How to Start a Startup (2014)(startupclass.samaltman.com)
startupclass.samaltman.com
How to Start a Startup (2014)
https://startupclass.samaltman.com/
75 comments
Just to add to this comment. If users can't watch/read, you can listen to podcasts while you run or drive a car, it can help you to understand how people try to build a business. There was a podcast (How to Start a Startup | Podcast on Spotify)
. On that note, I enjoyed also listening to those who are building projects, and share their journeys e.g. Nathan's interviews with SaaS founders (https://nathanlatka.com/podcast-thetop/) and The Startup podcast(https://gimletmedia.com/shows/startup)
Reminds me a quote of Naval Ravikant -
"Free education is abundant, all over the internet. It's desire to learn that's scarce."
I think two things contribute:
1. People think the point of education is credentials and free online courses don't typically come with credentials.
2. People routinely use price as a proxy for value. This makes it hard to feel confident that a free course is actually worthwhile.
The nice thing about YC's free education is that neither of these applies.
If you want to start a business, you mostly don't need credentials. (There are exceptions.) You mostly just need to know how to make it happen.
They have a really good reputation. They know what they are talking about.
Bonus points: They do this stuff for free because HN and Startup School are both part of their funnel. If you actually do start a business and hope to grow it big, they would like a piece of the action.
So you know they are giving you good information because they want you to succeed so they can get a cut of some of the businesses that succeed that started out just consuming their free stuff. That's exactly how they make their money and there is a lot of money at stake, so it's worth it to them to give some stuff away for free.
1. People think the point of education is credentials and free online courses don't typically come with credentials.
2. People routinely use price as a proxy for value. This makes it hard to feel confident that a free course is actually worthwhile.
The nice thing about YC's free education is that neither of these applies.
If you want to start a business, you mostly don't need credentials. (There are exceptions.) You mostly just need to know how to make it happen.
They have a really good reputation. They know what they are talking about.
Bonus points: They do this stuff for free because HN and Startup School are both part of their funnel. If you actually do start a business and hope to grow it big, they would like a piece of the action.
So you know they are giving you good information because they want you to succeed so they can get a cut of some of the businesses that succeed that started out just consuming their free stuff. That's exactly how they make their money and there is a lot of money at stake, so it's worth it to them to give some stuff away for free.
I personally like Keith Rabois' and Ben Horowitz' material, in the list provided here. Those two individuals have built stuff, have suffered through painful moments in their entrepreneurial life, and have helped several startups do the same (with money and advice).
I am less of a fan of the rest of the material, but that might be just my preference.
I keep seeing lots of "bashing" when Sam Altman writes or says anything, and I'm not sure why. Agreed that he has his own way of interacting with the world, which sometimes suggests (at least to me) that he's living in a very thick bubble, and/or that he's not really able to be empathic with "normal" people. But besides that, I think he's a decent human being and his intentions are good, which in my book is more than enough to cut some slack and appreciate what he can offer.
I am also sometimes a critic of YC's material and "cool aid" approach, but again, I just try to take what works for me and simply ignore the rest. YC has the great merit of having democratized part of the process.
I think that right now founders have usually a decent deal; VCs are the top of the food chain; and early employees, and then mid-stage employees, got the shorter stick. But it's overall much better than it was twenty years ago. Again, IMHO.
On "how to start a startup", it's almost the year 2021, and I think that while some principles apply, we might need new ones; and that large corporations are making it harder for startups to succeed. E.g. try to build and "enterprise IT" startup, and you'll quickly see some sort of competition from AWS, Azure and GCP (in descending order), way earlier that what it would have been 10 years ago.
Or try to build b2c stuff, and wait for the big guys to show up at your door with a competing product or service very quickly.
I still admire the ones that start a startup these days. There's a huge difference of "opportunity cost" between white guys with a Stanford/MIT/etc background and a wealthy family behind them, versus a "normal" set of founders from a non-US background and very little money as a backup plan. I root for the latter, perhaps unfairly. I want to see more "rags to riches" stories, I want to hope that inequality and unfairness are going down in the world.
