of any of these three things. Those three things became the pillars of Amazon’s retail strategy for the last 20 years and employees knew that anything they did to drive those three things; lower prices, faster delivery and more selection would be in the long-term strategic interests of Amazon. And it was clear as day and it drove the strategy of the company for a long, long time. That’s the kind of communication that we’re talking about. That’s the kind of simplicity that’s effective. So how do you get good at this? Obviously, clear, concise communication comes more naturally to some people than others but I do believe that practice does make you better when it comes to communication and I believe that even in small startups even in two to four-person startups, as long as you have other people you’re working with, it pays to work on communicating clearly. The way you get better is number one, to realize that clarity of thought precedes clarity of language. You have to think clearly to communicate clearly. The first step is to free up time in your schedule, to just think and try to jot down your thoughts
Ali Rowghani [09:17] – and try to think about how do I express these thoughts in clearer and clearer ways. Plan and practice your communications. This is probably more appropriate in a slightly bigger company. But if you’re standing in front of a group of employees, don’t wing it. Try to prepare, try to have it written down. If the company is big enough, practice in front of a smaller audience. Get some coaching, ask for feedback. All these things will help you guys become better communicators. And there’s really no reason not to start now, to try to work on this. It’s such a fundamental skill. Great leaders are all different but they share three fundamental attributes. The first is clarity of thought and language. The second is that great leaders have good judgment about people. Why is this important? Why is it important for you to have good judgment about people Well, as your organizations grow, as your startups grow, before long when you get to have 20 or 30 employees, you’re going to have to hire or promote other people to be leaders in the company, to be managers and directors and one-day vice-presidents and so on. And the decisions that you make in terms of who to empower as leaders in your organization have a really profound impact on the future of the company. If you make consistently bad decisions on the people that you’re bestowing authority and power to, then your authority, your followership, the trust that people have in you will diminish. You have to make really good choices in terms of who you empower because in the end, they become extensions of you.
Ali Rowghani [10:58] – How do you get good at this one? Again, good judgment, good EQ is probably more natural for some people than for others. But my best advice here especially again, this is a few steps ahead of probably where you guys are now. But when you’re starting to recruit for any position in your company, you should try to meet a lot of people. You should put real time and energy into it. You should try to even meet people who you have no hope of hiring because it’s important to kind of get a sense for what really great leaders are like and what great engineering managers are like, what great sales leaders are like, et cetera. Just talk to them about their jobs and their backgrounds and how they came to be where they are. Ask them about how they lead people, what they think goes well, doesn’t go well. This type of kind of educational interview will really help you, will really hone your judgment about what’s good and what’s bad and who’s good and who’s bad. Don’t think that you’re wasting time in doing this. You guys, many of you will be hiring senior people one day for the first time. You would never have hired a CFO before. Don’t cut corners. Spend time meeting people and honing your instincts. The other thing I would say is as you guys start to grow your companies, you obviously going to have to hire and recruit a lot of people and some of those people will not work out. Just make sure that you view the hiring process as something that you can learn from every single time. And just be very diligent in terms of learning, who you hired, why you hired that person,
Ali Rowghani [12:42] – what went right, what went wrong in terms of their original hire, their onboarding and their career at the company. Be self-reflective about the development of people in your organization and your own choices as to who you’re empowering with authority. Last thing that great leaders have in common. Great leaders have strong personal integrity and commitment. That means standing for something meaningful beyond themselves and being motivated by things outside of their narrow personal interest. It means avoiding behavior that diminishes trust, diminishes credibility in a leader like favoritism, conflicts-of-interest, inappropriate language, inappropriate work relationships et cetera. Commitment means making your work into a life mission in ways that inspire other people. It means giving it your all. People see this and they respect it and they follow it. How do you get good at this? Well, my simple advice on this one is to try to hold yourself accountable to the transparency test which means ask yourself if all of your private communications and behavior towards others et cetera. If all that were to be transparent to everyone at the company, if everyone saw everything you said and did, would you be embarrassed by any of it? We obviously all make mistakes but patterns of mistakes are bad. Mistakes that sort of damage the integrity that you have or damage the perception of integrity are the worst of all. That is I think a very important characteristic in leaders. Third observation about leadership.
