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. This is what he learned about navigating market cycles.","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":"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":"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":"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":"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/"},{"id":"63d45389ba7a5900012d1ccf","name":"#622","slug":"hash-622","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":"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":"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/learnings-of-a-snapdocs-aaron-king-on-navigating-market-cycles/","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. This is what he learned about navigating market cycles.","reading_time":9,"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. 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You can read the first edition <a href=https://www.ycombinator.com/"https://www.ycombinator.com/blog/learnings-of-a-ceo-max-rhodes-faire/">here. </p><p><a href=https://www.ycombinator.com/"https://zapier.com//">Zapier was founded in 2012 by <a href=https://www.ycombinator.com/"https://twitter.com/wadefoster/">Wade Foster</a>, <a href=https://www.ycombinator.com/"https://twitter.com/bryanhelmig?lang=en\%22>Bryan Helmig</a>, and <a href=https://www.ycombinator.com/"https://twitter.com/mikeknoop/">Mike Knoop</a>. The founders went through YC’s <a href=https://www.ycombinator.com/"https://www.ycombinator.com/companies/zapier/">Summer 2012 batch</a> and <a href=https://www.ycombinator.com/"https://www.ycombinator.com/growth-program/">S18 Growth Program</a>, and today, Zapier automates work by connecting with over 5,000 apps. The company has been profitable since 2014 and is valued at $5B – with 700 employees working remotely. Wade, Zapier CEO, shared his learnings growing into the role of a growth-stage CEO. </p><p><strong>How has your job as a CEO changed from leading a 3-person company in 2012 to a 700-person organization today? </strong></p><p>In the early days, you’re in the trenches with your co-founders and early employees splitting up tasks and touching nearly every part of the business. Often you’re writing code, selling products, recruiting, and helping with HR and finance functions. Today, Zapier is almost a team of 700 – and as we’ve grown, people have taken more and more duties from me to help the company grow and scale.</p><p>Now, one place I feel I am most needed is the vague concept of setting the vision and communicating that vision — and then ensuring everyone understands what we are doing, why it’s important, and their role in getting that done. This came naturally to me when we were small and I was in the trenches with everyone and communicating constantly. But as we hired more folks, I realized leaders were interpreting the vision to their team somewhat differently. I learned that if you are not communicating the vision well, you'll have teams that seem to be working on random projects. In isolation this isn’t bad, but as a collective set of tasks, you discover their work doesn’t fit into the vision. </p><p>We now repeat the vision over and over again in many formats. We put the vision in writing and it's constantly referenced; it's communicated at our all-hands; we bring in customers to talk about Zapier’s impact; we show data, so charts and figures can help tell the story; we have a company podcast. </p><p>When people inside the company start to turn the vision into a meme or Slack emoji, I know they really get the vision. Diagnostic tools, like employee engagement surveys, also help me understand how well employees understand why their role is important. It’s also evident when reviewing roadmaps. If a team’s tasks are tight and cohesive, I can tell they’ve been making tough decisions to align to the vision; if there are a bunch of random tasks, I can tell the vision hasn’t been communicated clearly. As a CEO, you have to ask, “Tell me how this is aligned,” and force those conversations to occur. Over time, people will get more comfortable with these types of assertive exercises. </p><p><strong>As you've grown, what changes have you had to make to keep everyone at your company aligned?</strong></p><p>We host weekly all hands, bring customers in to talk at those all hands, are transparent with metrics, and make sure those metrics are reflective of the good and the bad. Ultra transparency with metrics has served us well, as they are motivating and help people get aligned. People start to ask, \"How do we get these bad metrics to the good category?\" and then work towards change.