Aaron Epstein</a> is the cofounder of <a href=https://www.ycombinator.com/"https://creativemarket.com//">Creative Market</a>.</strong></p>\n<p>One of the most difficult things about starting a company is that you have to create both a product that people love and a company where people want to work <em>at the same time</em>. It’s usually not enough to <em>just</em> have a great product, or <em>just</em> be a great place to work, because great people build great products, and great people won’t tolerate a bad environment for very long.</p>\n<p>People leave managers, not companies, yet while most founders are obsessive about trying to build a product that people love, many first-time founders raise a bunch of money and start building a team without any management experience at all.</p>\n<p>I was one of those first-time founders who had to quickly learn on the job, so here’s some advice I wish someone had given me when I was just beginning to grow and manage a team at <a href=https://www.ycombinator.com/"https://creativemarket.com//">Creative Market</a>.</p>\n<p><strong>Delegate!</strong><br />\nAs a founder you’re used to doing it all, and it can be scary to shed responsibilities you’ve always owned, but you can’t scale yourself and focus on the highest leverage opportunities until you get things off your plate. If you think you’re going to have to work especially late or can’t get to the things you need to in a given day, take that as a signal to delegate to your team.</p>\n<p><strong>Create growth opportunities.</strong><br />\nGreat people often care about personal growth way more than money or any other tangible benefit you could offer them, so the flip-side of delegating your responsibilities is that you create opportunities for people on your team to do new things, learn, and grow. Don’t hoard them all for yourself.</p>\n<p><strong>Invest in your stars.</strong><br />\nSimilar to how it’s much easier to retain an existing customer than to acquire a new one, it’s much easier to keep an existing star employee happy than find a new star. Go above and beyond to make sure your stars feel valued, appreciated, and rewarded.</p>\n<p>Set a high bar. Great people want to do big, meaningful things. Push your team with aggressive goals, and you might be surprised what they will accomplish.</p>\n<p><strong>Lead by example.</strong><br />\nTeams embody the characteristics of their leaders, and the things you care about will be the things your team cares about. If you sweat the details, your team will learn to sweat the details too.</p>\n<p><strong>Your team’s success is your success.</strong><br />\nGet satisfaction and the feeling of accomplishment from the success of your team. As an individual contributor, it’s easy to look back at the end of a week and feel good about all that you’ve directly produced. As a manager, you’re responsible for the accomplishments of your team, which can be a difficult transition for a lot of people. The advantage is that you can scale yourself and your vision.</p>\n<p><strong>Deflect all credit and absorb all blame.</strong><br />\nUse “I” when talking about a screw-up, and use “we” (or better yet, specific contributors’ names) when talking about successes. A little recognition goes a long way to make people feel valued.</p>\n<p><strong>Share the big picture.</strong><br />\nIt’s important for people on your team to understand how their work and role fits into the big picture of the business, and why they’re doing what they’re doing. It’ll give them a sense of purpose and motivation to understand how they’re contributing to the success of the business. It’s easy to take it for granted that your team is clear on this, but this is one of those things where you want to constantly make that connection.</p>\n<p><strong>Repeat yourself often.</strong><br />\nYou should feel like you sound like a broken record about the things that are important to your company — your mission, your vision, your KPIs, etc. You think about it all the time, but the people on your team don’t, and most people need to hear something many times before it truly gets ingrained in their memory. You’ll know you’re repeating key messages enough when every single person on your team will be able to explain them to a complete stranger exactly how you would’ve said it.</p>\n<p><strong>You’re in charge.</strong><br />\nIt can be uncomfortable telling people what to do if you’ve never done it before. But you are the leader, and everyone on your team will be looking to you for direction and guidance, so own it. People want structure and direction, so don’t be afraid to use phrases like “I need…” and “I want…” to shape your team in your image.</p>\n<p><strong>Focus on the What, not the How.</strong><br />\nCommunicate your vision for what success looks like, to give your team a framework and goals to guide their decisions and work. It’s a way for you to “be in the room” when the work gets done without micromanaging the work.</p>\n<p><strong>Set deadlines and hold people accountable.</strong><br />\nWhen you give someone a task, ask “by when?”, then add a note to your calendar to follow up to make sure it’s complete. If standards or deadlines are not being met, give direct feedback to change future behavior.</p>\n<p><strong>Verbalize your thoughts.</strong><br />\nSimply saying things like “I’m disappointed in this work” is extremely powerful in helping people directly understand where you stand. People aren’t mind-readers, so rather than just jumping into solutions when giving feedback, state your feelings out loud to be clear and direct.</p>\n<p><strong>Manage for the employee.</strong><br />\nMy favorite interview question for manager candidates is “How would you describe your management style?”, where the best possible answer is “it depends on the employee”. Each person has a unique combination of experience, motivations, personality, etc, and it’s up to you to take the right management approach that helps them succeed and maximizes their contribution.</p>\n<p><strong>Understand that everyone’s different.</strong><br />\nJust because you may be an achiever that’s self-motivated to get things done doesn’t mean that everyone else on your team is. Get curious to figure out what drives and motivates each individual on your team, rather than assuming everyone’s like you.</p>\n<p><strong>Hire slow, fire fast.</strong><br />\nIt’s the thing everyone says and few have the discipline to do, but hiring well is the most important thing you can possibly do to positively impact your business and your team. Great people want to work with other great people, so resist the temptation to fill open positions with mediocre candidates, and don’t settle. You should be thrilled about each new hire.</p>\n<p>Hire for hunger. It’s great when a potential candidate walks in the door with all the skills needed to succeed in the role, but passion for your mission, business, and team will do more to drive an employee to make a big, long-term impact than any specific skills they may have. Passionate employees will be quicker to teach themselves new skills too, especially as your business changes and grows.</p>\n<p><strong>Set your team up for success.</strong><br />\nIt’s unfair to expect even the best people to hit the ground running on day one without being properly onboarded. As their manager, it’s your responsibility to invest the time early on to set expectations, show them the ropes, teach them about your business, train them, and provide clear direction and a well-defined role. Anything less will diminish their ability to succeed.</p>\n<p><strong>Your trust should be earned.</strong><br />\nDon’t just assume that new and more inexperienced team members will hit the ground running and understand your expectations from day one. Make them prove themselves first by working more closely with them and frequently reviewing their work until they’ve earned your full trust.</p>\n<p><strong>Shield your team from distractions.</strong><br />\nProvide structure, focus, and clear goals for your team to maximize their ability to execute on the strategy. They should come in to work each day knowing exactly what they’re working on and exactly what they need to do, and any other distractions should be deflected to keep from derailing productivity, wasting time, and knocking the team off course.</p>\n<p><strong>Include your team in decision-making.</strong><br />\nIf you’ve hired great people, you’d be crazy not to include them in important decisions. Define the decision-making process upfront to set expectations for your team — will it be a decision by committee, will someone else on your team own the decision, or will you gather feedback to make the final call yourself? Listen to their thoughts and opinions with an open mind, make sure everyone feels heard, then decide the best course of action. It may even go against the consensus of the team, and that’s ok so long as you’ve defined the process and expectations up front. Even if your team disagrees with the final call, by including them in the process they will better understand the decision, feel like their opinion was valued, and be able to get on board to help support the decision going forward.</p>\n<p><strong>A little professional tension is healthy.</strong><br />\nDiffering perspectives help make teams and products better, so a little professional tension can be really valuable to help push your team to think about things in new ways. It should be net-positive though, so if it’s forcing too many decisions to get stuck in the mud, or if the tension moves from professional to personal, then you need to take action to eliminate it quickly before it drags down the team or blows up.</p>\n<p><strong>Show your work.</strong><br />\nExplain your decision-making process. Whenever you take a controversial action or make a difficult decision, it’s especially powerful to fully explain how you arrived at that decision so your team can understand your thought process and rationale, and ultimate help support the decision.</p>\n<p><strong>It’s ok to not always know the answer.</strong><br />\nAsk questions, probe, and admit when you don’t know the answer to something. There’s nothing wrong with saying you’ll need some time to think or learn more before making an important decision.</p>\n<p><strong>Have consistent 1-on-1s every week.</strong><br />\nThese are for the benefit of your employees, so you should let them drive the agenda each week. From your side, it’s an opportunity to set aside some focused time each week to talk privately, get on the same page, and ask open-ended questions like “how are things going?”, “how are you feeling?”, “what are your thoughts on the big news that was announced earlier this week?”, “what’s your opinion on X?”, etc. Prioritize these meetings in your schedule, go out of your way to keep from canceling or rescheduling them whenever possible, and your consistent time and attention will send a signal to your team that you care about their happiness.</p>\n<p><strong>Ease the maker to manager transition.</strong><br />\nAs you scale from a team of individual contributors to a more structured org, the maker to manager transition will challenge your best people. Just because someone is an outstanding individual contributor doesn’t mean they’ll be an outstanding manager right off the bat, because it requires a completely different set of skills and experience. And during the transition, their instinct will be to take on both their prior maker and their new manager duties – spending 75% effort on making and 75% effort on managing – a 150% workload resulting in less than 100% output in each area. Put structure in place to allow them to focus on being a manager first and foremost, and take maker duties off of their plate.</p>\n<p><strong>Create a career path.</strong><br />\nEvery 6 months, ask your employees where they want to be in their career in the next 2–3 years. Work with them to put together a plan, help them get the skills and experience they need, and guide them on a course to get there.</p>\n<!--kg-card-end: html-->","comment_id":"1096641","feature_image":null,"featured":false,"visibility":"public","email_recipient_filter":"none","created_at":"2016-10-10T02:38:05.000-07:00","updated_at":"2021-10-20T13:19:22.000-07:00","published_at":"2016-10-10T02:38:05.000-07:00","custom_excerpt":null,"codeinjection_head":null,"codeinjection_foot":null,"custom_template":null,"canonical_url":null,"authors":[{"id":"61fe29e3c7139e0001a71070","name":"Aaron Epstein","slug":"aaron-epstein","profile_image":"/blog/content/images/2022/02/Aaron-E-2.jpg","cover_image":null,"bio":"Aaron is a Group Partner at YC. He was the co-founder and CEO of Creative Market (YC W10), a marketplace for graphic design assets, which was acquired by Autodesk in 2014.","website":null,"location":null,"facebook":null,"twitter":null,"meta_title":null,"meta_description":null,"url":"https://ghost.prod.ycinside.com/author/aaron-epstein/"}],"tags":[{"id":"61fe29efc7139e0001a71174","name":"Advice","slug":"advice","description":null,"feature_image":null,"visibility":"public","og_image":null,"og_title":null,"og_description":null,"twitter_image":null,"twitter_title":null,"twitter_description":null,"meta_title":null,"meta_description":null,"codeinjection_head":null,"codeinjection_foot":null,"canonical_url":null,"accent_color":null,"url":"https://ghost.prod.ycinside.com/tag/advice/"}],"primary_author":{"id":"61fe29e3c7139e0001a71070","name":"Aaron Epstein","slug":"aaron-epstein","profile_image":"https://ghost.prod.ycinside.com/content/images/2022/02/Aaron-E-2.jpg","cover_image":null,"bio":"Aaron is a Group Partner at YC. He was the co-founder and CEO of Creative Market (YC W10), a marketplace for graphic design assets, which was acquired by Autodesk in 2014.","website":null,"location":null,"facebook":null,"twitter":null,"meta_title":null,"meta_description":null,"url":"https://ghost.prod.ycinside.com/author/aaron-epstein/"},"primary_tag":{"id":"61fe29efc7139e0001a71174","name":"Advice","slug":"advice","description":null,"feature_image":null,"visibility":"public","og_image":null,"og_title":null,"og_description":null,"twitter_image":null,"twitter_title":null,"twitter_description":null,"meta_title":null,"meta_description":null,"codeinjection_head":null,"codeinjection_foot":null,"canonical_url":null,"accent_color":null,"url":"https://ghost.prod.ycinside.com/tag/advice/"},"url":"https://ghost.prod.ycinside.com/advice-for-new-managers/","excerpt":"Aaron Epstein [https://twitter.com/aaron_epstein] is the cofounder of Creative\nMarket [https://creativemarket.com/].\n\nOne of the most difficult things about starting a company is that you have to\ncreate both a product that people love and a company where people want to work \nat the same time. It’s usually not enough to just have a great product, or just \nbe a great place to work, because great people build great products, and great\npeople won’t tolerate a bad environment for very long.\n\nPeople l","reading_time":7,"access":true,"og_image":null,"og_title":null,"og_description":null,"twitter_image":null,"twitter_title":null,"twitter_description":null,"meta_title":null,"meta_description":null,"email_subject":null,"frontmatter":null,"feature_image_alt":null,"feature_image_caption":null},"mentions":[],"related_posts":[{"id":"61fe29f1c7139e0001a71af9","uuid":"cf5966b4-2e98-437c-a155-8f0f4258e83a","title":"Gaming AMA with YC Visiting Partner Holly Liu","slug":"gaming-ama-with-yc-visiting-partner-holly-liu","html":"<!--kg-card-begin: html--><p>YC Visiting Partner <a href=https://www.ycombinator.com/"https://twitter.com/hollyhliu/">Holly Liu</a> recently did a Gaming AMA with Startup School founders. It was so good that we wanted to share it here.</p>\n<p>Enjoy!</p>\n<hr />\n<p><strong>If you were starting a new game company today, assuming all other conditions and game mechanics, retention, were equal, and UA costs were the biggest decision factor, would you: A) Develop your own IP B) Use public domain IP like Sherlock, similar to your Camelot game C) spend money at market rate to license a hot/the hottest IP you can like an upcoming movie D) spend money to license a less hot IP that has been sitting around</strong></p>\n<p>If UA costs are big factor, I would work to reduce the CAC as much as possible. If you don&#8217;t have as much money, I would use a public domain IP like B &#8211; in fact this is the exact reason why our first game we chose the Camelot theme &#8211; it was public domain and market accessible.</p>\n<p><strong>Are there any great mobile UA resources or channels that are cheaper/undervalued, but overlooked because they perhaps don&#8217;t scale for the big players?</strong></p>\n<p>Unscalable UA channels overlooked are any of the ones that tend to be more grassroots. I would consider looking at forums, reddit , Discord etc&#8230; I don&#8217;t know which one will work the best for you, but go to where the potential gamers are at.</p>\n<p><strong>Mobile games are notoriously hard to raise money for, understandably, and also require a fair amount of capital to experiment with. Where should mobile game founders go to find investors?</strong></p>\n<p>Yes they are hard to raise money for! If you have the means, bootstrap the game! If not, there are a couple of ways to raise capital especially if you have a team or pedigree to raise money. You can go on Angellist to find founders who were in gaming still investing. There is also a list of VCs here for Series A: <a href=https://www.ycombinator.com/"https://signal.nfx.com/vc_lists/top-games-series-a-investors/">https://signal.nfx.com/vc_lists/top-games-series-a-investors

