Lecture 1 - How to Start a Startup (Sam Altman, Dustin Moskovitz)

> Another solid YC investment at work. I actually think this is an interesting example of YC's investments, but not for the reason you seem to suggest. YC's public persona is all about "hyper-growth" and building "very large" companies[1]. But if you go through the list of companies it has funded, a good number would have a very difficult time making a prima facie case that they fit the profile of a business that can achieve significant growth and scale. Dating Ring is the perfect example of that. There are numerous challenges associated with breaking into the online dating space generally. First, the costs of customer acquisition are typically quite high because there's so much competition. That makes it very difficult for new services to gain traction without significant investment in advertising. Second, there's an additional level of churn built in to this market because when a dating service works, it loses customers. That produces a constant need for investment in the aforementioned user acquisition which is so costly. More specifically, Dating Ring seems to be positioned in no man's land (no pun intended). It can't compete with the quantity and immediate gratification of online services that cost nothing or roughly the same, and it can't compete with the quality and exclusivity of matchmaking services which generally have costs signaling much higher value. If the OP's comment is true, Dating Ring would ironically appear to be offering the worst of both worlds by trying

[link] I offered similar thoughts when Dating Ring first launched: YC's public persona is all about "hyper-growth" and building "very large" companies[1]. But if you go through the list of companies it has funded, a good number would have a very difficult time making a prima facie case that they fit the profile of a business that can achieve significant growth and scale. Dating Ring is the perfect example of that. There are numerous challenges associated with breaking into the online dating space generally. First, the costs of customer acquisition are typically quite high because there's so much competition. That makes it very difficult for new services to gain traction without significant investment in advertising. Second, there's an additional level of churn built in to this market because when a dating service works, it loses customers. That produces a constant need for investment in the aforementioned user acquisition which is so costly. More specifically, Dating Ring seems to be positioned in no man's land (no pun intended). It can't compete with the quantity and immediate gratification of online services that cost nothing or roughly the same, and it can't compete with the quality and exclusivity of matchmaking services which generally have costs signaling much higher value. If the OP's comment is true, Dating Ring would ironically appear to be offering the worst of both worlds by trying to package users from the former as part of a service masquerading as the latter. Ev

Great question. An optimal strategy doesn't exist, because it is so circumstantial. The employee and founder (the seller) need a good idea about the price and probability of success. Making a buy/sell decision either way certainly effects outcomes, independent of the ultimate success. It really depends how the seller values the stock, and how that differs from the buyers valuation. Knowing a lot about (startup) stock valuation will certainly help. Probably its more political than anything, because the price of a 100M$ company can fluctuate wildly, and so being in similar situations should help as well. I don't know much about Silicon Valley, but there you have a lot of investor driven companies (people raising money to push the value, to raise more money, etc. without a real business seems much more common). The 10B$ outcome is exceedingly rare, so the employee should think really hard about the value (see Moskovitz talk about it here at 36:00 [this video] ) Usually 1M$ will be much more valuable when going from 0 then the next 1M$. In the example it seems irrational not to sell for 1M$, if the employee doesn't have already a lot of money. But usually people are not given the choice and need a liquidity event (IPO or acquisition). If one assumes that shares could be liquid from day 1 the dynamic changes. Most likely options will have vesting. The real issue here however, in most cases, is that there is no liquid market until very later stages. So the company might be worth 100M$ i

The articles that are most relevant are probably ones from YC itself, along with ancillary material on startup woes, pitfalls, etc. Among the advice is how to validate ideas, is how to maintain momentum, knowing when to ship, when to wringing your hands and stop adding features, etc. Obviously geared towards startups and businesses but also applicable to projects. The pieces of advice that I try and follow (and often fail at following) are: * Commit to completing projects, not time. I'm bad at estimating time and putting time limits stresses me out. I prefer to work towards a goal rather than a time limit. * Be vicious about removing features that are superfluous to the main project in order for it to ship. "Nice to have" features can be added later. A mediocre project that ships and can be improved later is better than a perfect project that never ships. * Get some space. Getting a little burnt out is easy to do and almost inevitable. Even taking a day or week away sometimes recharges my batteries. The hopelessness I feel about the amount of effort required to complete seems less daunting once I've recharged. This is even better if it ships because the daunting extra "nice to have" features, refactoring or complete architecture overhaul seem less daunting when I'm rested and recharged. * Don't get into "all or nothing" elements. Break up large projects into smaller manageable pieces as much as possible. Insofar as is possible, have smaller "shippable" elements that contribut