</p><p>Being candid has also served us well. Whether at all hands, on a podcast, or solely talking with one of our leaders, we have candid conversations about why we didn’t hit a goal, why we were off schedule, why a deal didn’t close – and then immediately dive into what we think needs to happen next. The goal is to give awareness to the organization, so that in various meetings and forums people can try to figure out how to improve those areas.</p><p><strong>What's your advice to other founders on how to hire executives?</strong></p><p>Hiring executives is one of the hardest things you’ll do as a CEO. It's hard to determine when to start hiring executives, exactly what you’re looking for in an executive, and then find that person. </p><p>The best way to figure out when to start hiring executives is to meet with people who are unquestionably good executives at companies a stage or two further along. With no intention to hire them, meet with the VP of Engineering, VP of Marketing, and VP of People and ask, \"What are the things you do? What makes you great at this job? What do people in your job disagree on?”. Get as smart as you can on this topic and then compare and contrast what that set of leaders is telling you with how your company operates. If these executives wouldn’t bring anything new to the table, you may not be ready for that type of leader. This starts to help you answer the when part of the equation – and also the what, because you start to see what these folks are capable of and what they are not. </p><p>Part of determining what you should look for in an executive is understanding your own strengths and weaknesses. This requires honesty with yourself and internalizing feedback you have received. (I encourage folks to work with executive coaches and get 360 performance reviews.) Figuring this out helps you start to realize, \"Okay, within my executive team, I need people who will compliment me in these ways.\" Otherwise, you risk hiring a team that is quite capable and competent at their function, but actually may not work well with each other or with you.</p><p><strong>What is Zapier’s culture? What do you do to cultivate it as a remote company?</strong></p><p>We have a strong set of values that we align around. One is default to action. We hire folks who are action-oriented – and we have to as a distributed company; folks aren’t in situations where they notice someone next to them is stuck on something. So, they need to be curious, self-starters, and (figuratively) scratch and itch when they see something that doesn’t satisfy their innate drive. </p><p>Next, we value defaulting to transparency because folks who are action-oriented should be equipped with a ton of context. The mission, strategy, metrics, goals, systems and processes – all of it – is well documented and organized so people can find them and take action.</p><p>We also have a feedback-oriented culture. I teach a course on feedback to all the new folks to ensure they understand how to ensure they understand how to give and receive feedback effectively because it helps us grow. </p><p>The rest of our values are outlined <a href=https://www.ycombinator.com/"https://zapier.com/jobs/culture-and-values-at-zapier/">here, but these are some of the things that drive Zapier’s culture – and as you scale, it’s crucial to create different forums to communicate these values. We have an internal tool we named Async, which is email meets Reddit. The platform is public by default, anyone can post, and information can be targeted at different groups or people. We find this is great for long-form substantive topics that have a longer shelf life (1-2 weeks) versus Slack channels (1-2 days). We also hold all hands and have a company podcast, where we capture evergreen content. For example, when we have key moments in the company history, we’ll break it down: Why we did this thing, what led to that decision, the outcomes, why it is an important moment, etc. We have found podcasts to be helpful when onboarding new folks. </p><p><strong>Why did you decide to not raise any additional funding since your seed round?</strong></p><p>The only funding we took in the history of the company was a $1.3M seed round in 2012. This was partially philosophical and partially about the business. </p><p>The three of us co-founders had worked at a fast-growing, bootstrapped company owned 50/50 by two brothers. When we came out to the Valley (we were from Missouri), we started to hear this line of thinking, “No great company has ever done X.\" Some of these statements would center around the impact of venture funding, and I was dismissive in part because I had this counterexample from my time in Missouri. So, when we raised the seed round, we decided to treat it like the last round we’d ever raise.