Startup School notes

After recovering from an unpleasant case of pneumonia, last Saturday I was lucky enough to attend Startup School 2011. Produced by Y Combinator and Stanford University’s BASES and held this year at Stanford’s Dinkelspiel Auditorium, Startup School is a one-day series of talks by well-known entrepreneurs and investors. I found the event to be incredibly inspiring and packed with great speakers giving great advice to the audience of young hackers. All of the talks were live-streamed, and I think recordings will be available sometime soon as well; I highly recommend checking them out.

I believe it was Max Levchin who wondered aloud what happens to those compulsive note-takers after they graduate high school; I never thought I was one of them but it turns out I have a few pages' worth of notes from the event–so without further ado, here they are.

  • Marc Andreessen, Andreessen Horowitz

    • Invented the img tag (!), started Netscape at 22
    • No Startup School-alike back then; entrepreneurs didn’t really know each other
    • If he could go back in time, he would instrument the browser to learn how people were using it. Also would have done something like RockMelt (built-in social) as well as built-in payments.
    • Building a company is like baking a cake. There are a lot of ingredients and if you’re not careful you’ll end up with egg on the ceiling.
    • He believes in engineering at the heart of the company because ultimately it comes down to the product. And in the long run, your product is innovation.
    • If the cake comes out of the oven and you forgot to add sugar, it’s too late. You can’t just put some sugar on top and say it’s fixed.
    • Hiring fast is hard.
    • The “magic formula” is an engineer who can become an entrepreneur and CEO.
    • Surprisingly, being CEO is a learnable skill. It’s easier than learning technical skills or entrepreneurship. A motivated engineer can learn to be CEO on the fly. Zuck and Jobs are two of the best CEOs and that’s their background.
  • James Lindenbaum, Heroku

    • Building a product for developers is hard but rewarding.
    • The process of making software is getting increasingly awesome-er, but deployment isn’t keeping up with that.
    • Wanted to abstract away deployment. Platform instead of servers.
    • For Heroku, developer UX is key.
    • Japanese poka-yoke: something that prevents you from making mistakes.
    • After launching, they realized they’d need venture backing.
    • YC is a bridge between the tech world (they’re approachable as hackers) and the investing world.
    • PG: “You should kill Oracle.” James: “Um, okay.”
    • Web-based editor was seen as a toy; devs loved the new git-based deployment
    • It is important to Heroku that they have code on their homepage; they want customers who get that.
    • Patterns
      • App decomposition into services: EC2 allows for extremely low ping times between disparate services.
      • Polyglot platform: devs are comfortable learning new languages and using multiple languages in a project.
    • Salesforce acquisition (2010): why? how?
    • They get to work how they’ve always worked, but now they enjoy Salesforce’s leverage
    • “Being made fun of by Larry Ellison…is the highest honor there is.”
    • It’s about taking your specialty and offering it as a cloud service.
    • Building tools for people who are building things gives you a lot of leverage and is lucrative
    • Scaling the team has been harder than scaling the platform.
  • Jim Goetz, Sequoia Capital

    • Spectacular companies start with ambitious but unknown founders, no pedigree required.
    • Search environment was crowded when Google started.
    • Sequoia’s 40 years of experience tell them that now is an excellent time to start a company.
    • It’s an order of magnitude easier to start a company now than it was a decade ago.
    • 10 billion mobile connected smartphones by 2020.
    • In the war between Apple and Google, devs win.
    • Business model as a weapon
    • “Unfair advantage” if starting a startup in Silicon Valley
    • In general, VC due diligence takes a few weeks.
  • Ashton Kutcher

    • To change the world you have to change yourself.
    • Red flag in entrepreneurship: “What will I get / who will I be by solving the problem?”
    • Don’t jump to the effect. You have to be the cause of a new reality.
    • “If you want to be the next Mark Zuckerberg, you will always be second best, because Mark Zuckerberg will always be a better Mark Zuckerberg than you.”
    • The story of Carl Fisher
    • It’s about leaving behind disruption for everyone to share, and how you can eliminate the space between people.
    • agrade@gmail.com
    • The biggest reason that SV/NY is attractive is that you have a certain culture of people surrounding you
    • Success is really imitation plus innovation
    • Startup “attitude” in LA: companies that spearhead content delivery are resistant to innovation.
  • Matt Mullenweg, Automattic

    • There’s a stage in every startup when you have more devs than users. Enlist your friends.
    • Be your own most passionate user.
    • “To be creative you need to be, or be sleeping with, someone who uses your software every day.”
    • Details matter. “There’s nothing like the crucible of real usage.”
    • Famous 5-minute install
    • “There’s nothing quite as permanent as a temporary business model.”
    • You need a better tagline.
    • Do your own support. Have support@example.com be an alias for everyone@example.com for as long as you can keep it up.
    • “If you are in school, please appreciate it before you drop out.”
    • “I don’t mind being on the Titanic, but I want to be steering it” (re: CNET)
    • PG’s Bayesian work influenced Akismet (blog comment anti-spam)
    • Time is short.
    • Never rely on a single partner for > 30% of your revenue.
  • Mark Pincus, Zynga

