Q&A at our Female Founders Conference.
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Y Combinator partners Jessica Livingston, Kat Manalac, Carolynn Levy, and Kirsty Nathoo answered audience questions at our third annual Female Founders Conference, which brought together more than 800 women building women-led startups.
On Applying to YC
Kirsty : There’s nothing to lose by filling out the application. No matter what, just answering the questions on the application form is a useful exercise for any founder. So even if you do that and don’t hit “submit”, you’ve probably learned something from it.
Carolynn : Being flexible, and changing your idea-- none of that is bad...but when you talk about cockroaching and dedication, when you see someone who has been working on the same thing, or just working on a startup for a really long time, you know that they’ve got perseverance because this is not an easy life.
On the Future of Startups
Jessica : Ten years from now I want there to be tons of women founded unicorns. When I reference Facebook and Google as the canonical successful startups, I want to reference ones started by women.
You can watch the entire Q&A and read excerpts of the transcript below.
Kat: The first question that someone asked was, “How does a company determine if they’re right for YC and if they should apply?”
Jessica: Every startup is right for YC. I think a lot of people say, “Oh, I’m too early” or “I’m too far along.” There is no right company for Y Combinator. Apply to Y Combinator if you want help with your startup wherever you happen to be-- whether you’re just starting your idea or whether you’ve been around for a year and need to take it to the next level. I really do feel at this point with all the partners we have and all the different alumni, we can help pretty much anyone who applies.
Kat: Yeah, during the break I had a lot of women come up to me and ask just that question and what is too early, what is too late? And we have a new program that we started in the fall of last year called the Fellowship, which works with even earlier stage (idea and prototype stage) companies. So really, there’s no such thing as too early or too late.
Kirsty: And there’s nothing to lose by filling out the applications, as well. No matter what, just answering the questions on the application form is a useful exercise for any founder. So even if you do that and don’t hit “submit”, you’ve probably learned something from it.
Jessica: It just helps you distill your thoughts into a useful format.
Kat: Another question that also comes up a lot when I talk to potential applicants is, “What does YC look for in a team? Is there an ideal kind of make up of a team?”
Kirsty: I guess there’s no simple answer to that except that we look for a team that shows determination, that they can get things done, and that they can work together. But there are so many different ways that that can be presented to us. So there isn’t this sort of one-size-fits all idea to it. It’s really important that you can get that across to us, and you’ve seen from the women presenting today, how much determination and how much not giving up that takes. And that’s what we really want and what we look for.
Jessica: Yeah, I look for founders who have known each other for a while or worked together for a while. I look for people who are solving a problem that they themselves have. You’ve got to be a domain expert to do a good job, I think. For people who have built something before-- even if it’s not their current idea-- if they built something in the past, it sort of shows that they’re effective at building something. And I look for an idea that could be huge.
Kat: There’s a question someone asked on Twitter that was, “Why did YC invest in Gobble when other investors saw, “The Trough of Sorrow”? What did we see in Ooshma?”
Jessica: I loved Ooshma. I knew Ooshma for a couple of years before she finally applied to YC. We thought she was really thoughtful and approached things well. She was in “The Trough of Sorrow”, I’m not going to disagree with that, but we don’t care if someone’s in “The Trough of Sorrow”. Our job is to help you get out of “The Trough of Sorrow”. We’ve done it before, we’ll continue to do it. There are ways out. (Not to take anything away from Ooshma-- she has done so much work, I’m not saying we were responsible for that, but we don’t get frightened off by that.) We basically funded it for her. And we knew that there was something in the prepared food market.
Kat: I think about this: we don’t pretend to know what ideas are going to hit it big because I’m sure when you met Airbnb founders, that sounded bananas.
Jessica: Totally bananas.
Kat: Right. I think the only thing we can predict from the amount of years that we’ve been doing this is that great startups are founded by great founders. So, are there tells that when founders come in or in applications that you look for, like, “this is how founder can show perseverance or determination that they’re going to be cockroaches and make it through hard times?”
Carolynn: I think the fact that they’ve stuck to an idea for a long time. Sometimes pivots and being flexible, and changing your idea, none of that is bad...but when you talk about cockroaching and dedication, when you see someone who has been working on the same thing, or just working on a startup for a really long time, you know that they’ve got perseverance because this is not an easy life.