</p><p>Our second reason for not raising multiple rounds: Across the founding team, we had all the skill sets to do every job inside the company. That meant we didn't have to hire to make progress in the early days. We even had rules in place around hiring like, “Don’t hire until it hurts.” </p><p>Then there was the third, rational component: We were able to grow quickly without external funding because of Zapier’s network effect on our developer platform side. We're able to have low customer acquisition costs (mostly through organic channels), and this is intrinsic to how Zapier works. </p><p>Along the way, some of the philosophical thinking fell by the wayside by observing other companies and realizing fundraising is a tool like anything else. There are moments when it can help you, and there are moments when it can hinder you. You should strive to understand when external funding is a good tool to use versus when it is not – and then apply it if it makes sense for you.</p>","comment_id":"62f15573ab52db0001d3b642","feature_image":"/blog/content/images/2022/08/BlogTwitter-Image-Template.jpg","featured":false,"visibility":"public","email_recipient_filter":"none","created_at":"2022-08-08T11:26:59.000-07:00","updated_at":"2022-08-15T12:08:14.000-07:00","published_at":"2022-08-09T08:55:00.000-07:00","custom_excerpt":"Today, Zapier automates work by connecting with over 5,000 apps. The company has been profitable since 2014 and is valued at $5B – with 700 employees working remotely. Wade, Zapier CEO, shared his learnings growing into the role of a growth-stage CEO. ","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. 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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":null,"url":"https://ghost.prod.ycinside.com/learnings-of-a-ceo-wade-foster-zapier/","excerpt":"Today, Zapier automates work by connecting with over 5,000 apps. The company has been profitable since 2014 and is valued at $5B – with 700 employees working remotely. Wade, Zapier CEO, shared his learnings growing into the role of a growth-stage CEO.","reading_time":6,"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":"62d8038a3644180001d72a0d","uuid":"1d8947c7-4bd1-4f7c-8175-e3750393a8d1","title":"Learnings of a CEO: Max Rhodes, Faire","slug":"learnings-of-a-ceo-max-rhodes-faire","html":"<p>Every year, 200 YC companies go through our <a href=https://www.ycombinator.com/"https://www.ycombinator.com/about#continuity-1\">post-accelerator programs</a>. These programs provide founders with the resources they need to build a company all the way through IPO. One area covered extensively is how to scale as a CEO of a growth-stage company. </p><p>Outside of the YC community, little has been documented on best practices to be an effective CEO. We want to help founders everywhere scale and build enduring companies — and today, we’re launching a new series to do just that: Learnings of a CEO. </p><p>We’re kicking off this series with Max Rhodes, the co-founder and CEO of <a href=https://www.ycombinator.com/"https://www.faire.com//">Faire, a one-stop shop for wholesale. Before Faire, Max was an early product lead at Square, where he worked on the Cash App and was a founding member of Square Capital. Max and his co-founders were part of the <a href=https://www.ycombinator.com/"https://www.ycombinator.com/companies/faire/">W17 batch</a> and <a href=https://www.ycombinator.com/"https://www.ycombinator.com/growth-program/">F18 Growth Program</a>, and YC led Faire’s Series B and doubled down in their C-G rounds. Today, Faire has over 1,000 employees. </p><p><strong>How has your job as a CEO changed from seed stage to Series G?</strong></p><p>Much of my time is spent setting the vision and strategy for Faire and driving the execution of that strategy. This often feels like driving an aircraft carrier versus a speedboat, which is how I often describe leading a seed-stage company. In the early days, we were on a six-week product cycle, decisions were centralized (often with me making those decisions), and the entire company met daily for standups to stay aligned on our goals. Today, we are on a six-month product cycle, decisions are decentralized, and we have built systems that hold people accountable without needing consistent touchpoints. </p><p>As a thousand-person company, the number of products and features we can build has greatly increased, and we have to map out our strategy for the next 6-12 months to keep teams aligned. Communicating the strategy to the entire company requires multiple channels and repetition. We have a strategy doc that I collaborate on with the leadership team and share with the company; updates are provided at the half-year mark. We hold all-hands, where I share what is top of mind. We also have biweekly business review meetings, which are open to anyone; we also make the notes accessible. </p><p>Being able to decentralize decision making starts with hiring the best people and then arming them with the right information. Outside of meetings, we use OKR templates, track the history of our milestones, and create a collective body of work (in Notion and Google Slides) to provide everyone with direction. </p><p>We’ve organized the company in a way that lets us hold people accountable without needing constant touchpoints. The product development strategy is broken down into focus areas that each get assigned to a team. Each team is self-sufficient and has all of the technical and go-to-market people it needs. The team works autonomously to reach a metric. Every metric ties back to a top-level company goal, ensuring that teams are solving real customer problems.