00:00:00
but this is it like literally this is
00:00:02
all the smart stuff I know period and
00:00:04
it's all in like maybe 14 slides so it's
00:00:06
really fast all right let's go how to
00:00:08
start a Technical startup first one two
00:00:11
to four
00:00:12
co-founders at least 50% engineering
00:00:15
they all have to have somewhat around a
00:00:17
Year's worth of money in the bank but
00:00:19
that doesn't mean a Year's worth of
00:00:20
money living in a one-bedroom apartment
00:00:22
like in a high-rise that means a years
00:00:24
worth of money eating ramen noodles and
00:00:25
being very poor and everyone has to have
00:00:29
quit their job
00:00:30
this is what you need to start a startup
00:00:32
notice no idea is required you just need
00:00:35
this that's it second idea I always
00:00:39
think that it's better to start
00:00:41
brainstorming with your teammates
00:00:43
typically one member of the team has the
00:00:45
kernel of an idea that'll become the
00:00:47
company but it's always best before that
00:00:49
gets too solidified to discuss it with
00:00:52
your teammates so that everyone Buys in
00:00:53
and gets ownership we tend to like
00:00:55
companies who are trying to solve
00:00:57
personal problems every investor says
00:00:58
that the real thing is we like companies
00:01:01
where the founders know what the hell
00:01:02
the companies are doing and know what
00:01:04
the problem is so if it's not solving
00:01:05
your problem it should be solving a
00:01:07
problem that you're very very aware of
00:01:09
and then the other thing I tell Founders
00:01:11
is try to focus on daily and weekly
00:01:13
problems as opposed to monthly or yearly
00:01:17
problems it's a lot easier to do
00:01:19
something like uber the typical person
00:01:21
in America has to figure out how to get
00:01:23
somewhere three times a day it's a lot
00:01:25
harder to do a car sales website the
00:01:27
typical person in America only buys a
00:01:29
car once every seven years try to focus
00:01:31
on daily and weekly problems it tends to
00:01:34
be a lot more successful Market this is
00:01:36
an area that like people talk so much
00:01:38
about do an hour of research figure out
00:01:41
whether there are billions of dollars
00:01:43
being made in your Market um and use
00:01:45
your competitors product after that I
00:01:47
don't care legal if you guys are
00:01:49
interested in raising money in the US
00:01:50
you're going to have to incorporate in
00:01:51
the US that is a very very very simple
00:01:55
process for $250 and clerk.com you can
00:01:58
have an American company and you can
00:02:01
raise money from American investors yeah
00:02:03
it's that's easy let's the mystify that
00:02:05
mvp most viable product this is where
00:02:07
most companies will screw up actually
00:02:09
sorry where most companies will screw up
00:02:11
is on team this is the second place most
00:02:12
companies will screw up how can you get
00:02:15
something into people's hands I can't
00:02:17
tell you I've done this many times
00:02:19
myself the number one piece of advice we
00:02:21
give to YC companies before they launch
00:02:24
is launch I can't tell you how many
00:02:26
people will just sit there and iterate
00:02:27
and iterate before users ever see
00:02:29
anything so when I ask a company how
00:02:31
long is going to take to launch I always
00:02:34
just ask them why does it take longer
00:02:36
than two months like I don't care what
00:02:38
it is I don't care if they haven't
00:02:39
started yet you should be able to build
00:02:41
something in two months and get it in
00:02:43
front of users this is just saying it
00:02:44
one more time you're nothing into your
00:02:46
launch so how do you achieve growth I
00:02:48
would say that for the typical Silicon
00:02:50
Valley investor this is the number one
00:02:52
metric for determining whether you're
00:02:53
going to raise money it's not team it's
00:02:56
not past experience it's not fancy
00:03:00
investors its growth so
00:03:03
um typically you're going to go one of
00:03:06
three places one you're going to
00:03:07
experiment with ads I tend to like that
00:03:09
strategy the least the second if you're
00:03:11
B2B you really want to focus on
00:03:13
reference customers the customers who
00:03:15
you can provide amazing service to who's
00:03:17
going to talk to other people in their
00:03:19
industry and spread the word about you
00:03:21
the last one if you're doing anything
00:03:23
related to Consumer whether it's
00:03:24
