How to Build the Future with Sam Altman
ycombinator.com
ycombinator.com
Wait do all three of you live together in one house in your 30s? That's awesome!
EDIT: Just to be clear, this comment is in no way intended to be sarcastic! I really think it's amazing for three brothers to live together in their 30s. The notion that each has to go their separate way after one turns 18/21/25 is bullshit. Life is more fun together and there's inherent economies of scale as well (both financial and social).
Now as an adult I've moved to the US, where it's much more common to move far from your family. I grew up expecting that I would always have my close family near, and I still struggle with the fact that's probably not going to be the case.
I would absolutely love to live near or with my brother and parents still. Definitely would need a way that would allow us to have private spaces when we want, but I miss being able to see close family with just 30 minutes of traveling.
Transcript: https://goo.gl/8z2h1b
Audio: https://goo.gl/D8h0NU
It's sort of counter-intuitive that this would be the case because after something fairly radically new becomes popular there's so much positive said about it.
It's an easy leap to assume that praise was always present, and that lack of it in your case is a signal that what you're working on won't succeed—but it seems like in actuality, when you're doing something novel enough people aren't going to 'get it' immediately by definition.
It's also easy to assume that those you speak to about your work will approach it with the optimism and energy with which you regard it, and without a little optimism and sustained attention it's easy to miss the potential or even comprehend the significance at all of some new idea.
Even having acknowledge this concept in the past, I still needed the reminder in the video to see I was potentially making the mistake again in my own project. It's a good point to remind yourself of periodically.
Across 5 funding rounds, Crunchbase lists Loopt as having raised $39 million and then was acquired (acqui-hired?) for $43 million. He didn't create any multiples of value for his investors. Loopt wasn't a breakout hit like so many other YC startups have been. It was certainly one of the first interesting location-based apps in the App Store, but soon was surrounded by other location-based apps and never really appeared to surface and gain traction.
Obviously Sam runs YC now and has dramatically improved it, but in the lens of being an entrepreneur, isn't he still essentially unproven, and not a success story in the startup world?
I think I've learned a lot from working closely with entrepreneurs that run massively successful companies that's worth sharing.
If you disagree, no one is making you watch this. You're free to hit the back button.
Obviously they didn't even click the link at all, but they had a legitimate question to ask the community in hopes of learning more about why the content is good. Your first two lines directly answer their questions, but the third one just seems, well, immature?
Look at it this way: if you're a musician and you're looking up to people for inspiration or advice to make great, interesting music - do you look to Kanye West or do you look to someone who failed to achieve success as a musician but then went on to become a record company executive? You look to Kanye West.
(to continue the analogy) So when a group of musicians are suddenly looking to the record company exec, it raises an interesting question: why?
It's not meant to be an attack on your character or your achievements...it's just an interesting question. Or at least, that's the way I interpreted it.
My text classification software marked the third line as the most authentic, most truthful line.
Huh.
If people honestly learned from the mistakes of others - I assert there'd be an awful lot fewer mistakes.
It's painful knowing they won't learn something until they do the same stupid thing themselves.
(I don't know if this is how you actually feel deep inside, but if it is, I wish you spoke of it so.)
Why would somebody want to only consume media they agree with?
I remember reading PG saying that Sama is one of the brightest entrepreneurs he has met, and I always wanted to hear the backstory since Loopt is the only data point we have from the outside.
Support players on the other hand, are relied upon to support the carries by getting supportive items, maintaining control over the map (fog of war is in effect), being in the right places at the right times so as to provide their carry with space to work, and generally staying at a higher level of awareness in order to make more of the big picture calls. Most teams' leader will play a support character.
I suspect something similar may be at work here, in that he is very good at choosing and supporting "carries". There are probably very many people in the world who are very perceptive, empathetic, and can achieve a high level of understanding, making them well-suited for leadership positions, but without luck in addition to giving it their best effort, are never put in a position to shine. Just because someone will never be a top-tier carry, doesn't mean they can't ever be a top-tier support, but our society tends to demand the former before you're trusted to do the latter.
Or not, just thinking out loud here. :)
But, of course: if the model they're building with YC works, this is the outcome you'd expect. YC wouldn't be very interesting if its outcomes were capped to Viaweb's and Loopt's.
Paul Graham was a borderline founder of Reddit, as well.
That's a successful company by any standard.
I think you're conflating "impressive" and "successful." I would say that based on the numbers you've given, Reddit is an impressive company (it's hard to get any company to that level of private investment and internet fame!), but it's not necessarily a successful company yet.
