e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e [Applause] [Applause] [Applause] [Applause] [Applause] [Music] [Applause] okay let's see here hi hi everyone good afternoon I think we'll get started you nice and cool inside thank goodness I lived in New York 20 more than 20 years ago at this point and
this is bringing back like the summers in New York on the subway I'll kind of never forget it so hot but thank you all for braving this Heatwave and coming here on a Saturday afternoon we're really excited this is actually uh the fifth year we've done the female Founders conference and our first time in New York so so I'm very
happy to be here and have you all here so I'm Jessica Livingston um I co-founded y combinator uh which was the first accelerator um today there are thousands all over the world um at least hundreds all over the world but in 2005 what we were doing was so unusual that people in Silicon Valley just regarded us as very irrelevant um
why combinator began the same way as most other startups with a hypothesis about something we thought people wanted and it turns out they did want it and we grew and grew now we funded more than 1,800 startups with a total value of over a hundred billion [Music] doar so having myself been through the
kind of startup Journey that many of you are hoping to I wanted to tell you my own story now if you only know me through the media you might get the impression that my contribution to why commentator is that I'm Paul Graham's wife and while I love being his wife uh there is a little bit more to the story than that so I was born in Minneapolis in
1971 uh later that year my mother left home leaving my father alone with a small baby so he took me back to Boston where my grandmother lived and I lived with my grandmother during the week while my dad worked and I lived with my dad on weekends my grandmother was the most important female role model in my life
she was a very independent person um and the term anyone who knew her would use to describe her is freespirit um for example in the winter time after putting me to bed she'd go out and work till late in the evening on these giant ice sculptures that she'd build in our front yard she did what she wanted and she
didn't care if people thought she was unconventional so despite growing up without a mother my childhood was really happy my dad made a lot of sacrifices so I could get a great education and he constantly encouraged me I played soccer when I was young younger and when I was in the n9th grade we had an away game at a school called
Philips Academy in Andover Mass and the place seemed so unbelievably fabulous that I decided right there on the spot that I was going to go to school there um little did I know though that this decision would have Bittersweet consequences um in my old school I'd been a big fish in a small pond I was a
straight A student and good at sports um and when I got to Andover in the fall of 1986 it seemed like everyone was straight A students and good at sports so I got really discouraged and basically gave up I defaulted to being a mediocre student and did nothing impressive or noteworthy for the next decade it was like my own personal Dark
Ages um and it's a bit embarrassing to reflect on to be honest with you but I think it's important to mentioned because when journalists and biographers write about successful Founders they often focus on early predictors of success um in people's formative years and for me you know I didn't have these things and I
didn't at least have any of the conventional kind of predictors and no one would have voted me most likely to succeed um but while I had no achievements I did have three defining character characteristics when I was younger that were critical in making y combinator work um the first was the quality that caused my YC co-founders to
nickname me the social radar I was one of those kids you just couldn't get anything past if something seemed off or out of character I noticed and made inquiries um I was always trying to figure things out based on subtle social cues the second was that I never liked being at the mercy of anyone else I hated anyone telling me what to do or
not to do parents teachers bosses people I had to collaborate with but disagreed with anyone and the third distinctive thing about me was that I've pretty much always been a straight shooter my grandmother and my father were both like that but I'll come back to those in a minute the day after I graduated from
college my beloved grandmother died died and it was a really sad and lonely time in my life and now I was supposed to find a job with a degree in English and absolutely no clue what I wanted to do I wound up getting a job at Fidelity Investments in their customer service group answering calls from 3:30 till
midnight every day basically talking to retail investors about why their mellan account was down that day oh it was awful I didn't love the job but I did love having a job um working hard and getting paid for it and not having homework hanging over my head it was great and after Fidelity I worked in investor relations in New York City um
then at Food and Wine magazine and at an automotive consulting firm and I I even worked briefly for a wedding planner in 2003 I was working in the marketing department at an investment Bank in Boston when I first met Paul Graham at a party at his house one night we started dating and I felt like I
finally had met Mr Wright um despite having quite different backgrounds we were really similar if I thought I never wanted to be at the mercy of someone else Paul was that dialed up to 11 um he'd moved back to Cambridge after selling his startup via web to Yahoo and he was at the time writing essays working on programming languages
publishing a book and curing his debilitating fear of flying by learning to hang glide of all things um Paul is the best Problem Solver I've ever met he's also a genius at expanding ideas and making radical improvements to things one of his defining characteristics is telling people you know what you should do
if you know him you'd find that very funny I'm sure i''d say it to you um Paul and his circle of friends exposed me to this new world of startups and it felt much more exciting than the later stage of publicly traded companies that I was involved with at the Investment Bank I read the book startup by Jerry Kaplan about his pen Computing company
called go and I was just immediately hooked it was like some light shining down from the heavens and I wanted to hear more stories about the early days of startups so I started working on a book of interviews with startup Founders and the book was called Founders at work and it was published in 2007 at the same time I was becoming
more interested in startups I was becoming less interested in my job um the bubble had burst a few years back and the Investment Bank was making some pretty drastic cutbacks and you know working there just had become boring and unpleasant so I applied uh for a job at a venture capital firm where I felt like
I might be one step closer to this exciting world of startups and while I was interviewing at the VC firm Paul would you know what you should do me each night at dinner uh telling me how I should change the VC business once I got into it we' talk for hours about how broken early stage funding was and most
importantly how more people would start startups if it could be made easier for them so as the VC firm took longer and longer to decide to hire me the ideas grew more and more compelling until one night Paul just said let's just start our own the next day we convinced Paul's co-founders from via web uh Robert and
Trevor to join us part-time and the initial plan was that they would pick and advise the startups and I would do everything else instead of giving large amounts of money to small numbers of established companies like traditional VCS did we'd give small amounts of money to large numbers of earlier stage startups and then we'd give them a lot
of help and our initial target audience was programmers who we felt could handle the technical aspects of a startup but were clueless about everything else just like Paul Robert and Trevor had been we also had more faith in young Founders uh than most investors did back then I mean this was back in the days when
Google's VCS had invest insisted that the founders hire an outside CEO as a condition of their series a round so none of us had any experience Angel Investing though and that's where the idea of funding startups in batches came from we decided to fund a whole bunch of startups at once during during the summer so that we could learn how to
be investors um in March 2005 we launched y combinator's website and invited people to apply for what we called the summer Founders program um we funded eight startups that summer and we recognized almost immediately the power of investing in batches um it was so much better for the founders they had
colleagues to help them uh during you know a time that had previously been a very lonely process um but it was also a much more efficient way for us to help the startups because we could do things for them all at once every Tuesday night Paul cooked dinner for them and at each dinner we brought in a guest speaker to
teach the founders about startups Paul talked to all the startups about what they were building and I helped get them all incorporated as sea corporations and this was a really big deal in those days actually because back then to become a C Corp you had to pay a lawyer like $115,000 to do this for you um the first summer we gave the
startups $6,000 per founder um which was based on the stien that MIT gave students gave their grad students during the summer at the end of the summer we hosted demo day for an audience of about 15 investors which we were very excited about um Reddit was in that first batch and the founders of twitch although they
were working on a different idea and Sam alman's geolocation startup um and though we only had tried funding a batch of startups as a way to learn how to be investors we realized within a couple of weeks that we were on to something promising so we decided to do all of our investing in batches and we also decided
that we'd fund the next batch in Silicon Valley um we knew that a lot of people would copy us and we did didn't want someone else to be the Y combinator of Silicon Valley like we wanted to be that ourselves um so despite the fact that we've grown significantly over the past you know 13 years and we've expanded in
a lot of different ways YC's core program uh is remarkably similar to what it was in 2005 so the question I always used to get over the years from people was so what is your role at YC and it used to really bug me because no one ever asked Paul Robert or Trevor that question but now I think it's kind of an interesting question to think
about what was my role as the only non-technical founder of Y combinator well at the beginning there were tons of errands like with any startup that just had to get done and there was no one else to to do them Paul and I divided up responsibilities perf perfectly which I think is very important if you happen to start a
startup with your spouse or your partner um he made our website and application and I got all the other stuff set up for the first summer I worked with the lawyers to set up why combinator the entity um and to help create all kinds of template legal paperwork um for our standard Investments and everything the
the founders would need to set up their companies and assign stock properly and if you've ever done that you know it's a lot of paperwork um to do and I had to learn quickly about how to advise them on filling everything out so that they wouldn't have to pay the legal fees I had to set up Paul's small office
building in Cambridge to be our weekly dinner Gathering space for 25 people I set up our bank account and I contacted people to speak at our our dinners every week I bought the groceries that Paul cooked for the dinners I even delivered air conditioners that I bought at Home Depot to the founders I mean I was really the only one of us organized
enough to make all this kind of stuff happen um when it came to investing I had something that my co-founders didn't have I was the social radar I couldn't judge our applicants technical ability or even most of their ideas my co-founders were experts at those things I looked at qualities the applicant of
the applicants that my co-founders couldn't see did they seem Earnest did they seem determined were they flexible minded and most importantly what was the relationship between the co-founders like while my partners discussed the idea with the applicants I usually sat observing silently and afterward they' turned to
me and ask should we fund them from the beginning I was very careful about only funding Earnest people um back then I never envisioned that uh the the people we funded would grow into this community of thousands of YC alumni but I always tried to create an free culture if I could tell someone was a conceited we did not fund
them um and I'm sure um we've since funded some conceited but early on I was pretty rigid about this um and I think that's the basis of the culture of our alumni Community uh so so far this stuff might sound a bit different than you'd expect in a successful investor um but when you get to an extreme in something things
get qualitatively different why combinator was a new extreme in the Venture funding business so so what made someone a good investor was different VCS relied on growth figures and estimates of Market sizes but those didn't exist at the stage that we were investing what YC needed was deeply technical people to judge the potential
of an idea and then someone like me to understand the founders characters and the relationships between them and to do that well you needed abilities that had previously not been considered important as an investor um it was doubly hard too because some of the applicants were so young we had to judge the founders not
by what they were but what they could turn into I mean imagine Mark Zuckerberg back in his dorm room in 2004 with his website that let college students see what other students at the school were doing not super impressive seeming to traditional investors another secret weapon of mine that was strangely well suited to Y combinator
was that I was a very experienced event planner events are a crucial part of what YC does when you fund startups in batches everything's an event interviews are an event each dinner is an event demo day is an event as the Alumni network crew we started doing events for alumni 2o and from the very first year
we did big events like like startup school um I'd been doing events for years in my marketing job so I could plan these things with one hand behind my back probably the thing that was most different about YY as an investment firm though was that it felt like a family and I was its mom I was soft and sensitive at a time when investors
tended to be hardened and aggressive and I'll throw in ruthless too for a couple of them that I know um I cared about how Founders were feeling if they were overwhelmed if they were eating properly I'd counsel them on relationships that were under strain due to the pressure of a startup and I'd listen at length and
help them with their co-founder disputes and breakups starting a startup is emotionally draining for Founders especially in the beginning sometimes they just needed someone to listen and luckily my entire college career had trained me on listening to people's social problems and I tried to always be a
straight shooter with my advice in fact we all were Paul is the straightest shooter I know which is why his advice is so valuable he doesn't bury it in euphemisms or worse like withhold the truth in order to preserve people's feelings and as tough as they might found his advice at the time they might have found his advice at the time
Founders always thank him for his cander one thing Paul and I had in common was that we were not driven by money we were interested in startups and we wanted to help people start more of them and that was the basis for everything we did at YC um and it was what allowed us to do something as weird as YC in the first
place and because YC didn't have any LPS at the time we weren't even constrained by a vague fiduciary responsibility to anyone and that allowed us to take more risks with who we chose to fund and it also allowed us to be benevolent to failing startups um and that often brought us into conflict with investors who had different
priorities early on we had funded a husband and wife team um who had a baby and they worked hard on their startup but it was clearly failing one of their investors tried to get them Aqua hired by a big company in in the valley who ultimately passed Paul talked to the founders and learned that they just wanted the security of jobs you know so
they could take a a break from the constant stress of a startup so we talked to the big company and got one of them hired there and the founders were delighted the investor on the other hand was livid he ripped into PA harder than almost anyone I've ever seen you know before Twitter um saying that Paul had
blown any chance of an aqua hire and you know to this day I still don't get why investors squeeze Founders over small outcomes like this I also never cared much about fame or my own personal brand I just wanted y combinator to succeed um one thing I've learned from Y combinator is that the most successful startups grow organically out of the
founders lives and this is true in my case too I was almost uncannily Well Suited for the kind of work that it took to make YC successful but the things that made me well suited for it were so far from the qualities that most people associate with startup Founders I'll list them oh my gosh have I not been have I been
turning that okay sorry I got so into my talk oh you're doing it thank you okay I'm going to list the qualities pardon that little okay wait back okay I'm going to list them so you can see for yourself I was a social radar a good event planner maternal empathetic a straight shooter and not driven by money or fame think how far
that is from the profile of the typical startup founder you read in the Press I mean maternal since when was that an important quality in a startup founder let alone the founder of an investment firm yet it was critical in making YC what it it is um and by the way this photo was taken just about the
same time that I wrote Airbnb their first investment check so that's why I wanted to share with you my story um it's not true that every person can start every startup but a lot more people have what it takes to start some startup than realize it and a lot of people perhaps all people have some unique combination of abilities and
interests and a lot of these combinations match some startup idea so if you want to start a startup I recommend you try asking yourself what's distinctive about you what unique combination of abilities and interests do you have and don't edit your answers because as you can see from my example the most unlikely ingredients can often
be the key to the recipe in fact it may even be that the strangest combination of qualities are the most valuable I had a weird combination of qualities but they matched YC because it was such a weird company and the most successful startups do tend to be weird they're usually such outliers that they seem Preposterous at
first to everyone except the founders because the company has grown out of their own experiences okay so what can you learn from my story here and I things I'm going to try to do this smoothly okay nine things there's no one successful mold for a successful founder just because you might only see a certain
type in the news that doesn't mean you need to turn yourself into that do what you're genely genuinely interested in and try to play to your natural strengths a startup is so much work that you'll give up um if you're not genuinely interested in it don't pay ATT attention to the mainstream's opinion of what you're
doing whether it's your skills your idea or whatever um unless they're your users their opinion does not matter although do pay attention to the opinion of your users um they're important like YC we agreed on the big questions and we each deferred to each other's expertise on the small ones focus on making something people