consumer services social media Etc usage
00:03:27
should equal sharing I can't tell you
00:03:29
how many Founders I've talked to said oh
00:03:31
I'm going to make my thing go viral well
00:03:34
if you want to make your thing go viral
00:03:36
it doesn't mean just adding a share
00:03:37
button the very fact that people are
00:03:39
using your product has to create some
00:03:42
type of sharing that has to be built in
00:03:44
from day one and so don't think of
00:03:46
sharing as an extra activity or a side
00:03:48
activity think of it as 100% part of
00:03:51
using your product all right press a lot
00:03:54
of people think that they need to hire
00:03:57
someone to do their PR at Justin TV me
00:03:59
my co-founder had a little competition
00:04:02
on how much money uh we've wasted and
00:04:05
we'd write it up on a whiteboard and
00:04:06
every time we wasted money we'd write it
00:04:08
up there and add it up uh I've wasted
00:04:10
over
00:04:11
$150,000 on PR firms so I'm giving those
00:04:14
advice because I don't want you to do
00:04:16
the same thing 99% of PR in the early
00:04:19
stage you can do yourself the best piece
00:04:21
of advice I've given I've been given
00:04:23
about PR the thing that completely
00:04:25
changed my whole perception is that PR
00:04:28
is exactly like business Business
00:04:29
Development when you're trying to do a
00:04:31
BD deal you get a warm introduction you
00:04:33
follow up you build a relationship and
00:04:36
you provide something of value when
00:04:38
you're dealing with press it's the exact
00:04:40
same thing you need to get an
00:04:42
introduction from someone hopefully who
00:04:44
that reporter is always written about
00:04:46
you need to be able to structure your
00:04:48
pitch so that it's real news something
00:04:50
launching money being raised a
00:04:52
significant higher a significant new BD
00:04:54
deal you can't just expect the profile
00:04:57
piece and what you need to do is make
00:04:59
sure you treat that as a relationship
00:05:02
once you have a reporter who's written
00:05:03
about you you've got to follow up with
00:05:05
them that becomes a very very important
00:05:08
relationship that can continue to
00:05:09
provide value if you continue to follow
00:05:11
up PR very simple and don't spend money
00:05:14
fundraising typically companies will
00:05:16
come to
00:05:17
YC and ask how do we start
00:05:21
fundraising and the number one thing we
00:05:23
say to them is that if you don't need
00:05:25
money people love to give it to you so
00:05:28
how do you put yourself in the position
00:05:30
of not needing money one let's not start
00:05:33
the company with a $1 million marketing
00:05:36
and advertising plan right that's you
00:05:38
need money for that um think about how
00:05:41
you can structure your company so all
00:05:42
you have to do is pay for the living
00:05:45
expenses of your co-founders that's it
00:05:47
hopefully your MVP requires so little
00:05:49
money to get up and running that you can
00:05:52
produce some growth without needing it
00:05:54
the second thing is that people don't
00:05:56
quite understand that speed when it
00:05:59
comes to fundraising is extremely
00:06:00
important um when you have meetings with
00:06:03
investors you want them to be scheduled
00:06:05
as tightly as possible like one week
00:06:08
every single introduction meeting you
00:06:09
have with an investor um the purpose of
00:06:11
this is that one it creates Buzz around
00:06:13
your fund raise two It lines all the
00:06:16
investors up so if one investor wants to
00:06:18
take a step forward you can contact
00:06:21
everyone else you just met in the
00:06:22
previous week and said hey look we've
00:06:23
got someone on hook here do you want to
00:06:25
come along or not the biggest mistake we
00:06:27
see people make is doing invest ing
00:06:30
these investment meetings serially I'll
00:06:32
take one this week I'll take one next
00:06:33
week I'll take one the week after that
00:06:35
investors move because they have a fear
00:06:36
of missing out fomo you're not creating
00:06:39
a fear of missing out if you're only
00:06:40
talking to them one at a time the last
00:06:42
thing is have growth having growth is
00:06:44
like the solution to every single
00:06:45
problem the more you're growing the more
00:06:47
investors are going to invest time
00:06:48
finding you as opposed to other way
00:06:50
around so you're having problems
00:06:52
fundraising how many people right now
00:06:54
are looking to fund raise in this
00:06:55
