Lessons from 1,000+ YC startups: Resilience, tar pit ideas, pivoting, more | Dalton Caldwell (YC)

seeing everything people apply to YC with people all kind of have the same idea one of these themes is simple pragmatic advice sell make money one of my mantras is just don't die being coached and being reminded of the fundamentals and Basics puts you in the right mindset you have this concept of tarpit ideas seems like an unsolved problem you'll get all this positive feedback from the world and people have been starting that startup since the '90s recently you put out a request for startups 20 categories of ideas that YC wants to fund we're trying to mix up some of information diet about what kind of ideas people might be contemplating they are currently a lot of people say you the king of the pivot a good pivot is like going home it's warmer it's closer to something that you're an expert at are there other patterns you find across startups that do well there's a lot of Founders that come this close to it all being over and through sheer will kind of just keep it going today my guest is Dalton Caldwell Dalton is managing director and group partner at y combinator where he's worked for over 10 years across 21 different YC batches including working closely in the earliest days of instacart retool brex deal door Dash webflow repet amplitude whatnot razor pay and 20 other unicorns prior to I combinator Dalton was the co-founder and CEO of imim which was acquired by Myspace and co-founder and CEO of app.net which was an early adsfree competitor to Twitter Dalton has seen and worked with more startups than nearly any human alive and in our conversation we get incredibly tactical and deep on the startup Journey why it all comes down to simply not losing hope and not letting your startup die what to do when your startup is struggling and how to know when it is time to give up what makes a great pivot and signs its time to Pivot had actually talk to customers why every single startup goes through a point where they feel like all hope is lost why investors say no to startups what most often leads to startups failing why you need to avoid overd delegating early on plus startup ideas that you should avoid and also 20 ideas Dalton is looking to fund also so many great stories and lessons this episode is action-packed with that I bring you Dalton Caldwell after a short word from our sponsors and if you enjoy this podcast don't forget to subscribe and follow it in your favorite podcasting app or YouTube it's the best way to avoid missing future episodes and it helps the podcast tremendously this episode is brought to you by EPO EPO is a Next Generation AB testing and feature management platform built by alums of airb B and snowflake for modern growth teams companies like twitch Muro clickup and DraftKings rely on EPO to power their experiments experimentation is increasingly essential for driving growth and for understanding the performance of new features an EPO helps you increase experimentation velocity while unlocking rigorous deep analysis in a way that no other commercial tool does when o that are being one of the things that I loved most was our experimentation platform where I could set up experiments easily troubleshoot issues and analyze performance all on my own EPO does all that and more with Advanced statistical methods that can help you shave weeks off experiment time and accessible UI for diving deeper into performance and out of the box reporting that helps you avoid annoying prolonged analytic Cycles EPO also makes it easy for you to share experiment insights with your team sparking new ideas for the AB testing flywheel EPO Powers experimentation across every use case including product growth machine learning monetization and email marketing check out EPO at get eo.com Lenny and 10x your experiment velocity that's get.com Lenny this episode is brought to you by vanta when it comes to ensuring your company has top-notch security practices things get complicated fast now you can assess risk secure the trust of your customers and automate compliance for sock 2 ISO 2701 Hippa and more with a single platform vanta V's Market leading trust management platform helps you continuously monitor compliance alongside reporting and tracking risk plus you can save hours by completing security questionnaires with vant AI join thousands of global companies that use vant to automate evidence collection unify risk management and streamline Security reviews get one $1,000 off vanta when you go to v.com Lenny that's v.com Lenny Dotan thank you so much for being here and welcome to the podcast yeah I than so much Lenny I'm really excited to talk to you today is going be great so to prep for this podcast interview I asked a bunch of Founders that worked with you during YC what advice you shared with them along the journey that was most transformative to the way they think about product the way they think about building their startup the way they operate and there's a bunch of themes that emerge and I'm going to touch on a number of these themes one of these themes is just how often you get to like very simple pragmatic advice and how much of your message is just like sell make money don't run out of money why do you think Founders need to hear this advice which is seemingly simple and obvious have you ever seen um in in like NBA basketball or college basketball where they have the coach miked up and it shows what they're actually saying in the Huddle you ever listen what they actually are saying they're like okay we we need to really focus and get the ball and win this game like if you actually listen to what the greatest smartest most successful athletes are talking about like if you listen to what Tiger Woods is saying to his caddy it all sounds like pretty mundane stuff they're not it's not like what Tiger Tiger Woods is talking about with his caddy as some you know imp possible to decipher jargon it's like yeah you really need to keep your head down on this one it's things like that and and I think the reason this is true is that even if you're the the best in the world being coached and being reminded of the fundamentals and Basics is what puts you in the right mindset and that you already know everything right you're at the top of your game if you make it to the elite levels of being a startup founder basically doing anything that's really hard um psychologically and so yeah one of my mantras is just just don't die just keep your startup going just keep going and I say that over and over again and and honestly that is often what people tell me is the most impactful thing I said it's not that I said some Ninja 5D chess move that they never would have thought it before it's just the constant affirmation that continuing to keep going and doing high quality reps is the game I know that You' give a talk that's exactly called that how how not to die just to pull on this thread a little bit more what is what is the general advice you share there for people that also don't want to die the way to summarize that is if you look at all the startup stories that we have at YC and all the companies we funded over all the years the underlying theme is that rationally the founder should have given up at some point and so again let's talk about Airbnb obviously something you know a lot about you know when they probably should have shut down like three or four times before they got into YC it objectively wasn't working they were basically ruining their lives they were disappointing their parents everything was wrong and it was it was a purely irrational act for the founders of Airbnb to keep working on their goofy startup and so and again that's just one story if you look across the across the portfolio of YC and non-c companies there has to be this irrational you know intention to keep going even when the world tells you it's not working and you feel completely defeated and you likely have to go through this many times and have these near-death experiences and then you get lucky and then you look like an overnight success right and so that's that's that is the theme that as a summary and I provide you know lots of data and lots of stories there but this is one of those things that the the longer I had this job the more I really really believe this is true what's your advice kind of on the flip side of that where there's a lot of startups especially these days that are just super struggling have been added for a while their mental health challenges they're really they'd be very sad if they had to shut this thing down but often it's probably the right move what's your advice to folks of deciding okay actually does make sense to give up in this case I think this is a nuanced question and it's hard for me to say something on a podcast that will actually be useful to people but here here's here's a couple of thoughts one are you still having fun do you still enjoy doing what you're doing do you enjoy spending time with your co-founders you know like is this actually a fun thing you're doing and if the answer is is yes I would tend to lean on the keep going and then if it's more of wow this is actually profoundly affecting me a negative way and my relationships with people in my life and my team you know I don't really want to work with my co-founder anymore and things like that then I would lean on the probably don't do it anymore something that a lot of the folks that turn it around have't common is they actually do love their customers and they love their product and again if in the Airbnb story again you know it really well but they really liked Airbnb like and they liked working with each other and they liked the first host that they met and they knew all their names you know what I'm saying like they were actually they loved their startup even though it was going bad and so that's kind of to me a signal to keep going is that you really really love what you're doing and the people you're you're doing it with and you love your customers and you love the problem versus when you're just like yeah I could care less about any of those things I'm just having a bad time hard harder to be encouraging in that situation you know and this is a fixable situ you know you can make it more like the thing you love can't you yeah this is actually very practical and great advice like this is something people can sense okay am I actually enjoying this do I want to keep doing this versus like man such a drag that I have to keep running this startup is there anything you