Chapter 1: Foundation (Sam Altman)

Why Should You Start a Startup?

● Reality isn’t so glamorous
○ Stressful
○ Always on call
○ Hunched over tables
○ Founder depression

○
○ Mark and friends @ FB
● You’ll be the boss?
○ Everyone else is your boss
○ CEOs report to everyone
○ If you want power and authority, join the army
● Flexibility?
○ You’ll be able to work any 24 hours a day you want!
● You’ll make more and have more impact?
○ Joining as an employee at mid-early stage growing startup can be worth
millions on its own
○ As a founder, you need to be wildly successful for that to make sense
○ Adding a late-stage feature to an established company is a force multiplier
■ Employee #1500 at Google made Maps
■ Employee #250 at FB made the like button
● The best reasons for starting a company are:
○ You need to do it
○ The world needs you to do it
■ The world needs it
■ The world needs you
● The world needs you somewhere - find where
● Recommended reading list:
○ Hard thing about hard things
○ Zero to one
○ Facebook effect
○ The Tao of leadership
 ○ The 13 commitments of conscious leadership
○ Nonviolent communication

Core Principles
Success = Idea * Product * Team * Execution * Luck (where luck is any number between 0-
10000)

Idea

General Guidelines
● It’s become cool to not spend too much time here and just begin building
● A bad idea is still bad
● Pivots are fine, but most good companies start with a great idea, not a pivot
● Airbnb started because founder couldn’t pay rent
● If this works out, you’re going to be working on this for 10 years
○ So think long and hard if this is something you want
● Plans themselves are worthless, but the act of planning is important
● You need a nice kernel to start with
● You need to build something that’s difficult to replicate
● IDEA FIRST, STARTUP SECOND
● Company should feel like an important mission
○ Mission-oriented to get people to rally and be productive around it
○ Hard ideas are easier to garner support for than a derivative easy one
● Your first idea does not need to sound and seem big/visionary

Market Size and Growth

● Must think about size, growth of the market, defensibility of the idea
● You CANNOT create a market that doesn’t exist
● Monopoly in a large market when you start is impossible
○ Find monopoly in a small market and then quickly expand
○ This is why some great ideas look terrible in the beginning
○ “I know this sounds like a bad idea, but here’s why it’s a great one”
● You need a market size that will be big in 10 years
○ Think about what your target market will look like in a decade AND what will
cause it to plateau
● How do you tell which markets are growing fastest?
○ Use instincts as a young student

Timing
● Why now? Why is this a good time to start this particular company?
○ Why couldn’t it have been done 2 years ago, and why is 2 years in the future
too late?
Customer Needs
● Best to build something you yourself need
○ Building your first version for a customer who isn’t yourself is hard
● Idea should be easy to explain and understand
○ If takes more than a sentence, it’s too complex
● Try to avoid derivative ideas like:
○ X for red wine lovers
○ Y for dog owners
● Begin with the audience - start with their demands, while you create the supply

Product

Love
● When turning a great idea into a great product:
○ Build something a small number of users love
○ LOVE. Not like or want a medium amount.
○ Talk to users
○ Eat
○ Sleep
○ Exercise
● Law of conservation of love

○
● A key indication of true love is spread by word of mouth (organic growth)
● Best way to achieve this is to start with something simple
○ Even if your eventual plans are complex, begin with as little surface area as
possible
● Fanatical commitment to the product helps building great products

Learning From Customers

● Recruit initial users by hand
○ Anywhere in the world
○ By any means possible
○ Understand that group extremely well
○ Do anything to make them love you
● Product building feedback loop
○ Make this loop as tight as possible
○ Show product to users
 ○ What do they like?
○ What would they pay for?
What would make them recommend it?
○ Make product decisions

Metrics
● Focus on growth
● Company will build whatever the CEO decides to measure
○ Active users
○ Activity levels
○ Retention
○ Revenue
○ Net promoter score

Team

Co-founders
● No. 1 cause for death is co-founder blowups
● Most important decision as a startup
● Top 20 YC companies have more than 2 founders
○ Best is tight group of friends with shared history
○ Not good is solo founder
○ Worst is random pairings
● A good model for a co-founder is James Bond
○ Relentlessly resourceful
○ Unflappable
○ Creative
○ Decisive
● When should co-founders decide on equity split?
○ Lots of people put this off for way too long
○ Should be done as early as possible
○ If you don't want to give you cofounder even split, think about whether you
want this person as a co-founder or not
● How to deal with co-founders leaving?
○ Vesting
■ n/4 of the promised equity where n is number of years worked
● Don’t work remotely with your co-founders

Hiring
● Try not to hire
● People tend to judge how real or cool your startup is by your team size
○ It sucks to have lots of employees
○ Low employee count is great
■ Low burn rate
■ Less management
■ Lean, agile
 ■ Clear direction
● The cost of getting an early hire wrong is VERY HIGH
○ Bad hires can kill the company
○ Airbnb took 5 months to hire their first employee
■ Airbnb CEO came up list of key culture attributes early hires had to
have
■ He asked “if u were diagnosed with 1 year left to live, would you work
at airbnb?”
■ A bit crazy, but point was made
● Recruiting is HARD
○ Great people have lots of great options
○ Long process of convincing that your mission is most important
■ That’s why product is most important
■ People wanna join a rocket ship
● How much time to dedicate to hiring?
○ Either 0% or 25%
○ Biggest block of time spent, or not at all
● How to find the best?
○ Personal referrals build the first 100 people
○ It’s weird to call every great person you met, and ask your team to do the
same, but these network effects are most important
○ Look beyond your local community
● Does experience matter?
○ It matters for some roles
■ E.g., someone who runs a large dept or organisation
○ For most early roles, not really
■ Go for aptitude
● Things to look for in a hire
○ Are they smart?
○ Do they get things done?
○ Do I want to spend lots of time with them?
○ Do they have good communication skills?
○ What projects have you worked on? (Take a deep, deep dive into this)
○ Are they tolerant to risk?
○ Are they maniacally determined?
○ Animal test
■ You need to be able to describe someone as an animal
■ Ala they need to have a defining characteristic
○ Would you be comfortable reporting to this person if the roles were reversed?
○ Try to work on a project together instead of an interview
● Employee equity
○ Aim to give 10% to first 10 employees
○ Be stingy with investors, generous with employees
● Employee retention
○ Praise your team, give them credit
○ Take responsibility for bad stuff
○ Give them increasing responsibility
○ Autonomy + purpose
 ● Fire fast
○ You want to fire people who
■ Create office politics
■ Persistently negative
○ How to keep existing employees feel secure?
■ Usually fires are constantly making poor decisions
■ Their bad performance is painfully obvious to all
■