    • It’s hard to say when your startup has actually started.
    • He tried to buy CNET (!)
    • It’s shocking how much of our Internet behavior is represented by one company (e.g. Facebook for social, Amazon for shopping)
    • Value a single engineering day building the right product.
    • Test, test, test. Build the house that you want to live in, don’t build a spec house you’re going to flip ASAP.
    • Don’t worry about your resume or exit path. Go all in.
    • He’s a serial entrepreneur because he wasn’t able to create a sustainable company.
    • You also need a plan for when everything goes right (e.g. scaling the company)
    • It’s hard to raise money even when you’re profitable.
    • Early-stage entrepreneurs sometimes only want to pursue something if it gets funded. Wrong idea.
  • Paul Graham, Y Combinator (office hours)

    • In reading this batch of YC applications: in so many cases, the desire to start a startup precedes actually having an idea. The best startup ideas don’t come from people looking for startup ideas. Look for problems, not ideas.
    • It’s better to do something hard if you’re capable of solving hard problems.
  • Mark Zuckerberg, Facebook

    • The coolest thing about SV is that there’s no reason not to just try.
    • The biggest risk is not taking one.
    • 1st-gen web problems were all about scale. Now, it’s hard to cache when the experience is so personalized.
    • It’s fundamentally valuable to have the person making product decisions also have technical knowledge about the product.
    • He did hold a programming competition for hiring interns, but there was no alcohol like in The Social Network.
    • A fundamental of engineering: you never want to build the same thing twice.
    • Once you have a product, centralize your competencies (e.g. disparate marketing people becoming a Growth Team)
    • The point of Facebook isn’t the features, it’s the people.
    • Only sell your company if you’ll still get to do what you want to do.
    • Find the VCs that are aligned with you.
    • Surprisingly, you can learn a lot of stuff you don’t know along the way if you stay focused on the user.
    • SV culture sometimes favors starting a company before you actually have anything to build.
    • Huge bias: companies that succeed have passionate founders.
    • People will remember what gets built on top of the FB Platform more than they remember FB itself.
    • FB’s future: what can you build now that all of these social connections are in place?
    • SV is not the only place to be. Good for beginners though.
    • He would have stayed in Boston if he were to do it all over again.
    • The short-term focus of SV bothers him
    • Average time spent in a job in Seattle is 2x that of SV. Non-committal culture
    • Non-SV startups seem to be more focused on the long term.
    • There’s always an advantage to doing things differently than everyone else.
  • Stephen Cohen, Palantir

    • “The product advice you get from VCs is worth how much you’re paying for it.”
    • The CIA has a VC branch: In-Q-Tel
  • Max Levchin, Paypal

    • The job of the cofounder isn’t to commiserate with you. It’s to provide the platform of support when you need it.
    • Not having a cofounder can be detrimental. No one can hear you scream, “we’re fucked.” Your mom telling you that “everything will be okay” doesn’t mean much in the practical sense
    • Pick a cofounder that you respect. If you get a bad feeling, break up ASAP. “Whenever there’s any doubt, there’s no doubt.”
    • Problem: charismatic employee that’s a net negative. Get rid of them ASAP.
    • How to fire someone: “I’d like to ask you to resign.”
    • Classic engineering mistake: confusing hard and valuable.
    • South Park underpants gnomes episode
    • Plagues: fear of failure. Fear of judgment. Desire to impress someone. The only emotion you should allow yourself is passion. You can’t always be thinking “How will this make me look?”
    • Ignore your mistakes. The number one thing to worry about is “Am I doing what I’m good at?” Don’t dwell on what you did wrong, push on with what you’re good at.
  • Ron Conway, SV Angel

    • Media and the Internet are finally converging
    • Think big, Really big. Not enough people do.
    • A defining entrepreneur is a product visionary who owns the mind of their customer. Decisive.
    • Bootstrapping forever is great.
    • Design/UX are the new intellectual property.
    • He can tell a defining entrepreneur from a mile away.
  • Drew Houston, Dropbox

    • Everything big starts small
    • Everyone starts out clueless
    • Get out of your comfort zone
    • As a founder, you start spending more and more of your time on people stuff.
    • It’s easier to start out as an engineer and learn the business stuff than vice versa.
    • Learn a little bit about a lot:
      • sales
      • marketing
      • finance/accounting
      • product design
      • psychology, influence, negotiation
      • organizational design
      • management and leadership
      • business strategy
      • blogs, HN, founder stories
    • Take on more than you’re ready to, and get used to that feeling
    • The fastest way to learn about startups is to join one, NOT grad school, big companies, business school, banking, consulting, etc.
    • Stack the odds in your favor. Anyone can push themselves; put yourself in a situation where you’ll be pulled
    • Surround yourself with kindred spirits. You’re the average of your 5 closest friends.
    • Get plugged into the startup world via YC
    • Find the best investors
    • Dropbox is looking to build the Internet filesystem
    • Re: acquisition, independence is important for ubiquity.