
Jessica Livingston (Y Combinator) at Startup Grind 2014 - pg
https://www.youtube.com/watch?v=zMZZPiJrBo0
======
patio11
I took the liberty of taking notes. They're my impressions of what Jessica is
saying rather than a transcription. All errors in interpretation are mine:

Jessica really likes Adora Cheung of Homejoy for having a very inspiring
narrative. (No specifics in this interview.)

First YC class: 8 companies, 400+ applications.

"We have to do this in Silicon Valley [rather than Cambridge] because we
didn't want someone else to become the YC of Silicon Valley." (Echoes the
"Uber will be the cheap Uber" line.)

@8:25 "No no no, I _know_ you can make templated legal documents and just fill
them in." Mass-customized processes let them accomplish e.g. incorporation for
less than $15k per company.

Ron Conway brushed me off 3 times. We couldn't describe ourselves as an
accelerator because that concept didn't exist yet. Despite the brushoffs he
was eventually convinced by multiple people in his network convincing him, so
he came to Demo Day and the concept of YC then made a lot of sense to him.

"What's changed w/r/t YC applications over the years?" The Social Network /
Facebook IPO caused a large spike in startups generally, but it's been on an
uptrend steadily for the duration. Quality is harder to measure. We get
companies which are much later stage (existing product, signs of traction,
evident ability to raise professional money) than the no-prototype folks who
usually applied earlier.

"Could YC 2x/3x in size?" We're interested in scaling but don't know the
specifics of how to do so at the moment. Number of startups will only
increase; it is a fundamental shift in the economy. YC's early stage makes it
incredibly difficult to accurately predict winners -- who would have called
AirBNB and Dropbox [as turning into billion dollar businesses]?

"You knew Drew was going to be successful with a 1600 SAT." Many smart people
apply to YC, but that doesn't guarantee you get in. Mere intelligence doesn't
make startups succeed. Not that went to MIT is a bad predictor of success but
it is certainly no guarantee.

"Where are the international entrepreneurs coming from?" International
increasing mainstream-ness of startups. Not just from UK/Canada, but from
(non-Anglosphere) countries as well. I don't have an explanation other than
more people are doing startups.

"Are international companies solving different problems?" Not really. Most
foreign firms are solving problems which US companies could equally address;
global problems.

"How do visas work?" It is a 'bad situation.' Unlike US founders they don't
have the option of remaining in SV after YC ends. The visa application process
is 'broken and horrible.' We as entrepreneurs/folks in the community should
actively attempt to make this situation easier; in addition to it being the
right thing to do, it makes it easier to recruit people from abroad.

"You're known for having a good people radar. What are the red flags you see
prior to a cofounder problem?" JL is not technical so she looks for other
things in their 10 minute interview. Do founders get along? Don't fight in
front of us. Do they have a good vibe between them? Don't interrupt your co-
founder aggressively. Do they understand their domain well? If they're a B2C
company, I ask to see if they've thought deeply about consumer needs.
Defensiveness is not a good trait. We want to work with people who will have
enjoyable conversations with us, not people who get angry.

Trivia: YC decisions are made immediately after the 10 minute interview, in
the room. We do 20 interviews a day and would otherwise forget.

Red flag: 90/10 equity split between founders. Even with 1+ years extra in the
company, as time goes to infinity you will have equal mental investment, and
90/10 will cause terrible resentment.

JL: "I am an expert in founder breakups." Warning signs: joining as co-founder
purely for the purpose of a YC application. It has been known to work but that
is often a bad sign. You might not know each other or have good working
relationship, and that will crack in the YC stress crucible. I like seeing
college roommates or 5-year coworkers apply. They're going to have better
working relationship and ability to overcome issues.

Regarding the new policy about YC partners investing in startups: This is a
pro-startup move. In past Paul or Paul would invest in the occasional startup,
which was OK for a few years, but these days Gary Tan et al have funds, and
the pre-Demo Day investment from partners was causing signaling issues.
Companies w/o partner investment were being seen as losers. We nixed this to
protect interest of the startups.

YC applauds partners who have funds orthogonal to YC: more funding
opportunities for startups, yay.

YC funding non-profits after success with the Watsi experiment.

Current YC batch is more diverse than typical. 56 year old founder (oldest
ever), father-son team, more international founders, more female founders,
etc. (Moderator seems to think the 56 year old is quite the outlier.)

Q&A with the audience @ 32:00:

Q1: To JL/PG: How did you build the community of alumni even though some
compete with their individual companies?

Fundamental to roots of YC and the community culture. If you help someone,
someone will help you. People who do not behave within community norms are
shunned very quickly. Moderator adds that the community is tight-knit and
doesn't leak very often. JL says they try to have batches intermingle.
Secrecy/etc is not an Applesque strategy -- the founders are probably just too
busy running companies to run mouths.

Example of YC alumni network helping: Bump got substantial promotion from
Apple. Servers melted. Founder of Cloudkick jumps in within 15 minutes, goes
to house to fix servers. "That's the power of the YC community. _sustained
spontaneous applause_ "

Q2: How can red-blooded capitalists and non-profit companies learn from each
other?

Non-profits can apply tactics like moving-fast-and-breaking things, launching
early, and listening to users. Historically nonprofits tend to be bureaucratic
and antiquated. We hope that if they become more startup-y they'll be more
successful at advancing missions to the benefit of the wider world.

For-profit companies support Watsi in many ways; very special.

Q3 (moderator): Founders at Work most impactful real book on what it is like
to be an entrepreneur. JL wants to write a sequel. Founder of Mosy (sp?)
recommended FaW when discouraging the moderator from pursuing his startup
idea, which that founder described as doomed, in favor of founding a
successful next company, which FaW would help with.

------
highCs
When a founder group from a foreign country come to YC, do they incorporate in
the US? If yes, once returned in their country, do they incorporate another
company/subsidiary? How do they work?

~~~
RRiccio
Founder of Glio here (YC S13). In our case, yes. That's what we did.

We incorporated in the US, then came back to Brazil and created a new company
owned by the American one.

~~~
highCs
Awesome. Thank you.

------
zmitri
I saw Jessica speak at Startup School in 2012 alongside some of the biggest
names in tech, and her talk was by far the most useful/practical for me as a
23 year old entrepreneur.

She is really really good. I suggest watching it.

~~~
randall
Here's a link to the written StartupSchool talk. It's really good.

[http://www.foundersatwork.com/1/post/2012/10/what-goes-
wrong...](http://www.foundersatwork.com/1/post/2012/10/what-goes-wrong.html)

------
soneca
My biggest takeaway: at 32:15 she puts her head closer to better listen a
strong accent guy making a question. I bet she was thinking "I better
understand what this guy is asking or another flame war will erupt on HN as
soons as this get there!" lol

~~~
simonebrunozzi
Ehehe nice one.

------
smtddr
This was a lot more informative than I thought it'd be.

I expected everything in YC to be hush-hush.

------
simonebrunozzi
Watching it now. What's the most important takeway, pg?

~~~
lukasm
You know you spend too much time on HN when pg is not PostgreSQL for you.

~~~
rmason
Biggest takeaway is that she's open to a second version of her book. Still one
of the most inspiring tomes for founders.

~~~
daniel-cussen
I think it'd be awesome if Jessica wrote another one, but it'd be even better
if she did the anti-Founders at Work. It'd be about all the different kinds of
flameouts, from spectacular to silent, from bad luck to bad calls, from goodie
two-shoes to unethical (but Zynga-sleazy, not mob-boss unethical). The title:
"Founders at Fail."