And finally, I also hope that instead of simply building "something that people want" (YC's motto), we see more and more people building something that is good for the world.
I am less of a fan of the rest of the material, but that might be just my preference.
I keep seeing lots of "bashing" when Sam Altman writes or says anything, and I'm not sure why. Agreed that he has his own way of interacting with the world, which sometimes suggests (at least to me) that he's living in a very thick bubble, and/or that he's not really able to be empathic with "normal" people. But besides that, I think he's a decent human being and his intentions are good, which in my book is more than enough to cut some slack and appreciate what he can offer.
I am also sometimes a critic of YC's material and "cool aid" approach, but again, I just try to take what works for me and simply ignore the rest. YC has the great merit of having democratized part of the process.
I think that right now founders have usually a decent deal; VCs are the top of the food chain; and early employees, and then mid-stage employees, got the shorter stick. But it's overall much better than it was twenty years ago. Again, IMHO.
On "how to start a startup", it's almost the year 2021, and I think that while some principles apply, we might need new ones; and that large corporations are making it harder for startups to succeed. E.g. try to build and "enterprise IT" startup, and you'll quickly see some sort of competition from AWS, Azure and GCP (in descending order), way earlier that what it would have been 10 years ago.
Or try to build b2c stuff, and wait for the big guys to show up at your door with a competing product or service very quickly.
I still admire the ones that start a startup these days. There's a huge difference of "opportunity cost" between white guys with a Stanford/MIT/etc background and a wealthy family behind them, versus a "normal" set of founders from a non-US background and very little money as a backup plan. I root for the latter, perhaps unfairly. I want to see more "rags to riches" stories, I want to hope that inequality and unfairness are going down in the world.
And finally, I also hope that instead of simply building "something that people want" (YC's motto), we see more and more people building something that is good for the world.
Why everyone shitting on sam lol. If you're looking for other complementary stuff, you might find these useful
- https://www.ycombinator.com/library
- https://www.forentrepreneurs.com/saas-metrics-2/
- http://christophjanz.blogspot.com/
- https://www.kalzumeus.com/
- https://pmarchive.com/
- https://www.ycombinator.com/library
- https://www.forentrepreneurs.com/saas-metrics-2/
- http://christophjanz.blogspot.com/
- https://www.kalzumeus.com/
- https://pmarchive.com/
Sam‘s articles are great！I have translated 《Startup Playbook》 into Chinese【1】，now I’m running a startup and I find that every sentence in that book is useful，even in China.
【1】https://playbook-cn.github.io
【1】https://playbook-cn.github.io
The transcript is here: https://genius.com/Sam-altman-lecture-1-how-to-start-a-start...
There’s a striking aspect of this talk, near the end: it explains why you don’t need to start a startup to have a big impact on the world. Google Maps and the Facebook Like button were two examples.
There’s a striking aspect of this talk, near the end: it explains why you don’t need to start a startup to have a big impact on the world. Google Maps and the Facebook Like button were two examples.
[deleted]
[deleted]
(2014)
These lectures are timeless. The advises in there are still valuable in .net era.
It's not a criticism. It's standard practice to put the year in the title on HN for older articles so as to give context.
Gott yo :)
Added. Thanks!
Not to be a dick, but Sam hasn't started a sustainable business; so keep that in mind when you read this advice.
From https://en.wikipedia.org/wiki/Sam_Altman:
> In 2005, at age 19,[9] Altman co-founded and became CEO of Loopt,[10] a location-based social networking mobile application. After raising more than $30M in venture capital, Loopt was shut down in 2012 after failing to get traction. It was acquired by the Green Dot Corporation for $43.4 million.[11][12]
From https://en.wikipedia.org/wiki/Sam_Altman:
> In 2005, at age 19,[9] Altman co-founded and became CEO of Loopt,[10] a location-based social networking mobile application. After raising more than $30M in venture capital, Loopt was shut down in 2012 after failing to get traction. It was acquired by the Green Dot Corporation for $43.4 million.[11][12]
I also never find the things he says very inspiring. Just rehashing the obvious mostly. Of course even the most obvious things might be useful to someone, but the bars for what Sam Altman says during what he calls a "lecture" should be higher than that.