Ali Rowghani [14:27] – Number one, all leaders are all different. There is no single archetype. Number two, nevertheless they have three common traits, communication, judgment about people and integrity and commitment. The third observation about leadership is the best way to measure great leaders is in terms of the amount of trust they’re able to engender in the people who work with them, for them, around them, et cetera. Trust is the metric, the success metric for leadership and trust in a 360° sense of the word. I would say that across any organization, the job of every leader is to build trust, trust in employees, investors, customers, users and so on. Building trust is both an art and a science. The science of trust is fairly simple. You have to be right about the empirical questions in your business. If you’re predicting, “Hey, we should build this product, we should try to sell to this customer,” or “We should try to market the product in this way,” these things over time, these choices get proven right or wrong and hopefully you’re right much more than you’re wrong because if you’re consistently wrong, then you diminish the amount of trust people will have in you. It’s almost like asking someone what’s two plus two, and if they consistently answer five, then they can be the most trustworthy, ethical person on the planet but you’re not going to trust them at the end of the day with anything that have to do with math. So that’s the science of trust. I find that founders often get this part right.
Ali Rowghani [16:09] – The second aspect of building trust is more of an art. This is about being able to show empathy and good judgment, having timing, good timing when you confront issues. It’s about striving for something bigger than yourself and not being selfish or self-centered. This is a more delicate. Obviously, the art of trust, building the art of trust is a more delicate topic and again practice makes you better. But I always try to keep it in mind. My parting advice for you guys as you guys are sort of tadpoles on your way to building big companies, is that with every step that you take forward, try to optimize for trust as leaders. You’re going to have lots of hard decisions to make in the coming years. You’ll have to fire people, you’ll have to admit mistakes to your customers. You’ll have to say no to people because you disagree with them and their ideas. Try to view every challenge that comes in your way. Try to view every challenge as an opportunity to increase the trust that people have in you as a leader. Try to view every challenge as a trust building opportunity. As you evaluate one course of action versus another, ask yourself which path is going to generate more trust in you as a leader. Always try to choose that path. That’s my parting my parting advice. I wish you guys all the luck and success in the world and it was great talking here today. Thank you.
Craig Cannon [17:41] – All right. Now for Kevin and Adora’s lecture.
Kevin Hale [17:44] – Hello Berlin. We made it to week 10. This is the last stop on the Startup School tour. We have something kind of special today so Adora and I are doing a presentation together and it’s all based on numbers from the last nine weeks of Startup School. She’s going to sort of kick it off and what we’re going to do is probably talk for like, hopefully 20 minutes and then we’ll open it up to Q&A to answer all of your questions or anything else you want to talk about and then we’ll have like more mingling and eating and such until we have to kick you out and go have you work on your company or apply to YC if that’s what you still have left to do at 8:00 p.m. Adora.
Adora Cheung [18:42] – 5:00 a.m. Berlin time.
Kevin Hale [18:42] – 5:00 a.m. Berlin time. Plenty of time.