/n

And a plug for my friends at <a href=https://www.ycombinator.com/"https://www.fig.co/">https://www.fig.co &#8211; if you want to crowd fund your game.</p>\n<p><strong>Is product market fit thought of differently in mobile games? Is it more retention based than &#8220;people are beating a path to your door/demand is exploding&#8221;? Seems many breakout mobile games are more the result of game with good retention and great UA strategy than they are about releasing it and it &#8220;taking off&#8221;</strong></p>\n<p>It&#8217;s much closer to player / market fit. And it&#8217;s closer to consumer &#8211; if you have your servers melting, you have product market fit. But when you first release your game, definitely drive a small amount of traffic to it (few thousand) in your target and work on your retention numbers, then I would start driving more traffic once retention is good.</p>\n<p><strong>Can you tell us more about how you see the future of mobile gaming (Hyper casual to High-core)? Do you see gaming ecosystems and how big companies (Facebook, Twitch, Google, Apple etc) are thinking about it?</strong></p>\n<p>So I may be jaded here, but because mobile has become more mature, I think the ones that make it a big hit will tend towards more core and niche than casual. This does not mean that the theme cannot be casual, but mechanics will likely be core. This is because content is so readily available that it is easy for someone to leave quickly, which is what casual tends to do more of. Even all the popular casual games definitely loop in more core mechanics &#8211; progression, player level ups, etc&#8230;</p>\n<p>In terms of gaming ecosystems &#8211; I&#8217;m a big believer in growing platforms provide gaming ecosystems. I think the larger ones (except twitch) focus on platform for all types of applications and not just gaming. It&#8217;s just that people love games and the highest revenue generating app tends to be games on any given platform. I think this is how PC games and mobile games are able to get their start. I do think there is still room for console or some type of hardware (VR?) gaming, but getting mass adoption will be difficult until you can reduce barriers of entry.</p>\n<p><strong>A little long-winded question: Sam Altman and others have said in the past that &#8216;starting a hard startup is easier in the long run than starting an easy startup&#8217;. Which means, if you&#8217;re solving a hard problem for people, initially it can be painful, but gets better over time because more people will be motivated to join you, invest in you, and be part of your mission. I worked for one such company for many years, and it was well worth it. Now, I was into game development growing up, and I got back into it in recent past with some potentially good ideas. But I started struggling to motivate myself because of questions like &#8216;it&#8217;s not real value to people&#8217;, &#8216;it&#8217;s not impactful to society&#8217; popping up in my head all the time. It felt like making games wasn&#8217;t akin to solving a real problem for anyone. Do you ever struggle with such questions as a game designer? Do you think gaming companies have a disadvantage in terms of, 1) how much lasting value they actually bring to people, and 2) how much talent they can attract as a result? How do you get around this? And what&#8217;s your opinion on communities like gamesforchange.org that are trying to mix in game development with societal impact?</strong></p>\n<p>I get questions all the time about what I&#8217;m doing is frivolous. I absolutely disagree.</p>\n<ol>\n<li>\n<p>This is how human beings learn and behave. Most people who tell me how they don&#8217;t like games or play games &#8211; I am absolutely astonished and say &#8220;well I think there hasn&#8217;t been a game made for you.&#8221; &lt;= AND this coming from someone who did not grow up in the gaming industry OR as a gamer. Games are how we learn and connect. The first game a human being plays is peek-a-boo he/she is learning &#8220;object permanence&#8221;.</p>\n</li>\n<li>\n<p>Ever notice that building a great gaming company can come from anywhere in the world? You have amazing game makers in every continent. To make a Hollywood blockbuster movie, you should go to Hollywood. To build a big tech company you should go to Silicon Valley. But not games &#8211; you don&#8217;t need to leave. This to me drives home point #1.</p>\n</li>\n<li>\n<p>Games obviously solve a real problem for people or else they would not be spending time on there. This is the hardest problems of all, because usually what games are solving are not tangible &#8211; they are problems of loneliness, loss of purpose, sense of low worth, boredom, lack of motivation, and yes even physical pain.Countless people use games to solve all those problems.</p>\n</li>\n<li>\n<p>Games is entertainment. It goes a step further in that it is interactive entertainment. In entertainment you get the privilege to influence culture. People cannot be what they cannot see, as game makers we enable them to not just see (and be) what they cannot see. Help them see the greater good in themselves as a game maker.</p>\n</li>\n</ol>\n<p>I can go on and on&#8230; but those are some of my initial thoughts.</p>\n<p>Games drive forward adoption of technology, they are the forefront of change, and I think its&#8217; up to game makers to be responsible with that power. That is how you make lasting change.</p>\n<p>My general sense of games + social impact: I certainly think games for social impact make sense, but you have make that into a game in it of itself and not really tell players it&#8217;s for social impact and then surprise them! what if Pokemon go was about exercise, that would be no fun!!</p>\n<p><strong>1&#46; When you first started, how you dealt with spam/bad content in the community? What policies, mechanisms you and your team implemented? (anything besides manually scanning the content).</strong></p>\n<p><strong>2&#46; Did you used social media to grow the community? If so, what did you do? Do you consider social media an effective way to grow a community? When the value of the product lays in the community, it is hard to start.</strong></p>\n<p>I felt like I started 3 companies in the last 11 years, but I will try to answer the most relevant experience to you question.</p>\n<ol>\n<li>\n<p>We had an admin tool for our fan communities and appointed officers to help us clean content. We did do it manually but we outsourced it to officers. For our games, we created some tools to help within the chat rooms to enable others to mute others and then eventually automated the prevention of spam.</p>\n</li>\n<li>\n<p>When we were early on Facebook for our fan communities we went into existing groups to tell people to install our application. When we did our mobile games we spent most of our time with UA &#8211; mainly because it was cheap. UA is really good when it&#8217;s an untapped channel but hard to grow. Now with UA being so expensive, I would consider doing grass roots social media.</p>\n</li>\n</ol>\n<p><strong>How to model games where &#8220;Player exp&#8221; will potentially decrease?</strong></p>\n<p><strong>Many &#8220;games&#8221; start from level 0, then the player exp/levels grow monotonically, so players can feel the rewards for their effort.</strong></p>\n<p><strong>What about the other type of &#8220;games&#8221; &#8211; think Fitness tracker, flashcard memory apps, that players actually start somewhere, and if they stop they actually go backwards. Giving them reward points for progress itself might be misleading &#8211; they actually gain weight / forgot, say. While punishing them &amp; deducting their exp could be frustrating.</strong></p>\n<p>Within games there are other things that start with a number and decrease (instead of the other way)<br />\n1&#46; Energy &#8211; often times I&#8217;m limited by the number of lives like in Candy Crush<br />\n2&#46; I usually start with a # of coins and I need to use it over time<br />\n3&#46; In many pet and sim games, if I do not take care of them, they die<br />\n4&#46; Limited number of actions (spins) done in a day</p>\n<p><strong>My startup is a gamified Q&amp;A app where a global community of language learners practice by checking each other&#8217;s writings. Our gamification consists of leveling up, unlocking features and earning virtual currency that can be used to buy power ups. There&#8217;s some social interaction that consists mostly of users following and helping each other.</strong></p>\n<p><strong>1&#46; Given that we have to prioritize features, in general, how do you know when it&#8217;s a good time to build gamification features over building social features, or vice versa?</strong></p>\n<p><strong>2&#46; Some of our users are a bit upset about having to unlock features, but we use this as a motivation for them to help others (everything is free). Do you have any tip on how to make users see unlockable features in a positive light?</strong></p>\n<p><strong>3&#46; We have avoided adding paid features because we fear this could create an stratified community where things are not earned by merit alone. Is there a good way to charge for extra features without affecting the dynamics of the community?</strong></p>\n<ol>\n<li>\n<p>I&#8217;m not sure the difference between the gamification features and social features? How does someone level up and how can they use their power ups?</p>\n</li>\n<li>\n<p>Sometimes you can give them a sample of what the feature is unlocked and lock it more based off of the second time they use it. Almost give a free trial so they know what they are trying to unlock.</p>\n</li>\n<li>\n<p>You can charge for things that do not impact whatever they need to earn points or level up. You can limit the number of things someone can get checked and then charge them money, split that money with the translator. In a game like League of Legends they only charge for skins or cosmetic things so as not to impact the core of the game.</p>\n</li>\n</ol>\n<p><strong>What are your thoughts on virtual reality gaming? Do you think it will go mainstream and if so what is your prediction to when?</strong></p>\n<p>Ah, opining on VR! A favorite past time of a gamers and techies.</p>\n<p>I think right now the VR gear is to cumbersome for it to be mainstream. You have to set up a whole rig and room. Compare that to the phone, where you just have to pull it out of your pocket and start playing. On top of that, most of the content I see for VR is just not that great. So I&#8217;m going to gear myself up, look more than an idiot than I already look for less of an experience? No thank you.</p>\n<p>I liken it to a bit of snorkeling vs. scuba diving. Snorkeling is much more accessible to the masses, less gear and less training. I can see some really great things. But if I want to see even better things, I need to learn how to scuba dive, put up the gear and prep a lot more! The content just better be worth it.</p>\n<p>I do eventually think it will go mainstream if it can solve some of the usability issues and phenomenal content on the other side.</p>\n<p><strong>1&#46; Do you see e-sports or e-sports betting as markets with exponential growth?</strong></p>\n<p><strong>2&#46; Which e-sports platform or game has the gamers that are most obsessed with statistics or live statistics?</strong></p>\n<p>e-Sports has a larger audience than NFL. That&#8217;s pretty crazy!</p>\n<ol>\n<li>\n<p>Yes e-sports is definitely a growing industry.</p>\n</li>\n<li>\n<p>I do think betting can be big &#8211; my issue with betting is it&#8217;s been so regulation heavy in the US and have seen it kill regular sports betting companies (a la Fan Duel)</p>\n</li>\n<li>\n<p>Not sure.</p>\n</li>\n</ol>\n<p><strong>What would you do if your product was engaging and fun, but didn&#8217;t have enough k-factor or new users to scale to meaningful size organically? How long do you iterate versus try something new?</strong></p>\n<p>I am assuming that the monetization strategy is ads or something with a lot of audience and that usage is important. If that is the case, I would give it 3-6 months iterating to crack the k-factor and then consider moving on.</p>\n<p><strong>We are building facebook messenger chatbots for restaurants for getting new customers and re-engaging existing customers. We have gamification as a core part of our user acquisition and retention strategy. We are using contests like Spin the wheel (variable rewards) and steal of the day (fixed rewards) to acquire restaurant customers on the chatbot.</strong></p>\n<p><strong>We will also be using variable reward based games as a way to increase customer loyalty for restaurants. For instance, we will send out a message saying your spin has recharged, spin and see what you get. Along with this we are also building a gamified referral system with a social aspect. My questions are:</strong></p>\n<p><strong>1&#46; What are some best practices of building product retention using gamification?</strong></p>\n<p><strong>2&#46; In your experience, what are the key elements of a gamified reward system which make it addictive? For instance, I really admire Google Tez scratch cards as a product feature.</strong></p>\n<p><strong>3&#46; Are there any resources you would recommend to gain deep insights into gamification?</strong></p>\n<ol>\n<li>\n<p>I don&#8217;t think gamification builds retention. I think the core of your product needs to be retentive and sticky. Facebook does a great job at creating a core loop first and then giving you signals and gamifying it.</p>\n</li>\n<li>\n<p>I&#8217;m not familiar with Google Tez scratch cards, but in a non-game, I think creating a core loop of a behavior that can become a habit. Games work differently in that they set a core loop and the game is the purpose, whereas your purpose maybe different entirely.</p>\n</li>\n<li>\n<p>I would consider a lot of work from BJ Fogg to help.</p>\n</li>\n</ol>\n<p><a href=https://www.ycombinator.com/"https://www.bjfogg.com/">https://www.bjfogg.com as well as Dan Ariely: <a href=https://www.ycombinator.com/"http://danariely.com/">http://danariely.com