</p><p><strong>As you've grown, what changes have you had to make to keep everyone at your company aligned?</strong></p><p>We’ve experimented a lot: strategy docs, all-hands, documenting our 5Ss (the five most important initiatives across the company), and OKRs. There are pros and cons with OKRs. We use them as a guidepost rather than a measuring stick, to make sure we’re consistent in our planning and getting realigned on goals. </p><p>As we grow, some systems break. For example, I used to hold a biweekly business review meeting with each team. This was great when the company was broken up into three teams. With more than 15 teams, it became inefficient and borderline impossible. Eventually, these teams were organized into pillars, and each pillar was held accountable with a biweekly business review. My goal is to always find a balance between how much time it takes to coordinate versus execute, while designing information flows that don’t turn into silos. </p><p><strong>What's your advice to other founders on how to hire executives?</strong></p><p>First, clearly outline the outcomes you need the person to drive. Then, design a rigorous hiring process that evaluates whether they’ll be able to drive those outcomes and whether they share the same values as your company. We use a combination of behavioral interviews and work studies, where we see how they’ll perform at the job. We also extensively check references. </p><p><strong>What is Faire’s culture? What do you do to cultivate it?</strong></p><p>Our culture can be described by our five values. These underpin both why we are here and how we operate as a team. We’re still in the early days of building what this company will someday become and these operating principles help everyone at Faire maintain the spirit of entrepreneurship:</p><ol><li>We serve the community.</li><li>We seek the truth.</li><li>We are owners.</li><li>We embrace the adventure.</li><li>We are kind.</li></ol><p>To create this culture, it’s all about mechanisms. It starts with hiring. If we’re able to hire people who hold the same values and bring a new lens to the work, cultivating this culture is easy. We also embed the values into our feedback cycle and reward people for living them out. We give weekly shoutouts and recognize people, as well as hold quarterly value awards.</p><p><strong>Advice you would give to future leaders? </strong></p><p>Starting a company is hard, but it’s a lot easier if it’s something you care about, something that will impact the world. If you have a vision for how to make society better, don’t take that for granted.</p>","comment_id":"62d8038a3644180001d72a0d","feature_image":"/blog/content/images/2022/07/BlogTwitter-Image-Template--3-.jpg","featured":true,"visibility":"public","email_recipient_filter":"none","created_at":"2022-07-20T06:30:50.000-07:00","updated_at":"2022-07-20T08:33:04.000-07:00","published_at":"2022-07-20T08:30:00.000-07:00","custom_excerpt":"Outside of the YC community, little has been documented on best practices to be an effective CEO. We want to help founders everywhere scale and build enduring companies — and today, we’re launching a new series to do just that: Learnings of a CEO.","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":"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":"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":"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":"62d804e33644180001d72a1f","name":"#1543","slug":"hash-1543","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":"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-max-rhodes-faire/","excerpt":"Outside of the YC community, little has been documented on best practices to be an effective CEO. We want to help founders everywhere scale and build enduring companies — and today, we’re launching a new series to do just that: Learnings of a CEO.","reading_time":4,"access":true,"og_image":null,"og_title":null,"og_description":null,"twitter_image":"https://ghost.prod.ycinside.com/content/images/2022/07/BlogTwitter-Image-Template--3--1.jpg","twitter_title":null,"twitter_description":"Today, we're launching a new series to help founders everywhere scale and build enduring companies: Learnings of a CEO.