Adora Cheung [18:45] – Plenty of time. All right, thank you Kevin. Thanks for being here. As Kevin said, my name is Adora, I’m one of the partners at YC. And we’re just going to go over what we learned during Startup School. So it’s week 10. We made it. Congratulations. So the Startup School team has been, in the past few weeks traveling around the world, visiting cities where there’s lots of Startup school founders. We’ve done 20 events at this point, over 15 cities and we’ve interacted with over 2,000 founders in person. Similar to how we started, we wanted to end Startup School by looking at the numbers. Most of you don’t know this but Startup School actually grew a lot during the course itself. When we held orientation back in July, end of July we were around 20,000 founders and 21,000 startups with over 20,000 people are in the course just for the content. As we let more people into the course, as of today the number swelled by over 40%. You’ll see, we have now over 40,000 founders in Startup School and over 30,000 startups. There are over 77,000 people
Adora Cheung [20:03] – actually subscribed to the content with the number of people increasing between 30 and 50%. Really cool that female founders increased the most here. One of the things that we want to look at was whether Startup School made a difference. We looked at the last two batches to see how last year’s participants are compared to the rest of the population in regards to their ability to get funding from YC. In the end, from the past two batches, 9.7% of Startup School applicants that applied got an interview versus 9.1% of non-Startup School applicants got interviewed. That means 6.6% of who did Startup School, 6.6% had a higher chance of getting interviewed. And we think this year, it will be much, much higher because we focused the course a lot on helping you build that application and just focus your startup on the right things to get those questions done well. All right. If you look deeper into the numbers, as of today, 106 Startup School companies have been accepted into YC. For a group of people who are more likely to get interviewed, you’d think they look amazing on paper, they got into YC. But you would be wrong. Startup School founders accepted into YC are surprisingly different. In every city we visited, founders are constantly asking us to see if YC still wants to accept companies that are not perfect that are like them but not perfect. And the big takeaway is that YC is not afraid of warts and we can assure you no startup we’ve ever accepted has been perfect. So dig a little bit deeper into these 106 companies
Adora Cheung [21:52] – from Startup School that has gone to the YC already. 40 of them had no traction when they got in. So that means no revenue, no users yet. 57 also had no revenue, 50 had no funding whatsoever meaning zero dollars cash in the bank. Some of them didn’t even incorporate yet. Quite a few of them were still looking at jobs or might have in college and still working part-time. 40 of them applied previously so this is one of the things as we encourage you, even if you don’t get in, is to keep trying again. A lot of people apply three to four times and then on that fourth or fifth try, they get in . Some of the companies, we didn’t really like the idea they applied with and they actually pivoted during the batch and so that counts for a dozen of them. And a lot of them applied late. By time you watch this video, you’re applying late and we still encourage you to apply. And finally, this is the most asked question in our tour which is if I’m a solo founder, can I still do YC? And the question is absolutely yes. Ten single founders got in from Startup School. We average around 10% of the batches around solo founders now, if not, a little bit more than that. We highly encourage every team to have a technical co-founder but if you don’t, it does not disqualify you. In fact, three of the Startup School companies that have gone into YC were not technical. All right. How can you replicate their success? It’s very simple and we’re about to, I’m about to repeat a lot of things we’ve already said during the Startup School.
Adora Cheung [23:27] – But the best thing you can do is when you talk about your startup, there’s a question on the applications, is what are you making? And that is to be very clear or it is. And if you’ve watched Kevin’s lecture from a couple weeks ago, the next few slides will seem very familiar. One is be clear on what you’re working on. No jargons. Not only be clear but don’t use all the words in dictionary. Be very concise on how you get your point across. To be even more specific on that question on the application of what are you working on, startups that have gotten accepted into YC use on average 78 words to describe what they do. 78 words might seem a little or a lot to you but in fact what it does, is it looks like this. It’s two paragraphs and gets your point across well. If you have something that looks longer than this, then you should really go through your description and start cutting words and finding sentences that you really don’t need to have there. All right. If this is what a description should look like, what should a description not look like? Well, here’s an example. This is actually one of my favorite ones because as you’ll see next, of a description that did not get an accepted or get an interview. We couldn’t fit the whole thing in here but if you read, like this guy or I forgot who the founder is but he basically knows he needs to write something short but decides to write a wall of text. In fact, that wall of text was the longest description we got of all applications in the past two batches. It was over 2,000 words. Obviously, please don’t do this.