Being that Reddit's valuation is solely attributable to private investment and not revenue generation (so far), the only sound way to judge whether or not it is a financially successful company is based on its potential return to investors.
By the standards of most VCs in tech, a $500M exit is suboptimal, which will result in either a modest return or just getting their money back. This is not good for a firm's "batting average" when they're trying to beat the SPY with a ten year fund. They need to cover their losses (which, indutry-wide, represents approximately all of their investments), their staff and business continuity costs, their management and performance fees and still beat the market. Modest returns aren't helpful in that regard.
You also have to consider the likelihood that Reddit will transition into a mature business that can exist profitably on its own, without continually receiving significant infusions of cash. If it can't find a way to navigate out of "tech adolescence" it's not really a successful company. The last numbers I read indicated that Reddit has achieved an annual revenue of $8-10M, which is an annual return of >= 2%. Considering that the S&P's average annual return is about 7%, you could earn $10M on $500M by sticking it into an index fund and literally burning the other $25M you would have generated by doing nothing.
> That's a successful company by any standard.
Simply being "valued" at some dollar amount doesn't actually mean success. Revenue and positive net profit mean success...
That's why I would say it's a success to everyone but the investors who never got their payday.
Yes, so it would not be a successful venture backed company. Lifestyle businesses are fine if you pay for them. When someone else invests and expects a return you need to provide a return to be successful.
Not saying I agree, BTW - I think that binary startup success has a large skill factor, but the magnitude of that success is largely luck, and that good luck can mask bad practices to a large extent. So in my view, people with relatively minor startup successes like Sam Altman, Paul Buchheit, or Michael Siebel might actually be better coaches than knock-it-out-of-the-park successes like Larry Page, Mark Cuban, or Notch. But don't misrepresent the argument: operational experience running an existing business is very different from experience founding one.
My belief is that there's a large chunk of building a company that I will never learn or understand without becoming a founder myself. Maybe that's 50% of success. However, for the other 50%, I can actually learn things better than many founders because they have a sample size of one or two or three startups that they have started, while I can look across fifty or a hundred companies that I am intimately involved in and analyze what is different between the ones that become huge and the ones that do not. I think this cross-sectional pattern matching is what makes a lot of VCs and investors sources of good advice (in some startup topics) even though they might not have built huge companies themselves.
Maybe that's 50% of success of being a football manager. I can learn more than other football managers because I can watch lots of football games on Sky Sports.
That's why many top premiership teams hire their managers by finding the people who watch the most football games on TV.
EDIT: I'm sure there's plenty here who have been in more startups than me, but in the 4 or so I've been in, I've heard conversations between founders and investors plenty of times.
Often little of what comes out of the founders mouth is based in reality. Sometimes they're not seeing reality as it really is, sometimes they're painting a rosier picture, sometimes they're outright lying, sometimes they're tired and not thinking straight, sometimes they've got obsessed by something utterly irrelevant. Sometimes they're not actually listening to the staff, or not even asking the right questions.
As a VC or researcher or whatever, you're not actually playing the game. You're not on the team, you're not on the field, you're not even on the side-lines. You're seeing a different game than's being played.
I think it's actually the opposite: if there's a good founder/investor relationship, the investor is an extended part of the team, is sometimes on the field (helping close job candidates or doing customer intros), and is often trying to help from the side-lines. Not all founder/investor relationships are this good, but some are.
To use your analogy, the founders are football players, and investors are somewhere between "football fan" and "football coach", but probably a lot closer to coach than fan. It's true that neither coaches nor fans are actually on the field playing the game, but coaches have way more insider info. For example, they watch players practice and have a deeper understanding of what each player can and cannot do, they know which players might be nursing injuries, how to motivate different types of players, etc. That doesn't mean a great coach could be a great quarterback, but I think lots of players would agree that a great coach knows a lot about how to become a better football player despite not being a football player themselves. (And to extend the analogy, I think coaches are good at helping players improve despite the fact that some players might lie or make excuses or paint rosy pictures or whatever.)
He is the President.
This is a valid point, but the majority of the content in this video (and in this series) is to help entrepreneurs. As the President of YC, his entire life now is spent helping entrepreneurs and given his track record in helping companies becoming very serious brands out of quite literally nothing [1] is clearly important and something worth listening to.
[1] https://en.wikipedia.org/wiki/List_of_Y_Combinator_startups
A lot of "heroes" in this world are fairly fraudulent. Worse, some went from young tech luminaries to older VC sharks with questionable ethics like Mark Andreeson.
I think coding and tech, in general, is mostly a meritocracy, but on the business end its practically the lottery. Right time, right place and other luck of the draws determine financial success just as much as the merit of the product, if not more so.
