Office Hours at Startup School 2013 with Paul Graham and Sam Altman

we have to sit up straight we have lower since this is not right Admiral rickover would not stand for this um okay uh George Nick what are you working on so we are building a multiplayer programming game for teaching people how to code so like code Khadem II but actually again a game so how do you how do you win the game so you just need more and more levels until you're an awesome developer so you sort of get points somehow for it's like a bit competitive learning like you learn to program I'll get more point we're competitive so there's multiplayer it's like write code to kill a bad guy yeah so the first level you got your guy you write code to move them around and you kill another guy so it's like right in the middle you're killing dudes all right so you're motivated yeah sort of you know what is your name what's the length of your name is a string okay that's cool bin like I kill that ogre yeah what you do right away it's not just badges not judges um is it launched yet it is actually we launched it yesterday oh well the beta things move fast around up check it out did you launch because we told you you were gonna be in office hours actually no we had just a coincidence it is somehow fortunate cuz we didn't have time to prepare the launch went crazy yeah wait they were I got home from the from the dinner last night and I get on a hangout with these guys and they're just at the server terminal control seeing and restarting the server because it's under so much load how's it doing now and not much better unfortunately we can only serve a certain fraction of the traffic that we're getting and that's been going on for 24 hours how did you start working on this um I wanted to learn to code about a year or two ago I had been a semi technical co-founder of my first startup and I tried coke Adam II I tried a whole bunch of these and I just couldn't stay stick with it it wasn't engaging it for me and so these guys might ooh co-founders were like hey why don't why don't we actually make a game so you were the original guinea pig I was they thought you can't keep motivated using existing stuff with like a game where you can kill people oh you know I was it wasn't just that our first start up the customers kept coming to us and saying we keep your your company your product because it's like a game and we hadn't attended that at all and what was it it's a company to teach people Chinese characters I see and so we thought well if we can do that inadvertently what would happen if we actually made a game so how far can you learn how to program by like how much can you teach people right because I can remember the kind of crappy programming I did when I was in high school where I didn't really understand what I was doing um so if you look at the stuff that's on you know top coat or hacker or how can you force people to learn advanced concepts when all they really need is like to have the right library calls right can you make advanced concepts produce advanced weaponry so the the software engineering part of learning to be a developer that's something we can add later focusing on core programming for now because you get motivated enough so like okay now I want to build this app but do you have to get through different levels right presumably you get more and more sophisticated yeah but you could get more and more sophisticated just by writing more and more code and getting access to the right library functions without actually learning any more about programming right couldn't you how can you force them to learn more about programming in order to make more powerful weapons so you can have things like okay your code needs to run this fast and this one you need learn how to use recursion this is the only methods available to you in this one you need to figure out how to do like it not honest function passing method here and generally if you make the levels hard enough which are able to do when they have a reason to complete it they try really hard and you can get them to do harder and harder stuff as natural progression of the game have you run beta users through this yet quite a few actually what did you learn from it like what went wrong well the first thing that went wrong was that we we started at too high a bar because I had worked in a kind of a semi technical role my first startup we assumed a whole bunch of prior knowledge that was totally untrue for our beta users so you know we started out like you know writing for loops that you're like oh well that's simple yeah yeah and then we got people with no programming background and they didn't even know how to complete a line like nearly no concept of formal notation is the single biggest obstacle correct right what's the most advanced concept you're teaching now so so far we have some dev levels where it was like okay you're going to need to figure out the targeting strategy for your tiller so you're going to fire into center of a group of dudes and your soldiers backed up with your artillery have to avoid your shots that you have to make sure they don't chase into your like line of shooting what what era of technology is this oh it's oh it's a web game and you're doing everything in JavaScript no no what what era of like comedy fantasy so you're a wizard and you're casting stuff to control your soldiers and your and your heroes and