Adora Cheung [25:19] – It doesn’t help us understand your startup any better. It actually just confuses more and frustrates us. It basically tells us that you don’t know how to be efficient when it comes to getting people to understand what your startup does. If you think about it, if this is how long it takes you to describe what you do, if you can imagine when you come in for a 10-minute interview, the interview will be done before you even finish your description. Furthermore, what culminates at the end of YC itself is a two-minute demo day pitch. Again, that’s even less time to get your point across and so you really need to start practicing now on how you deliver, deliver on how you explain your company. The good news is, in Startup School when you apply or when you’ve registered, you had to fill out your company description. We actually forced you to write it in less than 200 characters or less. Now this is a histogram of a number of characters of words that Startup School companies use and you can see that a lot of you got through the 200th character and probably wanted to write more but have to stop because we forced you.
Adora Cheung [26:27] – The result is, this description actually averages around 40 words or less. By force, we’ve made you do it less than an average of 78 words so that’s good news. When you transfer your descriptions to your YC application, we suggest you to not expand much further than the number of words you’ve already used. All right. One thing we noticed and we’re worried about was the lack of editing on your hand when you’ve entered in that Startup School description. Over the course, over the 10-week course, we’ve been trying to help you make that description a little bit better. In fact, a lot of the group sessions were designed to help you with that. But as you’ve been practicing pitching every week, many of you didn’t actually go back into your profile and edit your company profiles with a better description. It’s actually the one thing we do at YC, to help startups more than anything else is really get there one or two liner and there’s descriptions. The next Startup School we’re going to probably focus more on helping you do that and forcing you to document to your changes over time. The minimum number edits is only one. We think that most likely, the description you have right now can be improved on drastically. If you need more tips on how to do this, well, Kevin’s last lecture, “How to Evaluate Ideas Part Two” That’s the name on the YouTube channel. Please, please go watch as you see a lot of the slides were lifted from there. I’m going to let Kevin take over for the next bit.
Kevin Hale [28:04] – You guys submitted a lot of data to us. Every week we ask companies to let us know about their progress. If you’ve got an email from the Kevin inspirational bot, then you know that basically we’re trying to get you to just spend 10 to 15 minutes at the most to just tell us what’s been going on with your company. And in the last nine weeks, there’s been over a 124,000 pieces of data and so we’ve got a lot of interesting insights from that. The first thing is concerning what Startup School companies considered their biggest obstacle. Not surprising to us, but it is kind of worrisome, number one was funding. You we were worried about lack of resources and you couldn’t move forward as a result of not having money. And the other one that’s interesting on here is like meeting a co-founder at number six. And the reason I point these out is that if you look at what people said actually improved their KPI, the metric that they considered mattered the most when we did the text analysis, it looks very different. So you think your biggest problem is one thing but the thing that would actually help you the most are very different. Number one of course is launching, getting out the door. Once you launch, you can move that KPI, which is wonderful. Other stuff on here, a lot of it concerning product and things dealing with the users. If you’re having problems where the difference between what you think your biggest obstacle is and the thing that makes the biggest difference to a KPI are two different lists like this, watch Adora’s lecture. She talks about how to prioritize your time.
Kevin Hale [29:46] – It’s actually doing really, really well on YouTube. It’s the fastest spreading one. A lot of people have found her tips in there on how to think about your to-do list in a much more KPI driven way. Very, very helpful. We asked you to talk to your users and tell us what did you learn from them. These are the top things that people got. Not surprisingly, they’re focused on product and basically, the best thing you can do is make something people want. And the top two insights, because they’re focused on conversion and modernization. I’ve got two lectures that we did back-to-back on improving landing page conversion and pricing. Those are good places to start if you want to improve things for your users. Now actually most of the participants unfortunately in Startup School, did not launch. When you were considered not launched, the KPI that you track was weeks to launch and so these are the numbers and how they came out. People on average went from WTL weeks to launch are seven weeks down to five weeks at the end. For some reason, that should have been to zero.