could say to folks that are just like I can't stop because it'll feel like I failed if it's really going poorly if you're having a really bad time it's no big deal no one will remember that you that you shut down your company probably in 10 years or 20 years like time as long as you have integrity as long as you're an honest person as long as you handle yourself well through good times and bad people remember you fondly and it's you know better we have such a short life there's only so many years we get to to to have our careers doing something that makes you miserable and the only reason you're doing it is to avoid losing face and you know when your heart is not going to work I don't know that seems like a pretty big opportunity cost on on literally your life right yeah that's exactly what I tell Founders All the Time life is short there's no need to force yourself to work on this yeah and I really like your point of just like is it still enjoyable do you like working with your Founders kind of following this thread of the struggle train a little bit more one of the founders that was that worked with you during YC uh his name is Danny alberon yeah shared a story how during one of the batches of YC somebody one of the founders raised his hand and asked you what is wrong with our batch everyone is struggling nobody is doing well what had we done what have we done wrong and you shared a story about brex that made everyone feel a little better can does that a bell and if so can you show that that definitely happened and I think the story is the story of the winter 17 batch and in the winter 17 batch I funded something like I don't know 35 40 companies in my group so we subset them into groups so it wasn't like a lot of companies and I knew I knew all of them really well and Founders can't help but compare themselves with other Founders All the time about who's doing well and who's not doing well and there was this one company in in my group this batch was called theond that was their name at the time and it was like a VR headset thing from these uh Stanford dropouts and they basically showed up to group office hours and we're just ashamed and they're like our idea is horrible you know we might want to shut our company down this is like really embarrassing like they just I had to like beg them to not give up basically and if you would have asked people in the batch what the worst company was I think they would have said this one again not because like they were like bad people but it was just like the founders themselves seemed like despondent about how it was going and then funnily enough this is in the story too there was another startup also in my group called cashew which was this PTP for uh the UK PTP venmo excuse me um in the UK and it was going really poorly also and not growing and so if you just took this snapshot in time in the middle of the batch of like who is definitely not doing well it would clearly have been this vyond company in this cashew company and so to catch the chase vond changed their idea and got really excited about it and renamed to brex and this was brex which is like a decacorn and cashew changed her idea and renamed to something called retool and so out of my 35 companies the ones that objectively seemed the worst in terms of like it's just everything is going bad we're by far in retrospect the most successful companies in that group wow oh wait so you're saying brex was a VR head said company they thought it was really high-tech they want to do a really high-tech startup and so they're like we're going to build a new VR headset and you know they were good programmers but they just didn't know anything about Optics or the things you might want to be an expert in to build a headset wow that's an amazing story it's a great seg way to another theme that emerged from talking to Founders about advice that You' shared a lot of people say tell me you were kind of the the king of the pivot of helping people figure out how to Pivot I'm curious just what you've seen makes a good pivot usually a successful pivot gets warmer instead of Colder from what you're an expert at and somehow Builds on what you learned on the prior idea right and so in the case of brex it was let's they had worked on a a fintech company in Brazil when they were younger and so I'm like you need to work more on the thing you know all about and not the thing you know nothing about and that was what worked for them in the case of retool it was the same thing they had built similar internal tools both at their internships as well as for cashew they had all these dashboards they built to like operate their their venmo competitor and so they knew a lot about what to build in the case of post hog pivoting into their idea they knew a lot about analytics and had strong opinions about it and so it was much closer than what the original idea is in the case of zip rul knows a lot about a lot of things and um he knew a lot about like the crazy pictur process at airpnp because he worked there and so it was kind of like a good pivot is like going home you you know it's it's warmer it's closer to something that you and it never occurred to you that this thing you know all about would be a good idea or maybe you co consciously you're like I don't want to work on this because I'm burnt out on it like sometimes you have to someone someone has to get over this barrier they have on why they don't want to work on a certain idea these are amazing I like how modest you arm like oh here's like big idea and then you just give very tactical uh items to look for so essentially a good pivot in your experiences you're getting closer warmer towards something you have experi actual experience in and two it builds on something you've done essentially the core idea of a pivot right where you're like in the in the example of segment which is obviously a really big successful company um they started with something to tell your professor you were confused in class it was like software that they sold to universities and then they ended up PIV into something kind of like a mixed panel competitor after like two years and it's because they didn't they learned about how analytics Works running their first idea okay and then no one wanted to adopt their mix panel competitor and so they were like we should make this JavaScript thing that you embed on your website that can send events to multiple endpoints at the same time so that way people would be willing to try our mix panel competitor side by side with mix panel to show that it's better and then they were like oh yeah no one actually wants that they just want this JavaScript to send events to different locations and so there's no way those Founders could have started with the final idea you get what I mean there was no Universe where they would have made up the idea for Segment because they didn't know anything about how analytics worked but because they were grinding for multiple years and became experts on these things is a side effect of their earlier ideas they ended up with really good unique insights I think that's a really important point there is you don't need to necessarily have that experience before you start the company could come from trying to build a company exactly a big question people are always wondering is like should I pivot like is this the time to Pivot is this should I keep trying this idea what's your your advice there of just like okay now you should really be thinking about some else again this is one of those where I like to give very bespoke nuanced advice on a caseby Case bases to the folks in YC but again just to give you a preview of how I would think about it um I would look at how many more ideas the founder has on how to make it grow like if it's not going well and you're out of ideas that is usually a good time to Pivot but when there's a you know you have like half a dozen or a dozen really good grow ideas that you haven't tried yet he try them right like hey give it a shot again in the Airbnb story right they they tried uh all sorts of stuff including cereal and conventions like they had a bunch of zany ideas on growth and they didn't run out of them and so I think when you I think when there's still uh gas in the tank um on an idea that might be a reason to State the course and when when when literally the founder is like yeah I don't know I guess maybe we should pay influencers or something when when that's the kind of ideas they're coming up with that's that might be a better sign to Pivot that is incredibly helpful coming back to zip real quick they went through I think six different pivots before they landed on this idea that is now a billion dollar business is there anything from that specific Journey that you found really interesting because they went in so many different directions like accounting marketplaces and yeah I think of the example of the zip Founders they were both such great experts and you know I knew rul really well he actually worked with me at at y see as a visiting partner and so I was I was really close to rle and he had done this Marketplace called flight car when he was younger which was you know rais a series B it didn't work out but it was a really cool company and um I had a lot of confidence in his competence on running a business and executing fast and just having great instincts like he really knows the fundamentals and the problem was they weren't as clear on what Market to go into is still with me and so I actually suggested to do something in their case again this is very bespoke um but my suggestion was to start by looking at what companies are um publicly traded uh and or owned by private Equity that are large and that also are hated uh by their customers and to try to intentionally find where there's a knowable big Market with an incumbent um combined with the software is horrible and they kind of did that like they basically found out about all this procurement software and what the state-of-the-art was and that was that was the prompt again maybe he told you this that was that was basically the process he did tell me that I love that example and piece of advice so much I don't know why more people don't do this basically find a large incumbent with very low NPS uh and try to disrupt them so straightforward yeah I mean it I can't promise that works for everyone but again in the in the very best situation with rul it worked really well because he actually knew exactly once he locked in on that prompt oh man was he ran a master class you know