/n

P.S. Bonus article: <a href=https://www.ycombinator.com/"https://medium.com/startup-grind/do-this-one-thing-to-make-your-product-sticky-aa8ed6d55797/">https://medium.com/startup-grind/do-this-one-thing-to-make-your-product-sticky-aa8ed6d55797

/n

We cofounded queue.gg, which is a marketplace that lets gamers hire coaches for 1:1 online coaching and replay feedback. We&#8217;re pretty excited that someone from the gaming industry is doing an AMA here!</strong></p>\n<p><strong>1&#46; How can we combat cyberbullying in online gaming? Gamers are notorious for talking crap to each other and sometimes creates a toxic enough environment to the point a shooting happens (the recent Madden shooting) or swatting.</strong></p>\n<p><strong>2&#46; Can you tell us what your goals were when you oversaw the worldwide People and Culture function?</strong></p>\n<p><strong>3&#46; Coaching in e-sports is still uncommon and not a norm in society. How can we change that?</strong></p>\n<p>Congrats on launching!</p>\n<ol>\n<li>\n<p>I think there are a couple of reasons why gamers can get out of hand: 1. usually highly achievement zero-sum oriented games, you attract competitive people 2. Layer on anonymity and it can become a place that is really difficult. If you are a game developer or a platform you can enact decency rules or better yet penalize players that go too far. I can&#8217;t find the article but I think LoL implemented a user tribune to help combat poor user behavior. This was several years ago I remember reading about that. In terms of the Madden shooting, I&#8217;m very very sad about that and I personally think it&#8217;s related to a larger problem that is not applied to gamers.</p>\n</li>\n<li>\n<p>The people and culture function was related company building. Once you get product market fit, company building is your second job as founder. Our goals were very aligned with the business and would change as the business would change. An example of this is we needed to focus on building a long term relationship with the customer, from the culture side, we saw that our only metric of the customer that was shared widely was revenue. This was not a great way to build a relationship with our customers. So we began looking at other metrics such as retention , alliances and also added in qualitative ways to build a better relationship with our customers.</p>\n</li>\n<li>\n<p>I think e-Sports needs to become more mature. Once there is a clearer paths of longevity like the NBA or the NFL then all the support and feeder leagues can happen. Right now it&#8217;s a growing but not fully mature field. This is what makes it exciting!</p>\n</li>\n</ol>\n<p><strong>I&#8217;m keen to know more about user behaviour insights and learnings from Kabam, corporate social network.</strong></p>\n<p><strong>Specifically, what motivated people to engage and initiate new discussions among peers? And you were to do this again, how differently you will do it?</strong></p>\n<p><strong>At my startup, StackRaft, we are re-thinking professional social graphs to connect people with global and remote opportunities.</strong></p>\n<p>With the corporate social network we had very little traction. In our opinion it was because people did NOT want to keep talking about work when they were done with with work. They were at work to work, not socialize.</p>\n<p>If I were to do it again, I would find something that they wanted to do and tie it with what they needed. As we are moving towards a gig and freelancer economy, I do think a social network that is wider than the company may make sense. These people are always looking for the next job and their company is themselves.</p>\n<p><strong>I&#8217;m actually building a mobile game. Targeted at kids and using voice as a component. My main question is what is the best way to test, validate and market your game on a shoe-string startup budget. I&#8217;d love your thoughts on my game if you had time as well.</strong></p>\n<p>Here are some initial ideas:</p>\n<ol>\n<li>Recruit friends with kids and see if you can do a &#8220;playdate&#8221; with them &#8211; offer free child care or offer it as a class! Parents of toddlers are always looking for ways to entertain. </li>\n<li>Go to the library and offer it as a class for toddlers </li>\n<li>Create a signup list for the beta </li>\n<li>Infiltrate some facebook groups and recruit users there. </li>\n</ol>\n<p>Hope that helps!</p>\n<p>P.S. I&#8217;ve assumed that this is a game for toddlers because of the name.</p>\n<p><strong>We’re on a mission to connect the human brain to the computer using an AI-powered headset device. We’re currently exploring potential applications for our product in the gaming industry and I’m more than happy to have the opportunity to ask you a few questions.</strong></p>\n<p><strong>1) What do you think is the next big thing in the gaming industry when it comes to character control?</strong></p>\n<p><strong>2) Do you think that adapting a game content based on physiological signals might be a good idea at all?</strong></p>\n<p><strong>3) Do you envision any disruptive innovations in improving the video game console (components, electronics and/or any other hardware-related improvements to be made), controllers/joystick upgrades, etc. happening soon?</strong></p>\n<p><strong>4) Are you familiar with any gaming studio company that is experimenting with hard tech innovations or products at the moment?</strong></p>\n<ol>\n<li>\n<p>Funny enough, I&#8217;m bullish on voice as the next big gaming platform. Mainly because it&#8217;s immersive and so easy to get into.</p>\n</li>\n<li>\n<p>Could be really interesting!</p>\n</li>\n<li>\n<p>I certainly think the more you can remove barriers of entry the greater mass adoption will be. I honestly think consoles and controllers and terribly unusable. This is how I think mobile gaming was one of the reasons it could grow so fast</p>\n</li>\n<li>\n<p>A YC company called Plexus is creating a smart glove, but they re not a gaming studio. There are a ton more YC companies that are hard tech innovations, less with gaming.</p>\n</li>\n</ol>\n<p><strong>1&#46; Why didn&#8217;t the social network for corporates work? and how did you pivot from fan communities to mobile gaming? Especially what made you or helped you take these pivotal decisions.</strong></p>\n<p><strong>2&#46; Assumably, first thing a B2C based founder does is that &#8211; sharing the amateur(beta) version of the product to friends, and family and ask for their suggestions, Is this a good way because this set of users don&#8217;t give us the straightforward reviews? how did you manage to get product market fit for &#8220;Kabam&#8221;?</strong></p>\n<p><strong>(Funny thing is my mom[traditional South Indian] understood the business, she is playing with the app and literally is doing the marketing for me which I did not realize until a few days back &#8211; she calls up her friends and ask them to try out the Android version).</strong></p>\n<ol>\n<li>\n<p>I think the way we executed it, we sent an unsolicited email so many employees were confused and hesitant to use it. Many companies thought we were not trustworthy. Basically no one was using us, so that is why we pivoted. When we pivoted we learned it was really hard to build a platform and for us that meant we could not get users to come to us, so we learned &#8211; go where the users are. We were incredibly lucky as Facebook had just launched their platform and they were growing like gangbusters.</p>\n<p>Product-wise we learned a couple of things:<br />\na) We did not hit people&#8217;s passion points. People were not searching for stuff about work outside of work. Therefore we couldn&#8217;t ride off of any free traffic from Google by people searching for our stuff<br />\nb) We needed to provide value within an ecosystem we could play in. This meant instead of going after enterprises (we didn&#8217;t know inside the company their rules), we could create fan communities around TV and help TV show creators get to know their audiences more.</p>\n</li>\n<li>\n<p>Yes find the customers and watch them use it. IT&#8217;s more important to watch them use it than to have them give you feedback. You certainly should ask for feedback, but in B2C, what and why they say it is worthless compared to what they do. I feel like in user testing which we did, it is there to look for patterns. But most people cannot tell you if they will use it or buy it = they may say it and not do it.</p>\n</li>\n</ol>\n<p>When asking users questions, ask them about the last time they used a product like yours, ask them to show you how they found it it, what they did, etc&#8230; Easier for users to be telling a recount than what they WOULD do.</p>\n<p><strong>1) At a high-level, how did you approach game design when leveraging others IP vs. creating your own?</strong></p>\n<p><strong>2) Did you typically use multiple structures for agreements? Were the majority of rev-share based with some level of a guarantee? What were the core variables that you found really important to discuss on both sides to have deals that ended up with both parties happy?</strong></p>\n<ol>\n<li>\n<p>In leveraging someone else&#8217;s IP you have to be true to that story and things in that world. In many ways for us it de-risked execution because we did not need to invent new characters or story line. Therefore game design for us focused heavier on systems design, progression and level ups. In creating our own we needed to think about story line and environment more in addition to systems design.</p>\n</li>\n<li>\n<p>By the time we worked with IP at Kabam we were a larger size. There were definitely rev-share with a minimum of guarantees. Anytime there is attribution of traffic to figure out rev=share that should be clearly spelled out how it&#8217;s done. Also you should talk about marketing plans of supporting one another pre-through launch. It is good to stick a person to help manage this integration and ask for support on their end. Also make sure you know what the rights are for. A lot of IP licensing is sliced and diced on platforms and geographies. Make sure you know what you are getting.</p>\n</li>\n</ol>\n<p><strong>I&#8217;ve a few questions about the early days of Kabam.</strong></p>\n<p><strong>1&#46;) How did Kabam, in general, choose what games to make?</strong></p>\n<p><strong>2&#46;) What was the first game?</strong></p>\n<p><strong>3&#46;) How did you decide on the idea to build Kingdoms of Camelot?</strong></p>\n<ol>\n<li>\n<p>Our CEO really liked games, almost all kinds &#8211; MMO, RPG, FPS, and strategy/ city builder games. At the time Facebook only had the clicking games from Zynga and the one that made the most sense to build was a strategy/city building game. It was within our capabilities and really put a graphical interface to some of those text-based Facebook Games (remember Mafia Wars?)</p>\n</li>\n<li>\n<p>The first game was Kingdoms of Camelot on Facebook</p>\n</li>\n<li>\n<p>We chose Camelot as a theme because it was in the public domain, accessible and fun rich deep theme.</p>\n</li>\n</ol>\n<p><strong>I am a cofounder on an educational game company targeting adult learners (you may read Anthony&#8217;s question, too).</strong></p>\n<p><strong>My question is evolving around how you think it is possible for game based startups to get an MVP for investors out the door, in a decent amount of time and with an acceptable quality. For me this seems way harder to pitch to investors as one has to fight the aspect of doing a game (some investors already see this as less serious than web services) at the same time as fighting the effect that people focus way more on graphics in a game than on its functionality (compared to websites). Using game engines and assets already helps a lot, but it still seems that games make it hard to match the growth rates and development times expected by startup investors. Can you provide insides on how to solve this problem? 🙂</strong></p>\n<p>This is a hard problem. In general investors shy away from investing in games not because it&#8217;s &#8220;less serious&#8221; but because it is &#8220;hits driven&#8221; and it&#8217;s content. So just because you make one game, it is unclear if you can make another game that is as big of a hit &#8211; in other words it is not as repeatable. Where this is different is when you have a fundamental shift in the platform, and technology or even business model to show that the games are not just one hit. A great example is the free to play model or really the IAP (in-app purchase) model. That business model was very new to the gaming world as before it was just console games (you pay up front, no more and no less) .</p>\n<p>Other ways to de-risk it for investors is to run a crowdfunding campaign and show that there are players or capital lining up for this game. You can do this at www.fig.co</p>\n<p>Or you can go to a gaming platform like roblox try to start it. If you are in a country that gives gaming grants like Australia. That is another option.</p>\n<p>If you have a good gaming pedigree, you can look on Angellist and find some founders of gaming companies that angel invest.</p>\n<p><strong>1&#46; Futuristic &#8211; where gaming and gamification will be 10-15 years time and how it will impact our societies and industries &#8211; please use your boldest predictions?</strong></p>\n<p><strong>2&#46; Any thoughts how legal industry may use, learn from or benefit from gaming industry (or gamification)?</strong></p>\n<p><strong>3&#46; What are the key learnings/advices that you can share from your role of Head of Worldwide People and Culture function? Any surprising ones?</strong></p>\n<ol>\n<li>\n<p>My thoughts are not as grand &#8211; I think voice is going to be a large immersive seamless platform. Platform is still incredibly nascent.</p>\n</li>\n<li>\n<p>Move off of Word Perfect! My feeling is that the legal industry is one of the slowest to adopt new technologies. This is because they bill by the hour. Anything that reduces their time means less profits. I think there are other things that need to be fixed first in order to start changing. The one thing the industry can learn from gaming is to align incentives with its end goal. It doesn&#8217;t seem to be the case right now.</p>\n</li>\n<li>\n<p>Key Learnings &#8211; people will surprise you! Good and bad. I feel like HR is one of the most under appreciated professions. They are like the complaint desk for the company. And, therefore can not attract as high of a caliber it can. It is changing a lot as more founders are moving into the company building phase. Companies that do it right have a great free system and people infrastructure to move the company in the direction it is needed. And give your HR person a hug today 🙂</p>\n</li>\n</ol>\n<p>How can you gamify things like elearning platforms i.e. leaderboards, quizzes etc.</p>\n<p>I feel like for non-games you have to be true to your core loop of behavior. If you don&#8217;t have a core behavior, then you should ask yourself what is that behavior and build around it. Gamifying can help reinforce it.</p>\n<p><a href=https://www.ycombinator.com/"http://www.foggmethod.com/">http://www.foggmethod.com
http://danariely.com
https://medium.com/startup-grind/do-this-one-thing-to-make-your-product-sticky-aa8ed6d55797