that sort of thing I see how many users did you guys know Apache helicopters or anything like that no unfortunately we don't have the Orion SS magic yeah all right keep saying do robots we could do Romo it's when fantasy you can make up anything right how many users as you guys get yesterday so we we max out the server at 15,000 people we had 200 concurrent but we really don't know because we were actually people were just getting 404s why not just spin up a bunch more servers we weren't architected that way we didn't think we get nearly this much traffic we just posted it to Reddit that's it yeah we we posted it to Reddit and we got swamped not even the main reddit we actually people on the reddit threads were just like there were repeated things they're saying you know like oh the hug of death hug of death hug of death and you know four or four not working so that's they were scrambling all last night to do that do you know if it's people that didn't know how to program before that are mostly doing this or if it's just people that want to play a fun game so the people that know how to program already they're like okay when's it on github when can we this is awesome let's get on here I know like 20 people yesterday Poehler can made me like oh man I want to help out and when can we pull a link we clone yeah so we're thinking open sourcing in the next couple months to really capitalize on the interest but most of the people yeah they're on the learn programming subreddit I don't only programming this is great and they beat all the levels and we're like crap any more levels we're just gonna focus ice know anything about the gaming business like do you know how to make games we're learning is this quick is the quick answer there okay cuz I'm probably certain best practices in the gaming business and probably whatever they do would be the first would be the starting point yeah so if you're just wondering how much to open-source I don't know how much they open-source things in their world but whatever they do is probably the the default thing to start with yeah we actually that was the first thing we did when we started the company was we realized wow none of us are a professional game designers let's find and talk to game designers and so we had we've got this kind of core group of people that are advising us just telling us when we've built sucks but that it's been very helpful so far hmm is there anything they told you that changed what you were doing they said make a robots and said people understand robots they said make robots because when you have like controlling your units Fiat code people think ok that's natural if your robots when you say oh it's a spell you're a wizard you're adding to the fantasy and oh it's a little bit hard to understand yeah see okay so is it robot snail oh oh so that's it sure to change the art right the art is an all right hmm I know you guys now just gonna create as much content as you can while people are yeah we just finished the level editor so now the hope is that we can finally turn out three levels a week using our awesome live coding drag-and-drop thing as opposed to like hard coding all the coordinates and be like how does it work now mm-hmm so growth first how many people do you have is it just YouTube no we have one one guy that's Manning the servers right now he's keeping it keeping it alive hopefully keeping it Scott keep it alive this is the same team from the first startups we've been working together for six years now how did you originally meet so I was his roommate and I lived down the hall for my co-founder I'm Callie I found her yeah college roommate mm-hmm did you guys study were you guys programmers yes what Scott and I did see us and George's the econ film guy ice and then we graduate like oh let's not get jobs that's gonna suck what are you talking about and then then we did the startup and then three months later you're what crash I was like oh good luck the reason people start startups is because they don't want jobs Yeah right no sirree honestly really if we've if we are looking at some someone's application and they worked for a long time for a large company that's that's actually bad to us because like the best part of founders probably could not stand that every months that IBM did me in was like yeah sophomore year like oh no more how are you guys going to make money with this so it's recruitment model basically the the people that the leads that we generated through the coding challenges provide us with the opportunity to qualify people before we even get in touch with a potential company and possibly train these people good enough to make them valuable employees the recruiters we talked to said yes absolutely companies are interested in the the developers on your site and we're interested and so lettuce let me have something recruiters famously say all sorts of crazy stuff yeah they do so yes that's yet to be validated yes the the other people in the space that we talked to also say the same things people running coding challenges and doing placements and the boot dub boot camps and that sort of thing yeah we spoke to actually one Y Combinator company and he we asked him how he had done his recruiting he said we sent a group of qualified recruiters a spreadsheet I said how'd that turn out he said oh he had 50 placements in six months so I said okay hmm you're out of time all right