Execution

Jobs of the CEO

○ Set the vision
○ Raise money
○ Evangelise
○ Hire and manage
○ Make sure everyone executes

Focus
○ What are you spending time and money on?
○ What are 2 or 3 of the MOST important things?
■ If you cannot distill and act on these things, you will not be effective
○ Say no a lot
○ Set clear overarching goals
○ Communicate
○ Maintain growth and momentum
○ Don’t get distracted
○ Work locally together
○ Intensity
■ Focus and dedication
■ Relentless operating rhythm
■ Obsession with quality
■ Bias towards action, keep moving
■ Do huge things in incremental pieces

Momentum and Growth

● Never take your foot off the gas pedal
● Keep accumulating wins
● Software
○ Keep growing
● Hardware
○ Don’t slip up on ship dates
● Save the grand vision speeches for when the company is winning
○ When the company is losing momentum, focus on small wins
○ FB in 2008 setup a growth team that focused on small wins
■ Quickly became the most prestigious group in the company
 ● Sales fix everything
● Disagreement spawns when startups lose momentum
○ The best way to dissolve disagreement is to ask users
● Don’t worry about competitors until they launch a better product
○ The competitor to be feared is one who never bothers you at all, but
goes on making her own business better all the time.d

Chapter 2: Before the Startup (Paul Graham)

● Paul’s full essay here

Counterintuition
● Your instincts do not always work
● Startups are so weird that if you trust your instincts, you’ll make a lot of mistakes
● Listen intently, and do not ignore partners’ advice
○ Counterintuitive ideas contradict intuitions
○ Easy to dismiss advice as something that doesn’t make much sense
○ Only advice that surprises you is worth listening to anyway
● Trust your instincts about people
○ Don’t make the mistake of giving dodgy people a free pass just because this
is the ‘business world’
○ Pick partners like you pick friends
○ Good, upstanding folks

Expertise
● It’s not important to know a lot about startups
● It is most important to be an expert on your users
● Don’t feel bad about not knowing specific mechanics, e.g., fundraising
● One of the key mistakes of young founders is to go through the motions
○ Plausible sounding idea
○ Great valuation
○ Cool office
○ Absolutely fucked
● Never forget to make something people want

Playing the Game

● Gaming the system stops working
● Mindlessly going through the motions is something you’ve been trained in your entire
life
○ Extracurricular activities
○ Artificial standardised tests
● Young founders often want to know what ‘the trick’ is to winning at this new game
● The best formula is:
 ○ Do well (lol)
○ Grow fast
○ Tell investors
● Gaming the system can work at big companies
● You can even fake your way through investors
● But with startups, you have to stop looking for ‘the trick’
● Different types of work allow for different levels of gaming the system
● How do you win in each type of work?
● What would you like to win by doing?

All-consuming
● If you start a startup, it will take over your life to a degree you cannot imagine
● And if your startup succeeds, it will take over your life for a long time
○ for several years at the very least, maybe for a decade, maybe for the rest of
your working life
○ Opportunity cost is very high
● Every big YC success says the same things:
○ Running a company doesn't get easier
○ Nature of the problems change, but volume of problems is the same
● Starting a startup is like having kids
○ Once you push the button, your life changes irrevocably
○ But people seem to think starting in college is the best thing to do
○ Universities set up entrepreneurship programs left and right because it’s what
attracts students
● Starting a startup is something you can only learn by doing it
○ Startups take over you life
○ You cannot be both a student and a startup founder
○ You will be one or the other, or neither
● DO NOT START A STARTUP IN COLLEGE
○ Starting a startup is just a part of a bigger question: how do I live a good life?
○ Startups can be part of a good life for many people, but early 20s is not the
time to do it
○ Starting a startup is like a brutally fast depth-first search
○ 20s should be an exploratory breadth-first search
○ You sacrifice nothing if you forgo starting at 20, because you’re more likely to
succeed if you wait
○ The usual way for startups to succeed is because founders MAKE THEM
succeed
○ It’s stupid to do that at 20

Trying
● Should you do it at any age?
○ Startups are hard
○ How can you tell if you’re up the challenge?
○ SPOILER: you can’t.
 ● Paul probably has the most experience at trying to predict if people would be tough
and ambitious enough
○ How much can an expert know about this prediction?
○ Not much.
○ Therefore, he keeps an open mind about which startups would be stars
● The only way to know is to try

Ideas
● So you want to start: what should you do in college?
● Get an idea and some co-founders
○ M.O. for both is the same
○ The way to get startup ideas is not to try to think of startup ideas
○ Essay on this topic here
● All the top companies were meant to be companies
○ They were all just side projects
● How do you turn your mind into a startup idea machine?
○ Learn a lot about things that matter
■ Charles: first principles thinking helps here
○ Work on problems that interest you
○ With people you like and respect (this is how you get cofounders)
● Gratifying your interests energetically is the best way to prepare yourself for a
startup, and probably the best way to live
● One good way to turn your mind into the type for good startup ideas is to get to the
leading edge of a technology
○ Aka “living in the future”
○ At this point, you may not realise your ideas are startup ideas, but you know
they ought to exist
● If you want to start a startup after college, learn powerful things
● Starting a startup is merely an ulterior motive for curiosity: just learn.