If you listen to what a lot of YC partners say, most of them never say anything that is very insightful. Most are generic advice that can be applied to anything. And some partners have already spent more time at YC than actually founding startups, which makes me think how useful their advice really is. I, myself, don’t really find much value in them. But I am sure young 20 something founders gobble their advice up.
From what I've read [0], the most obvious advice is what first time founders need (even if they do not seek it). Serial entrepreneurs may already know but obvious advices re-align their internal compass.
[0] https://www.ycombinator.com/library/48-mistakes-first-time-f...
[0] https://www.ycombinator.com/library/48-mistakes-first-time-f...
Back in 2014 I found his lectures, and many of the other videos in the course very useful. Coincidentally, at the time of the course I was launching a software product and by applying some of the concepts learnt in the course it became something that is now bringing some $600K yearly in mostly passive income. So you do not need to go all the way in start up mode to get value from it. Reharshing the obvious is still great advice. We all have lots of blind spots.
What were some of those concepts that ended up being usefu?
Possibly those that turned out to be most useful were the importance (and resilience) of integrations (Box guy), the quest to try to create monopolistic situations (Palantir guy), importance of a North star KPI (Facebook guy). But the course has lots of other concepts (understand your customers by doing things that don't scale, focus on what customers want, not on what competitors do, etc).
Thiel is an outlier for me imo, that guy is gangsta
Would you be willing to share roughly what space your product is in?
[deleted]
“Seek advice from those who have become who you want to be”
There may be elements of Altman people admire beyond the sustainable business - but your criticism is fair.
There may be elements of Altman people admire beyond the sustainable business - but your criticism is fair.
Great quote and I totally agree but Sam is definitely capable of delivering value to business even if he hasn't started one from scatch
He's made investment decisions in successful companies and knows dozens of founders who have "made it". Despite not doing it himself, his experience is almost as good as it gets as an expert. If anything, having a decent track record across several companies means he's more aware of the patterns required for success than a unicorn founder who's only started one company due to suvivorship bias and path dependence.
As an investor, he's also incentivized to dish out solid advice to his portfolio companies and also to companies that are potential investments.
As an investor, he's also incentivized to dish out solid advice to his portfolio companies and also to companies that are potential investments.
To be clear, he is incentivized to dish out advice that is good for the investors. That is not always the same thing as good for the founders. A solid, sustainable, bootstrapped, slow-growth company is great for founders. But you won't find advice on how to do that. On the contrary, you'll often find it dismissed as "not a startup".
You don't raise money if you don't want to be a VC funded hypergrowth company. If you don't aim that high no one funds you anyway. It's a difference in definitions, for their definitions see Paul Graham's startup = growth
But yeah once you take the money and you need that exit, you're going to have a hard time. It's up to the founder to decide from the beginning
But yeah once you take the money and you need that exit, you're going to have a hard time. It's up to the founder to decide from the beginning
I’d take a look at the material and his writings before making that kind of judgement. Besides being smart, he seems to have a lot more humility than most of the people who give advice about startups, and he’s seen an unusually high number of startups throughout the process so he is in a great position to observe what works and what doesn’t. I’d much rather hear what he has to say than someone with one successful exit, mostly because I’ve come to trust his mind observational skill and his humble demeanor over the years.
Most of these videos had counterintuitive information that I was happy to have heard before getting started — especially since I came from a completely different industry. They won’t tell you near everything you need to know to get started, but nothing will so as far as these things go I found them to be very helpful.
Most of these videos had counterintuitive information that I was happy to have heard before getting started — especially since I came from a completely different industry. They won’t tell you near everything you need to know to get started, but nothing will so as far as these things go I found them to be very helpful.
Maybe I'm not seeing the right material but when I watch stuff like https://www.youtube.com/watch?v=0lJKucu6HJc from him, all I hear are mind-numbing platitudes. Having a "sensible business model" might have been my favorite piece of advice from that one.
Very happy for you to disagree with me friend. My mentor is super successful, one of the smartest people I've worked with...he's never started a business. I don't think he could.