like they did they did they did an A+ job it was really good also Lou his co-founder credit to him too of course like sorry yeah we got to give Lou the shout out Lou did an amazing job I just didn't know Lou as well before he did YC but you're right we got to give Lou the credit as watching your chat with Michael cyel talking about pivots and either you or he use this phrase of you want move towards the mountains and the desert to find the gold of a new startup idea versus the middle of the city you're unlikely to find gold in the middle of San Francisco is there anything along those lines that you you can share yeah I think maybe this pertains into what we see from applications and interviews which is from where I sit seeing everything people apply to YC with and what they interview with and and whatnot um people don't people all kind of have the same idea like like basically imagine this imagine your information consumption where you're listening to the same podcast wink wink um you're reading the same people on Twitter you're reading the same blog post basically you have the same information diet of all these other Founders and you're friends with all the same people does it seem surprising then that you would all end up with similar startup ideas or similar philosophies on what makes a good startup idea of course you are so this is the metaphor on cities is that if you just are following the same principles and have the same information flow into your brain you're going to come up with the same ideas as everybody else and so the prompt here is to try to go more off the beaten path either from your personal experience like in the case of brex and retool or whatnot you know there was no one else trying to build marketplaces for Funko Pops you know go go deeper in your own personal interest or experience to find something that just the your exact per wouldn't come up with in exactly the same way and again the zip example I don't think other people were trying to build wonky procurement software that was just that was not an idea that we saw much of and so again the prompt to people is try to mix up what your information diet is or what areas of expertise you have and and M that well versus just having all the same thoughts as everybody else and so again let me give you one more example a few years ago startups around Trucking were super new and fresh because no one was doing them and they worked really well and then it became completely conventional wisdom to do like Trucking related startups yeah I'm not trying to diss anyone but you'll see things that become fashionable really quickly because someone found success in this unfashionable space and then it becomes fashionable this is a good segue to something I definitely want to spend time on which is you have this concept of tarpit ideas which are essentially ideas people all kind of gravitate towards and get stuck in and either pivot into and then can't pivot out of or try to Pivot out of and essentially it's just like consistently bad startup ideas that people continue to try to start can you just talk about this and then what are some what's examples of just like bad startup ideas that people should stop trying to start for people that are familiar with this terminology for us sometimes they get defensive and don't give what we were saying so let me by definition it is only a tarpit if it seems like it's not like like if it's just a regular idea that is hard that is not a tarpet the the weird aspect of what we call a tarpit idea is an idea that a lot of people come up with and that it seems like an unsolved problem and you get lots of positive feedback for right and you have a really good set of arguments that it's a really good startup idea and that's different than a bad startup idea do you get what I'm trying to say a bad startup idea is like I don't know something that is obviously bad or something where you just can't get any positive uh feedback on but some of the the most common tarpet be something like building um like an app to coordinate with your friends to decide where to go out at night or where to meet up with people which is it which is a really it's coming from a good place like it's a good idea if you ask your friend hey would you like an app for us to coordinate to hang out more so we can be friends they're like yeah I would love that like you'll you'll get you'll get all this positive feedback from the world and man people have been starting that start up since like the 90s and so you can validate it like part of being a true tarpit is that you can get good initial validation you get what I mean and so anyway and and honestly I worked on tarpet ideas myself as a Founder which is music Discovery this is something I did in my first startup that was that you know music startups are hard um and trying to be like oh we're going to fix music Discovery is those classic things where you can get lots of positive feedback and even get users to work on those things but there are aspects of it that make it a very hard idea so does that make does that make sense absolutely I'm also guilty of this I had this startup called local mind that uh allowed you to talk to people checked in in various locations around the city on for square and koala back in the day and ask them how's it going and everyone when they used it they're like holy this is the most incredible thing I've ever seen I could see what's happening at this bar that I'm about to go to and then they never use it again do you remember when four score clones was all anyone worked on for two years they told they told us for square is going to own this there's no way this idea your building is going to be its own thing and now yeah for square is a B2B business yeah and all the four square clones if they didn't pivot out of doing what they're doing wouldn't work so anyway that's that's a tarpet is just something that's super appealing and a lot of people do it and that you can you can kind of get validation and that's why that's why is a tarpet is it draws you in and you get stuck because it seems like it's like a good idea and you get all this positive feedback kind of along these lines I was talking to a Founder recently and she's asking me what causes an investor to say no to you when you're trying to raise money from them and I know there's every investor has a very different perspective on what turns them off to a startup but is there anything that you find is just like here if you do these things investors will say no maybe my best advice here is for Founders to put themselves in the shoes of investors and just imagine what their life is like and how if you were in their shoes you would make decisions and so given this framework a lot of investors just don't make that many Investments and as for what we talked about earlier life is short and so there's lots of things that an investor that in their hearts thinks is like pretty good and they're oh like I like this person and I like their pitch but I only am going to do a few Investments and so even though I really like a lot about this I'm going to say no and then I I often think that Founders think that there's some secret truth that's being held from them on why someone says no or like they're you know like they want more feedback I need feed back it's like wow the feedback is we didn't want to invest and and it and it really is just that and and so I think if you put yourself and the in the shoes of an investor of like hey I only can do a few of these a year I have very limited budget they're really just trying to pick the things that they're either personally most excited about or things that they think can be truly phenomenally big in some way or you know again you I know you do Investments too so it's it's it's that you only get so many shots as an investor and so anything that doesn't seem like this is the one this is the one I want to do is a no and that that's actually why they're saying no versus this you did you know oh you you had a bad Zoom setup or something you know oh we didn't we didn't like what color your shirt was we said no I don't think that's I don't think that's how this actually works you know I think that's such a good piece of advice that it's not necessarily they don't believe in what you're doing it's they have better options and they're waiting for something that hits higher bar just because because they have a lot of options yeah because again and if you if you ask someone well put yourself in investor shoes wouldn't you be making decisions the same way usually Founders are like yeah like like they if you if you do that exercise a lot of this starts to make way more sense specifically when you're evaluating startups I wasn't going to go into this but I think it might be interesting is Mark Market size how do you think about the importance of a large Tam as as an investor YC I think it really depends on what stage you're investing at and it's absolutely critical the later stage you get right if you're going to invest at a very high valuation it is really important um the earlier you go the less it matters and some of the most phenomenally good startups if you were really uh penic about it the Tam would be like tiny like the The Tam of uber would be like nothing right like how um The Tam of Airbnb would have been nothing The Tam of I was uh I funded Razer pay which is I think the largest payment processor in India and the Tam of that was Tiny because no one was using credit cards in 2015 in India so you had to believe that the size of the credit card industry in India would like 100x well guess what happened you know what I'm saying and so so I'm not saying that the having a large Market someday doesn't matter of course it does eventually but trying to be super pedantic about Market size when you when it's like a preed company or someone applying to YC is not you know it's just not something I put a lot of thought on you get whatnot oh what's the Tam of the collectible Funko Pop industry I don't know I don't think it's that big man I don't know if you did that now when you invested but I you know think it's pretty small but I I wasn't worried about it that was like the last thing I was worried about it makes so much sense that at YC you don't think about it that much because of as you said many startups pivot anyway so if you like the team but and I'm not saying it's not I just it's not and the things I'm worried about it's like hey how do you get users hey how do you grow things like that like are you making something people