Chapter 3: Building Product, Talking to Users

(Adora Cheung, CEO of Homejoy)
● Have large blocks of uninterrupted time, rather than sporadic, spaced-out
● Describe the problem your idea is solving
○ Verify others have it
● What’s your solution?
○ Become an expert in your space
○ Identify your customer segment and focus on them
○ Storyboard the ideal user experience before you even build
● Build a damn MVP
● Get first users to start trying it
○ Parents
○ Friends
○ Family
 ○ HN
○ Local communities
○ Reddit
○ Mailing lists
○ Influencers
○ Blog
○ Cold calls/emails
● Now you’ve got users and MVP, get feedback
● Iterate on product
● Ready to ship
○ Just fucking launch it already
● Ready for a lot of users?
○ Learn one channel at a time
○ Iterate on channels that work
○ Revisit failed channels
○ Measure metrics, remain creative
● Types of growth
○ Sticky
■ Returning customers
■ Good experience wins
■ Customer lifetime value and retention are key
■ Repeat (power) users buy more and more over time
○ Viral
■ 1 person tells 5 friends, network effects
■ Great experience + great referral programs
■ Customer touch points
■ Program mechanics
■ Referral conversion
○ Paid
■ Buy growth through ads and marketing
■ Customer lifetime value > customer acquisition cost
■ AKA cost to acquire a user is less than what the customer pays over
the course of their subscription/time with you

Chapter 4: Competition is for Losers (Peter Thiel)

Capturing Value
● A business creates X dollars of value and captures Y% of X
○ X and Y are independent values
● The US airline industry has more revenue than Google, but its profit margins are less
○ As a result, Google’s market cap is far larger than the airline industry
● Two kinds of businesses in this world
○ Perfectly competitive
○ Monopoly
Lies People Tell
● Monopolies pretend like they’re in competition
○ We’re in a huge market
○ Example: Google says we’re not a search engine company, we’re an ad
company
■ Global ad market is 500 bn, Google is only a fraction of that
■ But in search engines, Google is > 70% dominance
■ But they would never admit that they’re a monopoly
● Competitive companies tell everybody they have a special edge, and are not
competing with other companies
○ We’re in a narrow market
○ Example: We’re the only British food in Palo Alto
■ There’s british food in the next town
■ Nobody exclusively eats British food
○ The something of somewhere is usually the nothing of nowhere

How to Build a Monopoly

● Start small and monopolise
○ Easier to dominate a small market
○ If you think your initial market is too big, it certainly is
○ Too much competition with a big market
● Expand from small markets
○ Amazon started with bookstore
○ eBay started with pez dispensers and beanie babies
○ Paypal started power sellers on ebay
○ FB was 10,000 people at Harvard
● Start big and you’ll shrink
○ Every clean tech company 2005-2008 failed because they tried to take on the
whole energy market

Last Mover Advantage

● Characteristics of a monopoly
○ Proprietary technology
■ Peter Thiel’s thesis is that you should have tech an order of magnitude
better than everyone else
○ Network effects
■ Tricky because they’re often to get started
■ Why is it valuable to the first person?
○ Economies of scale
■ High fixed cost, low marginal cost
○ Branding
■ Thiel: I don’t understand it, but it’s important
● Critical to have a monopoly that lasts a long time
○ First movers don’t always win
○ You want to be the last remaining mover
 ● The value of these companies lasts far into the future
○ Paypal finance exercise in 2001 showed that ¾ of value was cash flow in
2011 and beyond
● Growth rate is overrated, durability is underrated
○ Growth is easy to measure
○ Durability is more qualitative
● Having the first major breakthrough in an industry, and then being able to explain
there will not be another one for some time
○ Improving on it at a pace that no one else can keep up
● Chess analogy:
○ White is first mover, gains ⅓ pawn advantage
○ You want to be the last mover, perform the checkmate

History of Innovation
● In science, it is not uncommon for enormous innovation to go unrewarded
○ In the value equation where a business creates X dollars of value and
captures Y% of X, Y has generally been 0 across the board
○ Fundamental delusion where people think our society is fair and just, and they
will simply be rewarded for their contribution
● Enormous proportion of history that can be explained from the perspective of
captured value
○ Einstein didn’t make much money
○ Railroad companies went bust
○ Wright brothers also went bust
● Only 2 broad industries where people innovated something new and captured value
after
○ Complex, vertically integrated companies
■ Lots of moving parts, difficult to assemble
■ High value once built and working
■ No single massive breakthrough
■ Massive integration
■ E.g., Tesla, SpaceX, Ford, Standard Oil
○ Software
■ Economies of scale
■ Low marginal cost
■ High adoption rate
● Common rationalisation for scientists who aren’t able to capture value for their
innovations
○ “Scientists shouldn’t be motivated by money”
■ This is fair, but this rationalisation is dangerous
■ It means scientists are constantly working in an environment where all
the value is competed away, and they’re left with nothing
○ Important to understand that such rationalisation obscures the fact that X and
Y are independent variables
○ People of equal intelligence doing equally great things in their specific
industries can earn vastly different amounts of money
 ■ A lot of this has to do with the microeconomics/structure of specific
industries