nice job guys thank you okay okay guys you guys you know guys wait wait come back back for a second uh you didn't realize that but that was your y combinator interview um you're in the next batch uh you are a plane right no crap sir I guess I'm sure we just sort of decided to do that on the fly I mean that was the that was the first time I talked to them um hi I'm Karen hey I'm Finbar we are making give it 100 comm what is it give it 100 you can look at me okay we're making a video site where you sign up you choose something that you want to get better at and then you share a video of your progress every day so what would be a typical example like what's the most is it launched now it's in private beta right now okay so what do you anticipate being the typical use case like what sort of thing would people get better at the most common one right now is dancing the reason the reason for that is because I made a video of myself learning to dance in a year and I put it online it ended up I mean you spend a year learning to dance I did spend a year learning today what kind of dancing a robot dancing okay it's all robots today um Ron code you hear this this is the new trend robots so I ended up getting several hundred emails from people who said hey because I saw this video it wasn't a video of an incredible dancer but it was someone who started off not knowing how to do it and getting better so is this video you put on YouTube and a lot of people looked at it yeah so was this what led to the startup yeah okay so you made this video of yourself learning to dance and then you thought if other people did something like this it would encourage them to dance - yes what sorts of things are people mostly showing themselves besides dance learning and they are users are there we have invite-only beta 50 people and 50 we have yeah it's like 4,000 300 or so on and waiting lists yeah they are there's a 9 month old learning how to walk there's a woman who's recovering from a multiple sclerosis exacerbation she's relearning how to walk there's people who are learning how to ride a unicycle um learning a new language learning how to code learning design why haven't you accepted the rest of the wait list um well we're kind of just like ironing out some kinks in the product and getting it to the stage where we think it's going to be really engaging I'm not engaging in you know well is we gotta have some really awesome engagement stats well if it's engaging enough now you've got enough one out and ironed out enough kinks sure we have I think really the major things that I'd like to see personally are the kind of social sharing features because when we kind of open the floodgate and have lost nots people come onto the platform we want to kind of maximize on that and you know if a lot of them come on and share and then leave like they could have got a lot more people's come in by that point so so they're not sharing it enough now well there's no way them to share it right now because it's totally a private closed beta like nobody will see it right we really just were we're kind of just experimenting on our first batch of people getting their feedback and then we're gonna launch in the next couple weeks do they always make videos of their progress yes it's fitting it's how it works we started off as a photo and video site but then we cut out videos we cut out photos because the videos were more interesting so how do people make videos of themselves learning to code look how much faster I can type actually there is someone who's learning how to touch type but they they sometimes talk into the camera to talk about what's challenging what they're struggling with they'll show actual code they'll show what they actually built how many views does an average video get out of like a potential 50 so the view counts we're seeing about a thousand views a day and we have roughly between twenty and thirty of our kind of small group of users are coming back to website every day twenty and thirty out of 50 come back to the website every day so unique the kind of unique visitors it's not like the same twenty to thirty every day it's like people will kind of wait a few days and then upload a batch of videos at once so so the videos are hosted on your site not YouTube that's right yeah but we want to use YouTube we want to piggyback off of YouTube as a marketing channel the same way we did with my video so we'll take really compelling 108 challenges and we will turn it into a viral video put it up on YouTube and say made with 100 seems like that would have been really important to test during the beta is will people share these on YouTube and do they get watched well I guess our our test for it is my video which has 3 million views and was shared widely you don't put it on YouTube well the video clips themselves are on our site that's something that you can go on every day and see the same people every day see their clips Sam was saying I should have tested putting it on YouTube specifically oh the clips the type that ten-second clips themselves I mean I think like the kind of format that we have on the website where you kind of have this gallery of ten-second clips and you can just kind of see them all and consume them all kind of in context and a sequence is like really powerful so you have a view with a page with a whole bunch of little that's right on it right and you can see