/n

I know that one of the things that I really need for our team is a strong game designer. How would you go about finding one in the Bay area (I&#8217;m in Mountain View) and what qualities and questions should I be asking them?</strong></p>\n<ol>\n<li>\n<p>What kind of game are you making? Game designers come in all forms: map design, level design, systems design. You will likely need to be more specific. It is okay if you don&#8217;t get the terminology write, just plainly write &#8220;what you will do&#8221; in bullet points on the job req.</p>\n</li>\n<li>\n<p>Assuming you do not have a lot of capital, If you have a solid team, then you&#8217;ll be able to attract a solid game designer. If not, likely you can attract an inexperienced one. If you have traction, you can also attract a solid game designer. Without these it is cash or equity. This is the beginning of what you will need to do for the rest of the life of the company &#8211; recruit.</p>\n</li>\n</ol>\n<p><strong>How much weight do you give to a top-down analysis (e.g., platform, category, etc.) versus a bottom-up analysis (e.g., core loop, innovative mechanics) when selecting a new game development project?</strong></p>\n<p>I weigh top down analysis much more &#8211; platform and category. Sam talks about how you cannot create technological waves, but you can certainly ride the wave. This has been our experience at Kabam from a user point of view as well as a fundraising perspective. It was so much easier for us to fundraise when the gaming industry was doing well, irrespective of our performance. When facebook or mobile were growing so were our games.</p>\n<p><strong>Parts of our product has some gamification factor in it, particularly a reputation system that incentivizes people to engage and contribute quality answers to a question (symbolizing credibility).</strong></p>\n<p><strong>1&#46; I was wondering if you had any tips/resources for going about designing a reputation system?</strong></p>\n<p><strong>2&#46; We would like to test our MVP soon and was wondering what the process of getting and growing initial testers was like in your experience?</strong></p>\n<ol>\n<li>\n<p>I&#8217;m not sure off the top of head about designing a reputation system. However, here are a couple of tips when we were designing our communities:<br />\na. Find elements in the badge that show trust. Usually the basic thing is tenure. Oftentimes you will see &#8220;Member since&#8221; , so you can see how veteran the person is and vet their answers accordingly<br />\nb. Two sided reviews. The underclassmen should be able to rate the upperclassman and vice versa. I think uber and Lyft do this well. This creates trust on both sides and helps keep people honest.<br />\nc. Rating . A rating will flow from quantity and quality. There may be more elements, but those are off the top of my list. If you are creating a community, you will need to think about roles and moderation and what they can do.</p>\n</li>\n<li>\n<p>If you can get a couple of folks within a school some underclassmen and some upperclassmen that would be the best. If you are close to a school you can advertise there, or you can post in a Facebook group. I would recruit a couple from each group and have them use your product. Ask them questions and watch what they do.</p>\n<p>Once you have your product ready, you should consider the platforms of where students hang out and go advertise there. I&#8217;m not sure if you are targeting high school or college or some other level of schooling or even country, so a little general on some of the sources.</p>\n</li>\n</ol>\n<p><strong>1) At a high-level, how did you approach game design when leveraging others IP vs. creating your own?</strong></p>\n<p><strong>2) Did you typically use multiple structures for agreements? Were the majority of rev-share based with some level of a guarantee? What were the core variables that you found really important to discuss on both sides to have deals that ended up with both parties happy?</strong></p>\n<ol>\n<li>\n<p>In leveraging someone else&#8217;s IP you have to be true to that story and things in that world. In many ways for us it de-risked execution because we did not need to invent new characters or story line. Therefore game design for us focused heavier on systems design, progression and level ups. In creating our own we needed to think about story line and environment more in addition to systems design.</p>\n</li>\n<li>\n<p>By the time we worked with IP at Kabam we were a larger size. There were definitely rev-share with a minimum of guarantees. Anytime there is attribution of traffic to figure out rev=share that should be clearly spelled out how it&#8217;s done. Also you should talk about marketing plans of supporting one another pre-through launch. It is good to stick a person to help manage this integration and ask for support on their end. Also make sure you know what the rights are for. A lot of IP licensing is sliced and diced on platforms and geographies. Make sure you know what you are getting.</p>\n</li>\n</ol>\n<!--kg-card-end: html-->","comment_id":"1103221","feature_image":null,"featured":false,"visibility":"public","email_recipient_filter":"none","created_at":"2018-11-09T01:27:44.000-08:00","updated_at":"2021-10-20T11:59:58.000-07:00","published_at":"2018-11-09T01:27:44.000-08:00","custom_excerpt":null,"codeinjection_head":null,"codeinjection_foot":null,"custom_template":null,"canonical_url":null,"authors":[{"id":"61fe29e3c7139e0001a710d1","name":"Y Combinator","slug":"y-combinator","profile_image":"/blog/content/images/2022/02/1200px-Y_Combinator_logo.svg.png","cover_image":null,"bio":"Y Combinator created a new model for funding early stage startups. Twice a year we invest a small amount of money ($150k) in a large number of startups (recently 200).\r\n\r\nThe startups move to Silicon","website":null,"location":null,"facebook":null,"twitter":null,"meta_title":null,"meta_description":null,"url":"https://ghost.prod.ycinside.com/author/y-combinator/"}],"tags":[{"id":"61fe29efc7139e0001a71174","name":"Advice","slug":"advice","description":null,"feature_image":null,"visibility":"public","og_image":null,"og_title":null,"og_description":null,"twitter_image":null,"twitter_title":null,"twitter_description":null,"meta_title":null,"meta_description":null,"codeinjection_head":null,"codeinjection_foot":null,"canonical_url":null,"accent_color":null,"url":"https://ghost.prod.ycinside.com/tag/advice/"},{"id":"61fe29efc7139e0001a7118a","name":"Gaming","slug":"gaming","description":null,"feature_image":null,"visibility":"public","og_image":null,"og_title":null,"og_description":null,"twitter_image":null,"twitter_title":null,"twitter_description":null,"meta_title":null,"meta_description":null,"codeinjection_head":null,"codeinjection_foot":null,"canonical_url":null,"accent_color":null,"url":"https://ghost.prod.ycinside.com/tag/gaming/"},{"id":"61fe29efc7139e0001a7117f","name":"Startup School","slug":"startup-school","description":null,"feature_image":null,"visibility":"public","og_image":null,"og_title":null,"og_description":null,"twitter_image":null,"twitter_title":null,"twitter_description":null,"meta_title":null,"meta_description":null,"codeinjection_head":null,"codeinjection_foot":null,"canonical_url":null,"accent_color":null,"url":"https://ghost.prod.ycinside.com/tag/startup-school/"},{"id":"61fe29efc7139e0001a71180","name":"#startup-school","slug":"hash-startup-school","description":null,"feature_image":null,"visibility":"internal","og_image":null,"og_title":null,"og_description":null,"twitter_image":null,"twitter_title":null,"twitter_description":null,"meta_title":null,"meta_description":null,"codeinjection_head":null,"codeinjection_foot":null,"canonical_url":null,"accent_color":null,"url":"https://ghost.prod.ycinside.com/404/"}],"primary_author":{"id":"61fe29e3c7139e0001a710d1","name":"Y Combinator","slug":"y-combinator","profile_image":"https://ghost.prod.ycinside.com/content/images/2022/02/1200px-Y_Combinator_logo.svg.png","cover_image":null,"bio":"Y Combinator created a new model for funding early stage startups. Twice a year we invest a small amount of money ($150k) in a large number of startups (recently 200).\r\n\r\nThe startups move to Silicon","website":null,"location":null,"facebook":null,"twitter":null,"meta_title":null,"meta_description":null,"url":"https://ghost.prod.ycinside.com/author/y-combinator/"},"primary_tag":{"id":"61fe29efc7139e0001a71174","name":"Advice","slug":"advice","description":null,"feature_image":null,"visibility":"public","og_image":null,"og_title":null,"og_description":null,"twitter_image":null,"twitter_title":null,"twitter_description":null,"meta_title":null,"meta_description":null,"codeinjection_head":null,"codeinjection_foot":null,"canonical_url":null,"accent_color":null,"url":"https://ghost.prod.ycinside.com/tag/advice/"},"url":"https://ghost.prod.ycinside.com/gaming-ama-with-yc-visiting-partner-holly-liu/","excerpt":"YC Visiting Partner Holly Liu recently did aGaming AMA with Startup School founders. It was so good that we wanted to shareit here.","reading_time":22,"access":true,"og_image":null,"og_title":null,"og_description":null,"twitter_image":null,"twitter_title":null,"twitter_description":null,"meta_title":null,"meta_description":null,"email_subject":null,"frontmatter":null,"feature_image_alt":null,"feature_image_caption":null},{"id":"6348578e2184dc0001eebf80","uuid":"e6a0a134-b255-40e8-b7be-01494afbabe8","title":"Learnings of a CEO: Matt Schulman, Pave, on Hiring","slug":"learnings-of-a-ceo-matt-schulman-pave","html":"<p>Welcome to the third edition of Learnings of a CEO. You can read previous editions <a href=https://www.ycombinator.com/"https://www.ycombinator.com/blog?query=learnings%20of%20a%20CEO\%22>here.

