10 Valuable Entrepreneurial Insights From Y Combinator
Y Combinator is a firm that advises startups and invests in the ones holding promise. Last month, the YC community hosted a two-day demo featuring 103 different startups from a wide variety of industries. Some of the vendors included Symple, which is essentially Venmo for B2B payments; Speak, an AI English tutor; and Simple Habit, billed the “Netflix of Meditation.”
Everyone wants to have that million-dollar idea to catapult them to the good life. Anyone remember the pet rock?
The truth of the matter is that ideas are a dime a dozen. Turning them into profitable startups is a whole different ballgame. Here are 10 useful bits of advice to help jumpstart the ideation stage, and create something truly great.
1. Make something people enjoy talking about.
The goal of any startup is to create something people love. Look at some of the most successful ones of the modern era. How were you introduced to Uber? Chances are, someone you know told you about how awesome and simple it was. At a foundational level, your idea should be something that people are excited to rave about to their friends. Once you have achieved this, it will spread like wildfire.
2. Start small.
In the beginning, it can be tempting to try and get your new product or service in front of as many eyes as possible. However, it is more beneficial to create something a small number of people will fall in love with first. Even though there may be the same amount of positive and negative feelings towards your idea, keeping it small initially will make it easier to test the waters and avoid colossal failure.
3. Recruit users manually.
Before Pinterest became a worldwide sensation, founder Ben Silbermann would approach random people in coffee shops and ask them to try the app. Once he got a few people to bite, he would ask their opinion and what they would add.
While most founders would prefer to announce their great idea to the media, the chances of success can be a lot smaller. That’s why it’s smart to hand-pick users in the early stages. This will give you a chance to find out exactly who your ideal customers are and what they are looking for.
4. If it doesn’t excite first time listeners, revise it!
A great business idea draws people in immediately. It’s like love at first sight. Now, a lot of startups don’t fall flat because their idea is bad, but because they presented it wrong. This is where creativity is crucial. Coming up with ideas is easy. Delivering a perfect pitch to strangers is incredibly tricky.
If your first attempt receives a lot of raised eyebrows or head shakes, don’t scrap the idea and pout. If you’ve come this far, there’s got to be some merit to it. Remember, Steve Jobs and Bill Gates were rejected countless times in their early years. Tweak and practice your pitch until you get it right. There will always be new potential subjects to try it out on.
5. Practice noticing problems.
Great businesses do not simply sell products or services. They create solutions to problems. In most cases, coming up with a stellar idea does not happen by sitting down and brainstorming. Some of the best ideas come from pinpointing inefficiencies in common situations. Airbnb, for example, identified that staying in hotels when traveling can get expensive and limit the overall experience. So, they created a platform where travelers could find a host of their choosing and lease out a room in their home for the duration of the trip. It was a smart way to break the mold of traditional accommodation and make each experience unique.
Keep in mind, consumerism is very much a system of change and improvement. Inserting yourself into the history books of entrepreneurship depends on your ability to find innovative ways to make life better.
6. Know what you’re building and why.
This is perhaps the most important part of the process. While you’re at the drawing board, you need to create a thorough roadmap of your intentions supplemented with a strong rationale. The high death toll of startups can be attributed to entrepreneurs who thought they could skip this vital step. Your understanding of this concept is essentially your mission statement. Regardless of how your startup adjusts to the times, it should remain consistent. Don’t take this step lightly.
7. Create ideas that can monopolize.
One of the main questions YC will ask a startup is how will the company be a monopoly one day. While proceeding with baby steps is wise for a startup, you should have a clear vision of the potential your idea has. How will you keep people coming back? How will you appeal to new audiences? Will this idea be sustainable in five to 10 years? To be successful, the planning stage should include an in-depth analysis of how your idea will scale for the long haul.
8. Identify a single growth metric.
Outstanding execution revolves around a well-defined growth metric. For this reason, it is smart for startups to corner the most optimal measurement to keep track of. It’s well worth your time to find the One Metric That Matters (OMTM). This will help determine the most pressing question you have and force you to set clear-cut goals.
9. Invest in a great team.
In most cases, multiple brains think better than one. Also, there might be crucial character traits you simply don’t have. For example, let’s say you have superb ideation and analytical abilities. But, you are a severe introvert. In this case, it would be wise to partner with someone with a bubbly personality to promote your ideas.
If your startup gains traction, you will need to hire more hands regardless. Therefore, taking the time to find the right team is a must. Take a critical look at yourself. What are your strengths and weaknesses? How can you find people to play to them? Putting together a dream team will likely be the most important task you will face. Be picky.
10. Let your idea evolve.
Change is perhaps only thing that is constant in the world of business. Going all the way back to the invention of the wheel, great ideas are meant to evolve. Failure to adapt to a changing marketplace can spell death for any company. Take the cab business for example. Their negligence in adapting to the new business model Uber and Lyft created has practically driven endless amounts of taxi services into obscurity.
Critically examine your feedback. Keep up with the news. Adapt to the trends. The world is evolving; your business should be too.
All the statistics out there on startups can be intimidating -- and often discouraging. It’s no secret that monetizing your idea will be tough. For every successful idea, there are thousands of duds. Remember, the difference comes down to superior planning and execution.