want everything follows from that in 2005 people needed a way to get a small amount of funding easily don't let rejection distract you or hold you back you'll get rejected in so many different ways but you must just keep moving forward start small so you can be nimble and open to change we never could have
pulled off moving our operations out to silic Silicon Valley in a matter of months um if we had hired people in Cambridge for example and to this day YC has a tradition of trying things out on a small scale before expanding them it's okay not to have gone to an elite College I grew up thinking that this was the be all end all you've been
trained to believe that you'll be judged by your credentials but in a startup it's the users who judge you and they don't care about your credentials they care about your product lastly be Intrepid um there's room for lots of different types of people to be startup Founders but you do need a certain amount of boldness uh to
work on ideas that most people would consider stupid and to keep going when you're ridiculed or ignored okay let's see where am I here we go last slide you are a jigsaw puzzle piece of a certain shape you could change your shape to fit an existing hole in the world that was the traditional plan but
there's another way that can often be better for you and for the world to grow a new puzzle around you that's what I did and I was a pretty weird-shaped piece so if I can do it there's more hope for you than you realize thank you very much so thank you so cat cat's coming up all right come on down hi everyone I'm cat manik I'm one
of the partners at Y combinator and I'm really excited to be kicking off this Fireside with Katherine mchu and Alex kavalas kavalas yes yes um and the co-founders of the Muse The Muse was a company that went through Y combinator in Winter 2012 and they're based out of New York um so before we get started um can each of you
give us a quick introduction on yourselves and the Muse yeah sure so uh I'm Katherine mchu um co-founder of the Muse and CEO I'm Alex kavalis co-founder and president um and when we describe the mus it's a company that's all about helping people navigate their careers and connect with companies more authentically to find the right fit so
today we have 50 million people every year actually quite a bit more than that but more than 50 million people who use themuse.com um and hundreds of the best companies around the world from Facebook Dropbox slack to Johnson and Johnson uh Capital One Goldman Sachs um that are really all about telling a more
authentic story and using that to hire people who genuinely want what they're offering um and we have about 120 employees now based here in New York city so um both with our clients and with The Muse itself we've gone through a lot of the good bad and ugly of hiring so today we're going to focus on people you know it's all about the
people um so let's talk about hiring as a force for culture um so at a high level WIS this important this is really important both for individuals and for companies so for companies if you have the right people that is what makes or breaks whether you're going to be successful particularly in a startup
where you only have so many bodies to do the things that you need to do um but for an individual you are spending more hours at work than you ever did in the past it's such a huge part of your identity especially here in New York or on the west coast the first question you're going to get when you meet
someone is what do you do and whether that is something that resonates with you that aligns with what you want to be doing or not is actually hugely important um and so the industry has not caught up with the changes with the future of work um and we believe that it really needs to we also think a lot about finding the right fit for you and
I think that's particularly important for startups because every startup is so different right they have different cultures than each other they have different cultures than uh a large company for sure and I think that we live in a a culture these days that's obsessed with you know the best places
to work list or sort of ranking companies rating them from one to five stars but um one of our really deep beliefs is it's all about alignment not ratings it's about what is the right thing for you and so we'll talk more about this but I think when you're a startup founder one of the most important things you can do early on is
really identify what is the culture you're trying to build what are the characteristics ICS of the company that you want to create and how do you kind of broadcast that you know loud and proud so that people who want that will be drawn to your company and people who don't want that will say no thanks and
they'll go find somewhere else to work so uh let's start with hiring so many people in the audience so how many of you have already started a startup all right way to go yeah awesome so many of you uh might be thinking about hiring your first employee or your first few employees so how do you know who the right person or you know first few
people to bring on our I think one of the biggest things when you're hiring is you have to know what you're looking for and that's a mix of skills and values and so you might be like okay I need a salesperson they need to be able to close a deal great but what are the values that are core to your company as well and then how is your process
allowing you to actually figure that out especially early stage especially if you haven't really interviewed a ton prior to starting a company a lot of people just jump into it and they're like they go with their gut feeling and they're like I think this person can do the job but you really actually need to set up a
process and it can be a lot less you know arduous in the early days than it is if you get bigger but what are you going to ask for every single person going through the process how are you going to compare them head-to-head um how you going to check their skills are you doing reference checks you should be
doing reference checks all of those things and actually just thinking through the process at the beginning and identifying what you want because there are many types of salespeople many types of marketers many types of engineers you don't just want an engineer or a salesperson you want one with a particular skill set to make your your
company successful so would you be willing to share some stories of mistakes you made at the Muse early on when it comes to hiring yeah so first of all like we made so many St mistakes in the early days when it comes to hiring and I think one of the um sort of everpresent truths of startups is that everyone makes mistakes
you too will make mistakes and what separates the mistakes that are painful that survivable and the mistakes that kill you is how quickly you identify them and how um and how quickly you move to them so I'll give you kind of two examples of uh of early news hiring mistakes um one was sort of not doing
what Alex just talked about and vetting for values and Mission alignment when uh when you're hiring so when we started the Muse I mean we were like nobody wanted to join the company nobody wanted to fund us I think we've got a per so this is a picture from after our YC interview in November 2011 and we were beaming ear to ear because it was
actually the first VC pitch in months at which people hadn't basically just laughed us out of the room and um so you know we were kind of very used to the only few people that were interested in working at The Muse were people that were deeply passionate about the mission um and deeply um aligned with the values
that we had all of a sudden we get into YC uh that news becomes public and we had all of these people wanting to work for us we didn't realize a lot of them actually just wanted to work for a YC startup they wanted to work for a company they perceived as sexy they didn't actually want to work for us so
um one of our first hires was uh an engineer I'll call him Bruce because we've never hired a Bruce and uh you know he y um and he said all the right things he seemed so passionate he was also um in San Francisco where we had just moved to do white combinator he was ready to start the next day and so um you know he seemed to check all the
boxes we hired him we jumped right in um at the time Alex now codes and um and is has been you know ran product through the first like what six years 5 years of the business U but at the time neither of us were incredibly technical so we thought this is a great solution and it was great for exactly 7 weeks until he
shows up one morning after I will say I had sold $25,000 of the mu's first product to our early customers and he says Hey I want to talk I want to be a co-founder I want more money I want more Equity I want to be the one that they talk about in Tech Crunch and I'm not writing a single line of code until you give me these things
um now we're pretty low drama so we don't have a lot of tolerance for people bringing drama and this is also only a few weeks before demo day so in terms of holding this over our head we were really being put between a rock and a hard place um and you know without going into all the Gory details we had a
couple of quick conversations and then we're pretty much like great well it sounds like you should work somewhere else and we should find uh another person to partner with because obviously that's not an example of shared values and you know the thing is again like you're going to deal with a lot of crazy things in startups I think um we were
lucky that we had the YC Community who was able to hook us up with somebody else uh we you know paid more than $225,000 of that Revenue to build that early product but we did get to a place where we were able to launch with demo day uh with these customers with a working product um but it was a really big lesson for us because I think there
were a lot of signs early on that this person was just attracted by the shininess of of a startup of YC that said you can make the opposite mistake which we did about a year later which is get people who are so into your mission and so into what you're doing that they um they don't actually want to do the
job that you're hiring for um which again is a real problem so uh just a quick version of that story is that I did our early sales right because you know when you're five people in a room um actually I think three or four people in a room and it's like okay we need to go talk to customers like nose goes it
was me um so I sold our first probably about 35 or or 40 companies who were hiring partners with The Muse and when we needed to then hire our first salespeople we found people who loved what we were doing they were so passionate they wanted to be part of the Muse they did not actually want to do sales they did not want to do sales
calls they did not want to um you know do cold Outreach and unfortunately you got to do that in sales um and so that was another painful lesson and now I think we have um just a much more thoughtful structured hiring process where we try and assess to the extent that it's possible to do so you know how quickly um how quickly can this
person get up to speed how much do they have the skills and the desire to do the role how much are they value Al line Mission Al line and the last thing I'll say is um nobody is perfect so unfortunately it's it's kind of a harsh rule of thumb but if you you know have sort of for every 10 people you've hired
if there's not one person that you're either managing out or firing you're probably being too soft on performance thank you and maybe more than that that's like really the basine so a lot of companies have started to talk about diversity and inclusion so what is one thing that Founders in the audience can do to sort
of improve what they're doing in that space great question so one of the things I have actively fight against uh is the notion of sort of culture fit in interviewing I do think there's you know culture and different ways I think about how culture evolves but um culture fit especially for people who are not
skilled interviewers have not done it for a long time is an amazing for for bias can you talk a little bit about what culture fit interviewing is yeah so often uh in an interview process someone will meet and the question is say would this person be a good fit for our company so they'll go and they'll interview them they'll talk to them
they'll come out of it and they'll be like yes this person is a culture fit or no this person is not a culture fit and if you have not as a Founder identified actually what culture fit means what you get is is this someone I'm comfortable around when I hang out with them get are right and so that is not you not only
find bias against I found both in terms of introverted people often times interview less well uh for culture fit but also any sort of community of color if you are a white team any sort of women if you are a man mail team whatever you are you look and you are more comfortable with people who are like you who have your background who
joke about the same movies who travel to the same places whatever that might be and so when people interview at the Muse and I hear someone usually someone who's newer to the company is interviewing maybe one of their first rounds of interviews and says this person is not a culture fit I get to ask great which of
the values were you concerned about and if they can point to one of them absolutely let's talk about what it was that came up in the interview that made them Wonder but if they can't point to it then that actually I don't care the fact that you didn't click with them is not a preck the fact that you're not good friends and want to Buddy Buddy up
with them is not a prere to work here um I often have to tell very extroverted people being extroverted is not a prere to work here um because that's often a place where you will find bias the other thing I would say is starting day one and really valuing that and putting that into your process um because the larger
the company gets the harder it is to change the culture the harder it is to become inclusive if you're not the harder it is to become more diverse and have a more diverse team which breeds success there's so much research on it and so if you are truly committed to it from the beginning that's actually a competitive
Advantage so you both talked a lot about how important culture and values alignment is for people who work within your company but what about people that you work with you know that are external to your company so investors that you might bring on or Partners um talk to me a little bit about that yeah I think
shared values is is just as important for the people outside your company than in it and it's always been really important to Alex and I because um you know we started a company together before the Muse that failed really painfully like in a ball of flames because of co-founder issues and because yeah of a total lack of shared sort of
values and ethics and I love when Jessica said you know find someone who has a similar moral compass because you might think like ah we can make it work but like oh my God no you cannot make it work exactly I mean we've even um held the the shared values test to clients um we actually yeah we've had a couple of
clients and one in particular I think of right now that we ended up firing client for just not working well and treating people well and sort of did what you would do is have a conversation give the feedback say this is an acceptable you get the absolutely totally understand won't do it again they did it again we
returned their money and decided not to work with them um and it's a hard thing to do but I think it's values are only so important and only are real if they're difficult choices yeah right and on top of that I think one of the most challenging thing for early stage Founders is to think about how that
implies to your investors because you know I wish that the early Muse company had lived in a world where we got to pick and choose all of our investors we were actually very lucky in our series a and our series B we had multiple term sheets we had a lot of different options and so for those I did eight different
reference checks on um all of the investors that I was seriously considering to lead both of those rounds and I was really happy with the people we were able to pick but for our seed round I was basically like walking around New York and Silicon Valley like alliv twist being like please sir can I have some more and and um I mean really
we are doesn't matter how small the check is we'll take it yeah I mean we we raised uh our first 1.2 million do it took over a year uh it took about 13 or 14 months um our we had 1 300K check size two 100K checks and the remaining uh what is that like $700,000 was basically made of like 50k 25k 10K um it was brutally hard and we actually faced
a really interesting situation which um some people might know about where we had an investor who actually was a seed investor in 2012 who came back in 2013 um offered to write us a huge check and right at the end of the process um basically propositioned me for sex so uh we had to you know sit there and and uh
the way that process had the way that process had gone um the other fund had drawn it out so that we were actually down to about 2 months left of cash when we got the term sheet we had like we had plenty of time monh we had multiple options we had signed a term sheet we were you know down at the kind of we
thought the money was be wired into our account any day and we ultimately made the decision to walk away from that entirely um through literally a miracle I raised $750,000 in 5 weeks um from scratch honestly I don't think I could do that again we don't recommend it yeah thank you I it was it was surreal but I think
that um that also made me a really even more passionate advocate for shared values with everyone I work with um and actually was really powerful in um gosh earlier this year like March or so to be able to to talk about it in fortune and the guy ended up stepping down from his post because it turns out he was
literally doing it to someone six months uh before the article came out same old thing and I think um you know that's why it's also it's not only important to make those decisions and who you work with but I actually think when people really cross the line it's also important to stand up and tell others um because you know that's the only way
that we're going to change the industry thank you for sharing that story I mean I think it's it is really important and and so many stories have come out in the past year and I'm I'm so grateful to all the women and you included um that have been brave enough to do that um because I'm sure there are so many more stories
out there um and hopefully you're helping you know bring forth a future where this doesn't happen to anyone um so um we are almost wraid almost out of time we have a couple minutes left um but uh um to wrap it up let's talk about one blind spot that you think every early stage founder um should be aware
of as their company grows yeah so I think one of the things that has been most fascinating to me because we're now 120 people six years old is in the early days it you sort of understand that your culture is kind of an average of your personalities of your values sort of as Founders how much of an influence you
have and then as our company grew I think we genuinely believed like now there's so many more people that influence it and then as we got even bigger we realized NOP it's still that's still true um for better and For Worse the things that I'm proud of about us um I think are such a huge part of our culture it's a draw and people uh can
identify just walking into the room but also the things that we've had to work on as Founders things that are our own personal weak spots um are things that are also weak spots for the company and so as you um not just hire but think about how you grow as a company take those into account because you will be
such a huge influence on your company not just when it's small um but throughout the entire lifetime yeah and I I'll give you an example of that which is um you know I think that uh when Alex and I started the Muse we really wanted to build a company that treated people uh with respect we have a very strong no culture that we hire fire and