Pave helps companies plan, communicate, and benchmark employee compensation. Today, the company has 160 employees, more than 3,500 customers, and is valued at $1.6B. Founder and CEO <a href=https://www.ycombinator.com/"https://twitter.com/matthewschulman?lang=en\%22>Matt Schulman</a> has created one of the most comprehensive and thorough recruiting processes, which has made him one of the most successful recruiters in the YC community. We sat down with Matt to hear his insight on <a href=https://www.ycombinator.com/"https://www.workatastartup.com/companies/pave-2/">building a team</a> in the early stages of his company and today as a CEO of a growth-stage company. </p><p><strong>Many of the first Pave employees were hired as a contractor before converting to a full-time employee. Would you recommend this strategy to founders? </strong></p><p>I strongly recommend the contract-to-hire setup in the early days of a startup, as it led me to have a 100% close rate with the candidates we wanted to convert to full-time. This strategy worked for two reasons: </p><p>1) By the end of the contract, the contractors had poured weeks of energy into the work – learning the code base and investing their time – and getting to know potential coworkers. This escalated their sense of commitment.</p><p>2) I was flexible on working hours – open to them working nights or weekends. This made it easier for the candidates who were busy with full-time employment to say yes to working with Pave and earn extra income on the side. </p><p>To convince people who were employed to work for Pave as a contractor on top of their current job, I framed the process as a mutual evaluation. This is an opportunity to evaluate the company and come to a mutual decision at the end of 2, 4, or 6 weeks together – no pressure. We paid them a fair market rate, and as mentioned, we were flexible on working hours. One contractor worked their day job until 5:00pm and then on Pave from 6:00pm-2:00am, for example. They were excited to be able to build something from the ground up and work closely with me at the earliest stage of the company – which is another strategy I used to encourage people to work with us. </p><p>Before Pave, I was an engineer at Facebook and regularly worked on side projects. These projects were my fun, guilty pleasures because when I built something from the ground up, I felt an emotional attachment to the work. Usually engineers at large companies feel part of a machine, but when they build something full-stack from the ground up, there’s a magical allure to that work. I gave those contractors ownership over the work and often jammed out with them – working side by side at all hours. (One note: I did not have the contractors touch customer PII.) Within weeks, we’d both know whether Pave would be a good fit, and if so, we were already committed to each other.</p><p><strong>What were you looking for in early employees? </strong></p><p>When starting to build out the team, I was given a tip that the first 10 hires would set the tone for the next 100. Because of this, I personally recruited 100% of the early Pave employees. I sourced people, took phone screens, went to dinner, coffee, and on walks with candidates, and spoke with them for hours on Zoom and Facetime. It was an all-encompassing process. But I found that early advice to be accurate: The first 10 employees are the most important aspect in the company’s life cycle – other than finding product-market fit – and recruiting has to be the founder’s priority.</p><p>When recruiting for the first ten employees, I wasn’t looking for experts in specific areas but generalists with rapid career growth, passion for our mission, and a hunger to work. Those early employees readily tackled whatever fire we were facing that day from engineering work and sales to back office and HR. I also had a deep level of trust with those first ten hires, as they were all in my network. </p><p>Today, I still look for mission alignment and hunger but there are times I need to hire a specialist. I identify the tightest set of criteria for the role and only talk to people who fit that criteria. This is very different from the early days when I was solely looking for generalists who could fill multiple roles.</p><p><strong>How did you convince those early employees to join Pave? </strong></p><p>I always found ways to continue our conversation even when I could sense the candidate wanted to turn down the offer. I would do this by scheduling future conversations – saying that I needed to share something new with them – and then I would get to work writing a Google Doc that showed how I planned to invest in their career. We still use this strategy at Pave today, but it has evolved and is now affectionately called the collaborative Google Doc.</p><p>The collaborative Google Doc is shared with the candidate and used throughout the entire interview process. The document outlines expectations for the role and frames the interview process in stages, communicating which stage the candidate is in at any given time to ensure we are working within their ideal timeline. We encourage the candidate to comment and add their thoughts to the document, including feedback for me and their thoughts on the interview process.</p><p>As we get further into the interview process, I get more specific about what I’m looking for in a candidate. And when we get even deeper, I write multiple pages on what I’ve learned about their career aspirations through our conversations and backchanneling, and how I’m going to support them. </p><p>When it comes to backchanneling for potential executive hires, I try to talk with at least 10 people and ask, “If I have the privilege to be this person's manager, I want to set them up for the utmost success. What are your specific recommendations about the best ways to set this person up for success and unleash their full potential?” This 360 review is shared with the candidate right before I deliver the compensation package. I outline what I learned about their strengths and weaknesses, and specific ways that I’ll push them and support them.</p><p>When I communicate compensation, I lay out all the facts, including cash amount, equity (shares and dollar amount), and the benefits package. In addition, we also share:</p><ul><li>The salary band for the role (and implicitly their position in it).</li><li>The level that the employee will be in the organization, along with more information on our leveling framework and what each level means.</li><li>The methodology for determining the compensation, like the market data we use (75th percentile for similar stage companies).</li><li>Broader information on compensation philosophy, including how someone moves through the band, gets promoted, etc.</li><li>Additional info on equity: current preferred price, current post money valuation, details on vesting, PTE window, 409A price, and more – essentially everything they need to determine the actual value of the grant.</li></ul><p>We’re ultra transparent about compensation because compensation should not be a guessing game; people deserve to understand every aspect of their compensation package and how it was derived. I then offer to meet live to answer any questions or discuss feedback – or ask them to leave their comments in the Google Doc. Most candidates will ask questions in the document, as it can be more approachable.</p><p><strong>For every open role at Pave, a Slack channel is created to drive urgency and ensure no detail goes missed. Tell me about this process. </strong></p><p>As a seed-stage company, I was creating Slack channels for every role. Today, Slack channels are created for roles that I’m involved with – like hiring a head of finance or VP of engineering. The process still looks the same, however. </p><p>I create a Slack channel for that role and add relevant stakeholders. Every morning I ask for an update. What’s the movement? Have we sourced any more candidates? Have we talked with candidates X, Y, and Z? I do this to keep the process moving forward every day. I also post updates – sharing with the team when I spoke with a reference, for example. When we extend an offer, I use this Slack channel to encourage stakeholders to reach out to the candidate through text messages or Loom videos. </p><p>Loom videos are an interesting medium. If you’re a candidate and receive six Loom videos from different people at the company, it may feel bizarre and a bit overwhelming. But the videos show we are excited about the candidate and also gives insight into our energetic culture. </p><p><strong>You also review email copy and do drip campaigns for candidate outreach. Tell me about this. </strong></p><p>We have a pre-written email sequence that is sent from me or the hiring manager depending on the context, and then we use <a href=https://www.ycombinator.com/"https://www.ycombinator.com/companies/gem/">Gem to automate this. The response rates for these campaigns are much higher than if the emails were coming from a recruiter. Before the emails are sent out, I’ll spend 30 minutes personalizing 30 emails (one to two sentences at the onset of the email) that will be sent to target profiles. And then it’s important you do a drip. If you only send one email, most of the time the candidate won’t respond. I find sending a third email with a short message like, “Hey, any thoughts?” leads to the most responses. </p><p><strong>How do you think about where your job ends and your team begins when it comes to recruiting?</strong></p><p>Today, if I’m not the hiring manager, I delegate and come in only at the end of the process for a sell call. The process looks vastly different if I’m the hiring manager. I spend a lot of time reviewing resumes and identifying the top 25 profiles in the space. Every outreach to them is very personalized, and I have time to do this because I focus on quality over quantity of candidates. Quality over quantity was a big lesson for me, actually. At first, I would look at all inbound resumes and thousands of applicants. But I have come to realize that I have more success when I map out the market and find the top 25 candidates in the space. Then I'll find a way to get one of them in the door.</p><p><strong>Describe the ideal candidate for senior-level positions when Pave was a smaller company. </strong></p><p>As a company of 35 people, we didn’t need managers who delegated – which has merit at a later-stage company. We needed people who would personally take on the hard work. Often, first-time founders hire someone senior for optics reasons. Instead, you should look for someone earlier in their career who has grown at a crazy high slope – often referred to in the tech industry as a high-slope candidate versus a Y-intercept candidate. There is a time and place for both types of hires, but as a 35-person startup, almost always go for the slope, not the high Y-intercept. And in some cases, you may meet exceptional candidates with both high slope and high Y-intercept. This is the dream case!