Psychology of Competition
● We often think losers are the ones who are poor at competing
○ Consider that perhaps competition itself is off
○ We don’t understand competition/monopoly dichotomy properly
○ We find ourselves very attracted to competition, a reassurance that there are
other people doing this
● Competition as validation
○ We think lots of people doing something is proof of value
○ PT thinks that is often proof of insanity
○ 20,000/year move to LA to become movie stars
■ 20 make it lol
● School is one such example of senseless competition
○ Does the tournament make sense if you keep going?
○ Does the intensity of competition in grad school make sense?
○ “The battles were so ferocious because the stakes were so small” - Henry
Kissinger referring to academia
■ This is also proof of insanity
○ People lose their identities in absurdly competitive environments, they lost
sight of what was important
○ Competition does make you better
■ But if often comes at the price of questioning what’s truly
important/valuable
■ Don’t get caught up rushing to fit in the tiny door everyone else is
trying to get through
■ Go round the corner and take the vast entrance no one noticed
● Risk is a very complicated concept
○ Taking law as a degree sounds like a low-risk path
○ But in the grand view of doing something useful with your life, law may be a
pretty high-risk entryway into societal improvement

Chapter 5: Growth (Alex Schultz, Growth @ FB)

● What matters most for growth?
○ Great product
○ Retention
● How do I measure retention best?
○ Graph of % of active users vs. days since customer acquisition
 ○
○ To get this curve, measure % of active users on 31st day, 32nd day, 33rd
day, etc.
■ This will give you an idea of the retention trend for your product
■ Ideally it should flatten out and stabilise at a comfortable level
● What if my retention begins to approach 0? What if it never flattens out and
stabilises?
○ DO NOT HIRE A GROWTH HACKER
○ Head back to the drawing board, focus on finding product-market fit
○ No. 1 problem with new startups is that they do not have product-market fit
when they think they do

Good Retention
● What does good retention look like?
○ Let’s look at some successful companies:
■ Use dimensional reasoning
● Look at the dimensions involved in a problem
○ Newtons, n/m, m/s, etc.
■ FB’s retention rate is easy to figure out
● Total no. of internet users (except China) = 2 billion
● Facebook’s active user count = 1.3 billion
● Retention rate = 1.3/2 = 65%
■ Whatsapp’s retention
● MAU / Total smartphone count
○ Successful retention rates look different for different companies
■ Ecommerce: 20-30% is good
■ Social media: < 80% is probably bad

Scaling
● I have great retention. How do I scale this?
○ This is where growth teams come in
■ If you’re a scrappy startup, don’t have a fucking growth team
■ The whole company should be the growth team
 ○ The metric (north star) you choose to measure is important
■ Zuckerberg chose active users over total signups
● It’s not always active users though
■ Whatsapp used messages sent over no. of users
■ Airbnb used no. of nights booked vs. major hotel chains
■ Ebay used total gross merchandise volume instead of revenue
○ Once a company/team grows beyond a certain size, it’s impossible to directly
instruct everyone
■ But a north star provides guidance to the fundamental end-goal
■ Affiliate programs are an example of this
● Paying your affiliates to meet a specific, well-defined goal gets
everybody on the same page, and is much more effective
● At ebay they switched the payment requirement from
registered users to ACTIVATED registered users (users who
bid on something)
○ Made affiliates focus on driving users to a product
instead of driving them to do the bare minimum of
registration
○ For ebay users, seeing the desired product and being
allowed to bid on it was the magic moment

The Magic Moment

● What’s the magic moment?
○ For Facebook, it was seeing your friends on the platform for the first time
■ That’s why FB growth marketing is all about getting people to connect
to their friends as quickly as possible
■ Zuckerberg called in getting to 10 friends in 14 days
○ Airbnb is about finding the the cool house you’ve always wanted
■ For renters, it’s about getting paid for the first time
○ The magic moment is one the of most important things for a startup
■ It lets you move the asymptote of the retention line higher and higher
● Optimising for power vs marginal users
○ When building a product/seeking market fit, optimise for the power user
○ When seeking growth beyond the power user, optimise for marginals

Tactics
● Users will not beat a path to your door
○ You must work to get users
● Internationalisation is important
○ FB intl’d too late
■ FB clones everywhere in the world
■ Knocking down clones is very difficult
■ Hit a brick wall at 50 million users
■ Growth team was formed
○ Even though they were late, they took the time to build it in a scalable way
 ■ Wrapped all strings in the site in FPT, FB’s translation engine
■ Opened community translation options for professional+community
translators could work on it
■ 70/104 languages were community contributed
■ Language priority was important too
● Started with French, Italian, German
● But today these are the lowest no. of users
● Luckily FPT + community allowed FB languages to scale
anyway
■ Negative demonstration: Uber
● Kicked out of many markets because expansion was too rapid,
not localised enough
■

Virality

PFC
● Think about virality in terms of 3 things
○ Payload
■ How many people can you hit with each blast
○ Frequency
■ How many times can you hit someone per blast
○ Conversion rate
■ % of people who came onboard
● Hotmail added a link to bottom of every email ‘sent with hotmail, get free email here’
○ Payload was low (1 to 1 emails sent)
○ Frequency was high (lots of email sent)
○ CR was high (great product)
● Paypal used ebay as a vehicle for viral marketing
○ Payload was low (1 to 1)
○ Frequency was low (people don’t get paid that often)
○ CR was SUPER high (you got paid! That’s the magic moment!)
● Frequency and conversion rate are related
○ Hitting someone with the same ad again and again lowers conversion rate

K-factor
● K-factor = i * (c1 * c2 * c3 * ….)