uh and promote against um but personally I struggled in the early days of the Muse a lot with giving candid direct feedback and I've worked on that I've gotten a lot better um uh what is it radical cander great book if you to suffer this Affliction but it is really humbling and also really painful to all
of a sudden look around and realize you have a 9 person company that is collectively bad at giving direct honest feedback because you personally are bad at it and somehow that's just replicated and mored itself s across an organization and it's much harder to change 90 people than it is to change yourself and so I can't tell you how
many things you can look at at the Muse right now and you can trace a lot of the good things but you can also trace a lot of the challenges to things that um you know maybe we weren't as good at personally and I think that the more you're aware of that the easier it is to actively have other people say you know
look this is something I'm good at can you help me counteract this in our culture can you help me make sure that we don't build a team that suffers the same flaw at scale the one other thing I'd say in terms of a can be a blind spot and you know seeing rooms like this and and and having so many more uh female Founders than there were when we
started the Muse hopefully we'll change this but know that you can start a company that is the reflection of what you want to build and doesn't have to be what everyone else is building in terms of what you do how you do it how you approach it um it there's such a range and there's companies in New York that
we know well who've grown really quickly been like Wow i' have no idea how they're growing so fast and then I get to learn more about the inside and I'm horrified like I would never run that company and you know what you do you but the way that you want to do it I think is is okay right and and staying true to
who you are there are people who are going to want to work as part of that and be a part of that culture and that's going to be refreshing compared to a lot of other environments um so don't let the sort of Mo model that you know um be the one that you think you have to fit into yeah the rejection that Jessica was
talking about it's not only people rejecting sometimes your idea or telling you no for funding but it's also people saying oh if you try and build your company like that it'll never work and you know we made decisions early on we have a baby at work policy in fact Alex's daughter is somewhere in the in the back she in the back yeah probably
asleep no she's watching hey um but uh you know I think we just we were told over and over again like you can't do that you can't build a company that does that and make it work um and it does sometimes mean it's harder but I think that if it's something really important to you of course like learn as many lessons we
learned so much from other Founders about the mistakes to avoid how to build faster but I also think that um there's not one right way especially when that one right R is often you know a bunch of dudes basically deciding what they think like the best possible company is and there's real power in Just owning what you believe is right and then just
doing it that is awesome thank you so much to both of you thanks cat I'm going to do a bit of furniture moving you're going to have the back of my face but hopefully then you'll be able to see our speaker's actual face so let's bring that here okay okay hi everybody I'm Kirsty nathu I'm one of the partners at y
combinator um and it is my great honor to introduce shanin who's the CEO of Zola and Zola has reinvented the wedding gift registry and they've now worked with o um hundreds of thousands of different couples um and has latest reported valuations for the company of over $600 million so welcome so I gave a brief description
there of what you do but I'm sure you do it a hundred times better than me so why don't you say a little bit more about what it is and and what brought you to that point sure uh maybe I can start by getting a show of hands of who here has used Zola either as someone getting married or someone going to a
wedding great well thank you to you all um and for those of you who aren't as familiar Zola is the fastest growing wedding registry and also one of the fastest growing wedding companies and e-commerce sites in the country we use design and Technology to really reimagine what it's like for couples getting married today to plan their
entire wedding and we look to serve Couples from the day they get engaged through that first year of marriage um people getting married today are the millennial generation and they're unlike any other generation they want different things and so we are really the only place where couples can register for
things they truly want no matter who they are where they live or whatever device they live on and so what Drew you to weddings well like many successful startups we started Zola really out of personal need um so 2013 which was the year that I started at with my co-founder that was also the year that all my best friends were getting married
at exactly the same time yeah sounds like many of us have had that year here and you're going to a lot of weddings and you're buying a lot of gifts from really painful wedding Registries often um so I was doing that in 2013 and I was so frustrated because my friends were registered at the traditional department
store Registries and I had worked in e-commerce for a long time and I thought that buying from their Registries was the most painful e-commerce shopping experience I had ever seen I um started talking to my co-founder found ER noou who was the head of the user experience design team at guilt and we had worked together at guilt for a very long time
and he's married and he started complaining about how bad it was from the couple side where he really wanted to register for not just products but experiences and cash he couldn't do that um he wanted to um enable group gifting he couldn't do that he wanted to personalize his registry he couldn't do
that and so the more we talked about it the more we realized this was an opportunity and we were the best possible people to solve it and so what what was it about it that made you jump into being a Founder from you know a relatively stable job and everything else to make you take that that leap into the unknown well my background and my
co-founder's background is really in product management so we went through a very traditional product development process before we decided we really wanted to commit to doing this 24/7 and the process was we would start to talk to any engaged person that we could find any friend or friend of a friend we would meet them understand
their experience their pain points and then go away and try to design and innovate on how we could improve their wedding registry experience so in the 2013 we thought there's really three things that kept coming up up again and again couples really do want to register for products and experiences and cash
all in the one registry couldn't do that anywhere else couples secondly really do want to fully personalize their registry couldn't do that anywhere else and in a world where on average in the country people spend $35,000 on one wedding day which is the average yearly income they really care what it looks like and they want the
registry to reflect that and then third we heard again and again the worst part about registry from couples was they wanted to control when their gifts were sent to them and they didn't want to receive anything before they were ready and for most couples this actually means they don't want anything until after
their wedding date so we started designing this concept for Zola based on these three differentiators we would put prototypes in front of users we would ask them to walk us through the designs and over the course of a few months we would wait and try not to sell them or lead them we would wait for the brides
to be to ask us uh the magic question which is in the product world it is when can I use this product and it's really hard because you really want to pitch them on how great your product is but we tried not to and we didn't hear that for a few months and it was only after we started to hear Brides who were getting
married the following year say to us will this be ready in time for my own wedding can I use this anytime soon or can you email me when I can sign up that's when we knew we had a winning product and that's when we committed to doing it 100% wow that's exciting that's like the full-on process before taking the jump
is a good way to do it so you know we we we see a lot of wedding startups supplying to us um there's lots out there the we're in an age where retailers generally are struggling so what do you think it is about Zola that's made it so successful so when we were thinking about Zola as an idea we thought that um we could
produce a product that was different and that users really loved but just as important to that was it was important to me that we have a business model that works and I think that has been our biggest competitive advantage and that's the reason why we've been able to survive and thrive where most other wedding startups have have closed in the
years that we've been around and this was really based from my experience at guilt so I worked at guilt during the first four years of the business in product and saw a lot about what worked really well to drive that huge growth from zero Dollar in Revenue to over $600 million in Revenue in four years and I
also saw what ultimately did not work which led to the decline and meant that it could never really be a profitable sustainable company and we've we looked at what are those problems at guilt which are typical e-commerce problems and how can we solve them at solola so for example the way the things we learned were one in e-commerce
returns are the silent killer you hear laughs from from anyone who's worked in an e-commerce business you don't quite realize it when you're first starting until you're halfway into the business you're like oh these returns are brutal to the business model and the way that we were able to address that at Zola is
through this feature where we don't actually send anything until people tell us they actually want to receive it and through the registry people can do virtual returns so they exchange things through our app or through our site before they ever get it shipped out to them and that has meant we have virtually no
returns one of the other killers in e-commerce is inventory and we were able to address that by building our backend technology that enables us to drop ship products from our partner warehouses directly to our couples and by not taking in product into our warehouse and then shipping it out you know again that meant that we
were able to be much more Capital efficient and just ultimately a bet more sustainable business than the normal e-commerce business uh and then the last thing I'll say around e-commerce businesses is that they're very hard to forecast and predict and and to drive people down that checkout conversion funnel at guilt actually one of the
things that worked really well to drive demand and drive people to check out was that we saw when you're selling designer brands that people love at 80% off for 24 hours only in limited inventory that really drives demand um but the flip side of that is it's very hard to predict and forecast so at Zola we were
thinking about how do we still drive demand intent but have a more forecastable business and when it's more forecastable it's more manageable and the way the reason actually why we were excited about the wedding registry uh business and the model we were adopting is that for the most part when people get married you kind of set up you have
to pick a wedding registry and when you go to a wedding you kind of have to buy off the registry that is part of um already demand that is going to happen by a certain deadline which is your wedding date and so that demand in was built in to the idea of a wedding registry and that was something that was
one of the reasons we wanted to do this the other thing that was important to us was because people sign up for a wedding registry 7 months before their wedding date and they start adding things to their registry we can very clearly predict and forecast what we're going to sell 7 months to one year in advance and
then we can manage our business to make sure we have those items in stock available for couples when they want to ship them and in doing so have a better user experience but also a better business model and I think that solving the the user experience and the business model together is what has allowed us to to to be successful in the wedding
space amazing so I'm going to take you back in time back to the very early days of the company um and I love asking this question because practically every founder I speak to has some kind of crazy story around this um so asking you about your first seed Round And how that came about and what are your crazy stories on
there oh I have some crazy stories so I I speak to a lot of Founders and have really learned every seed round is unique and ours is no different um so RC round was a bit different because because I had worked at guilt group for 4 years before Zola and had worked very closely with the founder of guilt his name is Kevin Ryan um and he
is a Serial entrepreneur in New York he founded guilt Business Insider and co-founded and he was excited to work with myself and my co-founder noou again so when we talked about starting this wedding company he said I would love to work with you I will give you the seed funding and we can just get started
and while you you know many people are like that sounds like a really good seed round situation I will have to agree and say it was great but it wasn't as easy as it sounds because because it wasn't like it was just handed on a silver platter the reason I had that opportunity to have that offer was because I had worked with Kevin for four
long years four very intense startup years and had essentially slugged my guts out for him for four long years and that was the reason I got that seed offer so while many people are like oh you didn't even you know you didn't really raise a seed round I'm like I was Raising it for 4 years um so that that was a se bround
but the funny story is when I was negotiating the seed seed round with Kevin I was actually in Ireland because I I had to go and get my Visa cuz I'm from Australia and so I was in Ireland I was on a hike and for those of you who are Game of Thrones fans I it's like I was like essentially at Winterfell
hiking it was pouring with rain there was no cover anywhere and I was on the phone like trying to negotiate terms with him and we got there but it was yeah it was interesting and what was it like working with him as as an investor and somebody that you were working with it's fantastic and he because I've worked with him now for close to 10
years he has been essentially like a coach and a mentor and you know in many ways a very active investor and and co-founder in the business and so it's great to have someone who has operated at this point in New York for decades who has seen many many businesses who can give me a reality check um and do so
from the operator entrepreneur perspective which is very different from the VC investor perspective yeah yeah okay so so now coming back up to present day where you've gone from from negotiating seed rounds in the rain to raising $140 million um how how has the pitch changed how is it how has it changed how you
talk to investors um what mistakes have you made along the way any advice for these ladies yes I wish someone had told me in the early rounds what I'm about to share here which is you know in in some of the later rounds when I would pitch in partner meetings which were inevitably at that time all dudes and maybe one
woman in the room like 20 dudes one woman I would always ask you know do you see differences between the way I pitch and the way male Founders pitch and every time I hear a very consistent response which is guys come into the pitch they bang their fists on the table and they swear that this is going to be a billion dooll business they have no
doubt that it's going to be a billion dollar business which is funny cuz every single guy has no doubt it's going to be a billion dollar business and women just don't really do that they and and certainly I didn't so my pitch you know I have had investors tell me you're just more modest and more factual and not
really as aggressive as a lot of the male Founders pitching and and so I've been thinking about this a lot over the years and what I've tried to do is really verbalize externally during the pitch the conviction that I feel internally but in the early rounds never had enough confidence or enough um guts
I would say to really be banging my fists on the table because the thought in my mind at that point was always you know there's a small chance it may not be a Million Dollar business so I don't know if I want to say this there's no doubt this is good but it turns out that actually I feel very strongly about it
so I should just say that um and the funny anecdote here is more recently I had a guy pitching to me that he was building a trillion dollar business all right wait are we there now I guess so but I have to upgrade my pitch so you've mentioned you co-founder a couple of times um how did you you know how does the relationship work
between the two of you how has that changed over time what how do you complement each other yeah noou who is my co-founder is the best and we love working together be and part of it is we have worked together for many years before starting Zola and the reason we wanted to start Zola together was because we knew from
our past work we were able to create great award-winning products together and there was something so rewarding and fulfilling about that that we wanted to do that again and so he is I think the best design thinker in the world he is our chief design officer and leads product and user experience design and and in the early days when it
was just me and him he would focus on product and design and creative and I would focus on everything else um over the years he has contined to really manage our design vision and product roll out and and I've tried to replace myself more and more in each function that I was initially responsible for but
having someone that you trust fully who knows you really well who knows um that your weaknesses and strengths has made all the difference in the world amazing okay so we just have a couple more minutes so to wrap up what's the the one biggest piece of advice that you wish you'd known when you started that you can share with the audience
today my advice to Founders is always um a piece of advice that I got when I was first starting Zola and have I think it was the most valuable piece of advice which is before you really decide to commit to an idea for your startup to to think about how you are going to spend at least the next 10 years of your life
focused on this one thing and that's if everything goes well but you are going to be living breathing working pretty much 24/7 on this one thing and your most valuable asset is your time so is this the best way that you want to be investing your time for the next decade cuz if it's not the best investment of
your time maybe you should think about another idea another team something else but to really have a commitment to yourself before you bring anyone else on your journey and once you're able to think about that and commit to yourself that this is the only thing you want to be doing then you're ready to go all right shanin thank you
very much this has been excellent all right hello everyone my name is Adora I one of the partners at y commor I have raham from App Deco Alana from bulletin and Tiffany from the human utility today today we're going to talk about our discussion will be around essential startup advice um so I think there's a lot of actually good advice in
books articles and even on Twitter sometimes um but they tend to be I think very generic and Abstract uh an attempt to try to to make it apply to everybody as much as possible so today I want to go over some of that common advice you probably see and dive deep one level deeper into how it applies to um these