from the beginning to end the person's story that's the most compelling part bassett if you envision like Paul Graham I'm Paul Graham I am learning to like pick which startups I'm learning to make I'm learning to pick which startups for Y Combinator for 100 days then you see day 1 day 2 day 3 and then as you hover over each video it just starts playing so you can you can watch it for a second or for 10 seconds we cap it at 10 seconds because I have a short attention span and I'm building this for myself what do you think will be the most popular things I don't mean the most popular things by number of people who do them I mean what will be the most popular things for third parties to come and watch so that's a really good question parties like people who are not the people who are practicing like what do you want you've said you built a series on what do you want to watch like what are you excited about watching other people learn I want to see a good story I want to see someone who is struggling and and is against all odds like doesn't think they want to do it I want to see like Phil Libin at his 3:00 a.m. hour saying I'm out of money and I just got an email from this investor and I want to see video of that rather than just hearing him talk about it I think like today we I don't think he would have used your system no seriously not for like starting a startup maybe someone in this room well more for learning how to how to dance or something like that right um but what do you think will be not I mean what specific type of what genre of stuff will it be people learning how to dance do you think that will be the most popular stuff will it be babies learning to walk I think there's some we're seeing because the baby is learning to walk part actually sounds pretty exciting like parents would love to be able to document their kids progress I'll tell you the thing if you don't have kids one of the big problems about being a parent is the memories of the current kid overwrite the memories of the more recent of the sort of recent past no like I some so sad I can't really remember what my four-year-old son was like when he was three I see three-year-olds and I think oh yeah I remember when he was like that but only vaguely because my god I got this four-year-old like jumping up and down in them on bed and on the bed in my mind right I'm they're very if you wait till you have kids I mean I think there's going to be like a number of real kind of killer categories which will be very interesting the children one is certainly very very compelling when yeah this kids like crawling learning they can open the door and then like as parents hold his hands and he's kind of taking baby steps and you do how you tab videos that implicitly have these structure of like sequences but right but they're not organized that way they're just like on your iPhone right in chronological order you know they're not like the series of the kid trying to say some phrase or something like that how good are the users at sticking with the whole hundred days of making a video every day so a good question so every uses that we have there's an average of 18 videos uploaded per user so I guess we have some people who actually are kind of earliest implementation of the product was send us videos for our Dropbox everyday so we have some people now who are actually up to kind of in the 80s yeah so was a guy beatboxing who we've got him from day one through three like 85 I think and he's pretty awesome but it's like meet boxing beat boxing yeah yeah exactly like a 1 oh yeah I like that so he he like starts off and he's like not very confident not very good but you really see like over time the amazing improvement in him and that's like war trying to get our people like encouraging each other to stick with it is the is the point of this that the community will make you be more likely to stir solutely so that's definitely part of it as well so we have these kind of commenting and kind of propping feature so people say oh this was a really awesome day actually I think like our most commented on and most kind of liked video we've got somebody learn to unicycle and one day she upload a video where she had kind of a bad fall and kind of fail we're never it was like oh that looks really sore but you know keep at it keep going you'll get in there you realize you can people make their stuff semi-private yeah there's a feature to make your all your videos private because a lot of people they don't want to share when they're going through it but maybe once they're good though or they want a group of their friends to be able to see it like it's their kid that'd be an interesting thing for us temple you know the kid thing the kid walking is very different from someone teaching themselves how to unicycle don't be don't like like over optimize too early like let it grow into whatever it's going to grow into maybe it'll end up being kids or the big thing or maybe not who knows but be empirical about it and don't don't like wire in some well outcome too early all right is it time thank you guys all right you guys it sounds pretty good to you mmm you're right Andy Paul hey hi Sam you don't know how odd this is for us this is the brother of someone we funded in the past and except for having a beard he seems identical it's very disconcerting um mmm hopefully that's a good thing yeah um you meant yeah all right