YC Partner Adora Cheung shares her framework for how founders can efficiently make use of their time. She covers ways to identify and prioritize tasks, in addition to how you can measure their impact on your company.
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Adora: Hello. As Kevin said, my name is Adora. I'm one of the partners at YC and I'm going to talk about how to prioritize time. Time as you know is precious especially when you're working on a startup. Time burns money and money is the very basic thing that keeps a startup alive. Not to be too philosophical about it, but even if your personal burn is super low, you can eat ramen days on end which I don't suggest and you don't have to pay yourself for a very long time. There's always a high opportunity cost to doing your startup. So it's super important to use your time the best way possible to maximize your startup's chance for success which means you need to be really good at identifying and prioritizing tasks that are going to be the most impactful for your startup's progress, which I've noticed after going through thousands of weekly updates from Startup School founders that a lot of founders are not doing this well. So hopefully this will be helpful.
Let me first preface all of this by defining what time I'm talking about. So obviously, there are 24 hours in a day and I'm not here to tell you how to allocate those hours across your startup versus everything else that is important to you, sleep, family, friends, hobbies, and so on, and so forth. Everyone has different situations. So it's hard for me to from up here give you a good generic advice on how to allocate your time across these things. I'm just gonna assume you're doing what's best for you, whether it's 2, 6, 12 hours a day that you decide to work on your startup, it doesn't matter to me for the purpose of this lecture. I just want to help you figure out how to spend those 2, 6, or 12 hours that you've decided to allocate your startup in the best possible way. All right. So when it comes to things to work on your startup, my guess is that you already have something like a task list in which you put new ideas on to eventually work on and you update that very frequently. So let's start from there that you have a task list of things to do. First, I want to make a real clear distinction between real and fake startup progress. This is the easiest way to classify whether a tasks goes in to should do or the should not do bucket. If it contributes to real startup progress, you should consider doing it and if it doesn't, then don't. This seems trivial at first. Why would anyone do anything that amounts to fake startup progress, but let me explain further.
So real startup progress is when you're really focused on things that really move the needle for your startup and in the beginning, the best way to show this is through growth, in particular growth of your primary KPI. I gave a whole lecture on this a few weeks ago on KPI and goals. If you haven't watched it yet, please watch it. I talked a lot about primary and secondary KPIs. There's always a balance between what to focus on, but for the purpose of this lecture I'm just going to refer to the primary KPI as the thing to focus on growing. So to summarize, your primary KPI almost always is either revenue or active users and you should always be setting weekly goals for this. To move the needle on the KPI is the highest leverage thing you can be doing. It always comes in the form of tasks that involve talking to users and building, and iterating your product, nothing else. This is in direct contrast with fake startup progress which is when founders focus on things that are not directly related to growing your primary KPI. So common things I see in weekly updates are things like attending conferences, focusing on winning awards. Now we're convinced, optimizing the wrong metrics. While you may convince yourself these are good things to focus on, there are actually many steps away from delivering real value to your customer. And so if all the things you could be possibly doing spending any significant time on any of these things is almost always a bad idea. The goal is not to optimize startup vanity, but actually delivering value to your customer, doing the things that will help you directly help you increase your KPI.
Now that we have one way to filter what tasks you should be working on, let's go a little bit deeper and figure out how to determine if you're prioritizing the right tasks. This at first also seems trivial. Presumably, you're doing what you believe is high value work. I mean, nobody ever says, "Oh, let me do the thing that is going to help my startup the least." Right? But that's what I'm going to challenge. There are hundreds of things you could be possibly working on to increase your primary KPI. Is what you're working on right now the best thing you can do to meet your weekly goal or have you tricked yourself into doing something else? The reason I'm skeptical is because it's actually quite easy for a low-value work to unnoticeably creep into your schedule and it actually takes a lot of work and effort to not let this happen. So here's an experiment. Try journaling in great detail of each day in the past week every single hour. So hour by hour, what is it that you're exactly doing and be honest on what you thought the impact was before you actually did it, and what it was in increasing your primary KPI. I think you'll be surprised by how much of it was actually low-value work and the reason is not because you're lazy or I hope not. It's more because we tend to be as humans on autopilot. So we don't give much thought to what we're doing with our time and our natural instinct is actually to go for low-value work because it's usually the easiest and quickest thing to accomplish, and it fulfills our desires to check as many things off of the list as possible. It feels really good to check things off.