Kirsty: And I think also as Jessica was saying, if they’re a domain expert that’s solving something that they realize there’s a problem and have the solution to it, it shows that if you’re passionate about it and you’re wanting to do it, then you’re going to have that drive to follow it through. We get applications from people who are doing things because it’s the latest cool thing and you can kind of tell that this is not something they’re going to spend the next 10 years building a company around because it’s more of a fad.
Jessica: I love the question on our application “what do you understand that your competitors are overlooking?” because that really shows you’ve thought deeply about a problem. And in our interviews-- even though they’re 10 minutes long-- you really can get a feeling for if someone has thought deeply about their problem and if they’re sort of flexible minded about things.
Kirsty: Usually that shows by being able to explain what they’re doing clearly and succinctly. And if we get through an interview and we still don’t really understand it, then it shows that the founder has not thought it through enough to be able to distill it down.
Kat: The answer to what do you do-- you should be able to answer that in one sentence. And it should be a sentence that your grandparents could understand. Some of the best companies grow by word of mouth and it’s impossible to grow by word of mouth if no one understands what you’re doing.
Kat: Another question that came in was,”What is the best growth strategy an early stage startup can adopt?” Or maybe the question should be framed as “What should early stage companies focus on? How do you decide what to focus on?”
Jessica: Building things and talking to users.
Carolynn: I think it’s probably easier to answer that question in the negative, which is, “What do startups wrongly focus on?” And maybe it’s not what they wrongly focus on, but what do they get distracted by.
Kat: “Does YC fund solo founders and what’s the best way to meet potential co-founders?”
Kirsty: I will give the answer first: yes, we do fund solo founders. But startups are hard. And even if there’s a team of co-founders, there is far more than a human can do in 24 hours a day, 7 days a week. And so, if there’s a solo founder, if that founder is out selling, then they’re not building, if there out fundraising, they’re not selling. It’s just so much more harder for a solo founder to make a success of it. But you’ve seen solo founders on the stage today, there’s plenty of examples that it does work.
Carolynn: This is on my mind just because I happened to talk to a couple of people about this at office hours yesterday...Yes, of course, being a solo founder is super hard. But my personal opinion is that the worst thing to do is to go and seek out a co-founder just because you don’t think you can do it alone. Or because you think you have deficiencies, and you want to go fill them with someone that you barely know. Terrible idea. I think it’s such a better idea for founders to just try, and if they don’t have a co-founder, to just do it themselves. It will be very hard, but the damage that can be done by tacking on a co-founder-- that you haven’t worked with, that you don’t know very well, that you don’t think shares your same vision and goals for the company-- is very, very destructive to a startup company.
Jessica: I’m going ask a question actually. You bring up, “Do we fund solo founders?” Yes, we fund solo founders. Tons of them every batch. There’s a lot of misperceptions out there that exist. I was talking to a woman yesterday and I said, “Did you apply to YC?” Because I loved the idea she was working on. She said, “Well, I did but I originally thought I was too old.” She was 35. And I was like, “Hang on, you are not too old.” So I just want to be clear to everyone in this room: there is no one we don’t fund. If they’re good and effective in solving a real problem, you can be 20, you can be 60, male, female, gay, whatever… There’s no one type of person we fund other than determined and working on a big problem.
Kat: I have just one more question for you, Jessica, since you are leaving us for a year. So you’ve been, really, YC’s heart since day one. What has surprised you most about YC? And where would you like to see female founders 10 years from now?
Jessica: Ten years from now I want there to be tons of women founded unicorns. When I reference Facebook and Google as the canonical successful startups, I want to reference ones started by women.
Kat: What has surprised you most?
Jessica: There’s a couple things. One, how broken startups are, even the ones that you read about in the press and hugely successful companies are often more broken than you’d ever really know. That’s sort of inspirational because we all have days where we’re feeling like our company’s not doing that well. To be honest, even though we had aspirations for Y Combinator to really help the world, when Paul and I started it, funding people with $12,000 to help their idea, never in a million years did we think we’d be funding a thousand startups…many of which have gone on to be super successful. We never thought we’d have a company with all these wonderful partners who I love going to work with every single day. And it just makes me think, most of you raised your hands that you had started something: just keep moving forward, keep growing, keep working, get through all of the obstacles. And, I want you all to be successful and I want you all to be sitting up on stage saying, “I never thought that we’d be here 10 years ago.”