\n\nWe're kicking it off with @MaxRhodesOK, co-founder and CEO of @faire_wholesale, a one-stop shop for wholesale.","meta_title":null,"meta_description":null,"email_subject":null,"frontmatter":null,"feature_image_alt":null,"feature_image_caption":null},{"id":"61fe29f1c7139e0001a71be3","uuid":"75eeb41a-4c8e-4d17-9945-ea453628d722","title":"From Self-Doubt to Starting Up: Words of Wisdom for Women Founders From YC Continuity Partner Anu Hariharan","slug":"from-self-doubt-to-starting-up-words-of-wisdom-for-women-founders-from-yc-continuity-partner-anu-hariharan","html":"<!--kg-card-begin: html--><p>We’ve been talking about the unique challenges facing women founders for years, but the pandemic was particularly hard for women looking to start their own companies. According to <a href=https://www.ycombinator.com/"https://news.crunchbase.com/news/global-vc-funding-to-female-founders//">recent data</a>, funding to women-founded companies dropped from 2.8% in 2019 to 2.3% in 2020.</p>\n<p>Last year, during Y Combinator’s <a href=https://www.ycombinator.com/"https://futurefoundersconference2020.splashthat.com//">Future Founders Conference</a>, a16z’s Sonal Chokshi led a conversation on “Leveling the Playing Field” with Anu Hariharan, YC Continuity Partner. Frankly, we’re still thinking about Anu’s incredible advice for women founders.</p>\n<p>Anu started her career as a software engineer for Qualcomm, before joining BCG&#8217;s Private Equity Practice in New York City, and finally becoming an investment partner at Andreessen Horowitz, where she worked with portfolio companies like Airbnb, Instacard, Udacity, and Medium. In 2016, she joined Y Combinator to launch the Continuity Fund, where she partners with companies as they scale their businesses.</p>\n<p>Anu is never short on advice for founders, but her words are particularly salient for women looking to build and grow their startups in the aftermath of the pandemic. Here are her best pieces of wisdom for leveling the playing field.</p>\n<p><strong>On (not) doubting yourself:</strong></p>\n<p>“If you ask male founders, the thing is always, ‘I knew I always wanted to be a founder, and so I started a company.’ When you ask female founders what it is that got them to start a company, it’s because someone told them, ‘You can do it.’ It’s a small, but a very important difference. When I reflect back upon my career, women are always preparing for their next role. We are always figuring out what are the 10 skills we need to be perfect and do the job.</p>\n<p>Now, I’m not a founder, but I was very happy in my role at Andresseen Horowitz. Unexpectedly, YC had reached out when they launched their Continuity Fund about 5 years ago. One month after getting the offer, I had not signed. I remember this vividly: Geoff Ralston, [YC President], called me and said, ‘Why haven’t you signed the offer?’ He thought it was maybe compensation, maybe the role, maybe he needed to clarify more. But in the four weeks since I had gotten the offer, I had talked myself out of taking the job, because I realized I was not ready for it. When he heard that, he was shocked. I don’t know if he remembers this, but he said, ‘The whole YC partnership is convinced you are going to be really successful at this job. You just need to get this through your head.’ And he hung up. That’s how it was! And the next day, I signed.</p>\n<p>This is a common thing I see among female founders; if there’s one thing I want you to hear, the very fact that you are sitting and listening in this conference is that you have the ambition to be a founder. So, go do it and we’ve got your back.”</p>\n<p><strong>On the mindsets that founders need to succeed:</strong></p>\n<p>“Building a startup is incredibly hard, so you’re going to have to be willing to try, and be okay with some failures, and keep trying. That is resilience. Secondly, I think so much about being a startup founder is really about being optimistic about the future, and believing in your vision when no one else does — and most people don’t in the early days. The third trait founders need is resourcefulness. You are going to run into so many roadblocks as a startup founder; not even as a startup founder, but in real life. As you scale in your career, how resourceful you are, and creative you are in forging your own path and solving problems for the company, is an important mindset you need to have.”