Heard an excellent conversation between Michael Seibel (CEO of YC) and Patrick O’Shaughnessy (top asset manager, also moonlighting as an amazing podcaster). It had many fundamental insights that would help any founder♟ Sharing my top takeaways here:
#1 Don’t be too “smart” for your own good: there is nothing like that one breakthrough idea that is guaranteed to work 100%. Teams need to be willing to iterate, pivot & execute in new directions all the time 🛶
#2 Launch!!! At the 0-to-1 stage, the most important thing is the ability of a team to build & launch a working product, as fast as possible. You can’t build a company if you don’t launch in the first place 🚀
#3 Startups are all about momentum: teams need to demonstrate forward momentum in whatever time they have spent building the product. The best teams generate rapid momentum to acquire users & fundraise with this tailwind 🏎
#4 What kind of problem is worth solving? a) high frequency⏰, b) high intensity🔦, c) high willingness to pay💵. Overall, founders need to have some special insight into the problem they are setting out to solve💡
#5 Founders essentially take 2 kinds of risk: a) product risk🛠, not sure if people need this product (typically taken by relatively younger founders) and b) execution risk🔨, I know this product is needed but not sure of execution (usually taken by more experienced founders).
#6 Be “real” when coaching founders: be upfront in presenting facts about high failure rates. And that to win, you have to reach out for extraordinary (be 2 standard deviations from average). Also, emphasize the importance of developing tools to manage their emotions & health⚖️
#7 Best way to create leverage during your fundraising process? Acquire users & grow m-o-m. Pitch with real users & data. It’s possible to raise money just on ideas/prototypes, but you will have zero leverage in these discussions. Your goal should be to fundraise with leverage💪🏼
#8 What is Product-Market Fit? It’s like a sledgehammer to your jaw. It’s that month or quarter where you get so many users that it breaks your systems. When the sheer market traction bypasses all your spreadsheet plans & projections. When you have PMF, you WILL know it🚰
To conclude, what I found most intriguing was the importance of “bravery” in founders🧗🏽♀️ 2020 has shoved in our faces a plethora of issues we are facing as a species. The need of the hour is a generation of founders that take on problems that are intimidating to solve⭐️
Note: this post first appeared on the Workomo blog here.