</p><p>Another mistake first-time founders can make is rushing hires by trying to squeeze them in before a term sheet. Don’t try to meet some arbitrary deadline or cliff date. If it takes six months or a year to hire an executive, that’s ok – wait for the right person.*<br><br><em>*This answer has been updated to clarify the founder’s intention behind the statement.</em></p>","comment_id":"6348578e2184dc0001eebf80","feature_image":"/blog/content/images/2022/10/BlogTwitter-Image-Template--8-.jpg","featured":true,"visibility":"public","email_recipient_filter":"none","created_at":"2022-10-13T11:23:10.000-07:00","updated_at":"2022-10-26T08:44:29.000-07:00","published_at":"2022-10-17T09:00:11.000-07:00","custom_excerpt":"Pave Founder and CEO Matt Schulman has created one of the most comprehensive and thorough recruiting processes, which has made him one of the most successful recruiters in the YC community.","codeinjection_head":null,"codeinjection_foot":null,"custom_template":null,"canonical_url":null,"authors":[{"id":"61fe29e3c7139e0001a710a7","name":"Lindsay Amos","slug":"lindsay-amos","profile_image":"/blog/content/images/2022/02/Lindsay.jpg","cover_image":null,"bio":"Lindsay Amos is the Senior Director of Communications at Y Combinator. In 2010, she was one of the first 30 employees at Square and the company’s first comms hire.","website":null,"location":null,"facebook":null,"twitter":null,"meta_title":null,"meta_description":null,"url":"https://ghost.prod.ycinside.com/author/lindsay-amos/"}],"tags":[{"id":"61fe29efc7139e0001a71181","name":"YC Continuity","slug":"yc-continuity","description":null,"feature_image":null,"visibility":"public","og_image":null,"og_title":null,"og_description":null,"twitter_image":null,"twitter_title":null,"twitter_description":null,"meta_title":null,"meta_description":null,"codeinjection_head":null,"codeinjection_foot":null,"canonical_url":null,"accent_color":null,"url":"https://ghost.prod.ycinside.com/tag/yc-continuity/"},{"id":"61fe29efc7139e0001a71174","name":"Advice","slug":"advice","description":null,"feature_image":null,"visibility":"public","og_image":null,"og_title":null,"og_description":null,"twitter_image":null,"twitter_title":null,"twitter_description":null,"meta_title":null,"meta_description":null,"codeinjection_head":null,"codeinjection_foot":null,"canonical_url":null,"accent_color":null,"url":"https://ghost.prod.ycinside.com/tag/advice/"},{"id":"61fe29efc7139e0001a71152","name":"Founder Stories","slug":"founder-stories","description":null,"feature_image":null,"visibility":"public","og_image":null,"og_title":null,"og_description":null,"twitter_image":null,"twitter_title":null,"twitter_description":null,"meta_title":null,"meta_description":null,"codeinjection_head":null,"codeinjection_foot":null,"canonical_url":null,"accent_color":null,"url":"https://ghost.prod.ycinside.com/tag/founder-stories/"},{"id":"61fe29efc7139e0001a71158","name":"Leadership","slug":"leadership","description":null,"feature_image":null,"visibility":"public","og_image":null,"og_title":null,"og_description":null,"twitter_image":null,"twitter_title":null,"twitter_description":null,"meta_title":null,"meta_description":null,"codeinjection_head":null,"codeinjection_foot":null,"canonical_url":null,"accent_color":null,"url":"https://ghost.prod.ycinside.com/tag/leadership/"},{"id":"61fe29efc7139e0001a71170","name":"Startups","slug":"startups","description":null,"feature_image":null,"visibility":"public","og_image":null,"og_title":null,"og_description":null,"twitter_image":null,"twitter_title":null,"twitter_description":null,"meta_title":null,"meta_description":null,"codeinjection_head":null,"codeinjection_foot":null,"canonical_url":null,"accent_color":null,"url":"https://ghost.prod.ycinside.com/tag/startups/"},{"id":"634d76fe3f2ab90001338eb9","name":"#21831","slug":"hash-21831","description":null,"feature_image":null,"visibility":"internal","og_image":null,"og_title":null,"og_description":null,"twitter_image":null,"twitter_title":null,"twitter_description":null,"meta_title":null,"meta_description":null,"codeinjection_head":null,"codeinjection_foot":null,"canonical_url":null,"accent_color":null,"url":"https://ghost.prod.ycinside.com/404/"},{"id":"61fe29efc7139e0001a71155","name":"Growth","slug":"growth","description":null,"feature_image":null,"visibility":"public","og_image":null,"og_title":null,"og_description":null,"twitter_image":null,"twitter_title":null,"twitter_description":null,"meta_title":null,"meta_description":null,"codeinjection_head":null,"codeinjection_foot":null,"canonical_url":null,"accent_color":null,"url":"https://ghost.prod.ycinside.com/tag/growth/"}],"primary_author":{"id":"61fe29e3c7139e0001a710a7","name":"Lindsay Amos","slug":"lindsay-amos","profile_image":"https://ghost.prod.ycinside.com/content/images/2022/02/Lindsay.jpg","cover_image":null,"bio":"Lindsay Amos is the Senior Director of Communications at Y Combinator. In 2010, she was one of the first 30 employees at Square and the company’s first comms hire.","website":null,"location":null,"facebook":null,"twitter":null,"meta_title":null,"meta_description":null,"url":"https://ghost.prod.ycinside.com/author/lindsay-amos/"},"primary_tag":{"id":"61fe29efc7139e0001a71181","name":"YC Continuity","slug":"yc-continuity","description":null,"feature_image":null,"visibility":"public","og_image":null,"og_title":null,"og_description":null,"twitter_image":null,"twitter_title":null,"twitter_description":null,"meta_title":null,"meta_description":null,"codeinjection_head":null,"codeinjection_foot":null,"canonical_url":null,"accent_color":null,"url":"https://ghost.prod.ycinside.com/tag/yc-continuity/"},"url":"https://ghost.prod.ycinside.com/learnings-of-a-ceo-matt-schulman-pave/","excerpt":"Pave Founder and CEO Matt Schulman has created one of the most comprehensive and thorough recruiting processes, which has made him one of the most successful recruiters in the YC community.","reading_time":7,"access":true,"og_image":null,"og_title":null,"og_description":null,"twitter_image":null,"twitter_title":null,"twitter_description":null,"meta_title":null,"meta_description":null,"email_subject":null,"frontmatter":null,"feature_image_alt":null,"feature_image_caption":null},{"id":"63d45276ba7a5900012d1cb7","uuid":"539ff8b7-1511-483b-aade-1dccd48511b1","title":"Learnings of a CEO: Snapdocs’ Aaron King on navigating market cycles","slug":"learnings-of-a-snapdocs-aaron-king-on-navigating-market-cycles","html":"<p>Welcome to the fourth edition of Learnings of a CEO. You can read previous editions <a href=https://www.ycombinator.com/"https://www.ycombinator.com/blog?query=learnings%20of%20a%20CEO\%22>here. </p><p><a href=https://www.ycombinator.com/"https://www.snapdocs.com//">Snapdocs is the leading digital closing platform for the mortgage industry. Today, the company touches 25% of all US real estate transactions and is valued at $1.5B. Founder and CEO <a href=https://www.ycombinator.com/"https://twitter.com/a_w_king/">Aaron King</a> and his team have expertly navigated fundraising and market cycles. We sat down with Aaron to hear his insight into getting a business up and running with minimal outside funding and building through volatile market conditions. </p><p><strong>Why did you decide to raise minimal funding early in the company’s history?</strong></p><p>I never considered funding to be a requirement for building — but I also didn't know much about fundraising early on in the company’s history. Snapdocs was started as a side project a couple of years before ever thinking about applying to YC. By the time I applied, we had a live product, customers, and revenue. Even after YC, we didn’t raise much immediately. We stayed focused on building and then raised a seed round later in the year.</p><p>It wasn’t until three years later that we raised our Series A. By then, we had spent about $1MM of our seed round and were at a $5MM revenue run rate. Around that time we started working with much larger customers, and it was clear we would need more capital to be successful in this bigger market. So, we raised our Series A. After we closed the round, our lead investor revealed how capital efficient we had been compared to our peers. </p><p><strong>Do you feel you had to ruthlessly prioritize when building the product because you didn't have the capital?</strong></p><p>Yes, and I’ve learned that you should take the same approach even when you do have the capital to be less disciplined. Back then, ruthless prioritization was our only option. We couldn’t afford to build features that weren’t essential. There were always a hundred distractions that would result in a broader, less focused product. But our capital constraints kept us focused on going deep with our paying customers. That helped us avoid the common trap of building products no one wanted. </p><p>It also meant that when we decided to build a product, we had to think about the smallest version of that product in order to quickly ship. That helped ensure we had a short feedback loop from our users and ensure our resources were continuously being invested in building the right features. Looking back, I’m amazed at how much we were able to accomplish without spending much capital. </p><p>Being capital constrained forced good behaviors that served us well even after we raised more funding. We continue to be thoughtful about every dollar we spend. But, there is a cost to this approach, and we’re paying for it today. We built many things that weren't engineered for scale or flexibility. However, now we can afford to reengineer those unscalable solutions because we built something people want.</p><p><strong>What did your product cycles look like before you raised your Series A?