○ Where i is average number of new persons invited per customer

○ c is % of people who get onboarded at every step
■ E.g., c1 is % of ppl who opened the link
■ C2 is % of ppl who registered
■ C3 is % of people who activated their accounts
● if k-factor > churn, more users come than users leave, and your product is going to
have exponential growth
● if k-factor = churn, the virality only compensates the churn, and the number of users
will be stable
 ● if k-factor < churn, the churn of users is not compensated by the virality and audience
of the project will gradually decline
● Virality/k-factor fluctuates
○ Use paid channels (adwords, FB) to stabilise growth rate
○ Virality for big wins

SEO

Keywords
● What do people search for?
● How many people search for it?
● How many other companies are ranking for it?
● How valuable is it for you?
● Optimise using Google keyword planner tool

Backlinks
● Get valuable links from high authority websites
● Distribute love within your site by internal links
● Internal site directories are great
● XML headers

Email
● Delivery is most important, then open/click rate
● Dead for people under 25
● Instant messaging is far more powerful
● Take note what servers your email is being sent on
○ Dirty IPs will send you straight to spam
● Newsletters are stupid
○ The messages for a 3 year veteran user and a newbie are different
○ Notification emails are far more important
■ As a FB veteran, you don’t want to receive emails/SMS for a new like
■ But a newbie or low engagement person would love to know about the
likes they get

A violently executed okay plan today is better than a perfect

one tomorrow.

Chapter 6: How to Build Products Users Love

(Kevin Hale)
● Growth is simple
○ Conversion rate vs churn
○ The gap between the two shows how much you will grow
 ● The motivations to get to a billion dollars are the same as the first dollar
● Kevin built wufoo, a friendly contact form builder
○ Acquired by surveymonkey in 2013
○ Only raised about 100k USD
○ Exited at 35M USD
○ Profit: 29561% (LOL)
○ What did they do differently?
● They were fanatical about creating meaningful relationships with users
○ New users: dating, existing users: marriage
○ First impressions matter
● First kiss, how you proposed
● No free pass if your date picks their nose
● But married couples shrug that sort of thing off
■ Same with companies
● Make all your ‘first moments’ memorable
○ First emil
○ Account creation
○ blank/starting interface
○ Login link
○ Ad link
○ First customer support

Dating (First Impressions)

● Japanese 2 marks of quality
○ Taken-for-granted quality
■ A good pen can write well
○ Enchanting quality
■ The way the pen feels, the way ink flows, etc.
■ The little details matter
■ What’s the user’s first emotion as they interact with this?
■ Little tweaks and quirks of the product make people fall in love

■
● Companies tend to have beautiful marketing and horrible user guides
 ○
○ Opportunities exist even in seemingly boring avenues for product delight
■ Mailchimp switched user guide document covers to look like magazine
covers
● Readership went up, support calls went down
■ On Stripe, if you’re logged in, the API example code already has your
API keys filled in
■ When Wufoo wanted to launch their API, they didnt do a hackathon
● They gave out a custom battle axe (lmao)

Marriage (Existing Users)

● How do relationships work in the long term?
○ Short term conflicts can indicate long term durability
○ All couples fight and it’s about the same things as companies

○
 ● Engineers/software devs do not often feel the consequences of what they build
○ How do we fix the feedback loop, so even the technical team is accountable
for the user experience?

Support Driven Development

● Things that screw up relationships
○ Criticism
■ The support sucks, you’re not helpful at all
○ Contempt
■ Purposeful insult
○ Defensiveness
■ Trying not to take responsibility
○ Stonewalling
■ This is the worst
■ Straight up ignoring customer request
● Wufoo built empathy into their support forms with an ‘Emotion’ drop down field
○ This was an optional field, but was filled >75% of the time
○ Indicates that a user feels that their emotional state was just as important as
their technical details
○ An outlet for emotion allowed users to vent
○ People started being nicer - use of curse/caps/exclamations went down
● Make sure everyone does customer support
○ Responsible devs and designers give the best support
○ Once a dev hears the same problem 2-3 times, it gets fixed
● Everybody in Wufoo did customer support (sometimes with day shift rotations)
○ 500,000 users got support from 10 people
○ Support time was about 7-12 minutes during working hours
●

Direct Exposure
● More exposure to users produced better software
○ Sharing support duties is a great way to do this
○ Direct exposure every 2 weeks for at least 2 hours is best
● Knowledge gap is the gap between your user’s knowledge level and the minimum
required to use your app
○ You either educate the user well
○ Or lower the barrier of entry
■ Great help/documentation
■ Contextual help pages
■ Make the app simpler to get going with
● For Wufoo, Great UX and support meant
○ Support requests grew slowly compared to user count
○ Lower churn rate
○ New user increased
○ Team size remain small (this also means everyone gets more equity)
○ Culture maintained
Relationships Atrophy
● Relationships need work
○ AND you need to show-off that work
○ Newsletter and blogs showing off new features are not very effective
● Wufoo introduced Alerts, which show new updates (work done) when a user logs in
after a while
○ Users felt grateful because the team appeared to be working for them all the
time

○
● Every Friday, Wufoo team would write handwritten thank you notes to users
○ Humanises the company
○ Retention is way better

Chapter 7: How to Get Started, Doing Things that

Don't Scale, Press (Stanley Tang @Doordash,
Walker Williams @ Teespring, Justin Kan @
Twitch)

How to Get Started (Stanley)

● Went from idea to website in an hour
● Started paloaltodelivery.com
● Customers streamed in 100% organically
● Only began to scale when demand began becoming crazy
● Keep asking for feedback, do the dirty work yourself for as long as possible
● Only scale when you have to

Doing Things That Don’t Scale (Walker)

● Initial user acquisition was very painful
● Getting a small non-profit to buy $1000 worth of t-shirts was a lot of work
● Speed is more important than scalability/optimisation in the early days
○ Teespring split codebase into 2 just to accommodate some enterprise
customers
 ○ Smashed code into duplicate just to ship features to enterprise without
affecting existing users
○ Slowly integrated new core features into original codebase
● Teespring almost died recently, shrank to 30 employees
○ Victim of its own success
○ The power sellers were doing so well that they found economics of doing t-
shirts themselves was better

Press (Justin)

Target Audience
● Press should have a target audience and goals
○ If you don’t have a clear business goal/audience, garnering press is a waste
of time
■ Investors
■ Customers
■ Industry

The Story
● You need a good story
○ Types of stories:
■ Product launches
■ Fundraising
■ Milestones
■ Business overviews
■ Stunts
■ Hiring announcements
■ Contributed articles
○ Think about your story objectively - not everything you do is interesting
○ You don’t always have to be original - just original enough
● Mechanics of a story
○ Think of a story
○ Get introduced
○ Set a date (4-7 days in advance)
○ Reach out (get a commitment to invest in time)
○ Pitch
○ Follow up
○ Launch your news!