Just because you understand the theory doesn't mean you can start a business. That's all I'm hoping to point out. I wish to take nothing away from Sam's success. In purely monetary terms Sam is infinitely more successful than I might ever be.
Just because you understand the theory doesn't mean you can start a business. That's all I'm hoping to point out. I wish to take nothing away from Sam's success. In purely monetary terms Sam is infinitely more successful than I might ever be.
> he seems to have a lot more humility than most
Sorry, are you talking about the same Sam Altman who wrote about "life advice" when he turned 30? https://blog.samaltman.com/the-days-are-long-but-the-decades...
Or the Sam Altman who tells us:
- How to invest in Startups https://blog.samaltman.com/how-to-invest-in-startups
- How to be successful https://blog.samaltman.com/how-to-be-successful
- etc.
Sam Altman is a PG wannabe, but without the actual insights and experience
Sorry, are you talking about the same Sam Altman who wrote about "life advice" when he turned 30? https://blog.samaltman.com/the-days-are-long-but-the-decades...
Or the Sam Altman who tells us:
- How to invest in Startups https://blog.samaltman.com/how-to-invest-in-startups
- How to be successful https://blog.samaltman.com/how-to-be-successful
- etc.
Sam Altman is a PG wannabe, but without the actual insights and experience
I mean, yeah. That post says “life advice” but it reads more like “things I fucked up in my twenties.”
I like his life advice. Do you have any issues with any specific advice or just his age at the time it was written ?
You want to go in the right direction, age is irrelevant. Think more about what you want to be doing. Being ageist is not what you want to be doing.
You want to go in the right direction, age is irrelevant. Think more about what you want to be doing. Being ageist is not what you want to be doing.
I think too many people are looking to other people for advice.
Most need to find their answers from within.
Most need to find their answers from within.
Advice by definition is from outside. What does it matter where the answers come from as long as they pass a sanity test from within.
That's factually wrong. He is also a co-founder of OpenAI, and within YC, he initiated YC Continuity (just to name one of the many initiatives that continue to live on). So if you're specifically evaluating him on finding the PMF within his own projects, I think you're not giving him enough credit.
If we were to evaluate him against his investment record, the score looks even better - he's clearly a wealthy guy, and it appears that most of his pre-OpenAI money comes from this area. This is significant, since if he can spot a good startup early on, then supposedly his thoughts on early stage startups are likely valuable.
You might go ahead and trivialize those data points, but the reality is that's a 100x better resume than the majority of people whose blog posts form a basis for daily discussions here on HN. Why hate on Sam specifically?
If we were to evaluate him against his investment record, the score looks even better - he's clearly a wealthy guy, and it appears that most of his pre-OpenAI money comes from this area. This is significant, since if he can spot a good startup early on, then supposedly his thoughts on early stage startups are likely valuable.
You might go ahead and trivialize those data points, but the reality is that's a 100x better resume than the majority of people whose blog posts form a basis for daily discussions here on HN. Why hate on Sam specifically?
The Tropical MBA (https://www.tropicalmba.com) is a good podcast for startups. Those guys have started businesses from scratch, the advice is very practical.
Thank you I'll have a look.
Would you recommend another place that has all this information together?
No because I didn't learn how to start a sustainable business from a book or online resource unfortunately.
It was more a case of trying something, seeing if it worked, keeping it if it did and stopping it if it didn't. Aka trial and error.
Problem with trial and error is that unless you're naturally gifted at running a business (I'm not) or lucky (I'm not) it takes a long time to learn all the lessons you need to learn to make a successful business.
The best shortcut is a good mentor...but those are hard to find.
Edit: Having said that, Reddit has a lot of smart people on it that are able to provide sensible guidance for specific business problems.
Also: https://www.amazon.co.uk/Great-CEO-Within-Tactical-Building-... <-- this was a great framework for running various areas of a business. Wish I had stumbled across it sooner than this year.
It was more a case of trying something, seeing if it worked, keeping it if it did and stopping it if it didn't. Aka trial and error.