three folks and their startups uh and go from there so the most common advice I hear all the time and I give all the time is make something people want it's so common that's almost the motto of combinator um so maybe you guys can start off with introducing yourselves and what's the oneliner for what you're
building and how did you know or why did you think it was something people wanted um hi everyone I'm rahan feri co-founder and CEO of AB Deco uh we are a Marketplace for buying and selling furniture based here in New York city so if you're selling furniture definitely check out AB Deco uh have to plug all
the time um so the reason why I started ABD I was actually out of my own frustration trying to sell furniture on Craigslist had a really bad experience uh realized that there are something has to be done to make it better and more efficient so we are One-Stop solution we take care of the pickup and delivery we
handle payments online we verify everything before pickup and that was the reason why we started it is because out of my own frustration great hi guys I'm Alana Branson co-founder and CEO of bulletin uh bulletin is we work for retail space so we build uh physical retail stores where direct consumer Brands can sell their products uh for a
monthly membership fee uh so we have two stores here in New York uh the stores are actually filled with all female lead Brands so um yeah it's completely for women by women um and yeah when we started the business we actually did not build something that people wanted at all like it was a disaster um we started
off with uh it was basically like an Etsy competitor it was like a cool curated Etsy was the idea um we like literally didn't sell anything it didn't work um and then we started talking to those users and basically asked them okay like what can we do that is helpful cuz this clearly is not and figured out that they wanted access to retail space
and how hard it was for them to get into Stores um so yeah we eventually built something people wanted it just took a while hey everybody I'm Tiffany Ashley Bell I am the founder and executive director of a not for-profit organization called the human utility where we essentially pay water bills for people that can't afford their own own
um we've done that for like a thousand families in Detroit and Baltimore and a bunch of surrounding cities since oh thank you thank you um it's not really we either it's all you guys have donated um but you know we've done that for a thousand families uh since we started in July 2014 and it was more of make
something people need um because we essentially crowdfund the money to help people um and I just read one day I'm not from Detroit or anything like that I just read about what was happening in Detroit cuz I was actually working in City Hall in Atlanta and I was just thinking to myself like what kinds of failures had to happen in City Hall
where somebody just decided that if you're poor we'll turn your water off and I thought that was pretty crappy so um friends and I got together and just decided to like you know we'll we'll throw away a 100 bucks in a in a weekend on some shirt we don't need in a bad restaurant so why not give that to you
know people to help with their water bills but it turned into like the whole internet wanting to do that so I've been doing that ever since so awesome um okay so another piece of advice is do things that don't scale so give us one example of something that you did that wasn't really scaling but you have to do it
anyway um and maybe it's related to how you got your first user I have a lot um but um so when we first started um I don't know how many people are doing marketplaces but the big problem with marketplaces this they call it the chicken and egg problem is you need to get you know content and also buyers and so how do we convince
people to actually transact in our on a platform so um how do I get furniture in the platform when nobody will trust that I actually am a real legitimate business was the question that we were trying to tackle so um we were going on Craigslist um the reason why I actually built a platform is because of Craigslist but we
were going on Craigslist just telling people hey you should try AB Deco you know we are going to take care of delivery etc etc etc um some people you know were convinced enough to list but um the part that actually came came out of one of my partner meetings at YT was instead of having people you email them
and have them go list on your website why don't you just list it for them and so that was like oh wow is that even kosher I mean I don't think it is but um so we just started just going on Craigslist and literally just copying content from Craigslist to our site and then there's a whole other story of like
once something's sold how did we get it to the customer that's a whole different story um yeah for us we basically when we were pivoting from this like Etsy competitor idea to the the retail space idea um we really didn't have any money I think we had 20K that we had gotten from YC Fellowship um and we're like okay how are we going to test like a
retail space concept uh and so my co-founder and I it was just the two of us at the time started doing these like outdoor weekend flea markets as a way to test the concept um so we literally rented out this like overgrown vacant parking lot in Williamsburg it was like a toxic Wasteland and we had all these
Brands come we'd have like 40 Brands come every weekend and they would come and like set up their product and sell and like it actually went really well where like they were making a lot of money we were making money finally um and we use that to basically prove that like okay Brands will show up and pay for space and like there's definitely
better ways to do this um and yeah it was completely unscalable but it did like prove our point which is good so um we have kind of a two-sided thing where we have donors and then the people that actually need the help um and so if you follow me on Twitter I'm sorry but that's like the uh the the way that we
got the initial donors but um we had all this money that kind of piled up as far as uh pledges go and um since we done everything on social media we didn't know how to access or like get to the people that needed the actual money um but what ended up happening just like we got really low Tech and we just like
designed some postcards and sent them to people um and so like if you the USPS has like a way where you can just like Target certain blocks and just kind of like uh say you want to send you know 500 postcards to this street and it's like kind of Jerry manner the way it looks like um but like we ended up just kind of doing that and just kind of
going from our database and just saying we have a lot of people from Detroit in this ZIP code that are applying so why not just Target that entire zip code and we just started doing that kind of thing so these people were not on social media so we couldn't just keep tweeting for them um and actually maybe I'll talk
about it later but the city wasn't helping us either cuz they were kind of like who the hell are you so they were just you know we didn't get help in that way so we kind of had to like just hack it in that way and it turned out to be a really interesting sort of thing to send out postcards so um so the next one is
find 10 to 100 customers that really love your product um so how did you determine that people are loving your product like how did you define that either qualitative or or quantitatively um so I'll continue along the same story um so for us once we started you know listing these products from Craigslist and trying to um we got
our first sale and we were like wow okay what are we going to do to actually fulfill the sale because these sellers don't even know that we've listed their product on our platform um so uh we were trying to figure out how to fulfill that order so you know the first time I tried i' email hi I'm the CF AB Deco you know
we sold your product on AB Deco and you know we're going to pay you and it just didn't work they nobody responded um so then we just realized like hey like why don't we just actually just pretend like we're a Craigslist Shopper go on their plat go and just email them like hey I'm going to buy it and we just paid them in
cash and that's what we did um the most amazing thing that happened out of that is because we were actually visiting every person's home we were talking to our customers and we realized once we told told them why we started the business because once we got to their home we would tell them hey this is by the way AB Decker this is what we do Etc
um they were like wow this is amazing they actually started telling all their friends so every time we went and we were doing something very unscalable 5 10 people signed up as a result of it so that was the Genesis of sort of getting from you know 10 to 100 customers referrals basically pretty much exactly
and yeah I feel like we have like a pretty similar experience where once we started getting referrals from we felt like okay like we're doing something good enough that people are recommending their friends um I think we got lucky cuz our our users they're in this tight-knit community of Brands and so they all would talk to each other and if
someone sold in our store for a few months and they were making good money like they're going to tell someone else in their Community um and yeah I think it was like when we opened the third store and we just were able to like book it out immediately and we like couldn't believe that people were paying like
pretty healthy rates to sell in the store um and yeah it was just like finally getting to a point where we were doing something right for the users yeah I mean so the first T again from donors versus people that were helping um so the donor side was again just social media and it turned into like the news finding out about us and
then people signing up from there and that became like me getting stuck in my apartment for like two weeks talking to press over and over again about what we're were doing because it was kind of weird if you think about it to pay somebody else's water bill so people were kind of fascinated with that aspect
um but then as far as the people we helped again is the postcards but then like you know Facebook groups and stuff like that so so let's talk a little bit about competitors so the common advice is just ignore it you're going your startup you know startups are going to die because of suicide not murder um so how do you
guys think about competitors uh it's definitely it's easier said than done to ignore them for sure but um you know I've learned through time now where this is our fifth year in businesses that is really the best advice is to try to ignore them and uh what I've learned over time is you know just focus on the things you can
control um and you can control make delighting your customers you can control making you know a product that people want and things of like things of that nature we've had competitors that have raised you know tons more money than we have to date even and they've shut down so it doesn't really matter at
the end it's all about the execution and just focus on the things that will make you um uh you know compete in the market yeah I think we try and ignore them as much as possible also um I definitely have like my Google alert set to see like if when they announce certain things and I think you know we'll look to see how they're
positioning their product in the market or when they're raising money um but yeah I think like the more you can just keep your blinders on and look at your metrics and look at your milestones and keep your team looking at that and not be like oh my God they just raised $23 million like what are we going to do um
it's just it's distracting and it doesn't really help you in any way yes so the not for-profit sector is a little different um because there there's still totally competition like it's not just this like oh everybody's like trying to help the world or whatever because it's actually surprisingly cut throw which I learned
kind of on the job um maybe if you pull me afterwards I'll tell you about certain Mafia S phone calls I got from other organizations I'm not I'm not even kidding but like um just for us it's been like learning how to like communicate the work they we're doing really well um and also just kind of pulling at people's heartstrings and
like learning how to do the storytelling um and then also um you mentioned you buted heads with the cities a little bit can you so what's that you you but it heads with the cities a little bit or they weren't helpful at all no so I think when we launched we embarrassed Detroit which wasn't the which wasn't the goal we just
helped people when they didn't um and so they they didn't I mean it's true it's true so they they told people not to come to us for help because they're like well you know if you need help come to us but they weren't helping people um they were turning off cancer patients for crying out loud and this is the kind
of stuff that was going on um but we got a call from a certain very big nonprofit it's a National Organization and they saw us as competition which was funny because I was still like operating this out of my bedroom basically as a fundraising thing but it's just the principle that you know we got more press people were this what we were
doing was resonating with people more and we could show actual like success stories and we weren't like building six houses with hundreds of millions of dollars um and that kind of thing so I think that's the nonprofit sector has competition still but I think if you like show that you operate better you're
actually using the money for what you say you are and you're like putting those success stories out and then you're talking about like the systemic change that you're trying to actually uh kick off that actually resonates with people um because that's the question I get all the time too like how are you going to do this like what's the
long-term sort of plan and for us it's actually not to keep raising money but it's actually to like have laws passed around water affordability and just kind of use like a lot of startup esque principles to to do that so cool um so it's often said that you shouldn't uh start scaling as in hiring lots of people until you find product Market fit
um so maybe can you we kind of went over we talked about referrals and stuff like that but maybe you can go over when did you know you should hire your first person who who was your first important hire and why did you hire that person product Market fit for us um was when we decided to take on delivery and
make it inhouse um so when we started the business we did not want to touch the furniture we just wanted to provide the platform a year and so into it um we were working with thirdparty moving companies we realized that it's just the quality of service was not up to par and they were just cancelling jobs on us
last minute so we some guys off of GES again and and rented as a van and that day you know we had incredible feedback from customers fast forward you know now we have over 10 trucks in the city and what we saw was as soon as we brought delivery in house um you know we talked about referral but really skyrocketed um
the type of referrals um the quality of service as well The Branding um also our metrics We Now understand our metrics very well um and that that was really the the basis for it I mean our first first hire was customer service because it was all about delighting customers and what I learned over time is you know
your needs as a business change over time so our first hire was customer service and that was at the time the most important hire um we fast forward it a couple of years later our head of operations and obviously our Engineers Etc yeah for us it took us about a year and a half before we got to product
Market fit like we pivoted so many times and just kept taking like the little things we'd learn and use it for like the next version of the company we'd run um um but yeah it literally wasn't a year and a half until we got to a point where we were opening retail stores they were working the brands were happy um
and then to answer your question about the hiring I think our first important hire is really what got us to like full product Market fit in my mind um there was basically a point where we were treating the stores as like the store stores as a service like any brand can come and sell their product and so we ended up with this like crazy store
where there was like Fitbit competitors next to blankets and it just didn't make sense SS obviously um and so we hired um our director of product Maggie brain she came from J crew who just totally transformed the business she's a merchandiser and so she was able to really pick the right Brands pick the right products and price point and I
mean the stores just took off after that but it was like that final key hire before we were like okay like we can scale this we're good yeah for us product Market fit is just like having people continue to support us basically so we've been trying to build a stronger curring giving program so that's still kind of
in the works actually because like I had never run a nonprofit before so I didn't know like what we should actually be doing and like what that looks like as far as success besides like changing laws so we're still doing that um but as far as like the first hire we had it was also customer service because like you
know we had all these people that were applying for help that like I couldn't talk to them all on my own um we talk about stuff that didn't scale I was turning into kind of like a social worker SL therapist by like talking to everybody who like seriously like who everybody who applied I talked to them on the phone for at least 30 minutes um
which was good in the beginning because like people were feeling heard for once because when you deal with a lot of people that are in poverty the thing that's common amongst all of them is they they get overlooked and ignored um and so we just kind of I just listen to people more but um Kate who used to
direct uh nonprofits at YC she kept telling me like you need to hire somebody because you're looking worse and worse the every time I see you and you can't like you know you can't do this on your own and then like whatnot so I actually um the spring of 2016 I'm an engineer by the way too so like I took like a month off from everything
else and just built out what became our case management system and then that allowed me to actually hire the customer service person because they would have had the no rails otherwise because all we had was the rails console um but that was our first customer I mean that was our first hire cool semi- related to
that is when when founders come into YC we we say please please remember to get some sleep and some exercise so how do you guys stay sane while running a startup yeah or do you still still trying to figure that one out um yeah so this year at least I'm trying to make it to the gym more and travel um it's still work in
progress but definitely it's very very important and what I learned over time is you know it's not about the number of hours it's more about how productive you are you can work 6 hours and be more productive than working 15 hours in a day so um I'm trying to still Implement that but it's yeah it's very very
important yeah I think for us I mean it's something where it es and flows like there's there's weeks where things are just completely insane and we're opening a new store and I just feel like very unhealthy and not okay um and I think the whole team gets that way sometimes um but yeah I mean I think when we do have like kind of a Down
moment like trying just to really take advantage of it and just you know not go into the office on the weekend um running has really helped me I know like a lot of people hate running I used to but for like just my mental state like running has done wonders for me um so yeah I know people hate it but maybe try
it I mean I so this is actually the end of my vacation this week um I was like literally I was on vacation this entire week um which never happens um but the three things that I've been doing more is like going to therapy um I work with an executive coach that helps me like stay organized and prioritize and things like that and then like something I