want those are the things I'm really worried about as opposed to oh I ran an Excel model and I'm worried this might not be a big enough T that's that's not at the top of my list I think it's important to acknowledge though a lot of investors are very like YC I think is unique in a lot of ways where you invest very early and you help people through this journey a lot of investors are very focused on Tam so you may find you're getting turned down because they don't think there's a big enough market for you to build a big business right yeah or that you're asking them to believe a crazy leap of faith that again they can say well it's theoretically possible you'll be able to sell more than Funko pops and I understand that that is your pitch but I am I have other opportunities that are less risky you know what I'm saying like like it's not because the a lot of Founders make the argument that the Tam is big and you can say wow that's a really interesting argument and I have no I have no you know I'm not going to argue with you about it but no I'm not going to and so again it's it's hard to get someone to engage in a debate about Tam even if you have you know even if you have some proof points ultimately uh a lot of investors just don't like that risk fair enough fair enough going in a slightly different direction so uh someone else that worked with you uh another Lenny uh Lenny boganov who started a company called milk and then he was head of growth at open a for a bit he asked me to ask you about things product leaders and startups should watch out for do that ring a bell I don't remember the specific office hours but I I understand the question and of course remember Lenny um I think that the advice that he's referencing here is just how important it is to not overd delegate and for the founders to stay close to things um as well as watch out for the Trap of hiring super senior people with fancy resumés really early at a start up I think that that's what he's referencing there and again this is definitely one of those very basic things that we find ourselves repeating a lot um where they're like yeah yeah I get it like don't overd delegate we get an adult on and then like two years later they're like wow we over delegated um we need to we need to go clean that up so that is probably the best product advice and the folks that are really great at product the founders that are are always deeply in the Weeds on product and still care a lot and are still talking to customers no matter how late stage it gets again I'm sure you experienced this in Airbnb culture but you know you can't delegate caring about your users and you can't delegate caring that the product is great that is so critical to make this even more real what are what is it that you see them do it's they hire a PM too early they hire a senior salesperson to early what are the yeah I think it's I think that you get pushed Often by investors to hire Executives or to scale the team or we need you know we need we you raise all this money you got to spend it you know we got to you got to show you're serious about growth and building a world-class organization whatever stuff like that and so you end up with super nice people with super shiny resumés from from Big tech companies oh wow they they did this amazing thing at Google and then you hire them and then you wake up one day and you're like oh wow everything went wrong it's not really anyone's fault it's just that you you you o you took your eye off the ball and this is what happens um to first-time Founders lot how do you as a Founder then have time to do all these things is there any guy you give just like don't overd delegate don't overhire but also you need to you you you have 24 hours in a day is it just find the time prioritize well or is there more more to it I think if you just care a lot about your customers and you care a lot about the product your instincts are pretty good on what to spend time on and so for example spending tons and tons of time like hanging out with investors and networking it's probably not it's probably the thing that I would be cutting um you know what I'm saying like it's it's what we talked about earlier if you really love what you're doing no one needs to tell you how to rep prioritize your time your intuition will be correct on what you should be spending all your time on which is being obsessed with product I love that advice this episode is brought to you by Kota and I mean that literally I use Koda every day to help me plan each episode of this very podcast it's where I keep my content calendar my guest research and also the questions that that I plan to ask each guest also during the recording itself I have a Koda page up to remind myself what I want to talk about Kota is an all-in-one platform that combines the best of documents spreadsheets and apps to help you and your team get more done now is the perfect time to get started with Kota especially its extensive planning capabilities with Kota you can stay aligned and ship Faster by managing your planning Cycles in one location you can set and measure okrs with full visibility across teams and stakeholders you can map dependencies create progress visualizations and identify risk areas plus you can access hundreds of pressure tested templates for everything from road map strategy to final decision- making to prds if you want a platform that empowers your team to strategize plan and track goals together you can get started with Koda today for free and if you want to see for yourself why product teams at high growth companies like Pinterest figma and qualtrix run onota take advantage of the special limited time offer just for startups head over to coda.io Lenny to sign up and get $1,000 in credit that's coda.io Lenny to sign up and get $1,000 in credit coda.io Lenny okay so one of your former one of your colleagues current colleagues not former colleagues Gustaf was on the podcast previously his episode is I think the fourth most popular episode of all time currently so no pressure cool I don't know I can with that all right I think you can so I asked him what is often the most common reason a startup fails and his answer was they don't talk to customers they don't find product Market fit nothing else matters if they can't do that and so his advice is talk to customers more often so two questions here and first of all just is there anything else you would add to why do startups fail I know we talked about some of these already but just what comes to mind there I completely agree with what gustoff said but to to look at this from a different frame I think is that the founders lose hope and when you and your heart is like yeah we're failing like once I can see it when I'm meeting with the founder when they've resigned themselves that they're failing versus when like we got one more move in us we got one more try like you can see in their eyes when they feel like there's more ideas or there's some last ditch Hillary thing um it doesn't always work but it's it's almost like like you have to not accept that you're going to fail and as long as you don't accept that that's going to happen there's usually a lot more moves you can try to save the company what maybe it's to get profitable maybe it's to like do some other zany thing maybe it's you know to launch a new product um and so it's pretty rare I would argue that the cause of death is that they had lots of Firepower and they were feeling really positive and they just ran out of money that's actually like more rare than Founders think um it's much more common that they still have some money left I'm not saying a lot but some money and they're just like yeah I'm done I'm out of ideas I don't want to do this anymore and again fair enough you know but do you get what I'm saying like I think Founders are afraid that they're going to run out of money and that's why they're GNA shut down and it's way more common that they like their idea doesn't work and they have a big fight with their co-founder and then they can't agree on what to work on and then they just like are like I don't want to do this anymore and they shut down that is the most common cause of death is something that sounds like like that story that is so interesting and again this comes back to your cord viice don't die just don't die we talked about this already of just like sometimes it's actually okay to die and I guess just to refresh that lesson is if you're not having fun anymore maybe yeah you're out of ideas you're like I'm just I'm done like if you know in your heart that you're done you don't have to keep going through the motions no one benefits from that right and you've also seen enough cases now you've shared a few of these where they their all hope was potentially lost but they kept going and then they turned into a huge success story and I think most people don't see those examples I guess is there anything you can share just like how often that happens how often you see that turn around I would argue that if we Define it is the company had a near-death experience where it was going poorly and the founders seriously wondered if it was all going to be over 100% of the time people go through that you know where the found like yeah I guess we're done guess we should pack it in and at least you feel that way at some point in your startup journey I me everyone goes through that um and again there's gradiation people that actually truly got down to very very hard situations it's still a high percentage like maybe 50% I mean you can ask Founders there's a lot of Founders that come this close to it all being over and through sheer will kind of just keep it going you know that is really uh empowering I imagine for many Founders hearing this of just knowing every single founder goes through okay I think it's actually over yep following on this real quick the advice that gusta shared which is about talking to customers I'm just going to keep trying to pull wisdom out of your head do you have any advice for just how to effectively talk to customers we're always hearing talk to customers build things they want easier said than done you get a lot of asks you get one customer asking for a lot of stuff there's a big company that's like build this thing we'll buy you pay a million dollars just you have General guidance of just like what to pay attention to and what to build versus avoid yeah I think what I talked to to to aspiring Founders about this a lot they're like yeah yeah talk to customers we get it cool and I'm like