25 Lessons from Sam Altman’s Talk on How to Succeed with a Startup
We were really inspired by Sam Altman’s recent talk during Startup School. As a result, we’ve created this post to summarise the key takeaways from his presentation. We hope you find it useful in your ventures going forward.
Lesson 1: A product so good people tell friends
Sam highlights that if you are able to build a product that is so good that people tell their friends — you have probably done 80% of the work to be really successful startups. He also points that if you think about really successful startups, such as Google or Facebook, you probably heard about them because someone told you to try them out at some point.
Something that people love so much that they tell their friends about.
Lesson 2: Easy to understand
You need to be able to explain clearly in a few words. Sam points out that failure to do so could be an indication of incorrect thinking about the problem or a need that isn’t big enough.
Lesson 3: Exponential growth in market
You need to be building a product in a market either growing or soon will be growing exponentially. Identify a market that is going to grow to be able to ride the growth of that market going forward.
Lesson 4: Real trends vs fake trends
Sam advises to learn to differentiate between real and fake trends. He says that before you make a big bet on a platform, you need to make sure you understand whether the trend is real. For example, early adopters of that platform need to be using it obsessively and tell their friends how much they love it.
Lesson 5: Evangelical founder
Someone at the startups will need to be someone who is able to recruit, sell the product, talk to the press, raise money. This requires someone who can infect with the enthusiasm the whole world about what the company is trying to do.
Lesson 6: Ambitious vision
This helps with recruitment and bring others on board. Closely interlinked with lesson 5 and 7.
Lesson 7: Hard startup vs easy startup
It is now easier to start a hard startup than it is to start an easier startup. Ambitious projects are more interesting. There are so many startups and this will help you to stand out from the crowd.
Lesson 8: Confident and definite view of future
Founders need to have confident and definite view of future is a common trait YC seems among many of their most successful entrepreneurs.
Lesson 9: Huge if it works
Entire startup ecosystem is setup to support startups that have a small chance of success, but are huge if they work. Going for something that is huge if it works will attract the best people!
Going for something that is huge if it works will attract the best people!
Lesson 10: Team
Sam points out that “the team you build is the company you build”. He hasn’t met many founders who spend enough time on recruiting. All successful founders will go through a transition where you transition from building a product to building a company and building a company is really about building a team.
Lesson 11: Optimist!
The whole world will be telling you why you are going to fail as a startup. If you don’t have that internal fire and belief, it is very hard to succeed.
Lesson 12: Idea generators
You need a few people in the company who are really good at comping up with ideas. Many of these ideas will be bad, but this does turn out to be super important overall.
Lesson 13: “We will figure it out”
Sam’s favourite thing to hear among early stage startups. There are a lot of things that will go wrong. This spirit is super important
Lesson 14: “I’ve got it”
Another important thing to hear among team members. Startups need people who are going to step up and say “I will do it”.
Lesson 15: Action bias
You need people to have bias toward action. Sam points out that startups in their early days often win by moving very quickly.
Lesson 16: The blessing of inexperience
YC has seen startups sometimes do incredible things no one told them it was hard.
Lesson 17: Momentum
Never lose momentum. Startups are not a good choice for work/life balance, especially in the early days. Startups survive on the own momentum. If you lose it, it is very difficult to get it back.
Lesson 18: Competitive advantage
Sounds so obvious, but many startups don’t know this when applying to YC. All of great businesses have an answer to this question. Something you need to have a plan for.
Lesson 19: Sensible business model
You need to know how you are going to make money.
Lesson 20: Distribution strategy
How are you going to grow and get users?
Lesson 21: Frugality, focus, obsession, love
You should be able to say this about the thing you are doing and yourself as a founder.
Lesson 22: One no vs one yes
One no in a large company can kill a new innovative idea — everyone in the corporate structure need to say yes. If you are startup, one yes from an investor is enough to launch. It is a very different mindset.
Lesson 23: Fast changing markets
This is where a startup can beat a large company. Startups great advantage is in its agility and speed.
This is where a startup can beat a large company.
Lesson 24: Platform shifts
Large companies work on annual plans and unable to quickly adapt to platform shifts.
Lesson 25: Look for ideas that sound bad but are good
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