started in the last couple months is acupuncture um because it's helped with like energy issues and like actually getting me to sit down somewhere like during the business day so those are really quick things um I know we're over time but I I apologize but I want to add in one more question because I think it's so
important and that is um advice is founder relationships matter more than you think um so can you talk about your relationship with your co-founder and how do you guys say saying with each other and balance things um so for us I have a co-founder and uh so my background I'm an engineer and he um came from marketing and sales so um
early on we tried to create delation of roles and you know we butt heads still all the time but at the end of the day someone has to make the final decision because it's if it was always democracy and we both have to consensus we're just never going to um move forward move quickly so what we do is you know any
product related things I I essentially have the final say any marketing related things he has the final say for example we run Subway campaigns I really did not want to spend the money and he was like well we're going to do it and we did and actually worked out to be very well but you know I think this is the important
thing is creating that sort of making sure that you have a structure where you're able to make decisions fast and quickly and conflict is okay but you have to figure out a healthy way to manage it as well yeah um yeah I feel like I just got so lucky with my co-founder Ally like we have very complimentary and different like skill
sets and personalities like I'm more introverted I like to kind of manage things from behind the scenes she is like the total opposite she's like highly extroverted amazing salesperson amazing press person um and so we work really well together and I think even from the very beginning when it was just
the two of us like working my apartment um we just could kind of like stay in our own Lanes like I just knew what I was good at and what she was good at um and yeah we just we worked really well together uh and so yeah I think when you're looking for your co-founder even if it's not like she's the technical one I'm the non-technical one like I don't
think it needs to be like that but looking at like different personality types and even soft skill sets it really helps to have a little bit of a mix there I think so my original co-founder couldn't go through YC with me but she's like a very dedicated donor an adviser of the organization but the next person I think
of that has been around just as long technically is my uh the customer service person I hired Marie um she's I I'm the fundraiser and the person that like does all the technical stuff but she does the customer service which again I burnt out on but other thing that she's really good with is people like I I still labor under the belief
that this is ridiculous I have to do this as an organization but she is just kind of like you know okay I'll call the city people and talk to them for you because I'm on the phone like why the hell can't you do this or whatever and she's patient enough to be like you know um I will talk to them I will make this
work for us or whatnot and she's way better at that stuff than I am because I'm just like to me Common Sense this shouldn't have to be a thing but she's able to talk to people and kind of finesse them and whatnot so I really like appreciate that aspect of the work that she does cool awesome well that's
it um if you can give this three a round of applause thank you so much hello I'm Carolyn Ley I'm a partner at Y combinator and I'm very happy to introduce our next speaker Maria nurislamova her company is called sent bird I have one of her products in my purse please join me in welcoming Maria really bright and sunny today I can't
see the slides but I guess that's okay hi everyone my name is Maria for the past four and a half years I've been building a company called Sunbird Sunbird is a fragrance subscription service and we help people date fragrances before marrying them um I'm really happy to be here today because Sunbird is you know it's
probably one of the hardest things that I had to do in my life but it's also one of the most rewarding and the YC Community has been instrumental in helping me get to this point so it's really I'm really happy to be here today um now I would like to take you I guess behind the scenes of how we build the company and some of the early mistakes
we've made and God knows there were plenty so chapter one of our story it's called the year of misery I kid you not that's how I refer to that time um it was the year where I think we read every book Under the Sun about building an MVP yet we didn't talk to a single customer um I'm a huge fragrance junkie so let me
set the story straight uh the company was built out of my passion for the category right I love fragrances I hate shopping for them you know when you walk into a store like a thousand fragrances in the air the lady is spritzing something in your face the pushy sales assistant I hated that the coffee beans
don't work long story short is I had a dream and that dream was what if I could discover my next fragrance from the comfort of of my couch the one thing that was missing was a really good fragrance recommender or scent recommendation system so Michel Founders and I set out to build one uh took us about so the first landing page was very
quick um and I was the original person who recommended fragrances I doubt I was really good at that then we brought technology on board and I think we built like six different ways for you to discover fragrances online this one feature we call it smart search but basically you can say okay like I want a
fragrance for a workout that smells like oranges and we basically got your back the problem was we all decided as Founders to quit our jobs and this was the business model oh wait a second you cannot really monetize a recommender can you because people are not going to pay you I think it took us about six months
to realize again really monetize a recommendation platform and then we had to figure out what is it that we can build that can actually charge people money for and so the first idea was well why don't we build a discovery kit Sun Discovery kit so it was basically it looked like this if you can see basically six small little samples
people would pay us $9 for that and the idea was that if they liked a scent they would purchase a full-size bottle from us long story short they purchased the kit they never really purchased the bottle so all we made was $9 off of like a hundred people um not really a billion dollar business um so we went back to
the drawing board and mind you this is we still haven't talked to one single customer about what is it that they really truly wanted so we're still living in our heads so oh and this was a fun time for me because we're operating on a Sho sing budget I basically don't have a job my uh savings are dwindling
down so I found this really fun hack you know when you go to Sephora they give you three samples for free you know when you go twice at six samples you can sell them for $9 it's it it's an amazing business model or not um so I feel like I literally went to all 12 Sephoras in Manhattan a few times a day I asked my
friends to do that not fun they knew like I felt like sales Clarks literally recognize my face like what is she drinking the fragrances I don't know um next long story short we moved on to the new business model so we're like okay well maybe the problem with our first business model is that it takes an additional step for people to buy the
fullsize bottle so why don't we ship them the fullsize bottles right away so we came up with this try before you buy a model for fragrances three full-size bottles of fragrances and little samples attached to them we would just ship to people for free obviously we would recommend them the sense based on all our algorithm and data and they had 5
days to try the fragrances and ship the full bottles back if they didn't want any of them so that was a really fun experience because we saw a 30% fraud rate on those on that business model so would ship a box and more often than not it would not come back and we would then not be able to charge somebody's card so
at the time we were able to get into an accelerator program out here in New York called erra and they give us $40,000 so basically that's all the money that we had to play with and I think we wasted about 20,000 which is half um on trying to make this work and got very much in the red got very upset um I think I mean
saying that this was Blood Sweat and Tears is really not saying much so I think we came to a point where um let me skip that um we came to a point where I think we really wanted to give up and that's where we come to chapter two the glimmer of hope so you know when the going gets really hard you call this one
person who you hope is going to support you so for me that person was Michael cyel Michael is currently now the CEO of um the accelerator program at YC at the time he was just a successful entrepreneur sold his company to Autodesk so I tried to I wanted to call Michael to cry on his shoulder basically I was like Michael you know fragrances
really suck I don't think we can make them work I think we're going to build a makeup company and he goes like wait what Maria you spend the last year failing at fragrances you're telling me that you're going to go and build a makeup startup and spend another year failing at makeup because like makes no
sense no no if I were to put my money into someone and or back a team that I think has the best potential to make fragrances work it would be Sunbird something shifted for me um and I think sometimes we only need that one mentor to kind of like hold our hand through something when when the going gets really tough um Michael also shifted my
thinking a little bit because he said Maria what if people are not looking for a signature fragrance what if they would like to change fragrances like they change clothing I was like huh interesting idea I hung up the phone two hours later we had the winning business model and it was a fragrance rental
basically so we said okay full bottles are not really working for us we keep just losing money every time we try to sell full fragrance bottles of fragrance of perfume so we decided that we are going to rent quote unquote or ship people a 30-day supply of a design a fragrance of their choice for under
$15 so basically instead of committing to one full bottle you can kind of get it in increments and build your collection and we decided to make it a subscription so we basically turned off all the fancy features on our site it was a one-pager really ugly looking with this ugly picture that's why I have it up on the slide um and basically it
worked like magic people paid us money first you know we sh them product later amazing we got well you can't really I see picture but we got 105 orders in the span of a week and for us that was like I've never felt this successful in my life we're finally making it oh my God now we had our 9 to-5 as like startup
Founders um if you can tell from the picture that's me on the left to of my co-founders after hours we would Spritz perfumes like literally trying to get them from a big bottle into a little guy until 2 a.m. every day that's how we fulfill our first orders these are the little guys all packed up and ready to go all 105 of them I counted I took them
to the post office myself um and then we get to the real fun part the darkest hour and that's chapter three The Darkest Hour is Just Before Dawn as our business was scaling well scaling 100 customers is not really scaling it's really early on um and you know I we went through um an experience of pitching a demo day at the first
accelerator here in New York nobody really wanted to give us money and I was looking at our bank account I think out of the 40,000 that the first accelerator gave us we had about 5,000 and e-commerce is a business that requires a lot of working capital it requires a lot of cash so I realized I would have to
raise and um for the longest time it was like the biggest disconnect because we were looking at this and this is the the rendition of like our first version of a sber dashboard you can hardly tell but there are like literally three kpis on here and the most important one is how many orders a day we're getting so we're
getting 10 orders a day for me it's huge it's like I'm making it but the rest of the world does not really catch up you know caught up to that they're looking at my product they're like it's kind of ugly would anybody want this you know and a lot of investors are like you know what my wife doesn't use fragrance I
don't think you'll ever be successful I'm like okay so I I go ahead and I pitch people I I pitched I it didn't count maybe 40 people everybody told me no but the nose are not the like nose never really upset me what upset me were the crappy yeses and I'll tell you what those are so I was bitching this one
investor couple um there were angels and um I told them hey I'm raising 2 $50,000 to get this company off the ground look it's killing it clearly 500 orders um yeah and um and there and and they basically took me for a spin it was like eight meetings send us this due diligence send us that like built a financial model for us so I was
legitimately thinking they were going to give me $250,000 after all of this work and then we get to the close quote unquote to that last meeting when I ask them for the check and they're like okay Maria we're going to give you $25,000 and they promised me a valuation that was three times lower than the lowest that I could accept at the time
and they said that they would also want 5% advisory shares in my company because they didn't think I was qualified to run this business um I walked out of that meeting and walked into another meeting um and it was probably even worse although I don't know it depends uh but it was a real estate investor and he
said Maria sber is awesome I love your idea how about you give me 10% of your company for free office space for a year for you on your three co-founders I worked out of that meeting I told both of them no obviously although at the time I was pretty close to actually saying yes to some of those deals and then I went back to the only person who
I thought would listen um his name is John he's an angel investor he does invest in ecomerce but for me he was a mentor and I was always afraid to ask him for money I would always ask him for advice I'm like John how do you do this how do you do that and um I that was also the time when we applied for YC by
the way it was the second time that we applied for YC the first time got rejected um it was fine it was the wrong business model anyway I would have rejected myself many times over um and basically um I came to John and I said John sendor is Raising 100K I want you to put all of it and I'm going to give
you a good deal and the reason you should do it is a we're growing like crazy B I'm going to get into why combinator in 3 weeks and our evaluation is going to Triple so now is the perfect timing for you to invest so John wrote us a check for $100,000 and then that brings me to our next chapter why combinator well we applied to Y
combinator for the second time and we didn't get in so I had to call John back and say John so no the company's valuation is not 3x but by the way we have another 500 customers so you should be really happy because we're basically a rocket ship um and then I had to go back to the drawing board and start and
keep raising my basically because we needed more working capital to build inventory and um one thing though I think I discovered with that experience with John is the rule of scarcity because all I said was hey I have 100K and I want you to fill that whole 100K there's no room for anybody left in that round so what I I ended up doing
afterwards is every investor pitch that I had I I would come in and say hey so send Birds round is 150,000 I already have 100 in my bank so all I have left in the round is 50K do you want to be the last 50k in so I pitched six people in like funds and I think I got five yeses out of that so that kind of really
gets you over that like 150 real quick and so I think that the big lesson learned there is you know if you're going for like a million say you're really going for one quarter of that and then just keep over subscribing eventually you'll get to that million um but um you know again A A lot of my mentors um a lot of my friends are
you know why combinator alums and although the business was growing I still didn't feel that the DNA of the company was there and we truly had the product Market fit on some level um and so a lot of my friends were like Maria are you applying to YC and I'm like what a third time to get rejected a third time I did apply to YC long story short
we got in h invited me to speak here because you know if I didn't get in for a third time probably wouldn't make it to the stage but basically was the best experience of our life we moved out to California and I really think it changed the DNA of our company so hyperfocus Fus on growth not like yearly growth and
quarterly growth week over week over week over week and when you get go through that experience you always feel like in your badge every company's growing faster than you and everybody's smarter than you but by the way you walk out with like the best peers and the best friends out of this and um the one
thing that YC also taught us is to have true user interviews to really try to understand what people think then this one funny one that stuck with me it was probably one of the first ones um somewhere in the Palo ala area we met with this lady in a coffee shop she wasn't a user of of the product and we're like hey we wanted to meet with
you see what you think about our product she goes like are you dying is Seer going out of business is that why you're talking to me oh I bet you're D don't die please don't die I'm going to buy 10 subscriptions I'm like what she clearly cared and that was like probably the most that was probably the first time
when I truly realized we might just make it because when people are willing to like just pay you 10x just like don't die please it's you know you kind of know that you're building something that people want um and now CH five life after YC you know for most companies that kind of like end up making it the
bigger chunk of their life would be post YC not prior um I kind of wanted to leave you with a couple of last thoughts um some of the things that you know I wish I knew um or I just need to remind myself so the first one is surround yourself with 10x people and what I mean by 10x it's not like 10 times more
people so there is this basically you know concept like in more traditional Industries somebody who is really top of their game is just about maybe two times better than your average person in startups because it's like really out out of the box thinking really creative top people L de laem like the smartest people are 10 times better than your
average person and I wish I knew that when I started hiring my team because I would always go for the cheapest person like you know oh you're cheap and you're kind of hardworking welcome to sunburn you know and I was like well I could have hired probably three times less people just hired the 10x people and
would have probably gone further ahead um so that's the one two it's actually uh has been said before here today have an audacious dream and not just have an audacious dream communicate it kind of like come out tell the world that it is your dream because when you do you're helpable right so and you know the world
actually can get on board with you I think as women we do tend to be very shy and that sentiment has been shared here today you know pronouncing billion billion word is really hard but I think we have to I mean I've heard pitches from when we're like we're going to be 50% of this industry like in three years
and I'm like yeah you really won't but you know as women we kind of prefer to get there first and then say that we really wanted to hit that Target I think we have to start reversing our thinking and first kind of like setting that audacious goal communicating it to the team to the partners to everyone and then hitting it then last but not least
