How to start a Startup – Lecture 2

This week we kept exploring the YC lectures about starting a Startup. This second lecture is about team members and cofounders. For more information just check the link!

 

How to start a Startup

Lecture 2: Ideas, Products, Teams and Execution part II -> To see the video press here

Cofounder relationships are among the most important in the entire company. Everyone says you have to watch out for tension brewing among cofounders and you have to address is immediately. The number one cause of early death for startups is cofounder blowups. But for some reason, a lot of people treat choosing their cofounder with even less importance than hiring. Don’t do this! This is one of the most important decisions you make in the life of your startup and you need to treat it as such. It’s better to have no cofounder than to have a bad cofounder, but it’s still bad to be a solo founder.

To get the very best people, they have a lot of great options and so it can easily take a year to recruit someone. It’s this long process and so you have to convince them that your mission is the most important of anything that they’re looking at. There is a famous test from Paul Graham called the animal test. The idea here is that you should be able to describe any employee as an animal at what they do. Mark Zuckerberg once said that he tries to hire people that A – he’d be comfortable hanging with socially and B – he’d be comfortable reporting to if the roles were reversed.  You don’t have to be friends with everybody, but you should at least enjoy working with them. And if you don’t have that, you should at least deeply respect them.

One thing that founders forget is that after they hire employees, they have to retain them. You have to make sure your employees are happy and feel valued. This is one of the reasons that equity grants are so important. People in the excitement of joining a Startup don’t think about it much, but as they come in day after day, year after year, if they feel they have been treated unfairly that will really start to grate on them and resentment will build.

As a founder you have to let your team take credit for all the good stuff that happens, and you take responsibility for the bad stuff. You shouldn’t tell your employees they’re messing up every day unless you want them all to leave because they will.

Execution for most founders is not the most fun part of running the company, but it is the most critical. Many cofounders think they’re just signing up to this beautiful idea and then they’re going to go be on magazine covers and go to parties. But really what it’s about more than anything else, what being a cofounder really means, is signing up for this years long grind on execution and you can’t outsource this. The way to have a company that executes well is you have to execute well yourself. Everything at a Startup gets modeled after the founders. Whatever the founders do becomes the culture.

It’s easy to move fast or be obsessed with quality, but the trick is to do both at a Startup. You need to have a culture where the company has really high standards for everything everyone does, but you still move quickly. Apple, Google, and Facebook have each done this extremely well. It’s not about the product, it’s about everything they do. They move fast and they break things, they’re frugal in the right places, but they care about quality everywhere.

 

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