The 7-Step Guide to Surviving Y Combinator
Ambition Co-Founder and COO Brian Trautschold gives some words of wisdom to future Y Combinator companies.
YC Summer ‘14 is about to begin. Here's how to optimize the three months you're about to spend: one of the most grueling, harrowing, and rewarding experiences a Startup can undertake.
Our company recently graduated from YC's W14 batch, and like most new members of Y Combinator, we entered with a gamut of feelings: excitement, nervous angst, confidence, skepticism, determination. You name it.
This is a Field Guide for not only surviving, but excelling during Y Combinator. Just being accepted into the program in the first place is a massive honor, and I hope any actionable advice you find here will help you maximize your three-months in YC and the foreseeable future of your company. Best of luck to you.
Words of Wisdom from a Recent Y Combinator Graduate
1. Start Selling Now.
Right Now: Customers. Users. Partners. Investors. Repeat. The YC Golden Rule: Growth Solves All Problems.
2. Prepare to be on Your Game At All Times.
I fear many people only expect on bringing their “A-game” at specific YC events. Another obvious tendency is to reserve the fire or drive, or the energy and charisma that you have for when you’re working; talking to customers/investors.
When you are a newly-minted YC founder and thus a fresh-faced, potential Drew Houston or Brian Chesky in the making--everyone wants to help you or get to know you. The caveat is, they want to help exciting, dynamic, “I’m about to face-punch the world” founders who seem like they cannot be stopped.
They are not interested in helping the “man, I’m super tired from all of these meetings”-type founders or some dude with the attitude of: “yeah, if our business works it will be pretty sweet, but if not I can get a job at Google or something”. Always, always, always be on your game. Your YC batchmates know people who may be your customers or employees or investors.
The YC partners want to befriend fun, engaging people. Investors want passion - not drab. “But…. we’re just starting, we don’t have much to talk about.” This is not an excuse. You have to be performing at your highest level at all times - find something to talk about. If growth isn’t good - figure out what is good, and sell that. Then go home and bust your ass fixing growth - as you will hear, growth solves all problems.
3. Act Like You’ve Been There Before.
A.K.A., own this opportunity and attack it. (Note: This does not mean be a douche. Absolutely do not be a douche).
Realize you have an inherent advantage (that YC thing) and a lot of people vetted your path to the present - so utilize it and be confident about your capabilities; whether in sales, new relationships, meeting with YC partners, potential investors, or other big co’s you’ll meet during YC.
I blew this a number of times by either being too modest or not attacking an opportunity and getting “big stage syndrome” - don’t do that. You are in YC, you are some type of really, really awesome, now go do work.
*The caveat here is don’t pivot confidence into being the snobby dude in a new YC hoody looking down on company X or investor Y or your former coworker who didn’t get in this batch. (AKA: don’t be a douche).
4. Identify Who Can Help You + Let Them Help You
YC is not one of these programs with a strict rubric or daily schedule. You will have topic-focused events, but things will come up (opportunities/ issues/ founder drama/ regular running-a-business-crap) that you will need help with.
Part 1. When this happens, identify who can help you. I don’t know about you, but I’m not a lawyer, so the Levys were incredible, for example. There are also partners who have run P.R. depts, finance, huge engineering teams, been engineering founders or business-side founders - so getting advice on those topics is crucial.
OR better yet, those partners may be (or have been) your target customers…Use them. It sounds obvious, but figuring out who has specific knowledge and then utilizing them to help your business is critical.
Part 2: Let them help you. YC partners are smart and in many cases have been there before. Sometimes what they tell you will not equal what you want to hear. That’s ok, they are sincerely trying to help you. Let them tell you and learn from it.
5. Be Committed to Staying Healthy.
As you will hear early and often - you should be spending your waking hours working on your startup, and occasionally exercising.
I paid the price for ignoring the latter advice. I did not exercise, generally felt terrible & lost about 10 lbs of muscle, which ended up being replaced with 15 lbs of non-muscle. Too often in our house I would wake up early, start sending emails in bed, move to the kitchen, move to our “office” (living room), then sometime later in the evening move back to bed and do more work.
After you do this for a few weeks, you will not feel awesome. Physically it will be difficult for you to feel up to the challenge of taking over the world. Pro-tip: buy healthy groceries/ use Gobble or another food delivery service.
6. Be Accountable... AKA Set Goals + Figure Out How to Meet Said Goals.
YC is metric-driven. In the first week or so you should have a big board somewhere with goals on it detailing what you need to do. Accomplish a goal and then talk about it with your batch mates / YC partners. If you don’t meet the goal, talk about why with your batch mates / YC partners.
Embrace your goals and then be accountable to completing them. Being “in” YC is time constrained - maximize your time.
7. Be Opportunistic with Raising Money… Don’t Waste Time, And Don’t be a Pig.
[Everything you’ll read here is best applied situationally - with another post to come closer to Demo Day].
We went through YC with a live product in a pilot market and were fortunate to have low six-figure revenue, a pretty robust team, and some previous seed funding. We waited until the final few weeks to take any investor meetings.
In hindsight, we probably could have pushed the investor button earlier to begin getting people involved and building relationships, but we would have wasted valuable time that could have been utilized for selling. Don’t try to convince yourself that raising money is a substitute metric for growing your core business metrics.
Do not show up month one and start meeting with investors. They will want to meet you and get a free, early screening. Put this off (cough, be pursued). If you’re just starting, have no product, or are figuring out your vision you will not say anything that makes them want to invest.
Once things are working (read: growing, making money, product live, aggressive vision set) - it may be okay to meet with some limited investors. If someone wants to give you a first or early check - and you like both them and their value proposition (+ the terms seem reasonable), you should probably take it.
Getting the first check in the bank is really hard. Really, really, really hard. But once you get one, more will come. Realize most investors are spineless (no offense, those of you who read this). They will rarely act without some other first mover to judge from.
You will see very different faces if you give your pitch and don’t mention any current investors or people “you’re talking to” versus giving the same pitch, but adding: “Oh, and VC Firm X is in. We met Y yesterday and meet with Z next Tuesday.” Expect a question at the end of most pitches going to: “Who else is in?” Answering with, “Well …. it could be you?” makes for a tough conversation. This seems obvious, but is important to understand.
What if you don’t have that first investor yet? Well, you have YC, which is arguably one of the most respected investors in the game. Leverage your partner relationship to get a warm intro (see #4).
Regarding the intro: Don’t ask for the all-star, dream angel first. Identify a relationship or ask for an intro to someone who invests in your space and who could be a first check- then leverage that to go after top targets you have. There are many people like this in the YC ecosystem.
Finally, don’t be a pig. Once your bank account starts growing, it can be difficult to turn off “fundraising mode.” As I alluded to earlier, it can be an euphoric alternative to working solely on the grind of growing the business.
Pick a hard number (not the same number you tell investors your target raise, when you are creating a little scarcity to drive demand) and stick to that number in your head. It should be a combination of need, target equity threshold, and balance of how much value you will receive working with these partners.
Alternate view: Some founders will say take every dollar you can. I don’t think that is necessarily bad advice - but it’s not been our approach (remember: situational).
If after you’ve raised enough money to run your company for the next 18-24 months (and are confident you can grow the business in the given timeframe), and you find your calendar still loaded down with investor coffees or meetings at The Battery - you may be a pig.
Get back to growing.
That's all I've got. Good luck and enjoy one of the best/ fastest/ most unique experiences of your life. Please feel free to email me or our founders questions - we’re always willing to help.
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