which is also a big lesson learned for me don't take advice from people that don't have what you want um I don't know how many of you are building your companies um I certainly when I got started I felt everybody wanted to give me advice from you know my mom and I do welcome her advice to everybody else you know um friends and
family and um everybody and um one of the um conversations really stuck with me so it was my successful friend she has built a business like a hedge fund very rich and so I told her hey you know I I kind of want to build this Tech startup in the fragrance world and she goes like have you ever worked for a
fragrance company do you even know what like you know I'm like no I have not worked for a fragrance company but I think I might just make it um and basically um she was um she was very discouraging and I'm really happy I didn't listen because in that moment I was this close to going like you know maybe I should apply to L'Oreal and like
spend my next 10 years working for like $60,000 a year or something and being really miserable at my desk I'm really happy I didn't so in other words only take advice from people who have have um who have what you want in life um just you know to like um wrap this up um sber has come a really long way um we're now
a team of about a 100 people we're shipping fragrances to about 250,000 people in the United States we are eventually going to expand International we've raised about 25 million people but $25 million not people luckily um yeah and I think that a lot of a lot of what we accomplished is definitely thanks to YC so if you
guys are running companies and you haven't applied yet I strongly encourage you to do so it'll change your life thank you so much for your [Applause] attention hi everyone I'm Stephanie um we're about to start a short break and I have a few short announcements before we do um I helped run admissions at YC so
Maria thanks for that plug about accepting applications we are accepting applications for winter 2019 I'll tell you more about that in a bit um first announcement if you know of any Engineers looking to work at a startup we recently launched something called work atast startup.com uh where they can browse
hundreds of jobs at YC companies we're also throwing a live hiring event on July 28th so you can check the site out for more information on that um also please submit question for the YC partner Q&A that's right there at slido.com FFC uh finally like I mentioned before we're accepting applications for the winter 2019 program the deadline for
that is October 2nd so you have a while and the program runs from January to March of next year you can go to apply. ycombinator dcom for more information and to submit an application um if you have any questions about about applying you can find me at the break uh we'll have 20 minutes I'll
just kind of be walking around or you can email me Stephy combinator e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e [Applause] hello everyone we're going to get started again please take your seats thank [Applause] you all right everyone we're going to get started again the talks all
right all right so I'm just here to introduce the next speaker um Rush machete of gko bioworks who y combinator funded in the summer of 2014 and I am delighted to also describe rashma as her company is the first female founded YC company to be a unicorn which is just amazing so here you go thank you all right thank you Jessica I don't know
what I um thank you all for uh being here today it's a real honor to uh be around uh such an amazing group of women um I'd like to thank Sharon and Cat for inviting me to come talk to you all it's a real honor um as uh Jessica said I'm a co-founder of a company called GCO bioworks uh for those of you who have
never heard of us uh we're based in Boston um we're about 200 people um located in the seport district there and basically we design organisms to spec um and you're probably wondering what the hell does that mean um basically uh uh the best way to sort of introduce what we do is if you take a look at this picture and you can
see there's a lot of Technology on this desk and does anybody know what the most advanced piece of technology on this desk is you're right it's the plant right so this uh believe it or not is the most amazing piece of technology that uh that any engineer can think about right this plant can for self self-replicate
self-repair it can self assemble and it can do all these things at subnanometer Precision right these are all engineering traits that any other engineering discipline can only dream about but that biology does routinely every day right and this is why I fell in love with biological engineering and why I started genko is because I wanted
to be able to harness this power of biology to do great things the other fascinating thing about biology is that it is at its core digital right you can program biology so every organism whether it's you or the plant or a bug um that lives on the floor is made up of A's Keys G's and C's and the sequence of those A's T's G's
and C's basically dictates the behavior of that organism right it dictates what it's capable of so if we can learn how to program that DNA if we can learn the right A's ke's G's and C's um to synthesize to write then we can program biology to do what we want and so that's what we do every day at genko is try to
figure out how to program biology how to design biology so this was an article that came out a couple years ago now in Wired Magazine for all the Apple Fanatics at gko this was the most exciting thing ever comparing our organism designers at gko to Johnny I right and this is what we think about is how to design biology
how to make that process better how to get um smarter about it how to make it more efficient so uh you might be asking well why am I here today am I G to teach you all about biological engineering um well when uh Kat and Sharon asked me to speak Sharon asked me to specifically talk about um a little bit about scaling
companies so I uh happened to be at the YC or the FFC conference um a couple years ago and there I talked a lot about how to start companies and sort of My Philosophy about what what it takes to really start um a a new company and so today I'll talk a little bit about scaling companies um so one of the things that I think
Jessica already alluded to is that two years ago I was at FFC and she issued a challenge to the group right she gave a talk about how to not fail as a startup and Jessica sort of posed a a challenge for all the women in the room she said I want to see a female founded unicorn come out of this room right um at the time there's Al
obviously been a lot of YC un orns but they actually all had exclusively male Founders um and so um as Jessica um sort of stole my thunder uh I'm really excited that in December um we became um another YC unicorn and yeah um so really excited if you had asked me 10 years ago when we started gko whether I would get to the spot
today I would have said hell no um but you know there you go um life takes you and ex unexpected places and as a biological engineer I'm just so excited about being able to put these resources towards the engineering of biology um what's even cooler about Geno becoming a unicorn is that we are a
unicorn that actually has some shot of making a unicorn someday so so maybe I'll come back in 10 years and talk to you about the Unicorn we've made um so how to scale a startup um so this is something that I think about every day at genko um my I'm the CEO there and so I think a lot about how to grow and scale the company effectively
how to execute effectively um and I as I thought about what I could talk to you all um uh today I wanted to really focus on some advice that has been pretty um prominent um in the news recently for startups but I think it's a little misleading actually um and that's the advice to not raise too much money right
so there' have been a lot of headlines recently about the dangers of raising too much money as a as a startup founder and um on one hand it makes me laugh right I think Founders should be so lucky to raise too much money for their startup right um um but if you actually dig in and look at what Sam and others are
saying um what they're really talking about is being smart about how you spend that money so I would actually advise raise lots of money that's good because as a founder if you're working on your life's Mission if a little more money can make the difference between success and failure then you know what extra
delution is probably worth it um but so raise that money just don't spend it all okay and so that's when I wanted to talk to you today is about the second part of how to raise a lot of money but not spend at all because that's actually surprisingly hard to do once you've raise money and that's what's leading to these headlines that are warning
Founders not to raise too much money so after you raise a lot of money um you can sort of have a holy cow moment right and you're like wow these people who are apparently smart just handed me several million dollars to go build my company and work on my life's Mission uh one are they crazy right or and two what am I
going to do now right um is sort of the typical reaction you have after closing around um and I think the other thing you then have is sort of an uh oh no like how am I going to pull this off right now I have all this money and so now how am I going to achieve all those goals I set out to to I promised I would um and I think um so you you'll go
through that right and you'll say okay and you'll get over it but sort of even more um possibly dangerously your team will go through that too right and so they'll see all this money any duct Tails brands from when they were a kid uh you know your team will say hey we've raised all this money now we can do all
this new stuff right and there's going to be a really big but unconscious pressure to go spend that money on stuff right um all of a sudden all of the frugality and scrappiness um and leanness that got you to where you are today there's going to be a unconscious pressure to sort of throw that out the window right and that's going to
manifest itself in a bunch of different ways right so have too much stuff to do hire more people right why not like we have money we can hire more people to go do all these things on our to-do list having a problem with a fellow team member well go to HR we should now be have a beefed up HR to go take care of those interpersonal conflicts right um
have some annoying tasks that you don't want to do anymore oh well we should hire some administrative support to take care of it for us right and the problem with each of these sentiments is that in some level they're all true right like you raise more money you should go hire some people to do new things right
that's why you were given the money in the first place and yeah like HR is important you should invest in that and they should be a resource for helping people solve um their their problems and yeah you should try to operate efficiently by Outsourcing tasks that are not important for you to do but if you take this too far right and if your
whole team takes this too far then that's what leads to sort of a bloat in your company both from your headcount size and in terms of your spend and that's the kiss of death for a startup no matter how much money you've raised right because you get too big you get too loaded you spend too much then all
of a sudden the bar for how much more you have to raise how much more you have Revenue you need to bring in to pay for your team gets that much higher right so if you can figure out a way to raise money but keep the discipline keep the scrappiness keep the frugality then that's really the winning combination when you're scaling a
startup so what does it take to make that happen well I would argue that you need a Scrooge McDuck uh in your organization right you need someone who keeps everybody focused on what are the key metrics for growing our business and how do we do that in the most efficient way possible efficient in terms of headcount
and efficient in terms of spending right and this is not an easy thing to do particularly right after you've raised a bunch of money right because there's going to be all sorts of pressure to try to go try to spend your way out of problems right but you've got to have the Scrooge in your organization who's
pushing back against that and pushing for efficiency p ing for scrappiness if you're a female founder and you're taking on this Scrooge mck role let me tell you it's going to be a little bit harder for you right and that's because female leaders like whether we like it or not are subject to certain stereotypes right like if you're
taking on the Scrooge rle you know you're definitely at personal risk for be considered the battle ax right the tough person who's saying no to everything right and who's an unsympathetic uncaring leader right and that's just a certain reality I wish that stereotype didn't exist but you know it does and so you got to weigh
that sort of personal risk to your own reputation and to yourself against the risk to your organization of not having somebody who's putting pressure on the organization to be lean to be efficient to retain that scrappiness right and so that's a decision you have to make but ultimately I think your your startup
success is going to hinge on whether or not you have this pressure being applied right right because the more efficient you can be um the longer your Runway is the more optionality you're going to have as you go forward with your startup so your goal is really to try to scale your startup scale your revenues
scale your customer base whatever metric by which you measure Commercial Success grow it without growing your headcount and your spend too much right and only you can really Define like what too much is but in general that's what you're trying to do you're trying to De to decouple your growth in your commercial success from your growth in your spend
and your headcount okay if you can crack this nut this is a huge competitive Advantage no matter how much you raise um no matter what this is can be huge for your team and the reason for that is that all sorts of problems scale with the number of people you have in your organization right so recruiting becomes harder right you have more
people it's harder to recruit top talent people when you have to hire twice as many people as you might otherwise have to similarly you know interpersonal problems well they scale with and squared so if you have end people in your in your organization you have nend squared possibilities for conflict right
um uh and so a million different things get harder and harder as your organization grows and so if you can again grow your business by whatever metrics are important Revenue customers eyeballs whatever number of GMOs you can produce um then uh then you're just at a a huge huge Advantage relative to others
and you're building an inherently stronger longer term business so how do you scale um without actually scaling right um that's a fundamental Challenge and let me tell you it's not easy it's one that I've been working on for several years now and I I won't pretend that like I've totally cracked this nut um but it's a
worthy problem to work on as you're growing your company um the best thing I figured out so far um is based on um a conversation I had with Ali rogani A couple years ago now um Ali is um a YC partner um and he's in charge of the YC growth program and I went and sat down with Ali and I think this was probably just after we
raised or series C or something and you know I was like hey you know what what advice do you have for me like as we're trying to grow our company and whatnot and Alli told me about this concept of Mission to metrics and he actually later wrote up a blog post on this um so I'd encourage you to go read this if you
haven't already um but alli's basically said that as a leader of a company your job is to map out the mission to metrics for your organization right so what's your mission what what is your organization all about right this is your purpose for your organization you probably should already have this on the day you
start right so at Geno our mission is to make biology easier to engineer that was the first thing we figured out before we even had a name for the company we figured out our mission statement right your your strategy that's really your commercial strategy right how are you going to make money how are you going to get people to pay you for what you want
to do how are you going to be a sustainable company in order to deliver on your mission right and so that obviously takes a ton of thought right um and only you can figure out and honestly your commercial strategy might change several times over the course of um growing your company even as you're in in growth stage and that's okay
that's totally fine but you still need to have a a hypothesis about what your commercial strategy is and then finally based on what that strategy is you need to Define your metrics how are you going to quantitatively measure whether you're succeeding or failing at your strategy right this is hard right this is not a
trivial thing this is something that like even at gko we've we we continuously work on a refine over time right but if you can Define that mission to strategy to metrics and even more importantly if you can explain it to the entire team right make sure that everybody at your company understands
this then they can connect what they do every day to the metrics of the organization to the commercial strategy to the mission of the organization it's a hugely powerful aligning um uh Force for any startup and so I would argue I would add one thing to what Ali said right so yes how do you scale without scaling Define your
mission to metrics that's huge it's going to take a lot of work expect it to it might take months or years for you to figure out but try to figure it out and then I would say that also make sure that your metrics include one other thing which is that at least one of your metrics should be focused on efficiency
right so instead of a total output you know is it output per person is it you know dollars of Revenue per salesperson whatever your efficiency metric is make sure that's included as one of your metrics because if you're opt if you force your team to optimize on efficiency then you're forcing them to think about what goes in that
denominator right how many people does it take how many dollars does it take to achieve your goals and so I think this is a nice way to sort of encode a a value system around efficiency in your organization is by defining metrics around efficiency as part of your overall mission to metrics and then finally as I said
before you need the Scrooge who's going to be pushing that message across the organization day in and day out again it's not an easy job I know because I have it at Geno um but I think it's the one that's hugely important for the long-term health and success of your organization and so this is what we've been doing at genko over the past few
years you know we figured out our mission 10 years ago it's to make biology easier to engineer roughly speaking our strategy in a nutshell is to try to aggregate genetic engineering R&D at Kingo and our metric is thinking about just how much genetic engineering can we do per person at genko so driving
that efficiency as much as possible is in incredibly important to our strategy every day so with that um again I'd like to thank all of you for um being here today and thanks to Sharon and Cat for the invitation [Applause] thank you so much rashma um hi everybody my name is Holly Lou I am a visiting partner at YC and before I introduce the
next panel I just want to let you know that um if you want to submit or upvote any questions at slido.com FFC um you could do that so you get upb this is for the partner panel later we're going to have a AMA with all the Partners from YC so feel free to do that during this time so I'm really excited to tell you about this next panel our
it's really something that's unique that I don't think I've seen anywhere else but at YC we're going to be doing an onstage pitch panel so basically um I will be pretending I'm an investor and we will bring a Founder on stage why don't you come on up NAB this is naira molum Frontier 7 I want you give her a