</p>\n<p><strong>On the tangible skills that founders need to succeed:</strong></p>\n<p>“I would highly recommend you learn how to code. I think whether you’re building a tech startup or not, most startups or companies today have some tech component — e-commerce at the very least, has a website. Learning to code is not that difficult; I grew up learning to code, and programming has only dramatically improved in the way in which you can learn. There are a lot of low-code, no-code tools, so I’d highly encourage you all to learn to code. At the very least, when you are trying to find a co-founder or you’re hiring those engineers, don’t let them bullshit you. You know if you learn how to code and know how to build a prototype, you just have way more leverage in starting a company.</p>\n<p>Number two, I’d highly recommend you work at a startup. There’s nothing that comes close to learning from a startup. I worked at Qualcomm; I started my career as a software engineer. But if I could go back to my twenties and give advice, I’d go join a startup. What you learn at an established company in 10-15 years, you learn at a startup compressed in 3-4 years, especially at a scaling startup. Working at a startup really gives you a feel for the day-to-day, what roadblocks you’re going to run into, and it also teaches you to be resourceful, because you don’t just do your own role. You wear multiple hats.</p>\n<p>The third thing is sales skills. When I say sales, it’s not about the traditional field sales or inside sales role. It’s more your ability to sell to your customers, to your investors, to potential employees. If you work at a startup, you have to wear that hat anyway, because you’re convincing other people to join the startup or even your own team. I think working at a startup and building those sales skills are really handy.”</p>\n<p><strong>On how to know you’re ready to start your company:</strong></p>\n<p>“Too many female founders have told me they wasted too much time thinking about when to start a company instead of just getting started. The most important thing is to have an idea, a problem or a pain point that you yourself face… You don’t have to spend months and months doing market research; talk to 10 or 12 people, then start a side project. If you’ve learned to code, it doesn’t take that long to ship an MVP [minimum viable product]. So, start a side project and test it out. Does it truly solve your problem? Are a few other users at other companies willing to sign up for it? If you have a compelling idea that’s a pain point, that you truly think is yours and a few others have it, that’s a good moment. The other important moment is having a co-founder. This is the one that actually takes time, not the idea or the MVP.”</p>\n<p><strong>On where exactly to find your co-founder:</strong></p>\n<p>“It’s so important to have a co-founder who you trust and who can basically take the load off you on certain things — who can share the workload. But most importantly, you are the support system for the other person when things are hard. Finding a co-founder is hard for everyone, but really hard for female founders. Why is that? Because we are limited by the access to our own network, which is our own social circle. If you are not a coder, the odds of finding a technical cofounder is really 10 times harder, because you’re not wining and dining with them. But if you ask a male founder, ‘Who is your co-founder?’ It’s usually their best friend from college, their dorm mate, their roommate, or they live in the hacker house. Those are not things I want to do; I’m not hanging out with them on my weekends! But female founders can be deliberate.</p>\n<p>If you’re deliberate, you can actually knock it out of the park. The tendency here is we want to join a lot of societies and communities, and I would say that our tendency is to join ‘Women in Product’ groups, or ‘Women in Engineering,’ and that’s how we’re going to try and invest our time. But is that the best place you&#8217;re going to find a co-founder? Probably not. The best place you’re going to find your cofounder is at other startups. Think Stripe, DoorDash, Airbnb, or Dropbox, because the early engineers in those teams are probably itching to go start something else. The very fact that they’re working at a startup means they are itching to start something of their own. If you’re smart and deliberate, and take the time to find those people in those specific companies, build relationships, maybe work on a side project with them over a year, you’re likely to find a co-founder from there.</p>\n<p>I want to emphasize this message: You’ve got to be proactive. It’s not going to land in your lap. But if you are deliberate, you can really find a great co-founder.”