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What you need to know to succeed in a startup is not expertise in startups, what you need is expertise in your own users” – Paul Graham.

This post contains points that resonated with me from Paul Graham’s lecture to Stanford about the counterintuitive aspects of running a startup and how to have ideas. Y Combinator has distilled its experiences and insights about how to start a startup into a series of lectures for Stanford University.  Most of the lectures are delivered by people with an impressive track record of hypergrowth in their companies and huge exits under their belt.

 

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Y Combinator has distilled its experiences and insights about how to start a startup into a series of lectures for Stanford University.  Most of the lectures are delivered by people with an impressive track record of hypergrowth in their companies and huge exits under their belt.

I’ve taken notes of the bits that resonated with me, and am sharing these in case they’re useful.  You can find a link to the lecture at the end of this post.

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The previous lecture focussed on Idea and Product.  The second lecture is about having the right team and the importance of execution.

Co-founders

  • A startup should ideally have 2 or 3 cofounders – not more and not less.
  • Choose a co-founder as carefully as you would choose an employee.  In YC, the number 1 cause of early death in startups is co-founder conflict. Make sure that the person you choose is relentless resourceful, tough and calm.  That’s more important than them being an expert in a given domain.
  • Decide on an equity split quite early on – don’t let it drag on.  Also, have vesting on equity.

Employees:

  • Avoid hiring in the early days.  Keep the team as small as possible, even if that means it’s just the co-founders. However, later on, when you’re scaling up, you should learn to hire very quickly.
  • Getting an early hire wrong can be very damaging to a startup.  Mediocre hires during the early phase can kill startups.
  • For early hires, experience may not matter as much as aptitude and belief in what you are doing.  Good communication skills tend to correlate with hires that work out. 

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Y Combinator has distilled its experiences and insights about how to start a startup into a series of lectures for Stanford University.  The lectures are delivered by people with an impressive track record of hypergrowth in their companies and huge exits under their belt.  If your goal is hyper growth, then the content in these lectures is for you.

I’m working through the lectures and these are notes I made for myself which I’m sharing here in case they’re of use to anyone. You can find a link to the lectures at the end of each set of notes.

This first lecture starts by talking about assessing your idea and building the right product.  How do you decide whether the idea for your startup is worth pursuing?

  • It’s worth doing if you find that you can’t not do it, and that the world needs you to pursue it.
  • Stress test the idea; this should help you assess whether your idea is worth pursuing. Ask yourself about the size and growth potential of your market, the growth strategy for your company, and how easy it would be to replicate your business.
  • Think about what the size of your market will be in 10 years; don’t just focus on the size now.  Small but rapidly growing markets are better than larger, slowly growing one as these will usually have customers who are desperate for solutions and who will trial a limited but rapidly improving ones.
  • Good ideas may often look very bad at the beginning.  Ignore the naysayers.
  • Have a mission; you’ll need one to get people behind your idea.  It’s easier to get support for a hard-startup than an easy, derivative one. People are compelled to work harder to make something difficult come together.
  • Ask yourself, why now?  Why will it be too late to start two years from now and why didn’t it get started 2 yrs ago?

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download

Am I old fashioned for thinking that you should read stuff before sharing it online?

It is easy for people to share links to articles that they haven’t even READ! And it’s about to become even easier….

Buffer’s new product, Daily, is basically Tinder for Content.  Swipe to the right to share. Swipe to the left to skip. ( Tinder, for those who don’t know, is a popular dating app).

Sounds great for quantity but (more…)

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 bitcoin-logo-plain

I was avoiding the topic of bitcoins fearing it would take too long to wrap my head around it. But it’s time I bit the bullet.

Like everyone else, I want to be able to answer questions like: ‘Are crypto currencies a good thing?  What are the risks and are these being adequately addressed?’ How do crypto currencies other than Bitcoin fit in to the picture?’.

But before you can form an opinion on these matters, you need to know what Bitcoin is and how digital currencies work. The problem for people who are new to the conversation is that the discussion is filled with vocabulary and concepts that are unfamiliar to many of us such as:

  • blockchain

  • cryptocurrencies

  • encryption keys

  • mining

  • proof-of-work

  • hashcash (more…)

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I have a brain and I like to think it’s well-developed. But then things like this happen: at lunch today I somehow upgraded my BBQ chicken wrap to the more expensive meal deal option which included the chips and drink I didn’t originally want…. why did I do that?

Understanding how we choose

When you give people different options and tell them to choose one, they tend to compare the benefits in order to work out the value of things first.  Most of us don’t know what we want unless we view it in some context; we rarely value things in absolute terms as it’s hard to make decisions in a vacuum. Furthermore, it’s harder to compare things that are dissimilar so, unsurprisingly, we prefer to compare items that are similar.

Businesses that are aware of this can exploit this tendency to influence what people buy.  They can do this by including decoy items to make one item (the one they’d like you to pick) look more attractive than another.  A well-known example that is often used to demonstrate this is The Economist’s subscription options:

(a) web only: $59

(b) print only: $125

(c) web & print: $125 (more…)

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Days after it was announced that the mobile messaging app Viber was acquired by Japanese internet giant Rakuten for $900million, the news was dwarfed by the noise following the announcement that Whatsapp had been bought by Facebook for a record $19bn.  This post contains some of my favourite reactions to the news from Twitter & 9gag.com, a selection of opinion and analysis from industry experts and a list of items that Facebook could have spent the money on instead.

Does EVERYONE think that Facebook overpaid for Whatsapp?  Asia has already seen the potential that other regions of the world are only beginning to see in mobile messaging apps, according to this Wall Street Journal blog article.  Some of Whatsapp’s biggest competitors in Asia are Line in Japan, KakaoTalk in Korea, and WeChat in China.  These messaging apps have developed into platforms that allow users to access a range of services.

For example, China’s WeChat offers e-commerce services to its users, and Japan’s Line offers mobile games, which they say are a big source of revenue.  Messaging apps have been considered a hot mobile service in Asia for some time and Line’s Chief Strategy and Marketing Officer says:

“The amount that Facebook is offering to buy WhatsApp is not excessively high. This is a proof of how valuable smartphone messaging has become in the age of mobile.” 

Over at Reuters, finance blogger Felix Salmon (@felixsalmon) suggests that to ask whether Facebook paid too much is to ask the wrong question. With this acquisition Zuckerberg is making a statement that mobile is more important than money. Facebook’s mobile offering is not as popular as its desktop product. After going public, everyone knew that leading on the mobile front would be the next biggest challenge and Zuckerberg would need to make the transition as quickly and aggressively as possible.  That’s what he’s been doing. You can read more of what Felix Salmon has to say in his article here.

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