cool well how many customers do you talk to and they're like well and they get really quiet and so I think this is one of those things like hey you should have a healthy diet and exercise every day or or whatever where people know it and that doesn't mean they do it and so I think to start with you have to get out in the world and talk to people in person and you can't just hide behind your keyboard and call that talking to customers right and I think a lot of folks their inclinations are to like you know build a landing page and buy some Instagram ads and try to get people to sign up for something and again maybe I maybe that's something but I think a lot of the reason people do that is they they're just shy and they don't want to put themselves out there because it's a little awkward to go talk to people and and you kind of have to Su yourself up to go out in the physical world get people to meet with you get them to take you seriously show them a product you're building and so again to be very tactical here you can do a self assessment in the past month how many in-person physical meetings have I had with potential customers maybe you've done a lot I don't know listener maybe maybe you have but you know it's it's shocking how many companies I talk to they're like well we're focused on raising our prede round before we talk to customers like things like that and and again I think the core the core core thing going on is um just social anxiety and like looking stupid and I think you just got to get past that you know you just got to start doing it until it doesn't feel bad anymore but you know think about how how stupid the Airbnb FS must have felt they were like hey you should run out your house and I'm GNA come and sleep in your house and here's an hair B like like it's the whole thing is a little awkward right so you got power through the awkwardness of talking to people and um once you start doing it it's actually kind of fun and so once you once you get used to to overcoming this awkwardness um I think people do much better at talking to customers when someone does this self-evaluation is there a heris that tells you this is enough what do you look for is there a number like how many per week how many per month yeah I don't know if I know a good number I think it's look at your calendar and there should be you know 20 or 30% of your time that the calendar says something like customer meeting customer call like meeting with food meeting with this person and when the calendar is not that or it's all you know again what you're actually doing is just buying ads to try to validate your idea that I don't I don't think that's talking to customers you know I think that's something else that's an awesome her istic so roughly fifth of your time at least should be talking to customers yeah again it depends on the idea space you're working on some are more some are less um so yeah I just it should be a fair amount time and nothing substitutes for an actual conversation versus just staring at analytics dashboards makes so much sense so airb B is a classic example of they went to New York and talked to their host and things like that is there another startup that comes to mind that did this really well I found just a really cool way and hustle to talk to customers well again if you if you some of the companies we talked about I mean for brecks they were just talking to other people in their batch and that worked extremely well um same with retool is they just sold it inside of the YC Network I think with zip they were just beasts at getting companies on calls with them to ask them about procurement and I think they had way more than 20% of their time like when you looked at their calendars oh man I think they were doing they were talking to customers a lot to to build their first product and kind of pre-selling it before they built it same with postt talk I guess that's a different go to market they launched this open source thing to start with and it was they their calendars are filled with people that were trying to implement the first open Source version of post hog or so excited about it and people on Hacker News were excited about it and like they had this like huge influx of people that were excited that post hog existed and had lots of feedback and uh web reports like it wasn't always positive but they never lacked for people that wanted to talk to them once once they launched that which was very helpful on zip I actually have a lot of their story in one of my series on how to build a B2B startup and what they did actually as you know uh is they just called DMD people on LinkedIn and asked them for advice on hey we're we're trying to understand how you enjoy your current procurement products and then they ended up being early beta testers I think they did and I think they did hundred like hundreds of these they just had oh yeah no it was a numbers game they they were just grinding at this and so yeah that was that was very good the other classic uh YC story is the the cison Collision I think it's called or the cison install oh cison install Okay where can you tell that story briefly the Collinson install is um what often happens with customers is that they say yes I want to buy your product and then they do not implement it they just go quiet they're like there's no implementation and this is very bad if you're selling software to someone if they never implement it they're going to churn and you're not you know you basically failed on the on the one yard line okay and so they kind of developed this tactic to be like oh well you know I'm in the neighborhood you know I'll drop by to your office to help you implement stripe and kind of just like create again it was a little awkward like we talked about earlier but you would You' be like yeah I'm I'm in I'm in the neighborhood like how about I drop by and then they would show up and they' be like cool cool can you like pull up your text editor oh yeah cool all right um hey can you can I can I drive can I have the keyboard and they would just sort of like install stripe into the customer's website you know smiling being like Charming Charming guys and they be like oh that's cool okay well like can we like roll out the website now and and they basically would kind of not go away until you uh finish the implementation of stripe and like again it was actually helpful because they were doing all this white glove service to get it implemented that was very effective and I think the takeaway from that story is even when you get a yes you're not actually done with sales you have to finish the last mile to get the thing implemented and uh they were very good at that that's an incredible story and uh now they're like I don't know hundred billion dollar in business and that's how it all begins yeah I was an early uh stripe customer my start up and yeah Patrick would like um we used Google talk at the time Patrick would be sending me messages like on a weekly basis just like checking in and so again it's funny how successful these folks get but yeah Patrick was very Hands-On with all of his customers and was extremely available um like I I can say that because I was one of them yeah and I'm sure he had social anxiety going through all that that wasn't a comfortable thing to do just like keep pushing people to install your software and deploy oh surely not it's just you got to do like if you want your startup to work this is just what you got to do you know comes with the territory this is going to be just a way broad question and I don't know if you'll have an answer but just are there other just patterns you find across startups that do well this is like maybe the 64th million dollar question of just Founders and what they do that ends up leading to success I don't think personality types matter as much I've seen very quiet people very extroverted people very you know you name it I've seen all sorts of personality types so for me personally I don't think that there's a right or I don't think there's a personality type that people should copy and be like I need to be like this person you know I need to be like Steve Jobs I need be like Elon you know I don't really believe in that because there's just so much variation like Tony from door Dash is so different than a lot of folks and reel is so different and Grant from whatnot these are all very very different people Patrick is a different kind of person Ryan from flexport like these these are just very different personality types but the thing that I would argue folks that build really big companies have in common is they just really want it and they really believe in themselves and they really believe they can make it work and that there somehow deep in their internal psyche there's something that's like I'm the one and I won't take I won't accept this not working and even though OB objectively there's all there's all this data coming in this isn't working this is bad you know my employees want to quit my Executives want to quit you know whatever it is somewhere deep down in there they're like oh yeah I'm gonna make this work this is this company is gonna be big and they and they they just believe and it's almost like that internal gravitational force inside of them is so large it kind of warps the world to bend to that will and people start to believe it because they believe it so much and they convince their employees to believe it and they convince everyone around them that this is going to happen for them and so again this is not a personality trait this is I'm arguing this is like um a core belief so interesting and it connects so much to what we've been talking about just don't die don't lose hope in what you're working on a Founder hearing this might feel like man I don't know if I'm like so convinced this is going to work in your experience how much of this is internally they're so certain and convinced versus externally they need to show this confidence well I think it's internally they're convinced I I again I'm not sure it's external but and this is the big butt no one has this at the early stages when they don't have a good idea and they don't have customers and like it's objectively not working and so I again I know a lot of Founders like well I don't feel that way oh no maybe I'm you know maybe I'm an imposter and I shouldn't do a startup well of course you don't feel that way if you haven't talked to any customers and haven't built a product like you know but what what usually happens is you pivot to a good idea or you