What qualities does Y Combinator look for in a founding team?

YC looks for teams that demonstrate determination, the ability to get things done, and effective collaboration. Founders who have known each other and are solving a problem they are passionate about, ideally as domain experts, are highly valued.

Can Y Combinator invest in solo founders?

Yes, YC does fund solo founders. However, it's acknowledged that startups are incredibly demanding, making the bar significantly higher for sole founders who must juggle all aspects of the business.

What's the worst way to find a co-founder?

The worst way to find a co-founder is by seeking one simply to fill a gap or meet application criteria using someone you barely know. This can be destructive to the startup.

Can you be too old to found a startup with YC?

No, YC does not have an age limit for founders. They have funded founders of all ages, including those in their 30s and older, focusing instead on determination and the ability to solve a big problem.

What should early-stage startups focus on for growth?

While the exact best growth strategy varies, early-stage startups must focus on acquiring more users. It's often easier to identify what startups *wrongly* focus on or get distracted by, rather than prescribing a single strategy.

How should founders explain their startup idea?

Founders should be able to explain their startup idea clearly and succinctly, ideally in a way their grandparents would understand. This clarity is crucial for growth through word-of-mouth.

What is a surprising observation about successful startups?

Even highly successful companies that receive press often have significant internal 'brokenness' that the public doesn't see. This can be inspirational, showing that challenges are normal.

Key Moments

Q&A with YC at the Female Founders Conference 2016

Y Combinator

Science & Technology5 min read18 min video

May 31, 2016|4,528 views|38

YC Y Combinator

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Key Moments

TL;DR

YC partners reveal that even highly successful startups are often deeply flawed, emphasizing that perseverance and a clear mission are key qualities they seek, not perfection.

Key Insights

YC has a Fellowship program for idea and prototype stage companies, indicating they support founders at virtually any stage of development.

YC looks for teams demonstrating determination, ability to execute, and effective collaboration, rather than a specific team composition.

YC is not deterred by a startup being in the 'trough of sorrow'; their role is to help companies navigate these difficult periods.

Founders who have a deep understanding of the problem they are solving, often as domain experts, are highly valued.

YC funds solo founders, but acknowledges the significantly higher bar for success due to the sheer volume of work required.

Jessica Livingston envisions a future with numerous female-founded unicorns, stating that the world of startups is dramatically different now than when YC started 11 years prior.

YC welcomes founders at any stage

Y Combinator partners emphasized that there is no 'too early' or 'too late' to apply. They encourage any startup seeking help to apply, whether they have just an idea or are looking to scale an existing business. To further support very early-stage companies, YC has introduced a Fellowship program for those at the idea and prototype phase. The application process itself is also presented as a valuable exercise, helping founders clarify their thoughts and business strategy, even if they don't ultimately submit their application.

What YC looks for in a team

When assessing potential applicants, YC prioritizes teams that exhibit determination, a proven ability to get things done, and effective collaboration. While there isn't a single 'ideal' team makeup, these core qualities are crucial. Founders who have known each other for a while or have worked together previously are often favored, as are those solving a problem they personally understand and have a deep connection to. Prior experience in building something, even if not their current idea, demonstrates effectiveness. YC seeks founders who aren't afraid to put in the hard work, highlighting the 'cockroach' mentality – the ability to persevere through tough times and stick with an idea, even through pivots and challenges. A passion for the problem and a long-term commitment to the startup are strong indicators.

Navigating the 'trough of sorrow'

Y Combinator partners are not afraid of investing in companies that are experiencing difficulties, what they term the 'trough of sorrow.' They highlighted the example of Gobble, a company whose founder, Kashish, was known to YC and was in a phase of struggle. YC's role is precisely to help companies emerge from these challenging periods. They don't view a startup's current struggles as a deterrent but rather as an opportunity to apply their expertise. This reflects a broader understanding that many successful startups, even those that become giants like Airbnb, likely went through periods of intense difficulty and uncertainty that were not apparent from the outside. The key is identifying founders and general business areas with potential, even if the specific execution needs adjustment.