</strong></p><p>We were always heavy on customer involvement when building product. We spent a lot of time in our customers’ offices watching them use what we were building and understanding their work. We also kept a lot of our prospects in the loop as we built new features. Some of the best feedback came from people who had chosen to not yet work with us. Responding to that feedback with a killer feature was a great way to ultimately get them on board. </p><p>We built a lot of trust and rapport with these early customers, and the in-person interactions helped immensely. As a result, they would call one of us the moment they thought there was a problem or if they thought a competitor was doing something compelling. Customer churn for Snapdocs has always been incredibly low as a result. </p><p>We created a disciplined product release process, even in those early days, but we were still able to move quickly. We shipped code every day, sometimes multiple times a day. Customers were impressed by how quickly we could respond to issues and feedback. </p><p>Interestingly, not having too much pressure from investors early on allowed us to experiment more in an underappreciated part of our market. The Serviceable Available Market (SAM) of our initial product was roughly only $20MM, but we believed it would allow us to expand into more critical parts of the mortgage ecosystem. It was the type of opportunity that would be hard to discover through market analysis or spreadsheet exercises. You had to get deep into the problem set to see the opportunity and develop the right strategy—and that ultimately worked to our advantage. </p><p><strong>Founders need capital to hire employees. As a bootstrapped company, what was your strategy around hiring? </strong></p><p>Hiring was hard, but we did a few things that worked well. Even before the company could afford full-time employees, I worked with talented contractors. I also leaned on friends to help me work through both technical and business challenges. Someone would come over and whiteboard with me or we’d get into the code and work through a problem. </p><p>When I could afford to hire full-time employees, I treated them like founding team members. I was generous with equity and shared everything about the potential and challenges of the business. We built a lot of trust as a small team. Getting a few really good people into the company early on was foundational to the company’s success. </p><p>The first person to join full-time was an engineer I had worked with in a previous role (and one of the friends that would help in those early days). The second and third hires were applicants from job postings on Hacker News. All three turned out to be excellent. None of us initially had large networks in the startup world, so most of our early hiring involved lots of interviews and hiring a few of the wrong people. We couldn’t attract well-known talent and took risks; invested in people we thought had a lot of potential. </p><p>One mistake I made in the early years was being too timid to approach more of the people I respected. I should have tried to convince them to quit their successful jobs and join our small (yet risky at the time) startup. I’m fearless on this approach now, but back then I was intimidated to try to convince a friend to join a company that might fail. In hindsight, I did them a disservice by not trying to recruit them. The truth is that these people are smart and you’re not harming anyone by sharing your vision and the potential of the company with them. As long as you’re honest and transparent about the inherent challenges, you should give them the opportunity to take a risk on you. </p><p>As Snapdocs grew, it became easier to pull from the team’s networks. We continued to build a lot of trust within the team, and they started referring their friends to apply. Eventually, we attracted well-known investors, and that, along with our culture and growth, made hiring easier. </p><p>Because we were capital constrained, we also didn’t hire anyone until there was a clear and painful need. It made running the company harder because we were all spread thin but ultimately made us incredibly productive, as it meant we were always working on the most important things. </p><p><strong>How have you navigated different market conditions? When do you decide to react?</strong></p><p>A big part of our success has come from selectively ignoring some market changes while reacting quickly to others. It has always been a question of how the change aligns with our resources, vision, and north star metric of market share growth. </p><p>For example, the biggest and most dynamic change we regularly experience are fluctuations in the number of mortgages that happen in a given month or year. This can change quickly based on a host of economic factors. When we are well-resourced and growing fast, we can ignore some of those market downturns and stay focused on market share growth — knowing we have the momentum and capital to power through it. Other times we’ve had to scale up or scale back based on the size of the fluctuation.</p><p>But other market dynamics can change quickly too, like the industry’s appetite for new technologies and the competitive landscape. There have been times when the market was demanding a technology but we believed there were underlying factors in the industry that would prevent that tech from scaling. If we built the technology, it would pull resources away from the priorities that drove us toward our long-term goals. And so, sometimes to the protests of our sales team, we ignored it or invested minimally in these trendy areas. By doing so, we were able to stay focused on the things that were truly going to transform the industry. </p><p>It’s also worth noting that navigating change was relatively easy in the first few years of building the company. It was a lot easier to adjust course on company direction or strategy when the team was smaller and could all fit in the same room. The product cycles were relatively short and malleable. The cost of making a change was low. </p><p>As the company has grown, we’ve had to be a lot more thoughtful and methodical about changing the speed or direction of the business as we react to market changes. The cost of making a change has increased a lot. Investments take longer to play out. Changes to headcount take longer to scale up or down. There are more people on the team and more layers in the organization to communicate the change through. </p><p><strong>In March 2020, Snapdocs made a huge shift because of changes you were seeing in the housing market. How did you communicate this shift to your team and ensure their goals were aligned with the new priorities? </strong></p><p>COVID accelerated demand for our product, but with that came a shift in what our customers wanted from a platform like ours. We had to expand quickly to serve their needs, and we had to pivot our roadmap on a dime. It’s a testament to the team that we were able to pull that off. </p><p>To make decisions quickly and then communicate them, we worked in concentric circles. We started by discussing the change in a smaller group of 3-4 people. This is where the hardest and messiest conversations took place. We moved quickly to define the problems and opportunities and set a direction for the company. We then looped in the senior leadership team for further discussion and to arm them with everything they needed to share the directional changes with their teams. Finally, we held a company-wide meeting to share the new direction and answer questions. All of this happened over the course of about 2 weeks.</p><p>Now, our business required more speed and flexibility as information was coming in and changing week on week. We dealt with this by creating temporary pods of 4-5 team members focused on solving specific challenges that would spin up for a few weeks and then dissolve once the challenge was addressed. We also increased the frequency of our company-wide all-hands meetings from monthly to weekly so we could keep the whole company up to speed. </p><p>Luckily we had a deep culture of transparency that goes back to the beginning of the company. We’ve always tried to share everything with our entire team — our cash balance, monthly growth rate, burn, our biggest challenges. This got harder as the team grew, but we’ve largely continued this transparency to today. It’s much easier to be transparent in times of great change if you've laid a foundation of trust and transparency in the past. </p><p>We also worked hard to be intellectually honest about the growth we were experiencing. It’s easy to take credit when the business accelerates, but our message to the team wasn't, “Look at how great we're doing.” The message was closer to, “This industry works in cycles. We're in an up cycle now and that's great. There's going to be a down cycle. We don't know when or how strong it's going to be. But we should not overly congratulate ourselves for the current situation, just as we shouldn’t be too hard on ourselves when we’re fighting through an inevitable downturn in the future.”</p><p><strong>In 2021, Snapdocs </strong><a href=https://www.ycombinator.com/"https://www.snapdocs.com/resource-center/blog/announcing-our-150m-series-d-funding-round/">announced a Series D round. How did this change your mentality around resources?</strong></p><p>It was clear that the pandemic would be an accelerator for our business, and we needed to move fast to stay ahead of the market. We went from being frugal to raising larger rounds of capital and hiring seasoned executives who could help us scale. It’s important for companies to evolve at the right points in time and ask themselves, “Is what I did yesterday the thing that's going to get me to where I need to be tomorrow?”. We asked that question and decided we needed to change parts of our culture and capital investment strategy if we wanted to win.</p><p>When we raised capital in 2021, transactions on Snapdocs had steadily increased to millions of closings a year and thousands of lenders and title companies were using our technology every month. Demand for mortgages throughout the pandemic was strong, and we deployed an intentional strategy of prioritizing effectiveness over efficiency. We needed to get aggressive and expand our market position, which required capital. </p><p>The market turned again later in the year, with demand for mortgages cooling. It was clear that it was time to go back to some of our old ways of doing things. We ditched the motto of being effective over being efficient. This meant a return to ruthless prioritization of our focus. We shifted away from investing so heavily in future scale as we wouldn’t need to tap into these systems for a few years.</p><p>I find it helpful to remember that market fluctuations are normal and unavoidable. Startups should scale up at times and scale back at others. It’s hard and painful. There’s nothing easy or enjoyable about being understaffed to meet customer demand on one side, or needing to let team members go on the other. But these ups and downs are natural and a necessary part of building an enduring company. In a startup, you’re always making hard decisions based on insufficient information. You’re never going to be able to perfectly predict the future. You need to keep making the best decisions you can — knowing all the while that you may be wrong and need to change course again once the future becomes clearer.</p>","comment_id":"63d45276ba7a5900012d1cb7","feature_image":"/blog/content/images/2023/02/BlogTwitter-Image-Template--24-.png","featured":true,"visibility":"public","email_recipient_filter":"none","created_at":"2023-01-27T14:38:46.000-08:00","updated_at":"2023-02-22T18:17:22.000-08:00","published_at":"2023-01-30T08:59:00.000-08:00","custom_excerpt":"Founder & CEO Aaron King expertly built Snapdocs through volatile market conditions and with minimal outside funding into the mortgage industry's leading digital closing platform, valued at $1.5B today. 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Advice for New Managers

