September 27, 2012
Near the end of Randall Stross’s new book, The Launch Pad: Inside Y Combinator, Silicon Valley’s Most Exclusive School for Startups, he recounts a coaching session with an entrepreneur right before demo day. Paul Graham is talking about a topic he rarely brings up with founders: fearsomeness.
“I’ve seen it time after time,” says Graham, the creator of Y Combinator. “You have to undergo this sort of transition that produces James Bond.” It’s a transition “that makes people seem more confident, more resourceful, and tough.”
According to Stross, Graham lays no claim to instilling fearsomeness in Y Combinator founders. But the book, an inside look into the workings of Y Combinator, shows how the program itself fuels these transformations. The Launch Pad follows the summer 2011 class of 63 startups from interviews to demo day, and it’s a story of growth. The founders go from tentative applicants praying for an elusive spot at Graham’s table, to polished presenters “buffed to a high gloss” at demo day.
One of the main differentiators for Y Combinator, ranked the top US accelerator this year, is autonomy. Unlike many programs, there is no shared office space. And the curriculum basically consists in Tuesday night dinners and office hours – all optional.
“It’s kind of sink or swim,” says Graham in the book. “If you drift off and do nothing, we’re not going to come find you and drag you back.” He says he looks for founders with an “independent cast of mind,” and this format can strengthen their independence even further.
Founders are also hardened by Graham’s honest criticisms, offered up regularly. “If you want to drive off a cliff, go ahead,” he says to one startup, who is thinking about pursuing the wrong idea. He opens the program telling startups that half will fail, and closes by telling them they were “undeserving” of the $150,000 investment that each got in the beginning. Three months of such critique helps founders build a resilience like James Bond, charging forward and jumping over obstacles come hell or high water.
On top of that, the structure of Y Combinator is like a series of achievements that founders can check off their lists. They were chosen as the top 3 percent of around 2,000 applicants – check. They slaved day in and day out, surviving on Lean Cuisine, or working out of a living room in sleepy Sunnyvale – check. They survived “Prototype Day” and demo day practice, pitching for a few minutes before receiving a barrage of comments and criticism in front of their peers – check. They survived demo day itself, in front of hundreds of investors like Marc Andreessen and Ashton Kutcher – check.
In a chapter titled “Fearsome,” Graham gives the example of Justin.tv’s Justin Kan, who went through Y Combinator in 2005. “Justin Kan seems so terrifyingly fearsome now,” says Graham. “During the first YC batch, he seemed so clueless. He seemed like he just rolled out of bed.”
That transformation must have started with getting selected for Y Combinator – overcoming the first trial. It was a turning point in Kan’s life, Stross recounts. Kan recalls, “We were college kids from a school with no culture of entrepreneurship who had just received the external validation that our company was worth $300K!”
At the end of the book, we see three founders greeting the next batch of startups. They are the experts now, assuaging fears and dispensing advice. They seem like they belong.
In short, founders come away from Y Combinator knowing: You were chosen. You survived. And you did it yourself. A pinch of external validation, a dose of self-esteem, and some hardcore self-reliance: that’s a recipe for badassery.
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