round of an Applause this I don't know if you know what you've agreed to but so I don't know anything about our company outside of uh just her name and the name of the company so I'm going to pretend to be an investor we have Adora over there who is also a YC partner and we're going to spend the first half talking and then Adora is
going to come back and pretend she is naira and she's going to repitch the company all right so sit back and relax [Applause] hi hi uh I'm Holly nice to meet you we're going to pretend we're in a coffee shop you do that's usually that's what happens so tell me about what you do what does your company do uh so I'm the
founder of Frontier 7 and uh we have built a virtual data scientist platform that enable non-statisticians to be able to understand data and make data driven driven decision making without that ever having to have any background in statistics we do that through building a smart infrastructure and technology that
uses the automation of deep statistics including machine learning traditional statistics and natural language processing all right I have lots of questions because I'm an investor uh and usually investors are not so bright apologies to all investors in the room um so uh when you say virtual dashboard like how do I access that is it like on
the web is it on my phone yeah and who's using this are you selling it to a company or yeah so it's a virtual data scientist uh platform it's a software uh that you can log in on any so I think I've heard about this there's these things called virtual assistants but it's actually a real person that's actually doing the work so is it a real
data scientist on The back in Virtual virtual meaning like it's a real person doing the work or no it's a technology enabled uh platform and all what you do the way you engage in the technology is in two ways um it's either you uh collect data using the technology and then what happens on the back end we're
able to analyze up to 200,000 data um combination of data points in less than 10 seconds and then within a minute the user will have the results in their uh email so walk like if you can think of like your best like ideal customer like who would that be yeah like is it a company or is it a professor so we're B2B we've
launched we're live and our users currently head of insight teams uh I'm sorry head of insights insight okay so okay so they're looking at Insight analytics within a company um name me like the perfect B2B customer you would want would it be Salesforce Apple like who would you want like uh it would be
uh a cpg company multiple Brands where they need to figure out who their that you're like oh yeah uh unever uh P unever perfect um um our platform is being right now used in a lot in concept testing so it would also um in entertainment that where they have the need to understand who their consumers are and why they're doing what
they're doing got it so perfect so I'm a I'm the head of data science or insights at Uni lever um what is my question that I'm looking to answer that I would use Frontier 7 for uh you would want to know who your potential customers are uh that are currently maybe not purchasing or using your your product and you would
also want to know why they're using you andbody else and our theory around this we're living in an economy of Interest where everybody have so many options and so Brands need and companies need to know why their consumers are using them okay so you're mainly focus on why consumer like customer analytics so or is it something more
General is Data Insights at Proctor gamble are they looking for something else so in the early uh the when we first launched we wanted to experiment and we had users across many Industries and we decided to focus on the consumer space even though the technology can but are you answering the same question at
every single company like why are why do your customers use you uh because there's many products out there that predict churn um predict like revenue of some sorts is is are you focused on a problem in each the same problem in each company uh it's the who what and why yes okay so it might be different questions that you're asking
it might be different variables but then analytics I see and every company has a different V variable correct okay so it might be different questions I have different variables correct um and then you're much more like a bi dashboard that I have to um configure and do you does your team come in and configure it
for me and then I just username and password and that's it username and password and then you uh there's a twittering uh how to use the platform we do also on boarding and then uh it's clicks it's clicks and you get your answers I see and then um have you heard of this company called Tabo of course is
it similar to that no uh we are think of um think of our platform as D data ingestion where survey meets SPSS meets Mathematica meets Tableau uh meets interpretation and getting rid of the idea of having somebody with data science expertise whoa okay I'm totally blowed over I don't know maybe half of what you
said um so but like so in terms of uh oh I don't even know what to ask next um Can Can I can I tell you why it looks crazy and why we're doing what we're doing no because I'm still trying to figure out what what problem what what problem is being solved in the sense of is it uh cuz I I can't it's very hard for me to invest in something
that I don't really I can't I I don't really know so um can I answer that that question of the problem we're solving for yeah if you could give me a very specific customer like so uni lever had that problem give me another like proor gamble what kind of questions are they trying to answer and how how does your
product answer them so the problem is and the the issue that Unilever and many others are trying to answer is that there is massive segmentation in the market they collect the data those tools are not the ones that analyze the data and they're horrible in visualizing the data and then on top of it you need somebody who has background in
statistics to do it the problem is for the longest time that worked when data was manageable but we live in a different world now so does your tool do customer segmentation y automated click on so you do okay now I understand so in terms of the customer segmentation then um what types like um in terms of that
how how far long are you um how many companies have you sold towards so we um uh we built an MVP last year uh we had the paid Pilots this year we uh fully launched and uh right now we're up to um um 10 and hopefully 12 soon uh paying clients B2B and what's been like the largest Insight that you have on that that the customer that you've
delivered the customer because reality is a lot of these like customer segmentation tools marketing will want it um a lot of people might own it or it sits in bi of some sorts and people all use the data uh the Insight of the technology or the Insight I had uh the Insight that you're customers have brought like
something that you brought to your customer I I think one of the a moments for for some of our customers has been that they came in with so many assumptions about how to segment the data and how the data is behaving and it's often the case that your assumption Drive the analysis and the ability to to
to give the users a a tool that says segment it in a click in in seconds in how you want to segment it and let us run unsupervised is learning and tell you how the data is behaving um and then because then you take away the fear and the defensiveness and it has been I think opening to eye opening to uh many in terms of saying oh
like I wonder why I ended up in different segments now now I'm yeah that's I see all right well thank you very much I know it goes by fast thank you why don't you stay up here and we'll bring Adora up I wish I can record this I need can can I okay great you're the I'm sorry actually the investor left me I'm so sorry is the new
naira I'm sorry um why you go ahead and uh take a stand over there I think you can see us sorry hi I'm naira hi naira I'm you okay thanks for coming in today so why don't you tell me what you do so uh we buil software that does automated customer segment segmentation analysis and how do you want me to tell you how it works or
well I'd be super interested in like what some of your company like yeah tell me how it works okay so companies can send us all their data that they have and then the first thing we do is we clean it we organize it then we analyze it and then we output back insights about their customers and for for example what their highest for example
what their highest LTV customers and who should they target with their marketing budget or maybe even more specific like pet owners are their highest retaining users so they should be focusing their product more their next uh product features more for for them oh I see can you walk me through like a specific like
if you have a dream customer name what the dream customer is and then walk me through like the customer itself like I think you mentioned pets like was it with somebody like Petco or something like that um no it's like for example uh for example if you own a cleaning company and uh you know you're trying to
acquire a lot of these customers and then you look at all that data and um when if a company that uh looks at their data by themselves they're looking at usually the average customer um but you know we need to be more sophisticated we need to segment the customers out because each customer has different ltvs
has different cacs um and so you need to recognize that so for example I would put the data into Frontier 7 and then I would output that I would probably see that pet owners are higher retaining they're better customers and I should go find more of them oh I see and can you decide what attributes outside of
ltvs um and your CAC like can you do it based off of gender like it like how free is this stuff we can do thousands of segmentations oh do I get to choose or do you tell me we will tell you what to choose ooh so it's automated it's automated so you will actually tell me something I don't know about my customer okay so it could be like people with
highlighted hair like my product more and you if you like NASCAR do you you know are you more likely to buy their product or not you can do all those likelihood scenarios so which by the way the reason why this is so important is because you know to do this historically it means you have to hire uh either you
Outsource it to a big consulting company which takes forever and you spend a lot of money on it or you hire an in-house data science team who has machine learning experience which you know takes forever and you know it's not it's for most people it's it's not their core competency and so like the future is having a data scientist in a box you
just Outsource everything to us I guess we're all becoming in a box so how much like Revenue like what how does this how have you seen this impact the bottom line for people like not just cost I'm interested in increasing like my ltvs or even lowering my CAC obvious obviously it's business like well my other
portfolio companies want the medi impact is definitely cost savings uh but the big impact is lift and revenue and so when you Target customers the right way you obviously get higher conversions and you get you know higher higher Revenue I we can go in circles about this but yeah so do you guys do any of the like
selling of the channels for us or no what do you mean like meaning well now you know that uh people who are pet owners will use your cleaning service more so will you go out and find me those people for me or does it just stop so we will suggest new product features you can build into you know in your app or whatever it is your website or
whatever you have um but so we we can do product insights as well but we don't actually build the product you won't do the oh I see you're just giving me the insights you won't do the work we have to do the work yes you have to do something so how far along are you like how many customers are buying you your
product not you sorry your product insert I'm going to make up numbers right now uh we have we have 100 customers we're selling mostly to Enterprise right now and they're paying on average 50 25k in in Mr and your Revenue ARR 25k in AR okay um and what's your plan to kind of help it grow oh so we have a pretty good sales pipeline
basically we do the traditional Enterprise sales um we have a bunch of emails we get intros or we those emails convert and then those people you're not using Frontier 7 for that haha I am secretly yes so what kind of customer segment did you find most most helpful for Frontier 7 sorry can you say that again what kind
of like customer segment have you found most helpful for front tier 7 like what types of people want your product the most um well someone I think to start with for us it's it's uh easier to sell to companies who already uh actually have a data science team and so they're actually serious about it um and then
also customers who are open to using new products or early adopters I guess is what you say oh so you're probably mainly starting to sell with startups exactly the big startups I see and then um in terms of like how how big do you think this Market is so I mean we can do top down or bottom I mean top down you would just look at
data science in general and that's a huge billion trillion dollars I don't know how much I spent on that but bottom up I mean if we're making on average 100K like ARR a year um or actually you said 25 25k a 25k license you license okay so well let me back up a little bit um like the first thing that our product does is
just cleaning and cleaning the data and organizing data which is actually which actually I don't know if I believe that I usually have to Outsource that to like Mechanical Turk or something so you guys actually will clean the data are you having people on the back end or no it's all automated all right that's why we're going to be a
unicorn um so uh data scientists actually spend I would say 60 to 80% of their time actually doing that that work collecting the data and organizing and managing it and they don't really get time to actually do the actual data science um and so there I think I think there's actually a billion dollar
business doing that I mean if you say data scientists like we can charge around 100K AR a year for just that service there about 10,000 startups out there that can use us so that's a billion dollars in Revenue already just from that piece um but I can layer on the other pieces like the analysis and the automated Insight I mean if this is
such a big and common problem like why why you like what makes like you're right data cleaning is really difficult um like what what's so special about your algo and how good is it um well it comes down to team uh so I am a professor I believe in I spent 15 years got it I I have 15 years of experience doing exactly this and I was
I first did it very manually initially I was doing consulting for a lot of these companies and so I've learned over the years what can be automated and what cannot and so we're taking the first piece of automation um I'm also a professor in uh at NYU at Columbia and and uh teaching exactly this stuff and
so I've I I you literally have written the books on it I'm literally the software so that is scale to millions and scale to Millions right I'm literally yes and to scale me this is Frontier 7 is scaling me to everybody else all right I think with uh so I'm raising a million dollars right now um are you um what what do you think about the
space are you interested in yeah so I definitely think data is a problem uh I get emails way too can you do anything about my emails like that's a problem can't data science clean that too can Frontier 7 clean it up uh we're very focused right now on real data uh I might suggest you had virtual assistant
at the end of the at end of the coffee okay well um so you raising raing a million uh how much have you already raised and what's kind of the timeline that you're looking at uh we raised about half of that and we're hoping to close next week I see oh next week okay all right um do you have like kind of more information could I go talk to some
other team members uh do you have a deck you're welcome to talk to my co-founder um I'm the technical founder though so you can you know since this is a technical product you just ask me but um we uh I'm happy to give you a customer reference and oh that would be great uh if you give me a customer reference and
we could follow up uh via email sure great thank so [Applause] much hello everyone my name is Sharon Pope I'm the head of marketing programs at y minator and is my pleasure to welcome back to the stage YC's partners coming up cat manik Kirsty Matthew Adora Holly Jessica and Carolyn I'm gonna stand up here this
microphone oh this one works now I'm Gonna Stand okay so just as a quick reminder as I unlock my phone um um please submit your questions at slido.com s slo.com and the event code is FFC so you can also up foot questions so if you want to kind of try to prioritize what questions get asked these are your questions this
is your time to ask are okay so first question will YY ever open a New York City office um Caroline I'll I'll send that one to you it to kiry Kirsty is the CFO you know what I think um I think that we never say never at why combinator and as somebody mentioned earlier I can't remember maybe it was cat um we experiment a lot so it
could be that in our future we have an experimental NYC Outpost or maybe in a different city but I think that we like to try things and see what works and if it doesn't work we don't do it and again but it's always worth a try please though don't like start any rumors or get your hopes up this is just the point
is we never say never there are no plans that's true there are no immediate plans to do that so yeah that's but yeah sorry there are no plans one thing I'll add to that is that I I meet a lot of Founders all over the world and at this point in time I still think it's helpful for any founder from anywhere to spend you know three months
in the Bay Area and get to build that Network there's such uh so many investors there so many other Founders and then you can you can stay there for that amount of time and then theoretically if this is where if New York is where your customers are you move back to New York but um at this point it is still so much easier to
raise um and build that Network there so even spending a short amount of time I think still helps so all right and speaking of building or network one popular question is um I think a few people have talked about finding people who are 10x people right so those people who you hire and the people you surround
yourselves with that are just over the toop really great mentors and peers so how do you go about building that Network how do you find that and how did you find the ones in your lives I will throw that one to Jessica how do you surround your how do you how do you find find the kind of excellent people that will help push you
forward I mean I think I can think back to what we did 13 years ago because by the way we didn't know anyone in Silicon Valley um and we had to to meet people and grow our Network and I think if you're working on something interesting then people who are really good will themselves be interested in it and if you sort of
genuinely want to talk to people and get advice I mean most people in Silicon Valley are pretty open to it um but I think just working on something interesting and being insightful about what you're working on um makes for fascinating sort of conversation and people like that yeah what about Holly
maybe you could answer also when it comes to bil company as a Founder uh well I'll throw a fun story about a different YC founder Eric mikowski he was the founder of pebble and he had he came from Canada and most most people don't obviously have a network in Silicon Valley and that's why they join YC and that's why you should join YC but
um he came down and he was working on basically trying to fit like an entire computer processor in this little tiny little form factor and um the early early Apple computer computer like uh computer designers were like writing this blog and it was like a really nerdy blog and he followed it and he sent out