start with a good idea that you care about and customers you care about and you launch it and the better the product does the more obsessed you get with your own company like I I think in the case of stripe I don't want to you know tell Patrick's story for him but I recall him saying it at some point he wasn't as sure that stripe was going to work until they were like a year or two in and then once it started working then he you know they really believed in it but it wasn't like you woke up one day like stripe is the thing it's going to be it's going to work um I think I think you build conviction and you have this like um Network effect virtual cycle where you get more conviction the more customers reflect back to you and data reflects back to you that you're on the right track this is exactly what Scott bsky shared in our episode when I asked him when to Pivot is do you have more conviction this is going to work or less conviction over time and so I like that connection we just made there Okay so we've talked about all these way startups fail bad ideas tarpet ideas I want to go to the flip side and talk about good startup ideas so recently you put out a request for startups which is essentially 20 categories of ideas that you want to fund that YC wants to fund can you share some of these ideas that you're excited about and basically you're looking to fund and looking for Founders to work on yeah um and so we we put out the request for startups just to inspire people to maybe apply with ideas that aren't the ones that we always see it's not like prescriptive like we will only fund ideas on those list is not that at all it's just sort of remember what I talked about earlier with information diet we're trying to mix up some of the information diet about what kind of ideas people might be contemplating they AR currently and so um a couple of the ones that we we put out there one of them I made one about erps which is you know enterprise resource planning software and I did that because I get so few applications on that and they're usually pretty good and I just would love to see more people look at that and learn about what erps are just because it's so rare that people apply with that and now I have a feeling we're going to see a lot more applications working on that and so it kind of worked as intended which is introduce this idea space to Founders that didn't even know what an Erp was now they'll go learn about it um another one is you know we'd like to fund open source companies and so that's one of the rfs's where you know if there if more people applied to YC with open source ideas I think we'd be pretty excited about that and that might oh maybe FS didn't realize that would be something we want to fund same with space companies yeah we've had a lot of success with space companies um you know uh several of the folks that are actually going to space right now that aren't SpaceX are YC companies and so I think sometimes Founders feel like those ideas are too bold and ambitious but no we you know I love more people appli with space companies and so think about it that way we're just trying to put out we're trying to plant seeds of idea spaces that perhaps someone consciously filtered out is what might be a good startup idea and and you know hopefully that creates a a a new set of startup ideation for the person and we're going to link to this page in the show notes for folks that want to explore I'll give a couple more real quick a way to end cancer no big deal spatial Computing new defense technology bringing manufacturing back to America so a lot of like hard Science deep Tech stuff which is which is maybe a new I don't know I know I imagine you guys have invested in this in the past but it feels like we totally have right so these aren't like oh we've never invested in these before it's more of like hey it'd be cool if we saw more applications along these lines it would be nice um because it it currently feels a little bit under uh you know yeah there could be more startups working on this stuff yeah instead of the tarpet ideas uh a couple more real quick better Enterprise glue yep I like that idea say more about that what does that look like the software to connect all these Business Systems is usually pretty brittle in janky and there's been lots of good startups founded to solve this problem um I think there's still a lot more room for improvement and likely LMS will improve like we'll probably be able to create better and better glue so all sorts of software systems can talk to each other so again very broad idea but yeah I think we'll see a lot of very successful companies where that's the kernel of the idea they start with awesome one last one small fine tune models as an alternative to gigantic generic ones yep sweet and so we'll send we'll include this link in the show notes and folks can click on each of these and you basically there's a lot more explanation of what it is you're thinking about there awesome okay just a couple more questions yep one is just uh your background so from what I've read in the early 2000s you were you're basically hanging out with some of the biggest success stories of today folks like Zuck and Reed Hoffman Sam Alman Elon Sean Parker this is before they really became anyone and they became very successful I'm curious just what looking back at that what you've noticed is consistent across these folks that end up being really successful over time back in 2003 being in Silicon Valley and being interested in startups they're just it was a really small space there just weren't that many people that were into this stuff and so I remember um I cold emailed Reed Hoffman when LinkedIn was like 12 employees and he just responded and he's like oh let's have lunch it wasn't it he he was just like a guy and everyone else that was doing I guess you could call it social networking uh with that was sort of the people that I knew there was a few conferences you would go to and there' be like 30 people there it reminds me of stories about the homer Computer Club I'm not saying this is cool but when I read stories about what it was like when when the Homer Computer Club existed it was a very small number of people that all knew each other that were real like weirdo Outsiders that were into this stuff okay and so that's what in the post.com boom bay area startup scene that's legitimately what it felt like and so I didn't think a lot about the personality traits of these people um they were all again they were all pretty different people but what they had in common is the folks that are now the really big names just had a lot of staying power right so when I when I met Sam he had dropped out a Stanford to work on Loop which is hilariously a way you find people around you to hang out with h interesting theme here huh he was cool just he was this really young guy and um he just kind of did that it wasn't huge and then he got into other stuff and ended up working at YC ended up getting involved in hardtech and is now kind of like reinvented himself as um the the big mind behind AI which is which is again awesome but if I think about who he was back in the day he was yeah he was like a 23-year-old working on a thing for feature phones to find friends in neighborhood their customer was Boost Mobile I bet you could go find the commercials for Loops that Boost Mobile put out on YouTube those are actually pretty funny have you seen those commercials no but I'm going to go check them out anyway it's pretty funny so yeah like that's that's the the real story um and then yeah I remember I was in downtown pal Alto at the time and um you some of some of the folks I was friends with were friends with Shawn Parker and this is actually before Shawn Parker went to Facebook he was part of Napster and so one of my friends like oh we need to get my friend a ride to the airport and so I ended up giving Sean Parker a ride to the Oakland Airport and again I what was he like I don't know he just basically sat in the backseat on the phone the whole time but but again my point is I wasn't like wow these are going to be really big successful people that one day will be important in the world it just felt like a bunch of nerds that really liked the internet and computers kind of doing things that they were interested in and were just obsessed with like there was no they weren't like GE should I move to New York or GE should I maybe I should go to law school like it was people that were very bought in to to staying working on internet companies and so you'll see these folks just reinvent themselves multiple eras right okay like Reed hoffen right he was a worked at PayPal right and then uh he did LinkedIn and then he was like a VC and like like he's kind of had like all these different eras where it's the same person but it's it's almost like a different figure right there's a lot of interesting lessons there one is that your career is long and you will have the opportunity to do many things and you can continue to shift like in my example this is my fourth career I realized I was an engineer then a Founder then a product manager now whatever this job is and I think that's really common I think the other again is the personality types point which I didn't comment on but I think it's so important that you can be super introverted and be super successful you can be super extroverted be very successful and I think the key there is use your skills and strengths to achieve the same things you don't have to be the amazing presenter on Steve Jobs type stage you can do the same thing in a different way and then the other point there is again coming back to you just need to be really excited and enjoy the work you're doing because that'll drive you forward and make you be successful so I like that that I love that the story is kind of a summary of so many of the things you've shared so far there's other two other fun stories maybe pick one or the other one is you sold your startup to Myspace and your job was basically to save my space uh and then the other is You're the Reason Andre Horowitz missed out on Instagram yeah and couldn't invest so which of those would you want to share well it's it's kind of the same story okay great in the way that it's the same story is um my my second company um basically I sold my first company in Myspace it was the music company that I worked on and the they recruited a new CEO um who was formerly the COO of Facebook called Owen vanada so again hilariously part of the same little circle of people and