Launching
● Ask an entrepreneur who was recently featured by them for a referral
○ Give a week lead time for this
● Executing the launch
○ Write the story in bullet points
■ Memorise it
 ■ When you get interviewed, you will tell it like it is written
○ Follow-up
■ Thanks for meeting
■ Videos/photos
■ Here’s our launch date
● PR firms are of limited use
○ They can get contacts
○ Can’t produce stories for you
○ Expensive
● Getting press is a lot of work
○ Make sure it’s worth it
○ Getting press doesn’t mean you’re successful
○ Press is not a scalable user acquisition strategy
● If you decide press is worth it
○ Keep contacts fresh
○ Regular heartbeat of news (consistency is key)
○ Golden rule
■ Pay it forward. Always.
■ Karma always comes round

Recommended Reading
● Burned out blogger’s guide to PR https://www.amazon.com/dp/B00NFAT238
● Trust Me I’m Lying https://www.amazon.com/Trust-Me-Lying-Confessions-
Manipulator/dp/1591846285

Chapter 8: How to Raise Money (Marc

Andreessen, Ron Conway, Parker Conrad)
● What do VCs look for?
○ Of all the companies receiving funding every year, only 15 generate 97% of
returns
○ Strength instead of lack of weakness
■ If a startup checks all the boxes and shows no weakness, but likewise
has no killer strength, they are unlikely to be in the big 15
■ If they are so good in some aspects, and have tolerable flaws in
others, still worth investing
○ Have the one compelling statement for your product
■ For the investor to picture the product in their mind
■ Practise this like crazy
○ Be decisive
■ Don’t procrastinate on important decisions
■ Part of building a great team
○ Communication skills and leadership are no. 1
○ Be so good they can’t ignore you
■ Willing to tolerate flaws
 ■It’s worth more to make your business better than to make your pitch
better
○ YOUR REPUTATION IS YOUR BIGGEST ASSET
■ That said, you can get a lot done with not a lot of rep
■ But positive rep will serve you well

● Bootstrap as long as you possibly can

● Raising venture capital is the easiest thing a startup will ever do
○ If you have a difficult time raising funds, it means that the work you have to do
on your startup is going to be 10x harder
■ Recruitment, product, etc.

The Onion Theory of Risk

● A systematic approach to thinking about how cash gets deployed in risk mitigation
● A new startup has every conceivable kind of risk
○ Founding team risk
○ Product risk
○ Technical risk
○ Launch risk
○ Acceptance risk
○ Revenue risk
○ Cost of sale risk
● Raising money is a tool to peel away layers of risk
○ More money means you can pay your founding team, building product, recruit
eng team, etc.
○ Those are the true milestones
 ○ The money itself is not a milestone
○ Be very clear what milestones you’re attempting to solve with every raise, and
fundraising will become much easier and targeted

General Advice
● Don’t ask someone to sign an NDA
○ Build trust between parties
● ALWAYS get things in writing
○ Do fundraising as quickly and efficiently as possible
○ But always get things on record
○ Take notes
■ When you meet and agree on verbal terms, do up an email, and ask
for confirmation on what they just said to you
○ Investors have short memories and commitment
● SV Angel on seed raising
○ Invest in 1 mil to 2 mil rounds
○ 1/30 acceptance rate, about 1 new company a week
○ Team votes if company is worth bringing on for a phone call and then a
physical meeting
○ Followed by background checks on company, founding team
○ Following by checks on all other investors in the round
● A16z on series A
○ Most VCs at this stage only look at 2 types of companies
■ Seed raised?
○ Best way to get the attention of series A investors is through referrals from
seed investors or places like YC
● What terms should founders care most about?
○ Finding the right investors
■ YC does a good job telling who those people are
○ Picking the right threshold valuations
● How much equity should the company give away during seed?
○ 20-30% at series A
○ 10-15% at seed
○ Founders should ask at what valuation they get demotivated
● What signs should you avoid an investor
○ No domain expertise
○ No rolodex
○ Choosing an investor is like marriage under great stress and anxiety
● What constraints do investors have when bringing companies in?
○ Opportunity cost
■ Every investment made rules out conflicts
■ One investment locks out that category
■ Time and bandwidth of general partners
■ GPs could have done other deals over that time
Chapter 9: Hiring & Culture (Airbnb, Stripe,
Pinterest)
● The most important thing when maintaining company integrity for scaling
● What is company culture?
○ Every A and B of each member of the team in pursuit of our company C
■ A = assumptions, beliefs, values
■ B = behaviours, actions
■ C = goals, BHAG, mission
● Why does this matter?
○ First principles
○ Alignment
○ Stability
○ Trust
○ Exclusion
○ Retention
● How to establish core values
○ What values are most important to you?
○ What are the most important values for business success?
○ What do you look for in employees?
○ What could NEVER be tolerated?
○ Remember to incorporate your mission into your values
● Company values must have depth
○ Honesty, service, teamwork DON’T CUT IT.
● Elements of high performing teams