a note to uh the the founder and um he's like yeah I'll meet with you for coffee and I think um as Jessica said that there's a lot of kind of uh paying it forward culture particularly in Silicon Valley which is another reason why people do like to um have you come out there and it's weird investors don't
like jumping on a plane uh there's a lot of things they don't really and they like to meet you face to face still um in many ways if they so it's it's really good for that so um but piggy backing off of Jessica in terms of that definitely start finding people that you look up to that are in the same field
and I think you can reach out to them um in terms of like hey you know I want to ask if you can ask specific questions that's actually very helpful because on the other side in general I think people are looking to help but if they're just like hey do you want to meet and just have coffee with me it's really hard
because you don't know on that other side how busy they are it would just be much they'll they'll be more appreciative of it if they're like hey these are the questions I'm looking to answer and what your your background can give to me and then obviously sometimes you know you'd be surprised but there are also things that you can give as
well like you are the expert in well Maria was expert in in sense like there would be nothing I would be able to tell her around that and she could give me some some interesting insights into that that might be helpful for what I'm doing in my business so don't discount yourself either uh the one thing I'll
add is you can always just go work at a startup uh from someone that you admire um and work directly with the founder and I I think that's that's a good way to get some meaty time with somebody awesome also a lot of people wondering about H tips on how they can find a co-founder um ad Dora while you're talking do you want to
talk a little bit about that well my co-founder was my brother so that was easy easy yours was well I was going to say one of the things uh to be careful about is I get a little nervous when people say how do I find a co-founder because um one of the things that we stress is that you don't actually go out and find one you
probably look within your own network and the founder relationship that you form is probably more of an organic one so College friends and old friends from your prior life like people that you know pretty well um people that you're close to tend to make the best founder teams yeah usually it's someone you spent a lot of time with in college or
at work I think those are the two most common ones awesome um question of just generally are there startups that YC wants to fund more than others are there areas that YC is extra interested in female founded startups all right there's also the request for startups page where we list like hey we'd love to see uh startups solve you
know diversity uh create a million jobs voice um if you don't have one in that area does doesn't mean that we won't accept you and even if you it it's just these are things that are interesting and we put a call out for them and that's whyc combinator doccom RFS and and yeah I think some of the most interesting ideas we fund are
things we wouldn't have thought of ourselves uh you know I know when Airbnb came through Jess and Paul thought the idea was crazy right so we um you know I think yeah as a holly was saying just because your idea is not on that list doesn't mean we're not interested in it I think also just no idea is too crazy
for us like we' never think an idea is like oh that's crazy we'd never find that like we just don't have that thought yeah and chrisy could you answer is there a level of startup that that YC is mostly looking at in terms of stage uh so we think we can be helpful to any startup up to series a so that's like a really big Spectrum um we have
companies who come to us with just an idea we have companies who come to us who are already generating Revenue we have companies who are already profitable we have companies who've raised maybe a million or two in in seed funding and because we work with each company in a very specific manner to them we help them with what they need we
can be helpful in all those stages and so I think the important thing is let us make the decision about who we want to fund you know if you say oh I'm too early for y combinator I'm not going to apply you not even giving us the chance to see your company so apply you have nothing to lose and it means that that
you know we can we can see and we can we can apply our expertise to to see what could be amazing about your company awesome you any of you have applied before please do apply again um we have is it like over 50% of the batch has applied before I think the numbers like creeping up now I'm throwing out
numbers we heard from earlier sber got in on our third try um cat would you answer um just generally what YC is thinking about and what efforts YC puts forward to grow diversity within our founder population yeah this is something I'm super interested in and you know we've all had the pleasure of working on um at YC um for female
Founders for example in this batch of YC so summer 2018 27% of the companies in the batch have a female founder um one of the one of the challenges is only 23% of the companies who applied had a female founder um so we want you know so we try to do as much as we can to um support female Founders uh even outside
of the YC Network so we do female Founders conference hoping to um connect with women who are starting companies already or Inspire women who haven't started companies to start them um we do office hours with female Founders we also do office hours with black and Latino Founders to encourage them to apply um what else um we during the
batch we connect um the women in our batches to female investors prior to going out uh and raising money just so they can get advice from women um who've seen a lot of uh Founders come to them seen a lot of female Founders can give them advice um is there anything I'm missing and yeah so so I I think hopefully over the course of the next
few years we'll see that number increase of um women in YC and I think out of Jessica on Jessica's slide I think it's a total we funded how many it's like 358 women so far yeah that's great um fundraising question so maybe kir you grab the mic but anyone else to to chime in um just the question of when to raise
like how do you know when to raise whether it's seed funding and then also maybe thinking about that series a can I just say one thing on this raise money when you don't need it like that that's the best time to but don't wait until you only have like three months Runway um we have believe it or not a lot of
startups that come to us and like we're running out of money we have you know four months in the bank and we're like What you're going out to raise money with only four months of Runway like it's just creates disaster so sorry I've been thinking about that lately so I wanted to put that in go ahead um so I
think it depends who you're raising from as well um usually the the first money that a company will raise will be from individuals who are who are ra uh who are investors and at that stage when you're talking to those people then it's usually because they're either super interested in the space that you're in
or you already know the people and they know how amazing you are as a founder and so at that stage it's easier fundraising is never easy um but it's easier to to raise on an idea that doesn't necessarily have traction and growth as you then progress and you're talking to institutional investors um so C's some of the largest seed funds
that's the point where you need to be able to show that that people want what you're making and by the way that you do that is that you show that there is growth in users that there's growth in Revenue um that your churn is at a manageable level and that's how you start to then paint the story of this is
how this company becomes a billion dollar company and so depending depending on the stage that you're at will depend on who you talk to how you talk about your company um and the the types of money that you you raise it's also very um it's very easy to fall into the Trap of raising too much money if you're one of the lucky people that have
a relatively easy time fundraising so also think about how much money do you actually need to get to that next Milestone because when you get to that next Milestone and you're raising the next amount of money it's going to be at a higher value ation in theory um and so you know the dilution that you're taking
as a as a Founder will be less because the the investors putting money in it's a higher valuation whereas if you raise a bunch of money really early on that's likely to be it's a much lower valuation so more dilution to you as a Founder got it so Adora and Holly maybe for this one so speaking of traction um what are some examples of what counts as
traction for a b Toc company and the acknowledgement that it varies by business just kind of some principles that you might gauge that byy I guess we both we both thought consumer companies um so mine is a a gaming company and it it might be a little unique in terms of traction because it's usually very much like hits
driven so it's either a hit or it's not it needs to get into the top 10 um but in terms of uh early on when we were just starting out in terms of traction it it's really weird because um it's a little bit of an art and a science I I I can't really say like this is the exact number but for sure just like Maria had
with s bird you're like 105 orders we are on to something so the first little seed of traction is almost to prove to yourself that you are on to something and then the next seed is about like proving it to others once you're in YC we usually kind of ask you we usually kind of push you to say if you're
growing 10% week over week that's really good because that means that you know you have the raction and then exponential growth it's very hard to do in your head but pretty much by the end of the batch you'll be have grown 10x if you do 10% week over week so that's usually something that is like okay we'll keep on pushing that and if you
could get to that that thing and you're like oh yeah and for other investors they'll be like well if you want to go more that's really good but 10% is pretty good in terms of within the batch so if you're almost getting into that inflection point it might be a good time to to really figure out how to focus and
get to those that growth um and that product Market fit which we could help at YC yeah for Consumer companies I think there's two there's various types of metrics in terms of growth that you can focus on one is just user growth another one is revenue growth just depending on what you're doing um so if you're building a social app you you'd
probably focus on users versus if you're building an e-commerce app you would obviously focus on Revenue more the thing to watch for while you're growing if you're growing really fast is to pair it with uh by by uh observing something like retention and engagement um to making sure that you're growing
the right types of users or the right types of Revenue um because if you're bringing on what I call bad customers or bad users um they're going to turn if they turn right away or they're just not good for the product um and you have to just fire them uh it's like a waste of time almost and that growth is kind of
just a fake growth at the end of the day great um so as an engineerd designer building a product between prototype and beta what are the pros and cons of of launching before trying to raise money you should always launch before you raise money but I don't yeah yeah I think you should launch as as possible
well I think you can launch as soon as possible uh in our industry we always say you never know if you're polishing a turd cuz you could be sitting there and you can be like oh my God this is the most beautiful thing um and then you launch it and you realize nobody can find the sign up button nobody even wants to click on your side up but
nobody even wants to open up your email and then you realize you have much bigger problems than what you thought you were solving so I'm a huge fan of trying to launch as early as possible and even let's let's say you know it's going to take a while to build there's certain things you can do even before that um you could start talking to your
customers you could start um building a weight list of things you could start doing there's there's always things you can be doing um but the most important thing is to launch as early and as often yeah there's two ways to think about this one is um if you if if you don't launch then you don't know if you have a
product anyone wants and why why raise money for that like where's the confidence in that like get some if you launch then you'll have some confidence around that um and also there's a big difference in terms of how much you can raise and valuation you can get if you have users and revenue versus if you
have absolutely nothing um and so I think launch now even if you're an engineer like if Shopify is going to is going to be the fastest way to do it then just do it I know some Engineers are just like they're just embarrassed that they have to use Shopify to get it out there the fastest but that's the thing to do got it um question a mother
related question which falls into the category of things that would never be at a male oriented conference if there are those but um how do you for the folks who have kids how do you factor in decisions to have children with some of your your work goals and your Ambitions and your own careers and it was a popular question
question so I figured we'd ask it even though you know it can be a tough one I never did Factor it and I just worked on YC then Paul and I got married and had uh our son right away and we just plowed right through it I never sort of planned I wasn't very planful at all um which in hindsight was I wish I sometimes I wish
things were different because like as YY was growing and I was working so hard to make it succeed and it was so timec consuming that's when when I was having babies and like I barely took any maternity leave I just worked through the whole thing and maybe I should have been a little bit more planful but it's
it's hard you know don't put it off for too long would be my other advice yeah I would Echo that I um so I came from a law firm before I was at White combinator and I have nothing but sad stories of colleagues who didn't have children because they wanted to make partner and it's just there's I just don't have any happy stories from that
era um I'm kind of like Jessica I just thought life goes on and I'm having children so I had children while I was at a big Law Firm um I do want to mention we have a lot of great anecdotes about parents at YC and one of my favorites is that we had a female founder apply um and she was at y combinator for her interview and she
like ran out to go breastfeed her newborn in the car and we accepted her of course and she's great so anyway yeah there's we have lots of stories like that and I I guess just I mean this kind of sounds cliche but I kind of think like you got to live your life and there's tons of examples out there of women who are
having children and having a startup and a startup is like a baby so it's just like you have another baby I love that yeah so um when I got married like 5 months later I just I told my husband I'm like basically I'm leaving to start this startup and he's like what um and I think it's it's always it's a very personal and tough
decision as to whether or not you want to have a kid some people know right away and some people don't and I knew this was something that I had wanted and now I can't take it back No undo just FYI if you do think about it it is a big decision sadly I I will be honest I do think women have to also think about a
biological clock uh for me personally it took longer than we had expected um and we we had like there were just a lot more extra things we had to do at the same time trying to do this startup luckily my startup was probably pre series like probably series a series B by the definitely by the time my kid came around we were uh we're doing quite
well series C but the whole impact of even thinking about having a kid honestly it impacts you almost when you turn seven eight it's just so young this kind of thinking about this thing I I don't think guys think about this as much as women and it's it's there is the reality of a of a biological clock but
there's also a lot of great things in science we have some wonderful like we carot fertility that can help you you know extend some of that um and I think like maybe me and Jessica would and maybe even Caroline we might have been I I was definitely considered a what is it called geriatric pregnancy yes if you're
over 35 you're Advanced maternal age which I was yeah so yeah me too my second one they were like they gave me like this pen or something I don't know it was terrible um but it is is very much as for for all the the parents out there it it is a startup is like having a kid it's so cool that you did it with your husband
I feel like I had a kid without my husband so it feels like I was having an affair all the time it's like it's always Kabam Holly it always comes first I'm like I'm sorry um so that it but if you can surround yourself don't refuse help I mean it can be done and uh there's many YC Founders who have done it at various stages all the way from
interview all the way to um you know when it's a lot larger Rush's one of them she's GNA go in AUST um so it's it's very plausible uh there's definitely some more tactical things uh if you do end up hitting up that point think about a plan when you leave the like leave for temporarily uh definitely have the communication I'm a
huge fan of keeping the communication lines open and I'm only going to say this because this came up within the YC Community your options should vest on maternity leave that that I was just shocked but it was there was a whole discussion around that in our really somebody's option vesting suspended
during pregnancy Le suspend it but the other Founders had suggested that they're like since you're going on maternity leave we'd like to like would you consider suspending your options don't yeah no ever illegal too I feel like actually think that sorry so just one more question um we've talked about doing things that don't scale um if
you're doing things that don't scale early on how do you convince an investor or someone else that it eventually will scale um well you just need to have a product plan in place and so anything that's any investor should know at this point especially if they're a tech investor should know that something repetitive software can can most likely
replace um and so I think it's I think it's usually good to have a little bit of software to have automated some piece of what it is that that is not scaling um and also at every stage of growth there's a new way of a different way of doing things um and so as long as you're able to explain well in this stage I'm
doing X in this next stage I'll be doing Y and then the future um this is my plan for the future but at least I have the next few steps in place that's a great advice thank you very much YC's Partners thank you thanks for coming and cat has right I have a couple uh quick announcements before we wrap up I wanted
to thank you first thank you all for spending a Saturday with us um we've you know we're excited to meet even more of you at the reception after we're doing a reception at The Malt House um from 5:30 to 7:30 um and I also wanted to thank um some of the folks that made this event possible where's Dominique are you here
hi Dominique runs events for YC thank you and um thank you for everyone else um on the YC team Sharon Stephen um you know everyone here who um made it happen oh and Adele yes um thank You Adele um and then also I wanted to mention that Google cloud and AWS are offering free hosting credits for everyone here um and
so um keep an eye out for an email from us um if you would like uh access to those credits um and then also thank you to digital ocean who hosted our office hours yesterday um and that is all for me so thank you so much for joining us and I hope to meet you guys all at The Malt [Applause] House e e e e e e e e for