</p>\n<p><strong>On being deliberate in building your network to create opportunities:</strong></p>\n<p>“Five years into BCG [Boston Consulting Group], I learned a lot about private equity investing, but I missed tech. I really wanted to figure out if I should go back and do tech investing. This was 2013, 2014. I wrote down a list of 10 people I really admired in tech, based on all the reading I had done, and one of them was Jeff Jordan. I didn’t know any of the 10, but I read a lot about their work, and I emailed them — not for asking for coffee chats. This is really important; everyone always asks for coffee. Instead, I messaged Jeff Jordan and said, ‘You know, I read your blog post about retail, and the transition of retail to online.’ He had a take that some categories were not going to shift as fast, including grocery, and I disagreed with him. I said, ‘Our research at BCG says this, if it’s interesting to you, here is where it is.’ And he responded! It was intriguing for him; he realized it was a contrarian view, so we went back and forth and traded lots of notes.</p>\n<p>In hindsight, I didn’t realize what I was doing then, but I was doing a side project. I was spending nights and weekends, debating and sourcing new startups to prove a point, and six months later, I had an opportunity to join Andresseen Horowitz. That was because I was deliberate. It was not serendipitous, where the job landed in my lap. It was a conversation I had over six to seven months.”</p>\n<p><strong>On the importance of women taking VC money:</strong></p>\n<p>“I think most female founders hesitate to raise VC money, but the fact is, startups need growth. And chances are, if you’re solving a pain point that’s real, your company is going to grow fast, because the demand for the product is going to be really high. You need to invest a lot more money to support that growth before you make money. This is another difference I notice between male and female founders: Male founders never even ask this question. They’re just ready for venture funding. Most female founders hesitate, and I’d say that’s part of company-building. You’ve just got to do it.”</p>\n<p><strong>On her best advice for female founders pitching investors:</strong></p>\n<p>“Storytelling and sales skills are the most important skills for pitching VCs. At the end of the day, this is a confidence game. It’s about how you deliver your vision for the company with conviction. This is again where I’ve seen female founders underdeliver because they tend to emphasize more on risks and how everything could go wrong in spite of the traction looking stellar and they have built something amazing. They have also usually spent a lot less money to get here vs. male founders building companies in the same category. Male founders on the other hand will just say. ‘We’re here for the win.’ in spite of their companies having less traction and burning more money. I think that goes back to the point I made earlier: We women are always trying to be perfectionists and we’re always second-guessing ourselves. But pitching is not the time to second guess; it’s the time to convince investors. For them to look you in the eye and believe you’re going to get this done.”</p>\n<p><strong>On what metrics early-stage founders need to focus on:</strong></p>\n<p>“At the earliest stage, really only two to three metrics matter depending on your business model. Revenue is your best metric. If you’re not charging, then define the customer behavior: How do you expect a customer to use your product? Whatever that metric is, really measure that. When you are pitching investors, that is really what they want to hear.”</p>\n<p><strong>On listening, but not always acting:</strong></p>\n<p>“Listening to your customers is the single most important thing. I’ve noticed both male and female founders can do that a little better, but female founders in particular — when it comes to listening to their team, investors, and customers — tend to listen a bit too much. From when we are young we are taught to try and please everyone; this is not the time to please everyone. You know your idea. You have conviction. So, take the feedback, but don’t feel compelled to listen if you are really convinced about it. It’s important to hear and listen, but don’t take in all the feedback and take action.”</p>\n<p><strong>On why it’s okay to fail:</strong></p>\n<p>“It’s okay to fail. What’s the worst thing that can happen? You tried an idea and it didn’t work out? You can go onto the next one. If you look at Pinterest, Ben Silbermann talks about this: It was his third company, not the first company, and even then it was not a slam dunk. The most important attribute we all need to have is the willingness to try, and that it’s okay to fail. That is a very important mindset, along with the mindset that no one is ever ready. There is no perfect moment to start a company. Those go hand-in-hand.”</p>\n<p><em>Answers have been edited for length and clarity. For the whole interview, see <a href=https://www.ycombinator.com/"https://www.youtube.com/watch?v=YV1ee04SiJ4&amp;list=PLQ-uHSnFig5MJKDAd-TIIc0J1whV2L_0y&amp;index=6\%22>here.