Owen was like okay we need to fix Myspace you know rert murdo's got the juice he wants me to fix it like we're gonna turn we're gonna we're gonna do it so come up with some ideas and kind of the best idea that I could come up with at the time was doing something around uh mobile photo sharing something kind of like Twitter but for photos and I figured with myspace's user base that would work pretty well this was like like in 2010 so was right as the App Store was getting big and I had a lot I had a lot of success in the App Store with imme it was one of the top music top downloaded music apps and so I was like wow the App Store was really good and I was really into Apps being the thing and at this time Facebook was a little early on they were trying to do crossplatform mobile apps if you recall and their apps were not great this was again ancient history and so that was sort of like my plan and then immediately uh hen vanado was fired and so I didn't even really get onboarded and so I just like left I think I worked in mys space for like a month because the person that acquired my company got fired and there was like I think the whole word chart got fired so I don't even know I didn't even know who to talk to it was really great it was a great experience you know what I'm saying I wasn't really sure who my point of contact was at that point I don't think they knew either it was just a mess just Tom just message Tom no no he was long gone serious I know you're kidding but no like literally I don't know who was left at that point um great Tomas longone yeah and so I was like well I should just do a new startup and I should work on something like what I was thinking about and I ended up yeah starting the company and quickly was able to raise an angel around because people remembered uh my company from the first one and the the major investor we had was Andre Horwitz this is one of their first board seat Investments like Mark andreon was on my board and um you know again that I have my own set of stories about that but it was it was interesting experience and we launched it and I think we got half a million or a million users like you can go find Tech renal articles about it and it was we launched on Android and iOS and it was mobile photo sharing and actually was growing pretty well okay and then what happened is there was another portfolio company called bourbon which was originally a four square clone that was built by by these two guys and they decided to Pivot out of that and into what which was pretty similar to my thing you know again fair enough that's just how this works and they did something smart again this is just me talking I don't know what their version of the story is but what I think they did that was smart is if you looked on the paid app store charts the number one app was hip stematic and hypsta cost money and what do we know about what people want they want things that are free that cost money right and so they basically built a pretty legitimate knockoff of the hip static filters combining it with this social graph and they launched it and it pretty quickly took off so of course this is Instagram right and so it took off really quickly and like yeah that was like a wild experience for me to be like oh this seems familiar um and and basically because uh andran Horwitz had like invested in my company was on the board even though they were investors uh in Instagram um that was like a conflict they and they didn't do the deal and then for whatever reason this became like a big source of like Silicon Valley gossip which was like wow I can't believe this happened and so it was just a really weird experience for me as a Founder to um to be right in the middle of something that became culturally so important I imagine there's a bullseye in your back from a16z for a little bit oh they don't I don't actually think they care I don't think they held it against me um because like what did I do wrong it's true I started a company like you know what I'm saying like obviously there was some frustration but I was like I was a guy who had a company that they invested in I don't know I I didn't feel like they I didn't feel I didn't feel much higher for them I think it's this is just how this is just how life works yeah uh I wonder if they change their conflict policies after that at all I don't think so this H I think this happened I think this has happened multiple other times but those aren't my stories at all and by the way I don't know if you mentioned the name of your startup it's called pck pick please right yeah it's called pick please yeah great okay so for the Final Phase before we get to our very exciting L ground I have these two segments recurring segments I have failure corner and contrarian Corner we can do both or we can pick one or the other failure Corner share a story of something a time in your career where you failed and when you learned from that experience contrarian corner what's something you believe that a lot of that most other people don't believe yeah I think for contrarian corner I know where I would start and I think it's relevant for your listener like I think this is relevant to this um and so again maybe and you could argue this isn't contrary but here's here's what I think I think growth and growth hacking and doing all this analytics AB testing stuff um is a total waste of time for very early startups and that one of the weird things about having uh lots of startup advice on the internet again this is one of the reasons we started making videos at YC is a lot of the advice was catered towards later stage companies like oh here's how you set up your board and here's how you motivate your sales team like it it was all aimed at series a series B Founders and not for seed stage Founders the problem was seed stage Founders would consume all the later stage advice and get really confused and so the ant pattern I see is there are lots of Founders that are very familiar with your awesome work which again I really recommend I like it but when you have no customers and you're reading you know Lenny's guys on how to set up split testing and how you did growth at Airbnb oh man that is so dumb that is so not helpful and so you see this inclination away from getting a first customer getting one customer and talking to that person and instead they have like all this really complex growth hacking Theory I think this also happens if you worked in big Tech where there your product already has scale and so you know if you work at Facebook and your job is to launch new little features yeah of course you should make heavy use of analytics and AB testing and split testing and feature Flags like yeah yeah yeah makes sense but when you have no users what are you doing so do you think that's contrarian what do you think like I'm I'm just trying to argue this advice applied to a startup this too early is like actively not helpful I I think it's contrarian for many people 100% I also 100% agree with it makes me feel like I need to at the top of my post share here's who this is for if you're earlier than this ignore it if you're later than this ignore it I mean again I'm not saying you're doing anything wrong but imagine if the OG Airbnb Founders took all of your current advice and applied it when they had like four users and they knew their names and they were like trying to run complicated growth hacking split test things yeah maybe just to uh clarify when you talk about growth growth hacking so obviously when you're starting something say a consumer app there's a you need to get a bunch of users somehow what's your sense of just like when you say don't do this sort of thing but this is okay what kind of Falls in those buckets I think it depends on the idea um I think in the case of whatnot they obviously it was consum app and they needed to get users um but they were very intellectually honest on the metrics for how you get a Marketplace off the ground and they didn't just go dump all their money into Instagram ads and like they effectively knew they needed to focus on buyers and on the buy side and build momentum on the buy side um they really understood marketplaces and so for Consumer I think it's having a sophisticated view of how you get the consumer company off the ground I think if you look at the Facebook story them getting 100% penetration on the Harvard campus first instead of launching overall again good strategy would recommend U that strategy so again the way to extrapolate that is know what your comps are of what companies you your arch type is and then look at what they did on the zero to one and ignore what they do today right don't pay attention to what Facebook does today if you're a brand new startup founder pay attention to Facebook when they were getting their first thousand users what were those tactics I feel like this should be its own episode where we just go into how to get your first thousand users I know there's a video actually will link to that Gustaf made uh with YC's advice on how to get your users did you want to visit failure corner or not or shall we move on I failed it tons of stuff um I I as an investor I thought I make lots of bad Investments as well as good ones I think in my startups I pivoted a lot and a lot of things I did didn't work out and so again I just gave you a specific story with with with P pleas right you just heard a specific story there I guess what I learned is that you just can't let it get to you too much and you got to keep going and that if you keep going no one really remembers those as much and it doesn't really Define you and it shouldn't you know fear of failure shouldn't dominate all of your thoughts and instead you should use your energy and positivity to keep trying to do good work right cuz back back in the day if I would been like well you know I guess startups aren't for me I guess Tech isn't for me I I wouldn't have had a career doing any of this stuff I wouldn't be working at YC I wouldn't be advising companies right so I always had to have in my life um a lot of optimism and energy and use that energy and motor to keep me going and it served me really well right even if lots of stuff I tried didn't work and continue to not work you know again obvious stuff I know but yeah that doesn't mean it's not true even though it's obvious I feel like that's a recurring theme here and I love that it's another version of just how not to die there's like the startup itself that shouldn't die and then there's your just drive and motivation to keep going