Being the guy who sells a small app, service, or utility on the side and clearing $150k a year, or more, via mostly passive income is a much easier trick to pull off. Also this approach can come with a sweetheart acquisition deal from a larger company that wants your product and can run in the millions, on top of what you've earned already.
Perhaps some people are players, some are coaches.
Starting a company requires a very different set of skills than running one. That's why a lot of founders either step down or get ousted after their companies mature.
Same with Sam. His observations and insights are very useful and he is able to communicate them clearly.
From first principles, if you were looking for someone to give startup advice, then you want someone who has: been through the process; doesn't suffer from survival bias which just elevates all the random things they did and weird habits they have to some kind of mystical formula; has seen many other people go through the process from the very early to late stages. That's why you should listen to Sam Altman. If you want to worship mega-entrepeneurs then there are many other avenues for that activity.
I think you are selling the prescience of it short in this part. Loopt was out long before the App Store existed.
Tbh this advice reads like a brainwash in making yourself more exploitable.
To be clear, I suggest all young adults follow Sam's advice on risk.
Work on something together w/ people you like and on an idea that you are truly excited about and strongly opinionated on. Shit will get hard and most people will quit too soon (esp if they don't like each other or don't care about what they're doing). Don't be those people.
I was very disappointed with the How to Build the Future series. Particularly, the interview with Elon Musk. The quality of the questions was mediocre at best.
And the podcasts are just about showcasing YC companies. As an entrepreneur, I basically got zero value from these.
PG should write more essays. Whenever one of them came out, I dropped whatever I was doing to read them.
I appreciate the way Sam presents his thoughts (questions, answers, or otherwise). They're both extremely thoughtful and simple in a sense that he won't repel those who may feel below his level intellectually. Some of his points are so insightful, but it's taken me a lot of time, experience, and thought to be able to absorb or agree/disagree with them. Some just seem like simple advice that I should consider because I don't know enough to strongly believe he's right or wrong.
Perhaps you're at a high enough level intellectually that his simply-stated yet thoughtful points are, by now, obvious to you. I definitely don't mean to imply otherwise. Unfortunately, I haven't found many writers whose thoughts are as insightful as PG's, but I am content with rereading his old essays as I'm certain I haven't thoroughly understood everything he's written at the depth of understanding that he or others may have.
I think we need one of theses videos for the really poor kids. The kids who barely finished college due to finances though.
He states his three factors to success are, 'focus, personal conviction, and self belief'.
(Poor kids need to network. Poor kids need to make friends with rich kids. Poor kids can't fail, and take a vacation to unwind. Poor kids, and by poor kids, I mean generational poor. No wealthy grandparents, etc. My biggest mistake was finding upper, middle class kids very shallow. I just couldn't be around them growing up, and even in college. I would cringe when they talked about their problems. I should have held my nose, and try to win their company. I have no reason to lie. They will introduce you to people that have money.)
He said work hard early on.
(Yes, but don't blow a gasket. I had a nervous breakdown in my late twenties. Before that breakdown, I was doing what two people did. I literally felt like nothing couldn't be accomplished. I felt like Superman. Everyone is different, and you will statistically be fine. Just watch it.)
He talks a lot about failing, and why it's not a bad thing.
(That's great, but kids from a poor family only seem to have one big failure in them. It usually involves financing from credit cards. I guess if you know the right financiers, networked, or have family money failing/taking risk is not financial suicide, or living in a box somewhere. Poor kids have the real possibility of ending up homeless if they fail. There just a different mindset when you come from nothing.)
"Successful people impact the world" I believe he said, 'Make the world a better place.'
(That might be true for a handful, but let's get real; it's about making a lot of money. It's about the paper.
I don't like it, but let's not romanize it--it's about making money. The financially successful don't like to admit it.
And if you don't make money in life--there are more important things than narcisstically making a lot of money. Being a good, moral person goes a long way. Can attract the right girlfriend/boyfriend. It's not a crime to think like Jesus did. It might talk you a long way?)
I think the best advice he gave was sticking with what you truly believe in. Yes--there's Twitter, and other examples, but I believe it's good advice. Go against the crowd caught my attention.
If YC is still funding founders after 10-14 failures; I'm very impressed with the organization.
Maybe I need to read the article more carefully.
(A little more seriously the idea of finding the Venn overlap point between Good At, Love Doing, Adds Value is nice. Does not help me find my next big idea but at least is a filter)
What authority does he have / what has he done, that makes him a good candidate to interview Sam? Is this meant to help shine some light on Sam's brother and his startup?