Problem with trial and error is that unless you're naturally gifted at running a business (I'm not) or lucky (I'm not) it takes a long time to learn all the lessons you need to learn to make a successful business.
The best shortcut is a good mentor...but those are hard to find.
Edit: Having said that, Reddit has a lot of smart people on it that are able to provide sensible guidance for specific business problems.
Also: https://www.amazon.co.uk/Great-CEO-Within-Tactical-Building-... <-- this was a great framework for running various areas of a business. Wish I had stumbled across it sooner than this year.
Having consumed a lot of startup advice and founder biopics, it seems the one constant critical success factor is good mentorship.
I have no idea how to act on that nugget. All of my own attempts failed (clearly).
I have no idea how to act on that nugget. All of my own attempts failed (clearly).
Do enough to prove yourself to somebody who has done more than you.
Show them that you are on a path to success and they will want to push you over the finish line.
Show them that you are on a path to success and they will want to push you over the finish line.
Huh. Now wish young me had seen that video.
Thanks for the book suggestion, just bought a copy. Looks really great!
You're welcome, enjoy. It's super practical which I loved.
These SV made-men, taken as a group, are Exhibit A for survivorship bias. Their primary talent is having been in the right place at the right time and they've spun an entire self-help industry out of it. If they hadn't gotten lucky early on, they'd just be dopey middle management parasites at some investment firm. These aren't they people that can build anything, they're just the middlemen between rich idiots and people with actual talents.
Right, but the point is those materials are not for starting a sustainable business, but a startup, a whole different thing as you understand. For sustainable business you probably don't want to listen to anyone involved in VC-funded startups, it's in their interest even to sabotage you.
The fact that some think there's a distinction between a startup and a sustainable business says a lot about SV. A startup should be sustainable too. There's a distinction between a quickly growing business or a slowly growing business for sure, and sometimes it makes sense to forgo the sustainable part in the short term in order to promote growth, but to think that a startup somehow should not aim to be sustainable leads to really perverse incentives.
I think this concept was popularized by VCs like SoftBank. It also makes me wonder how much of a tech bubble we are in and what happens when it finally bursts.
The appearance of being a bubble is inherent in the VC business model.. VCs know full well that 9/10 startups they fund are likely to fail, they make returns out of the 1/10. The median funded startup is a failure. People look at this an think "all this money and all this failure, its going to end badly, these investors are gonna get burnt!" yes some do, but even the most stellar firms have more misses than hits.
> all this money and all this failure, its going to end badly, these investors are gonna get burnt
No, I think all these startups employees with families to feed are going to be out of a job. VCs fund startups that shouldn’t have been funded in the first place. They create a market that artificially props up unsustainable businesses. This video is a good explanation of how the VC world actually works. https://m.youtube.com/watch?v=NVVsdlHslfI
No, I think all these startups employees with families to feed are going to be out of a job. VCs fund startups that shouldn’t have been funded in the first place. They create a market that artificially props up unsustainable businesses. This video is a good explanation of how the VC world actually works. https://m.youtube.com/watch?v=NVVsdlHslfI
Fair point, I just want to point out that this "lecture" series could be greatly reduced to one simple rule: do what the money-men tell if you want to get funded.
These guys don't know how to build your business, they know how to get funds to change hands. So kiss their ass, jump through whatever inane hoops they use to trick the wealthy to part with their jewels, and you might just be among the chosen few.
These guys don't know how to build your business, they know how to get funds to change hands. So kiss their ass, jump through whatever inane hoops they use to trick the wealthy to part with their jewels, and you might just be among the chosen few.
YC (and by extension, Sam Altman in his past capacity as its President) is not in the business of maximizing the longevity of each and every investment. Instead, they are in the business of maximizing their ROI within a reasonable timeframe (and they are pretty good at it). If that doesn't sound like a good deal to you as an entrepreneur, you should raise your money from elsewhere or avoid raising altogether.
But to claim that Sam Altman doesn't know how to build a business is a bit of stretch. OpenAI seems to be doing quite well.
But to claim that Sam Altman doesn't know how to build a business is a bit of stretch. OpenAI seems to be doing quite well.