○
● Best practices for culture
○ Incorporate your mission to your values
○ Think harder and deeper about values
○ Interview from cultural fit
○ Evaluate performance on culture as well
○ Make culture a daily habit
Q&A with Airbnb
● How did you realise culture was important at Airbnb?
○ I found 2 great teammates who I admired
○ Great shared way of working and doing things
○ Mission was very clear
○ Bringing that mission to the whole company was important
○ Looked at big companies, Apple, Amazon, Nike
○ Even looked at nations
○ All had strong declarations and values to endure the test of time
● What did you learn about Culture from Zappos?
○ 3 or 5 unique values from every other person
○ Wrote down core values before hiring anyone
● Why did you take 3-5 months to hire your first engineer?
○ It was like bringing DNA to the company
○ There would be 1000 more people like him/her that would join the company in
the future
○ Diversity of background, age, gender etc.
■ But no diversity of values
● On what basis did you hire
○ All about the mission
○ Not just about putting people in rooms when travelling
○ It’s about bringing people together, so you can belong anywhere
○ “If you had 10 years left to live, would you join this company”
○ Looking for people that are looking for a calling
● Remaining scrappy frugal and creative
○ It’s easy to lose that scrappiness once you’re big
○ Reminder as part of core values to always be creative and not rest on laurels
● How did culture help you make important decisions?
○ Clarity of decision
○ Promise to only hire world-class with cultural fit was natural
○ Rocket Internet attempted to copy and destroy Airbnb with high raise and
aggressive hiring
○ The logical thing was for Airbnb to buy them or risk getting destroyed by them
○ Brian felt they were mercenaries just for the money, while Airbnb were
missionaries
○ Chose not to buy and maintain integrity with core values
● Culture and brand are two side of the same coin
○ Whatever happens inside the company bleeds into your external image
○ Brand is your connection between you and your customers
○ Strong culture can be a brand in and of itself
○ Apple decided that the way to sell computers wasn’t to talk about bits and
bytes
■ It was to talk about values (Think Different Campaign)
■ We believe in these passions and values
■ If you buy our products, you believe in these too
■ Avoid being a utility
● How do you know how to communicate this early in the days?
 ○ Early on Airbnb pitched itself like a utility
○ Changed to ‘travel like a human’
● How did you make sure the hosts enforce culture of Airbnb?
○ Anybody should be able to use Airbnb
○ Implemented the Superhost program
■ Hitting milestones and providing great service earns superhost status
■ Grants perks, better rates, visibility
○ Organised host conference on reinforcing values
● Open source community?
○ Airbnb thought it could be proprietary technology
○ But they also wanted to keep their tech open
○ Instead they made their defensibility about service
● Be loved instead of liked
○ 100 people loving you is better than 1m liking you
○ The 100 people are your own viral marketing
■ To get these 100, do things that don’t scale
■ Airbnb went out manually photographing everybody’s homes for a
better experience

Q&A with Stripe and Pinterest

● What are the most important pieces of culture in your compmanies
○ Pinterest
■ Hires
■ What do we do everyday
■ What we choose to communicate
■ What we choose celebrate
○ Stripe
■ Transparency internally
■ If everyone is aligned at a high level, and everyone has good access
to info and current state of stripe, big step towards working
productively
■ Culture is a resolution of a bandwidth problem
● You can’t make decisions for hundreds of employees
● Culture allows you to spread strands into getting all employees
being aligned
● What did you look for when hiring the first 10 to get culture right?
○ Pinterest
■ Who do I want to work with, and I find talented
■ It’s not architecture, it’s gardening
● Planting seeds and removing weeds and letting the garden
grow
■ Worked hard, high integrity, low ego
■ People with quirks outside of being good engineers
■ Wanting to build something big
○ Stripe
■ Biggest influence on the company
 ■ Their friends will tell them not to join
■ Had to find people who were undervalued
■ Biggest similarities with first 10
● Genuine and straightforward
● Deep into finishing things
● Cared a great deal (offended when something was off)
■ Takes a long time to recruit people, so getting people around you
excited early is important
● How do you tell someone is good?
○ Difficult to discern for categories you don’t have expertise/taste in
■ Must establish what makes someone world-class
■ Ask an already world-class person what defines characteristics in that
area
○ Important to be transparent about the vision, why the company is good
■ Lay out the gory details of why it’ll be hard
■ Weeds out candidates
○ Work with the person as much as you can
■ Usually for a week on small project
○ Look for references
■ Important to know what this person was like to work with
● What do you do to make someone effective ASAP?
○ Pinterest
■ When small, it was about setting up their PC, getting them up to speed
ASAP
■ Getting to know the person more deeply happened naturally, having
spent time together in a scrappy company
■ When bigger, it’s a UX exercise to onboard new people
■ What does the person see, who they meet, what they start by doing
○ Stripe
■ Get them coding/in meetings on the first day
■ Push people off the cliff on the first day
■ Give people feedback on how they’re doing adapting to the culture
● How do you convince people to join you when success is not guaranteed
○ Stripe
■ People often join BECAUSE its not guaranteed
■ Appeal to them on a personal development angle
■ Startups are a great place to benchmark impact and contribution
○ Pinterest
■ No one is under the illusion that you will 100% succeed
■ If they are afraid of this, they’re not as intelligent as you think
● How has your user base affected your hiring strategy?
○ Pinterest
■ Ambition about the mission is most important
■ They don’t need to be lifelong power users
■ If they’re not currently users, it’s good to bring them on so they can
remove the barriers they faced
○ Stripe
■ We hired 4 Stripe users early
 ■ They understood the product right away

Chapter 10: Building for the Enterprise (Aaron

Levie, CEO @ Box)
● Look for underlying environmental factors that are set to change drastically
○ For Box, the price of storage was dropping significantly
● Box fell into the trap of
○ Over-serving consumers (free tier)
■ How do you monetise?
○ Under-serving businesses
■ Insufficient security
■ Enterprise capabilities

The State of Enterprise

● Enterprise IT market size is several orders of magnitude larger than mobile apps +
digital marketing/ads
○ Enterprise is less concerned with dollars and cents vs. improving
performance
● Enterprise software was unsexy and slow
○ Building it it slow to prevent customer breakdowns
○ Sales are slow because of long deal-making process
○ No love and care for design and UX
● Enterprise software has changed drastically
○ Cloud computing
■ AWS put together lots of servers available on demand
○ Compute power is cheap
○ Standardisation of enterprise software lets companies go after small startups
and giant MNCs
○ Easy internationalisation
○ User-led instead of IT department dictated
● 2 billion mobile phones and growing
● 3 billion users online and growing
● Examples of spaces suited to new innovation
○ Multi-channel retail experiences
■ Online, mobile, physical, delivery
○ Personalised healthcare
○ Media creation and distribution

How do you get started?