what are you working on it says oh that's your user name what's the startup is called flex port were the first licensed u.s. customs brokerage built around a modern web application a customs broker yeah whenever you import a product from another country you have to clear it through customs what is a customs brokerage do collect tons of documents and organize them and file it forms with US Customs to clear your goods to show that this is a legal product and you pay the right taxes it is it is it one of these things we're dealing with the government is so awful that you need like a specialized group of people whose whole job which is also like a few old of license Oh their head they have to be licensed oh yeah heavily licensing focus years otherwise and so the government trusts them yes they're not gonna lie correct right you go to the government on a rubber stamp the paperwork you go through an FBI background check as well to get the license I see and what do you actually do you like file forms for this employee like so you anytime you there's based on what the product is there could be like 120 different forms you have to file so we have to take the what the product is determine which forms are needed fill those out for the customer file them electronically with the government so there are existing customers program yeah right and you're gonna somehow you're gonna take this you're gonna be an instance of software eating the world yeah you're gonna eat customs brokers yeah yeah um so what do you do like is it is it somehow scalable if you write software like what do you do differently than an existing customer um well first of all we will use a fax machine and Bloodless the cosmic Wow all right so yeah it's an online dashboard to allow you to organize all these documents and help you understand which documents are needed and then we actually collect those documents for you instead of asking you to go get it and it will file it I can just come to a website type in what I'm importing and have it come in the US and you'll take care of everything else yeah will the will the experience for users be as simple as a customs broker were they gonna have to do a little bit more work no that way less work it's less work oh absolutely I mean we do the work for you but doesn't the humans customs broker like sort of interview out of people what they're importing like the person says they're importing we're not removing the human elements are repairing you with a licensed customs worker we have customs workers on staff and it's our locations tool not like enable it's it's sort of like uber uh yeah I haven't used that analogy it's kind of like teleporter for products instead of for people okay if yeah yeah how much does someone pay a broker to import like a million dollars of goods it's usually it's not depending on the value of the goods but it's like between 100 and 300 dollars per shipment and there's 30 million shipments that enter the US every year filed with the customs customs entry 30 million yeah and then that's just to be nice berg so really I mean it many of them use customs brokers yeah yeah use a customs broker I mean you can have a big company will have a customs broker in staff yeah we drink like Apple at a certain scale that's guys yeah you hire customs workers are we'd like to make it so you don't have to hire a customs broker because our software is easier to use than then maintaining that division of your company you have customers now yeah we have three customers right now that are importing stuff yeah we actually have a waiting list of like 300 the base wheel company in the world signed up we were a little scared of like creating an energy crisis so I told him to hold off of it but we have a supertanker approaching that board in San Francisco right now so how did you get those customers um so I was in the industry for like 12 years I know a lot of importers are you currently a customs broker I have AK I'm not personally I do not have a customs broker license I have a customs worker that works for me I said and they kind of teaching me everything so you guys have you already been doing the manual version of this so over the years I've probably imported about a thousand containers and cleared them through customs okay my companies that I've worked with work for my brothers companies one of them I still work for my brother so you do know how to do this yourself yeah sure why is no one done this before um well why the existing companies haven't done it before is kind of obvious there yeah if you go to a customs broker convention web software what's up by 40 years probably yeah the widenar startups have done it well first of all I mentioned it's highly regulated hard to get a license and actually until recently it wasn't possible to clear a shipment except at your local port so if you built a software startup to do this you could only help people importing into the Port of Oakland unless you had an office in every port really on 2007 you're not doing the clearing though aren't you just matching them up with a customs broker no no we are at licensed customs brokerage we actually do the clearance and file it electronically with customs ok so you guys are kind of the customs broker of record yes we also it's not quite like uber yet yeah I didn't quite get that analogy to be honest hahaha he have the same Morton sense of humor as your brother do