Kevin Hale [31:02] – What’s actually super interesting here is that the median weeks to launch is about four. That indicates that in the average there, it’s being actually very much impacted by people having very large weeks to launch. That’s really bad. If you haven’t already, you’re going to find a theme here for this presentation. Watch Michael’s lecture on how to plan an MVP. He talks about how you should only be making the first version that takes just a few weeks to launch. Even that median is double the number that we recommend for our companies. In that talk, he also coined a new term that we’ve been using. It’s called YC the heavy MVP. This is if you’re a hard-tech or biotech company, you might need to build something that’s a little more substantial. In fact, you guys actually believe you do need to. You’re almost double the number of weeks to launch that you estimate. And unfortunately, if you look at the graphs by comparison, so this is the average Startup School weeks the launches that’s going slightly down over time. This is the biotech hard-tech people. You guys actually go up over time. Now add features over the course of the week and that’s not good because actually from our experience, funding over 200 biotech hard-tech companies is that they shouldn’t be following different advice or rules than other companies which is what we recommend. If you haven’t watched it, watch in Jared’s lecture on advice or biotech and hard-tech companies. He basically talks about seven, wonderful examples
Kevin Hale [32:38] – of YC companies that built a much lighter weight heavy MVP and creative ways of getting their company off the ground even though they don’t have millions of dollars and lots of time to build the first version. For the companies that did launch, you guys did great. This number represents the percentage of the weekly updates were submitted that came from companies that launched. At the beginning of the course, a third of the weekly updates came from launch companies and by the end, half of them were from launched companies. That’s super awesome. In fact, 2,253 startups we can actually track switched from weeks to launch to a different KPI during Startup School. To put this into perspective for us, it took over 10 years for Y Combinator to launch that many companies through our program. And in Startup School, we did it in 10 weeks. Adora’s going to talk about group sessions.
Adora Cheung [33:33] – All right. As you know every week, during Startup School we matched you with other startups to help you practice talking about your own startups. And everybody at the end would rate each other on three metrics. Did you understand this idea? Were you excited about the idea and would you want to work with the founders? For the first question. Over time, you guys got better at explaining your idea. As you can see the differential from each week to week was over 0.1%. To put that in perspective, a 0.1% increase represents almost a 100 startups because of the number of startups in Startup School. And by the end, there was a 7.1% increase overall. All right. In terms of improving on selling yourselves, you guys also got better over time. There was a 9.5% improvement from the beginning. The biggest improvement was actually getting other people excited about your idea. And so there’s a 17% improvement since the beginning. We know that there’s a lot more work that needs to be done here. We want to, in the future, create a lecture to help you get better at getting other people emotionally excited about your ideas. Being able to do that helps you with things like recruiting and getting customers on board and also investors on board in the future. If you want more help in structuring your investor pitch, Kevin’s lecturer, second lecture, it was called How to Evaluate Startup Ideas Part One. I would go watch that. All right. While the quantitative ratings made it easier to get founders involved, Startup School founders loved it when you actually gave each other
Adora Cheung [35:13] – qualitative feedback comments after the group session. We were amazed to see how supportive everyone was with each other in terms of giving this feedback. In fact, over 93,000 pieces of qualitative feedback were created during the course. Many of you have offered to help with introductions to customers, often whispered words of encouragement that we know made a huge difference to someone struggling to make the magic happen. One of the main reasons for doing these group sessions together, it’s sort of like emotional support in group therapy because we’re all going through the same things and so I think that achieved the results we were looking for in that sense. The generosity we saw in the comments is what makes doing a startup and a batch incredibly powerful. Thank you for everyone for taking the time to do this. It really means a lot to everyone. On the flip side, not all of you were great. A bunch of you no showed. 90% of startups who requested participating in a group session did not show up.
Kevin Hale [36:19] – Boo!