So... But once you're aware of this, preventing it is actually quite simple. But it does take time, thought, and discipline. So first, if you aren't already, you should keep a spreadsheet of ideas that can move your primary KPI and not to be too repetitive, but these tasks are almost always a variant of two things, right? One, talking to users and two, building product. Talking to users helps you with three things, right? It converts them into customers and revenue or helps you convert them into customers and revenue, it helps you understand if you're on the right track or not, and it helps you figure out if your product... Sorry, it helps you figure out your product's roadmap and then building product actually delivers a solution to the user to see if it actually translates into more customers and revenue. So as you come up with these ideas, you should log them into your spreadsheet and keep doing that as every idea you get. But the key is don't do them right away, just write them down. And this is important because always switching to the thing you just thought of which always sounds better now than later, causes a ton of whiplash for founders and it's a primary core part in making no progress during the week.
So now you're tracking this list, then once we go through each item in your spreadsheet and grade the new and regrade the old items based on how impactful you think the task would be on achieving the weekly goal for your primary KPI. There are three grades you can give to each task on your list, high, medium, low. These definitions are a little arbitrary in the sense that it's all relative to whatever else is on your list, but in general, high means it's a task you believe that will help you meet your goal for the week with high probability. Medium is you're not sure, but with okay probability you can hit your weekly goal. And low is with very low probability. You'll see that it's actually pretty easy to figure out what those low and high-value tasks are when you compare them against everything else you could be doing, which is why this exercise no matter how pedantic it is is important to do.
So let me go through an example. Let's say I'm a founder of a SaaS software, generic SaaS software company. My goal for the next week and I just kind of launched, and my goal for the next week is just to get five new paying customers. So here's just a sliver of things I can do to reach that goal. At the top you'll see that the most impactful thing I can do is go to the offices of 10 potential customers who were actually insured to me by friends or whoever, and I know that if I show up to the office, I have a very good chance or some experience. I have a very good chance of convincing them to buy my product and so that's why that's at the top of the list. The next year are of meeting impact because they involve me filling up my pipeline which is one step away from landing new customers, but necessary to do. I also have the second thing here, I also have a video demos I can do which for me aren't as effective as doing in-person, but worth doing as well because they do lead to some new customers. You'll notice that there are couple items at the bottom of this which involve programming. So a very common mistake technical founders make is to build things first and then go talk to users. And according to this list, to meet my weekly goal this means they would be choosing the least impactful thing to do for that week. But with this method if they're honest about it, they have no choice, but to get off their butt and go talk to users instead. So along with the impact that it might have on helping you achieve your weekly goal, we also need to consider our second dimension of how complex the task is. That is how long would it take for you and your team to complete it. Because there are many tasks within each category of impact, for example, there's like, four of here in medium and three in low. And sort of the question is how do I stack rank those within that category. And so this dimension of complexity helps. So we can grade complexity in three ways, easy, medium, and hard. So an easy task is something that you can do in less than a day. That means you can do a bunch of easy tasks less than a day. A medium task is something that takes one or two days for you to do and a hard task is one that takes many days to do, and you may not complete it within the week.
So once you go grade all of them you'll have again the second dimension here where you have impacts and then also complexity and so now you can easily stack rank all the tasks in your list, and it's pretty easy to choose what you should prioritize. So giving the objectives to hit your weekly goal, the obvious choice is always to go something with the...to go for the combos of high easy combos and high medium. That is something, a task that has high impact and is easy to do. You should always do those first and then go to high impact in medium complexity. And what you really don't wanna do is focus on these bottom things here, right? Something that has probably very low probability in helping you achieve your goal and it's very hard to do. It takes a long time to do. There's really no point in doing any of those things. So just as important as selecting the right task to work on is making sure you don't try to do everything at once. Pick enough tasks that you can complete and do well. Doing too many things means you won't be able to complete much of the task with much conviction and it makes it really hard to show progress from week to week.