by Aaron Epstein10/10/2016

Aaron Epstein is the cofounder of Creative Market.

One of the most difficult things about starting a company is that you have to create both a product that people love and a company where people want to work at the same time. It’s usually not enough to just have a great product, or just be a great place to work, because great people build great products, and great people won’t tolerate a bad environment for very long.

People leave managers, not companies, yet while most founders are obsessive about trying to build a product that people love, many first-time founders raise a bunch of money and start building a team without any management experience at all.

I was one of those first-time founders who had to quickly learn on the job, so here’s some advice I wish someone had given me when I was just beginning to grow and manage a team at Creative Market.

Delegate!
As a founder you’re used to doing it all, and it can be scary to shed responsibilities you’ve always owned, but you can’t scale yourself and focus on the highest leverage opportunities until you get things off your plate. If you think you’re going to have to work especially late or can’t get to the things you need to in a given day, take that as a signal to delegate to your team.

Create growth opportunities.
Great people often care about personal growth way more than money or any other tangible benefit you could offer them, so the flip-side of delegating your responsibilities is that you create opportunities for people on your team to do new things, learn, and grow. Don’t hoard them all for yourself.

Invest in your stars.
Similar to how it’s much easier to retain an existing customer than to acquire a new one, it’s much easier to keep an existing star employee happy than find a new star. Go above and beyond to make sure your stars feel valued, appreciated, and rewarded.

Set a high bar. Great people want to do big, meaningful things. Push your team with aggressive goals, and you might be surprised what they will accomplish.

Lead by example.
Teams embody the characteristics of their leaders, and the things you care about will be the things your team cares about. If you sweat the details, your team will learn to sweat the details too.

Your team’s success is your success.
Get satisfaction and the feeling of accomplishment from the success of your team. As an individual contributor, it’s easy to look back at the end of a week and feel good about all that you’ve directly produced. As a manager, you’re responsible for the accomplishments of your team, which can be a difficult transition for a lot of people. The advantage is that you can scale yourself and your vision.

Deflect all credit and absorb all blame.
Use “I” when talking about a screw-up, and use “we” (or better yet, specific contributors’ names) when talking about successes. A little recognition goes a long way to make people feel valued.

Share the big picture.
It’s important for people on your team to understand how their work and role fits into the big picture of the business, and why they’re doing what they’re doing. It’ll give them a sense of purpose and motivation to understand how they’re contributing to the success of the business. It’s easy to take it for granted that your team is clear on this, but this is one of those things where you want to constantly make that connection.

Repeat yourself often.
You should feel like you sound like a broken record about the things that are important to your company — your mission, your vision, your KPIs, etc. You think about it all the time, but the people on your team don’t, and most people need to hear something many times before it truly gets ingrained in their memory. You’ll know you’re repeating key messages enough when every single person on your team will be able to explain them to a complete stranger exactly how you would’ve said it.

You’re in charge.
It can be uncomfortable telling people what to do if you’ve never done it before. But you are the leader, and everyone on your team will be looking to you for direction and guidance, so own it. People want structure and direction, so don’t be afraid to use phrases like “I need…” and “I want…” to shape your team in your image.

Focus on the What, not the How.
Communicate your vision for what success looks like, to give your team a framework and goals to guide their decisions and work. It’s a way for you to “be in the room” when the work gets done without micromanaging the work.

Set deadlines and hold people accountable.
When you give someone a task, ask “by when?”, then add a note to your calendar to follow up to make sure it’s complete. If standards or deadlines are not being met, give direct feedback to change future behavior.

Verbalize your thoughts.
Simply saying things like “I’m disappointed in this work” is extremely powerful in helping people directly understand where you stand. People aren’t mind-readers, so rather than just jumping into solutions when giving feedback, state your feelings out loud to be clear and direct.

Manage for the employee.
My favorite interview question for manager candidates is “How would you describe your management style?”, where the best possible answer is “it depends on the employee”. Each person has a unique combination of experience, motivations, personality, etc, and it’s up to you to take the right management approach that helps them succeed and maximizes their contribution.

Understand that everyone’s different.
Just because you may be an achiever that’s self-motivated to get things done doesn’t mean that everyone else on your team is. Get curious to figure out what drives and motivates each individual on your team, rather than assuming everyone’s like you.

Hire slow, fire fast.
It’s the thing everyone says and few have the discipline to do, but hiring well is the most important thing you can possibly do to positively impact your business and your team. Great people want to work with other great people, so resist the temptation to fill open positions with mediocre candidates, and don’t settle. You should be thrilled about each new hire.

Hire for hunger. It’s great when a potential candidate walks in the door with all the skills needed to succeed in the role, but passion for your mission, business, and team will do more to drive an employee to make a big, long-term impact than any specific skills they may have. Passionate employees will be quicker to teach themselves new skills too, especially as your business changes and grows.

Set your team up for success.
It’s unfair to expect even the best people to hit the ground running on day one without being properly onboarded. As their manager, it’s your responsibility to invest the time early on to set expectations, show them the ropes, teach them about your business, train them, and provide clear direction and a well-defined role. Anything less will diminish their ability to succeed.

Your trust should be earned.
Don’t just assume that new and more inexperienced team members will hit the ground running and understand your expectations from day one. Make them prove themselves first by working more closely with them and frequently reviewing their work until they’ve earned your full trust.

Shield your team from distractions.
Provide structure, focus, and clear goals for your team to maximize their ability to execute on the strategy. They should come in to work each day knowing exactly what they’re working on and exactly what they need to do, and any other distractions should be deflected to keep from derailing productivity, wasting time, and knocking the team off course.

Include your team in decision-making.
If you’ve hired great people, you’d be crazy not to include them in important decisions. Define the decision-making process upfront to set expectations for your team — will it be a decision by committee, will someone else on your team own the decision, or will you gather feedback to make the final call yourself? Listen to their thoughts and opinions with an open mind, make sure everyone feels heard, then decide the best course of action. It may even go against the consensus of the team, and that’s ok so long as you’ve defined the process and expectations up front. Even if your team disagrees with the final call, by including them in the process they will better understand the decision, feel like their opinion was valued, and be able to get on board to help support the decision going forward.

A little professional tension is healthy.
Differing perspectives help make teams and products better, so a little professional tension can be really valuable to help push your team to think about things in new ways. It should be net-positive though, so if it’s forcing too many decisions to get stuck in the mud, or if the tension moves from professional to personal, then you need to take action to eliminate it quickly before it drags down the team or blows up.

Show your work.
Explain your decision-making process. Whenever you take a controversial action or make a difficult decision, it’s especially powerful to fully explain how you arrived at that decision so your team can understand your thought process and rationale, and ultimate help support the decision.

It’s ok to not always know the answer.
Ask questions, probe, and admit when you don’t know the answer to something. There’s nothing wrong with saying you’ll need some time to think or learn more before making an important decision.

Have consistent 1-on-1s every week.
These are for the benefit of your employees, so you should let them drive the agenda each week. From your side, it’s an opportunity to set aside some focused time each week to talk privately, get on the same page, and ask open-ended questions like “how are things going?”, “how are you feeling?”, “what are your thoughts on the big news that was announced earlier this week?”, “what’s your opinion on X?”, etc. Prioritize these meetings in your schedule, go out of your way to keep from canceling or rescheduling them whenever possible, and your consistent time and attention will send a signal to your team that you care about their happiness.

Ease the maker to manager transition.
As you scale from a team of individual contributors to a more structured org, the maker to manager transition will challenge your best people. Just because someone is an outstanding individual contributor doesn’t mean they’ll be an outstanding manager right off the bat, because it requires a completely different set of skills and experience. And during the transition, their instinct will be to take on both their prior maker and their new manager duties – spending 75% effort on making and 75% effort on managing – a 150% workload resulting in less than 100% output in each area. Put structure in place to allow them to focus on being a manager first and foremost, and take maker duties off of their plate.

Create a career path.
Every 6 months, ask your employees where they want to be in their career in the next 2–3 years. Work with them to put together a plan, help them get the skills and experience they need, and guide them on a course to get there.

Author

  • Aaron Epstein

    Aaron is a Group Partner at YC. He was the co-founder and CEO of Creative Market (YC W10), a marketplace for graphic design assets, which was acquired by Autodesk in 2014.