I stumbled upon Venture Blog by accident as a result of Googling for “sand hill road” and was pleasantly surprised to find yet another interesting blog to add to my RSS reader.
Paul Graham recently gave a talk at Foo Camp 2006 about what the Y Combinator has learned from building startups. Here’s my compressed version of the entire post on Venture Blog by David Hornik.
Paul Graham: What We Learned So Far From Y Combinator About Startups
- The biggest weapon entrepreneurs have against failing is focus and determination. Startup success is the absence of failure. Let’s face it, there are infinite ways a startup can fail, and most do. Astoundingly smart people fail because they lack the maniacal focus required to help a startup succeed against the odds. Paul goes so far as to say that smart isn’t that important. There are lots of smart people. To him, smart pales in comparison to focus.
- Make something people want. The easiest way to make something that people want is to make something that you want. Yahoo! started out as a directory of Jerry and Dave’s favorite links. Jonathan started Friendster to find a girlfriend. Zuckerberg started FaceBook to find a girlfriend. If you build something you want, chances are pretty good that someone else with want it as well.
- Build something you know others will want. It requires a lot of listening and a lot of luck. Truly successful startups solving other people’s problems are often started by domain experts who see big problems with the status quo and leave their industries to go solve those problems. That might work. But it is still really hard. It’s a lot easier to really understand your own problems than someone else’s.
- Listen and react. Even companies building something that the founders themselves want need to listen to feedback on their product in order to morph their idea to appeal to the largest (or most valuable) constituency possible. It is OK to be stubborn and have good judgment, but it is still better to have bad judgement and not be stubborn. Startups are necessarily fluid and agile. It is what gives them a chance of succeeding despite the long odds and giant competitors.