office hours with him always a little bit prickly um all right uh so how are you gonna get all of the customs all the importers just which to this um well presumably they have these like long stained relations with their custom brokers yeah and the kind of importers to a large degree have this figured out too by definition right they've been doing it they know how to import goods um so but every time you import a product into the u.s. its public record that product and my last company actually sells that data we have we aggregate every time you import something yeah we've collected 300 million of those shipping manifests and sell subscriptions to access it so we know every single you have that rosemary list that so you have the customer list yeah we have every importer in America database so we can Wow that's very convenient Wow um so how far along are you have you got sort of this like a big press or a beta version that yeah um MVP product it's a web app you can sign up for it we're not taking your users right now um but that's just a matter of me wanting to feel like everything's super tight mmm nice user experience but it has it has the functionality function initial version is gonna have - how many shipments have you done with your first three customers how much how many inbound shipments have you done no so the first clearance is happening in November so we've got these guys lined up ready to go we've got the but the first shipment actually the government shut down three weeks ago stopped us from they won't take a new broker the guy who's like job it is to onboard us and was furloughed but he's back to works office and I filed the forms on Monday that program I was hoping to have that done be able to come up my wife's Yap and say hey uh through our first shipment already but see you idiots in the government you are actually slowing down innovation how much do you make did you have a sense of like on average how much you make per customer yes well for each clearance that gross margin should we have 75% it doesn't take a lot of time - it's kind of so you can be like really hands-on and hire a lot yeah but I don't do the process it's done clearance we're gonna charge $100 to do it no matter the size of the shipment yeah pretty much it's actually not about this size but like there's some things you might charge extra for like clearance certain if you want to do something that has it clear with FDA there's extra paperwork we might charge actually seems that people would pay a lot more for like seven seven seven full of iPhones then you know like one little shitty yeah stop for the bull that now they're gonna pay more in taxes to the government right but as far as the broker it's still just one forum or was it dudes current brokers charge flat rates no matter what the shipment no they charge more and you know I'm kind of looking a little differently where the brokerage is just the way that we enter the much larger logistics space cuz once I'm your customs broker I know everything about your supply chain so what would you see a freight warehousing inspection sum up with trucks or something like that I someday I would like to be doing all those things but our other brokers doing that sort of these services after you get it into the country um yeah but I don't know that they look at it as like they're the primary way that they're gonna make money they would never go into it as a loss leader for example and I don't know if I'll do that here I like I don't like burn rates but hmm so how much do you think you'll be able to make like in you know once the thing launches yeah well the Logistics globally is a 2.3 trillion dollar industry no I just mean when you do the customs broker I just like to say there were trillion yeah you know really big markets are bad for startups not good yeah if you say a to big number the investors just don't believe it I you know what it's it's really hard to say I mean I've kind of model doubt and say like okay we can make about thirty million dollars a year in profit just being a customs brokerage if you get say 1% I don't like to do that kind of yeah an analysis but you know each customer is probably worth maybe two or three thousand dollars a year and I think we can get as many customers that the whole business is three billion a year yeah thirty million is one percent yeah exactly the customs current business it's about five linear right basically number you said earlier the whole US Customs is about acrobat miss about three yeah now I don't have exact figures for that but based on the number of shipments that are cleared and what people charged for those shipment are you gonna hire just an army of sales guys and go down that list um possibly my last company had an army of sales guys and it wasn't that fun to manage but things that aren't fun are still sometimes sometimes it's the way to make the most money so I'm not you know I have to do it better than I did the last time so it's more fun no we got to end all right boy all right interesting yeah all right thank you thank you for coming thanks guys [Applause]

Channel: Y Combinator

Views: 53,234

Rating: 4.8636365 out of 5

Keywords: YC, Y Combinator, George Saines, Nick Winter, Karen Cheng, Finbarr Taylor, Ryan Petersen, CodeCombat, 100, Flexport, Sam Altman, Paul Graham, Startup School

Id: syoqjYLDs48

Length: 29min 8sec (1748 seconds)

Published: Sat Oct 26 2013