How do I know I am prioritizing my time well? Ultimately you know you've done well if you're hitting your weekly goals consistently. So it's... You're doing well if your graphs look like that. Sadly, most of us have graphs that look like this. These chances are where it's decreasing and you're kinda like, stable for a while at the bottom, that's when you start doubting yourself as like, "Am I working really on the right thing or not?" And so what can we do about this or how do we know? So one way is to do what you're already doing in Startup School which is writing weekly updates and being really consistent, and honest about it. So the key components of weekly update is pretty straightforward, what was your weekly goal? Did you succeed? If not, what was the biggest block of the growth? What did you do? And what was the predicted impact and what was the actual impact? And what did learn this week? What were the big learnings this week? And then by doing an ongoing evaluation of your weekly updates, it will help you improve how you select and prioritize tasks.
Once in a while you should review all your weekly updates like, from beginning, the first one you ever wrote for your startup to the current one, to the last one and check for things like, do you feel like you're learning fast enough? Are you predicting the impact of each task well? Did you let low-value work or even worse, fake progress creep into your schedule? Is your biggest blocker the same thing for every week? A lot of people actually get in a rough spot where they're not learning anything new and just doing the same thing over and over without realizing it. Reviewing your updates will help you realize that and will force you to try to get yourself out of that bad loop.
In terms... This last one, in terms of completing tasks, if you're finding yourself always running out of time to complete tasks you felt was totally possible to complete in the week, I have two suggestions for you. One is perhaps your task is actually too complex and you should break it down into medium and easy tasks. The second one is maybe it is that your schedule needs to be rejiggered a little bit. I recommend a modified version of what we call the maker's, manager's schedule which was popularized by Paul Graham. The essay is linked in the Startup School library. The basic idea is this, there are high context switching cost to different types of tasks. For example, coding and meetings like talking to users, meaning it's hard to restart in a ramp back up on a task especially like coding and it's costly to exit at a time when things are finally flowing and you're getting stuff done. So if you find yourself switching back and forth too much it may be that you're wasting time and need to rejigger things so you have a continuous chunk of time devoted to each one. So many people will actually split, divide their week into days, right? So one full day, they'll just spend coding and then the next full day, they'll spend meetings and talking to users, and so forth instead of having like one hour here, one hour there, and hour there. For people who need to get more stuff done in the day, then they'll do half the day they'll spend coding and then half the day they'll spend talking to users. So this is... For any solo founders out there this is incredibly important for you because you don't have the opportunity to divvy up the work across multiple people. So it's really important to get your schedule correct.
All right. So I'll end with one final piece of advice which is moving fast. So in the beginning of your startup, your primary objective is to move as quickly as possible to prove that you're building something people want. The faster you figure this out, the faster you can pivot into something or have the confidence that you have product market fit and can start scaling, and building a tremendous business. So making decisions thoughtfully and quickly is super important. Time is often wasted in indecisiveness. The key is to be okay with making a wrong choice and learning fast. So of course, choosing the right thing to do at the get-go is the best thing possible, but it's also the case that a person who chooses the wrong task to work on today, but moves quickly learns why it's wrong and moves to the right one is better off than the person that takes forever to choose the right tasks to work on, and is twiddling their thumbs working on low-value stuff in the meantime. That's all I have today on how to prioritize time.
To summarize, what you should be doing? Always be working on things that directly impact your primary KPI. Do the things that have the highest impact to meeting your weekly goal and that usually always means what? Talking to users and building product. Any questions? Yeah.
Man 1: Okay. What do you think about using OKRs at this stage?