The importance of 'big ideas' and domain expertise

A core element YC looks for is a 'big idea' – something with massive potential, even if the idea itself might evolve over time. This is coupled with a strong emphasis on founders being domain experts. When founders deeply understand the problem they are trying to solve, it typically indicates a level of passion and commitment that will drive them forward. YC actively seeks out founders who have identified a significant problem that is 'super broken' and needs fixing, as this often indicates a substantial market opportunity. This deep knowledge also allows founders to articulate their vision clearly and concisely, a critical skill for demonstrating preparedness and potential to investors.

Clarity in communication is key

The ability to clearly and succinctly explain what a startup does is paramount. YC partners stressed that if they, as experienced investors, cannot understand a company's proposition within the first few minutes of an interview, it signals that the founder has not thought through their business model sufficiently. Clarity in communication is not just for investors but also for broader market adoption. A company needs to be able to explain its value in a way that a 'grandparent could understand' to facilitate word-of-mouth growth. If the core function of a business is incomprehensible, scaling through organic means becomes an insurmountable challenge.

Solo founders are possible, but challenging

While Y Combinator does fund solo founders, the partners acknowledged that it is an exceptionally difficult path. The sheer volume of tasks required to run a startup—from product development and sales to fundraising—means that a single individual is constantly stretched thin. If a solo founder is focused on sales, they cannot be building, and vice versa. Hence, the bar for success is significantly higher for solo founders. Despite the challenges, numerous examples exist of successful solo-founded companies, demonstrating that it is achievable with immense dedication and capability.

Risks of choosing a co-founder out of necessity

A strong piece of advice offered was against seeking a co-founder simply to fill a perceived gap or to meet application criteria. This approach, of 'tacking on' a co-founder one barely knows, is considered a terrible idea. The potential damage caused by a poorly matched co-founder, especially one who doesn't share the same vision or goals, can be destructive to a startup. It's far better for founders to attempt to navigate the early stages on their own or to find co-founders through organic relationships and then thoroughly test the partnership, perhaps through a trial period, before making a long-term commitment. Mediating founder breakups is a painful experience for YC partners, often resulting in the company's demise due to interpersonal issues rather than business problems.

Future aspirations for female founders

Jessica Livingston expressed a strong desire to see a significant increase in female-founded 'unicorns' within the next ten years. She hopes that in the future, referencing successful startups will predominantly involve companies founded by women, rather than relying on historical examples like Facebook and Google. This vision is considered entirely achievable given the rapid evolution of the startup landscape over the past decade. The surprising realization for YC, even after years of operation, is how 'broken' even highly successful startups often are; this offers inspiration by showing that perfection isn't the prerequisite for success. The message to all aspiring founders is to keep moving forward, grow, work through obstacles, and strive for success.

Mentioned in This Episode

●Software & Apps

●Companies

●People Referenced

Common Questions

Y Combinator accepts companies at all stages, from initial ideas and prototypes to those already established and seeking to scale. There's no such thing as too early or too late to apply.

Topics

Mindset & Self-Improvement Business & Entrepreneurship Team-building Venture Capital Startup Funding Growth Strategy Early Stage Startups Founder Qualities Startup Resilience

Mentioned in this video

People

Paul Graham

Co-founder of Y Combinator, mentioned in the context of starting YC with Jessica Livingston and funding startups with $12,000.

Jessica Livingston

One of the speakers, reflecting on her time at YC and her vision for female founders in the future.

Kevin Hale

A partner at YC running slides backstage.

Carolyn Levy

A partner at Y Combinator and YC's in-house counsel. She was previously YC's lawyer since 2006.

Jerry Brown

Was seen relaxing on the stairs of a state building while someone was walking by.

Susan Hobbs

Director of events for the Female Founders Conference 2016.

Companies

Airbnb

Mentioned as an example of a company whose initial idea (hand-gluing cereals) sounded 'bananas' to investors, highlighting that great startups can be founded by great founders even if the initial idea is unconventional.

Style B

A YC-funded company with a female founder that did makeup for the event.

Gobble

A company that YC invested in. The speaker knew the founder, Ooshma, for years and found her thoughtful and capable of navigating difficult periods.

Software & Apps

Y Combinator Fellowship

A program started in the fall of the previous year (11 years prior to 2016) that works with even earlier stage idea and prototype stage companies.