audience okay all right beautiful four
00:06:58
things to think about
00:07:00
one are you growing I should have asked
00:07:02
have you launched if you have a launch
00:07:04
plan that requires fundraising change it
00:07:06
two are you talking to the Press it's
00:07:09
investors jobs when they wake up every
00:07:10
morning to find a company to invest in
00:07:13
that's their job they try to trick you
00:07:16
into thinking that their job is to sit
00:07:18
at their desk and wait for you to walk
00:07:19
in the front door but that's not their
00:07:21
job so you need to be getting the word
00:07:22
out about your company so that they hear
00:07:24
about your company from someone else not
00:07:26
just you three build momentum make sure
00:07:28
you're talking to his as many investors
00:07:30
at the same time as possible sometimes
00:07:32
this means cheating like often times
00:07:34
this means doing stuff like telling the
00:07:35
investor you're really busy and you can
00:07:37
only meet a month from now so you can
00:07:39
spend a whole month lining up other
00:07:40
investors for that week that's totally
00:07:42
fine that's totally fine the last thing
00:07:45
is that try to focus on people
00:07:47
especially for your first money people
00:07:48
who understand your problem because
00:07:50
they've had it or they have it right now
00:07:53
oftentimes customers and potential
00:07:54
customers can be great initial investors
00:07:57
early stage so operations super super
00:08:00
fast the number one problem that
00:08:02
companies have is they spend too much
00:08:03
money that's the number one problem they
00:08:05
have Su spend less money pay yourself
00:08:08
less get a crappier office just suck it
00:08:12
up and use less money um this is the
00:08:14
number one way you can extend your
00:08:16
Runway and it's 100% dependent on you no
00:08:18
one else the second thing and I can't
00:08:20
tell you how many people do this look at
00:08:22
how much you spend every month it's very
00:08:24
simple just go to your bank account
00:08:26
download your you know the the
00:08:28
spreadsheet that says exactly every line
00:08:30
item what you spent and read it every
00:08:32
month if you're the CEO and you don't
00:08:34
know what your expenses are you're not
00:08:35
doing your job then figure out how to
00:08:37
spend less money that seems pretty
00:08:38
simple all right hiring one of the goals
00:08:41
I like to kind of instill in people in
00:08:43
hiring is figure out how you can
00:08:45
increase the average Talent with each
00:08:47
hire often times Founders think that
00:08:49
they are like the smartest people in the
00:08:51
universe Founders tend to be pretty
00:08:53
smart but very very very willing to take
00:08:56
on risk and so your first couple employ
00:08:59
employees should be a lot smarter and
00:09:01
just a little bit more risk adverse than
00:09:03
you are if when you're hiring someone
00:09:04
you don't think you're increasing the
00:09:06
average intelligence of the company you
00:09:08
made a mistake because those people are
00:09:11
basically your hiring advertisement if
00:09:13
those people are smart other smart
00:09:15
people going to want to come to your
00:09:16
company if those people are not smart
00:09:18
everyone knows it so don't I mean one of
00:09:21
the things I always think about is like
00:09:23
if you can't hire someone who's smarter
00:09:25
than you just do it yourself you know it
00:09:27
doesn't hiring a lot of people is not
00:09:29
not required um be fair and transparent
00:09:32
when you give someone an offer you need
00:09:34
to tell them how much stock they're
00:09:35
getting they should get stock need to
00:09:37
tell them how much stock is outstanding
00:09:39
need to tell them whether their salary
00:09:41
is you know typical for what you give
00:09:43
and if not be honest a lot of the times
00:09:46
your first employees are your most
00:09:48
viable and if you show them loyalty
00:09:50
they'll show you loyalty back and then
00:09:52
the last thing is higher slow my second
00:09:54
company social cam had three founders
00:09:56
when we sold we had three founders no
00:09:58
employees we didn't necessarily want it
00:10:00
to be that way but we were able to grow
00:10:02
a product to over 20 million downloads
00:10:05
with three people so don't tell me that
00:10:08
you can't do a lot with just your
00:10:10
founding team you can do a whole lot I
00:10:13
think Instagram sold for a billion and
00:10:14
they were under 20 so high or slow you
00:10:18
can do it