\nBy Lindsay Amos

Learnings of a CEO: Snapdocs’ Aaron King on navigating market cycles

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. This is what he learned about navigating market cycles.

AdviceYC ContinuityFounder StoriesLeadershipStartupsGrowth

Lindsay Amos

Lindsay Amos

1/30/2023

Learnings of a CEO: Matt Schulman, Pave, on Hiring

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.

YC ContinuityAdviceFounder StoriesLeadershipStartupsGrowth

Lindsay Amos

Lindsay Amos

10/17/2022

Learnings of a CEO: Wade Foster, Zapier

Today, Zapier automates work by connecting with over 5,000 apps. The company has been profitable since 2014 and is valued at $5B – with 700 employees working remotely. Wade, Zapier CEO, shared his learnings growing into the role of a growth-stage CEO.

YC ContinuityFounder StoriesAdviceLeadershipStartupsGrowth

Lindsay Amos

Lindsay Amos

8/9/2022

All Posts

Learnings of a CEO: Max Rhodes, Faire

by Lindsay Amos7/20/2022

Outside of the YC community, little has been documented on best practices to be an effective CEO. We want to help founders everywhere scale and build enduring companies — and today, we’re launching a new series to do just that: Learnings of a CEO.

Read More

From Self-Doubt to Starting Up: Words of Wisdom for Women Founders From YC Continuity Partner Anu Hariharan

by Lindsay Amos3/30/2021

We’ve been talking about the unique challenges facing women founders for years,but the pandemic was particularly hard for women looking to start their owncompanies. According to recent data,funding to women-founded companies dropped from 2.8% in 2019 to 2.3% in 2020.

Read More

Promise Co-Founder and CEO Phaedra Ellis-Lamkins on Being a Force for Good

by Lindsay Amos3/26/2021

Pheadra Ellis-Lamkins, Co-Founder and CEO of Promise ,had witnessed technology’s impact on the work communities in which she’d been apart — and not always for good. In the labor force and the environment sector,she’d seen technology replace jobs, relegating janitors and receptionists tocontract work. In the music industry, she’d seen artists’ content devalued withadvances in digital innovation. “I went into tech to understand it,” she said.

Read More

Apply to YC Summer 2021

by Lindsay Amos3/15/2021

The deadline to apply to the Y Combinator Summer 2021 batch is Friday, March 19 at 8pm PT. Due to COVID-19,Summer 2021 will be the third batch in a row to be fully remote.We occasionally get questions about what a remote batch is like. Our 2020 Yearin Review is helpful here,and I thought I’d include some quotes from when I asked founders from Summer2020 (our first all remote batch) about their experience.

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Edlyft Co-Founder and CEO Erika Hairston: How Community Can Elevate Tech

by Lindsay Amos2/25/2021

Edlyft co-founder and CEO Erika Hairston never imaginedherself as a “techie,” but was drawn to computer science while at YaleUniversity—not that it was a cinch for her. “I actually really struggled throughthe major and almost dropped it,” she says. While she ultimately persevered andgraduated with her computer science degree from Yale in 2018, she also builtappreciation for what it’s like to be truly intimidated by a subject matter.

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Squire Co-Founder and CEO Songe LaRon: Powering Barbershops of the Future

by Lindsay Amos2/23/2021

Songe LaRon didn’t have experience working in the barbershop world when he firsthad the idea for Squire , a business management andpoint-of-sales software focusing on barbershop owners. He did, however, havefirsthand knowledge of the customer experience.Beginning at the age of six or seven, LaRon started frequenting the barber withhis dad. Twenty years later, he realized the industry hadn’t evolved much. “Itwas very inefficient,” he said.

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Apply to YC on Your Schedule

by Lindsay Amos1/14/2021

We want to better support founders by giving them access to YC whenever it’sbest for them, regardless of our batch timeline. While it has always been anoption to apply year-round to YC, we’re now formalizing it with an earlydeadline.Now, founders can apply for an early interview to the Summer 2021 batch. If wereceive your application by Wednesday, January 27 at 8pm PT, we will consideryou for an early February interview (instead of regular interviews, which beginin late April).

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