Adora Cheung [36:21] – Yes. This graph shows updates requests for group sessions and attendance and no-shows over the last nine weeks. Oddly enough, 23% of startups who submitted a weekly update didn’t even request a group session. We’re looking for the next time, for the next course of how to make this easier and more convenient for startups because we think that this has been actually helpful, not just in improving your pitch but also for morale reasons.
Kevin Hale [36:48] – Interesting enough, this graph actually shows where we messed up in the first week. That big gap there between number of updates submitted and requests requested shows that you guys were very confused about how to request group sessions at the very start of Startup School. And that’s why we gave everyone a freebie on that first one and that sort of stabilizes as we get down on the end.
Adora Cheung [37:10] – Just like how you guys are probably using metrics to help improve your startup, we are too as well.
Kevin Hale [37:15] – Okay. So we also asked you guys to submit how are you feeling, what’s your morale on working on your startup? And overall, out of 124,000 pieces of weekly feedback and you can see the trend is we got a little happier over time. But we actually want to just segment this out to see what actually really impacted and what made a big difference for morale for companies. It led to some of the most interesting and unique insights from the program for us at Y Combinator. First one, so ethical startups, no surprise are happier. You’re just able to get more done. One thing to notice is you’ll think that the difference here and changes are small but because of the amount of data that we’re collecting across each one of them, these are pretty statistically significant. If you’re looking to be quantitatively happier, these are ways to do it. If you launch, you’re a little bit happier than the unlaunched people. One thing that helped a lot of companies to rethink how they thought about launching was watching Kat’s lecture on how to launch again and again. It just really changed that bar from being a launch that requires press to being one that is just about shipping and deploying on a regular basis. If you’re full-time on your startup, you’re a lot happier obviously probably because you can also make more progress. If you’re making money, you’re happier. The whole aphorism money can’t buy you happiness, not true. Adora’s got a good lecture on this, on focusing on revenue, how to set KPI’s. It’s her first lecture from the Startup School
Kevin Hale [39:00] – and I actually think it’s one of the under appreciated ones. It’s the lecture that really talks about why 99% of you should be focused on revenue and be honest with yourself about whether you’re actually doing that or not. Here’s one that’s really surprising. People who did not flake on group sessions were way happier than people who did. Basically feeling like you’re doing a startup and having other people to talk to and being part of the community and batch meant that you’re happier working in your startup than those who did not participate at all. The happiest cohort was actually people who were in teams. And this is actually one of the main reasons we always say that we want companies to try to have co-founders. It is so hard to do a startup on your own and this is usually, morale is the thing that kills a lot of companies and founders. And so again, when we talk about we want you to try to have a co-founder, it is to help with the longevity of your startup, not because we just don’t want to select those that don’t have teams. And then this was the most surprising thing that we learned from Startup School, that founders and teams that talked to users were way happier over time than those who didn’t. And what’s interesting about these two cohorts is that the people who did not talk to any users at all, they were the only cohort that actually had morale get worse over the course of the Startup School in the nine weeks that those who didn’t. So the lesson, the moral of this morale, are you feeling sad? Talk to users. It doesn’t take very much to do it.
Kevin Hale [40:41] – The median number of users that Startup School teams talk to which is three users a week, it actually provides a ton of insight for you but apparently it’s better than Prozac. If you want more information about how to talk to users and a better way of handling that in a sort of structured way that helps you improve your product, watch Eric’s lecture from the first week of Startup School. Let’s bring it home Adora. In summary from this presentation, Startup School helps you get interviewed. It’s okay not to be perfect. You can get accepted even if you haven’t worked. Try to write your description in 78 words or less, prioritize launching, you’re probably taking too long to launch. Practice makes you better at pitching, talking about, getting people to understand you and get excited and want to work with you. And lastly, talking to users make you happy which is why we’re going to switch over to talking to you guys. Thank you so much.
Craig Cannon [41:53] – All right, thanks for listening. As always, you can find the transcript and the video at blog.ycombinator.com. If you have a second, it will be awesome to give us a rating and review wherever you find your podcasts. See you next time.
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