> OpenAI seems to be doing quite well.
How so? OpenAI is nowhere near turning a profit, it’s a research lab masquerading as a business. It’s alive only due to massive injections of capital from investors (and when they weren’t prepared to fork over any more, Microsoft).
Sam Altman is clearly brilliant at raising capital. I don’t want to downplay the importance of that skill. But selling a product to actual customers for more than it cost to make is a completely separate - and let’s face it, less sexy - endeavour.
How so? OpenAI is nowhere near turning a profit, it’s a research lab masquerading as a business. It’s alive only due to massive injections of capital from investors (and when they weren’t prepared to fork over any more, Microsoft).
Sam Altman is clearly brilliant at raising capital. I don’t want to downplay the importance of that skill. But selling a product to actual customers for more than it cost to make is a completely separate - and let’s face it, less sexy - endeavour.
[deleted]
It's easy to make money when you have money and thousands of desperate poors begging for the opportunity to bhe your investment vehicle. Sam got lucky and got rich. From there it's all downhill.
Nobody would dispute the element of luck in each rich person's journey. Or that the first million is the hardest one. And yet, it does seem that the particularly ambitious, smart and hard working ones tend to get more lucky.
Also, note this quote from Paul Graham [1]:
> Within about three minutes of meeting him, I remember thinking "Ah, so this is what Bill Gates must have been like when he was 19."
Not to mention that PG still declined him, and Sam refused to leave. Sounds to me like a bit more than just your average lucky kid.
[1] http://www.paulgraham.com/mit.html
Also, note this quote from Paul Graham [1]:
> Within about three minutes of meeting him, I remember thinking "Ah, so this is what Bill Gates must have been like when he was 19."
Not to mention that PG still declined him, and Sam refused to leave. Sounds to me like a bit more than just your average lucky kid.
[1] http://www.paulgraham.com/mit.html
Ok, I guess Sam is one of the good ones? I'm not convinced, but my comments haven't all been specific to him anyway.
I'm sure there are ways to lean on the scales and enhance your "luck," but if you don't attribute most of anyone's success to luck you are a fool. How many potential business geniuses died of cholera in the last couple hundred years?
I'm sure there are ways to lean on the scales and enhance your "luck," but if you don't attribute most of anyone's success to luck you are a fool. How many potential business geniuses died of cholera in the last couple hundred years?
The "right place at the right time" argument sounds like you could create a cohort of all the SV-based entrepreneurs who arrived there within a certain time period (supposedly the earlier the better?), and somehow all current SV-based unicorns would magically link back to those folks. If anything, I am observing a surprisingly small correlation there - the average founder of a top 100 YC company went through YC 5 years ago [1].
5 years ago is shockingly recent and well past the SV gold rush curve.
[1] https://www.ycombinator.com/companies/?top100=true
5 years ago is shockingly recent and well past the SV gold rush curve.
[1] https://www.ycombinator.com/companies/?top100=true
I mean, it's just a phrase you can put away the analysis.
It means any other warm body inhabiting that space at that time would have similar results. There are infinite right places and right times.
It means any other warm body inhabiting that space at that time would have similar results. There are infinite right places and right times.
He made it further than most; you refer to him by 'Sam'. So listen to him.
Yup I agree with this. Sam Altman is no Paul graham, it he’s trying to fill the void that Paul graham left. His platitudes are generic, not insightful or original. But he has to put out “content”
In all fairness, if you do find someone whose content is as good as PG's, please share!
The page is a collection of video lectures, the majority of which are by guest lecturers, such as Patrick Collison and other founders or VCs. There is no written advice on this page, and only a small number of the videos feature Sam.
I will probably watch the Adora Cheung video later today. I think that's one I haven't seen and I've really liked everything I've seen by her so far.
YC also has a free library of stuff. You don't need to be in Startup School to start accessing their educational things.
So if you want to learn and don't yet feel ready to commit to starting a business, you can start learning on your terms, at your pace.
Don't discount the value of that for laying the groundwork for a future business. If you can only give it an hour or two a week now, do what you can now. It adds up over time.