Y Combinator Notes – 2

How to know the growing markets?

This turns out to be the easiest problem. Young people already can observe their environment, and they know what young people use, and what they will use in the future better than other people. Therefore, use college as a place to meet more people, to observe technologies, and to meet with potential cofounders.

Hiring First Employees

This is a very important part. In early stage, either spend your:

  • 0% time, and hire no-one
  • 25% time, and hire really good people

First employees usually become part of the team. Around 10% should be shared between the first 10 employees. Therefore, you need to choose them wisely. Some rules are:

  • Don’t hire too many people
  • Make every employee believe in the companies mission
  • Spend months(even 1 -year) to hire first employees
  • Do not hire a mediocore engineer, this will kill the company
  • Experience is not crucial for the first employees, but these three are important:
  • – Smart
  • – Getting things done
  • – Independently working
  • Best way to find an employe is to work together, if not possible ask about the past projects
  • Getting someones reference can also be a good way to find an employee
  • Fire people fast, don’t wait to fire someone
  • If an employee cannot make a decision, don’t make decisions; get better people who can decide


TODO: animal test reference


Whatever cofounders do, it becomes the culture.

Being CEO

  • Focus only on really required stuff
  • Don’t do/delegate non-urgent stuff
  • Don’t work on something that does not matter for the users
  • Have very good communication
  • You are not the boss, you need to report to everyone
  • Small amount of extra work makes a huge difference in the competition

When should we split the shares?

  • Don’t move deciding on the share into the future
  • Ideally, split the shares after starting working together
  • Split nearly equal

What happends if one cofounder leaves?

  • Use cofounder vesting equity
  • Talk early!

What if cofounders are not in the same location?

  • This simply does not work
  • Communication and speed is a problem in the early stage
  • Being in-person for some reason makes things work

What if there is a debate between co-founders?

Sometimes it is possible there is a debate between co-founders, and this slows down the growth in the startups. Just go to the customer and ask. Customers decide on what to do. Therefore, the feedback cycle is important.

What happens if there is a slow-down in the team?

You need to keep the team motivated. Startups usually try long speeches to achieve that. Instead, you can develop and release new versions. In each meeting you need to put something new as a team.


[1] https://www.youtube.com/watch?v=crMVJAf5TjA&list=PLQ-uHSnFig5MaafmEhFox7rO-b0RxQth-

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