Adora: So the question is what do I think about using OKRs? I think the concept of OKR is good, meaning you have key objectives and then tasks. I think at a startup, you don't need them. Like, you just need something much more simple than that which is here is my weekly goal and here are the tasks I wanted completed. And then over the time as you build out your team and you have like, 10s of peo-...50, 60 people and you need to manage that org, OKRs are a great tool to use. Yeah, yeah, right there.
Man 2: If you do not have product market fit and most are users are churning, where should you focus? Like, which type of users should you focus, for example?
Adora: So the question is if you don't have product market fit and users are churning, what should you focus on? That's a good question. So you should focus on definitely building...finding what the problem is first. So what is the problem that you're solving and then what is the solution to solve that problem. And in that stream of thought, it's finding 10 users. Like, the common advice we give is find 10 users that really love your product, do that first before you start trying to grow. So there are some things that you need to do before you start, you know, trying to scale the business. Yeah, yeah, back there.
Man 3: I'm B2B hard tech and my first potential client is requiring like, 400 times the amount of production that I am currently producing. How would you prioritize getting the funds for that user?
Adora: So the question is he's running a B2B hard tech company and to get users, you just need a lot of funds to get going.
Man 3: I have a user already.
Adora: Oh, you have.
Man 3: I have one. I mean, like, he needs 400 times what I can actually like, do the production. Who I get the funds with?
Adora: Okay. So he has one user, but he needs funds to deliver the amount of product that the user wants. I think there's a long answer to this. I'm trying to figure out the short answer. The long answer... Well, here's a short answer. There is a talk in Startup School from the last one with Eric Migicovsky, who is the founder of Pebble and he goes through all the steps that you should think about before you need funding so that you have enough proof when you do go to investors of what the show. But to more directly answer your question, I think what you wanna do is start getting more customers in the sense that not delivering the product, but in the sense of getting pre-sales or contracts. Because if you get more of... And it would be great if they are prepaid because getting it prepaid means that maybe you don't even need an investor to actually build the product. So try to do those pre-sales and pre-sales shows good demand, good demand investors love. It de-risks the whole entire thing for them and it would be much easier for you to do fundraising. If you can get the prepaid contracts as well, then maybe you don't even need...you're in a much better position with investors for sure, but maybe you don't even need them. All right. Yeah, right there.
Man 4: I'm a little conflicted in couple things that you said. One mainly is that you don't want people to rush out and go to market. And also, you're telling people in to start learning from that and prioritizing the time, right? And at the very bottom you had key features as being the ones that you give the least amount of effort when you considered it as low key activity. But if your market is telling you, the customers are telling you to buying product, those features are there, wouldn't that then become your priority rather than being at the very bottom?
Adora: Okay. So I think the question is... I showed an example of which one of the things that was more at the bottom was I should build this key feature and so the question is why don't you build that if that's what's the market is telling you? So okay. So the way I think about progress in the startup is for one, not to get ahead of yourself. So the example I gave was I want to get... My goal is just to get five new customers. How am I going to get that? Building a key feature like that might get me a thousand customers. It might, but really, I just wanna get five right now. But there is that low probability that it might get me a thousand customers. And so I wanna do the thing that I'm most sure to hit my weekly goal. At some point, my weekly goal is gonna be a 1,000 new customers in which I would probably stack rank that higher. Now, the thing on the chart... Actually, let me just go back to it. So this chart, right? So what you'll see here is that I'm coding the big feature, but what I actually have here is I'm getting feedback from users on the big feature. So I don't really know that this is going to do anything, but if I go talk to all my existing users and go validate that first, then... And I do validate that that's why it's medium up here, then I can pull up this task up much, much higher. All right. Yes, right there.
Man 5: You've probably seen this like, executed a lot of times. Do you have any examples of startups kind of misinterpreting the structure, using it in a way that was ultimately less helpful or doing it in a way that wasn't necessarily helping them get to that next small group of users? Like, how can this be misinterpreted and, like, how do we avoid that?
Adora: So the question is how can this framework be misinterpreted and send them off in the wrong direction?