and try new things when things don't work out y I love all the recurring themes and messages for people here Dalton is there anything else you want to leave listeners with before we get to our very exciting lightning round yeah I guess I guess the final thought is um you know if someone wants to do a startup and doesn't know where to start just to give you permission to talk to potential customers and try to pre-sell something before you write code and have those conversations I think so many folks don't know where to begin on starting to Startup and my tactical advice is start doing customer validation first versus building a PowerPoint deck versus trying to raise money versus like all these other things I think a lot of people people don't use that strategy and and basically if you if you find people that are really excited and you you do line up customers that is a great green light that it is time to do a startup right that can get you down the path so yeah I think that's my final advice and then with that when does the building come in is it build it while you're talking build it before you it depends on basally build it once you have some conviction that you're like oh I think I would have a customer I think i' at least one person would use this thing I want to build at least one I love it I I love the Simplicity and pragmatism of all of your advice Dalton welcome to the very exciting lightning round I've got six questions for you are you ready let's do it what are two or three books that you recommend most to other people I think a lot of Founders are afraid of doing sales and they don't know how to do sales and they think they need these really experienced sales coaches and they need all this training and I'll be like well go on to Amazon and find the most popular sales books like getting to yes that everyone reads and just read those and that'll did you 80% of the way there you know what I'm saying like they want to hire someone for millions of dollars to give them sales coaching I'm like well have you read these really basic sales books and they're like No And so I think that's a lowcost way to go on Amazon getting to yes and a few other of the top sellers I forget the names and just read those and that is your crash course on how to be great at sales awesome there's also this book called founding sales that I imagine you're familiar with uh Pete Kazi was on the podcast talking about that and that's something I always recommend because it's just like how founders can do sales start there start there great we link to that um do you have a favorite recent movie or TV show that you really enjoyed this may be warping the what you're asking for but I like to watch old shows a lot and so I keep rewatching like The Sopranos and the wire and it always is different to me every time and I you know things like that I think here's a silly answer I've been really enjoying watching old episodes of Columbo which was a television show from the 70s and 80s I don't know why I don't even know if this is instructive but it is um for some reason I'm really into that right now it's very old episodes of col you're an old soul Delta I guess I don't know I it's it just feels like a time machine uh to a different time when I watch these things definitely a maybe one of the most unique answers yet fair enough Columbo well again I guess I'm not trying to give you an answer where I sound super clever I'm just I'm actually telling you the real answer so that's actually what I'm watch it does actually sound very sophisticated and clever do you have a favorite interview question that you like to ask ask I guess Founders in this context I don't really believe in in trick questions and I think I just start with hey so tell me about what you're working on or what have you learned since you started you none of these are trick questions but I think you can get the most honest and interesting Answers by asking the most straightforward basic things and having that be like a blank slate for their answers to draw on you know what I'm saying so I like the most simple prompts and let them take the conversation where they want to go I know this probably is too a very big question but just what do you look for in their answer that gives you a sense of this is a good or bad answer for for for YC interviews yeah and and I know this is like its own podcast episode I think evidence that they actually have thought about it like as PR said earlier that they've done research that they have opinions that they they care about it right sometimes when you when people answer questions they're like you can just tell that it's really super superficial and they haven't put much care or Soul into their answers you know awesome do you have a favorite product they you recently discovered they really like like my or ring and my Apple watch and all that good stuff like I've been a fan there's a YC compy called CCI Fox siox I just signed up for and they do at home blood testing and and basically I'm trying to sync that ad at home blood testing thing into all my other devices um I think I don't know really enjoy all the stuff that apple and other startups are working on and YC companies are working on around personal health and so yeah those are products I'm into scifox okay and wait then you do like needle and stuff and you take your own blood it's this little tiny needle it doesn't hurt at all and just it takes a few drops of blood and you do it at home you mail it in and then it has all these blood tests it's actually really cool yeah and that's I just discovered that it's one of those cases where I I saw it uh I saw it and then and then I later was like oh wait that's a YC company like basically I became a customer and was pleasantly surprised that uh that it's a YC company and I think I found it it's siox health.com yeah it really rolls off the tongue right um yeah that's the name of it very cool okay I see this the little needle okay great go CCI Fox uh okay two more questions do you have a favorite life motto that you often come back to find useful in work or in Life share with friends just check in with yourself that you're having fun and and that you enjoy what you're doing and if you don't you should probably make a change whatever that is and again if you're a Founder you're in control right you can change your own company but I think a lot of people go through life and they don't ask themselves this question like am I having fun am I enjoying is do I value what I'm spending my time on and uh I think that you just can go back to this over and over and over again um as a as a it's good prompt on how to decide what to do with your life easier said than done to change that in many cases but it always starts with realizing okay this isn't actually what yeah admitting to yourself yeah I'm not really enjoying this and then trying to be like well how can I fix it having that conversation with yourself yeah it reminds me of a Steve Jobs quote where you wake up day after day like it's okay to wake up some days being like I don't want to be doing this but if it's every day and continues to happen then that's a sign you should change it exactly final question you and Michael cybel have been doing this incredible podcast together if somebody wanted to check out the podcast and dive in is there an episode that you love most that you think they could start with it depends some of the episodes are more for folks that already have a startup and they they're dealing with like problems I don't know some of the episodes about Investors or or things like that like it's very clear that the audience for those is current startup Founders and there's a lot that are just more life advice how to make decisions and think about and that is those have strangely become very popular and got a lot of views with non- startup Founders which is a pleasant surprise and so I'd recommend those for folks in the audience that are not currently startup Founders I don't know um life tips uh from Top Founders I think is the from billionaires is that one yeah yeah I think that was pretty popular so what I'd be looking for is diagnose am I a current founder and I have founder problems where am I just looking for General philosophy type questions and I really like those philosophy ones we have one for high school students and it's aimed the audience is here's advice for high school students that are interested in startups here's some tips that you should be thinking about again pretty narrow target audience but I love that episode because we're really trying to speak directly to that audience um and you know I think it's pretty good advice Dalton you're are wonderful thank you for sharing so much wisdom this is action-packed I'm really excited for Founders to listen to this I think it's going to make a big dent in a lot of people's lives two final questions where can folks finding online if they want to reach out and follow follow up on some of this and how can listeners be useful to you I on Twitter x.com Dalton c um is my username and also my LinkedIn is pretty good it's it's it's pretty popular I don't know just search for my name on LinkedIn um and uh yeah I love to see you all there and then how can folks be helpful I mean honestly it's just great when folks want to uh apply to YC and and do a startup and so feel free to dive into other videos and apply to YC and something this really special about my job is I get the privilege of getting to fund companies that they already know me from videos and they're shocked that I'm exactly the same as like like effectively um they're like wow you're you're just that guy from the videos I've been watching and and and it's so cool that you're just exactly like you see him in the videos and so basically yeah if if people like what I have to say and they like the videos and apply to I see it' be I would love to to fund their companies Dalton thank you so much for being here sure thing thanks so much Lenny I appreciate it bye everyone thank you so much for listening if you found this valuable you can subscribe to the show on Apple podcast Spotify or your favorite podcast app also please consider giving us a rating or leaving a review as that really helps other listeners find the podcast you can find all past episodes or learn more about the show at Lenny podcast.com see you in the next episode

Channel: Lenny's Podcast

Views: 123,892

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Id: m7LvNTbaqSI

Length: 80min 52sec (4852 seconds)

Published: Thu Apr 18 2024