Man 5: Can you say it's typically misinterpreted or this is like, pretty foolproof?
Adora: I think it's... I mean, I think the main thing is being honest with yourself about where the current state of your company is, what is your actual weekly goal, and, you know, how much time something actually takes. I think some people sometimes overestimate the time it takes or again, they let other types of work get in the way of the one or two things that they need to do that week because it's just easy to do. So that's what I was saying is like, we just get on, like, our brains going autopilot all the time and so the framework kinda whittles away over time. And that's how it can get a little bit wonky. Yeah.
Man 6: Is this supposed to be like a companywide thing or this is more of like, for a smaller team, or...
Adora: So the question is should this be a companywide thing or for like a small team? So when I talk... This is for like, really early-stage startups like, you've just launched or about to launch and you've got these weekly goals. I think that this can be...this is a framework that you can use for teams also. So it's a little bit hard as you have many teams in a company. It gets more the structure, it gets more complex. So it's little bit hard to keep it that simple, but that's when someone mentioned about OKRs, it's like, a good way to kinda structure progress in a company. But yeah, for sure, I'm talking about like, super early stage, whatever the stage most people are in Startup School. All right. Two more questions. Yeah.
Man 7: Do you have any metric that you can decide about that it is more a problem of prioritizing time or just you need more people in the team?
Adora: So the question is is there a way to tell, like a metric to tell whether if you're not making progress, it's not because you're not prioritizing time well, it's because you're actually just, you need people, you need bodies? I think if you go back to what I was saying was like, when you evaluate all your startups and you just...or sorry, when you're evaluating all the weekly updates and there's really no room for improvements there, then that's a sign. I do hesitate to suggest that you just hire people to solve the problems. It might be that case, but hopefully it's something that the founders have done themselves already and that they can just off, like, that's the thing that they need offload versus something that maybe software can be, like, software can solve or just, you know, team is not working well together, or, you know, time is not being used well. Yeah, all right. Last question right there.
Man 8: You typically advise not to buy advertising at first, just to speak with customers and try to get those customers, you know, talking to them. When is the right time to start really, you know, an advertising thing for a startup?
Adora: Yeah. Okay. So the question is we at YC do not advocate you doing any kind of paid marketing like buying ads and so the question is obviously, there is...at some point there's a right time for this and when is the right time? So for us what we say is the right time is usually when you have product market fit and you're ready to scale, and you've already done the experiments necessary to show that your CAC is reasonable for whatever the revenue is coming and doing on a per user basis. Usually, what we see... When we say don't do paid advertising, what we really, really, really mean is what we... The mistake that people make is to get the first 100 users or even the first 10 users, they go buy a lot of ads and I think it's a reflection of bad...usually a bad founder market fit if you don't know where to find those first 10 users especially if it's a consumer company. Consumer, you know, but even for a B2B type enterprise company, hopefully you have talked to at least all those kind of users and you are building...you've built something in which someone has at least committed to using the product and paying for the product. Cool. All right. Okay, last question. Yes.
Woman: Okay. Sorry. Should we do a follow up session where we have our teams to trying to make...to do everything that we need to do as a company?
Adora: Oh, that's a good question. So should we follow up with our teams and make sure we're all on track? I think weekly stand-ups are great. It depends on... I don't know, like, for a 100-person company that's too many for, you know, to do once a week. But like, say, four or five six-person team, weekly stand-ups are great. Some people do daily stand-ups or some people do even two stand-ups a day and personally, I think those are not as effective because to make progress, you know, it takes time. And so even if you are making a progress, it's hard to see it like, in one day chunks. But for sure one week stand-ups are great and reviewing this with everybody and getting everyone on the same page. Getting everyone on the same page in your company, by the way, on the definition of your primary KPI is super important. You'll be surprised how many companies or team members just have varying levels of definition, and then once you get that set, then having everyone understand what the goals of the company are and then what are the tasks what you should be working on. So cool. All right.
Kevin: Thanks, Adora.