● Spot technology disruptions
○ Look for new enabling tech that creates a gap between how things have
been done and can be done
 ○ What has a drop in price/complexity of technology allowed you to do now that
didn’t work 5 years ago?
○ EXAMPLE: PlanGrid realised construction industry was printing $4b worth of
blueprints, and decided to augment that with cloud and mobile
● Intentionally start small
○ Find a natural wedge - simple and small. A gap in current solutions that a
customer would want a discrete solution for
○ Expand over time
○ If people call it a toy, you’re onto something
○ EXAMPLE: Gusto, SaaS for payroll. Now moved into HR, benefits, etc.
● Find asymmetries
○ Do things that incumbents won’t do because they are not
economically/technically feasible
○ Be platform agnostic compared to incumbents who can’t adapt to all
competitor software
○ Monetize customers from a unique perspective that would be too expensive
or too small for a big company to pursue
○ EXAMPLE: Zenefits HR software targeting benefits for small businesses.
Earns money from insurance commissions
● Find almost-crazy outliers
○ Live in the future, and figure out what’s missing
○ EXAMPLE: Skycatch does enterprise data collection with drones
● Listen to customers
○ But don’t build what they tell you - distill their requests into what they need
○ EXAMPLE: Palantir takes in unclear customer data requests, distills into key
valuable insights
● Be modular, not customised
○ Don’t customise and be bespoke to each company
○ Difficult to maintain
○ Think about pluggable modules instead
○ EXAMPLE: SalesForce
● Focus on the user
○ Keep consumer DNA at the core of your product
○ Makes adoption easier
● Product should sell itself
○ Sales is important to navigate and close deals, but a great product is still key

Chapter 11: How to be a Great Founder (Reid

Hoffman @ LinkedIn)
● Founders are often seen as superwoman/man
○ Many skills, abilities, element of divinity
● Truth is that founders have to deal with a multiple of headaches
○ One hopes to have a few unique skills
○ Competitive edge is important
Questions for Founders
● How do I put together a founding team?
○ Best to be on a team of 2 to 3
■ Solo is not ideal
■ Compensate for weaknesses
■ Tackle diversity of problems
● Where should I locate my startup?
○ Seek the networks that best fit your endeavour
○ Groupon wouldn’t have worked in SV
■ SV people are adverse to massive sales forces
● Should I be contrarian?
○ Find something that smart people disagree with you on
○ What do I know that other people don’t?
○ Critics said LinkedIn wouldn’t work because of the vast amount of network
effects needed to get going
○ LinkedIn knew that he could leverage different sets of interests to get people
on board to try the product in a short span of time
● When should I do the work vs. delegation?
○ Sometimes one, the other, or both
● Should I be flexible or persistent?
○ When should I be either?
○ You should have an investment thesis to decide this
■ Why you think this is a good idea
■ What you think you know but other people don’t
■ Are you increasing in confidence for your investment thesis?
■ If decreasing, find out what is causing the decrease, and form an
immediate action plan
● Should I be confident or cautious
○ Confidence in your own ideas, but be smart enough to listen to sharp
feedback, criticism, competitive entries
○ Is this changing my investment thesis?
○ How do I adapt?
● Should I focus internally or externally?
● Should I work by vision or data?
○ Data only exists within the framework of a larger vision
○ Measure what you need to move towards a vision
● Should I take risks or minimise risks?
○ Taking calculated risk is part of business
○ But minimising risk within that framework is one of your most important jobs
○ Aka optimising chances of success
○ Start with the thesis
■ Is every step we take increasing or decreasing confidence in the
thesis?
● Should I focus on long or short term?
○ Daily/weekly todo lists have to play towards a larger path
● How do I know I’m a great founder?
○ Helps to be a great product person
 ○ Leadership at bringing networks and persuasion
○ Recognising macro view if you’re on track
■ Paranoia vs. confidence
● There is no single skill set
○ Ability to continuously learn and adapt
○ Take in input from multiple sources
○ Creating networks around you

Q&A with Reid Hoffman

● How did you target the early adopters that would strengthen LinkedIn
○ Our strategy won’t work today
○ Too much noise today
○ Strategy today has to be standing out from the crowd
● How do you know someone’s a good founder?
○ I believe in references the most
○ Insight into someone before they show up is often the best way
● The ability to say coherently what you’re targeting - a focused sentence - is important
○ Level of clarity and articulation is key to being a good founder
● How did LinkedIn remain persistent throughout hard times?
○ Kept returning back to thesis of wanting professional profiles for everyone
○ No one is getting closer to it than they were
● What are the ways of being fooled into thinking a founder is good when they’re
actually rubbish?
○ I like to push on someone’s idea, and see if they’re able to remain flexible and
persistent on it
■ “I stand by this idea, but i’m listening to what you’re saying”
● What makes a great co-founder team, how to evaluate?
○ Collaborate really well, do they help each other get to truth?
○ Collective learning makes great teams
○ Do you have diversity of strengths across the skills that are useful
● Different founders, different areas, how do you identify them?
○ What’s common across all great ounders?
■ Software needs speed
■ Hardware needs accuracy
○ Domain-specific founders
■ Attributes that are unique to domain
■ E.g., operational efficiency and cost control is important for commerce
■ for digital game startups like Zynga is not as important
● When should you stay when something is taking longer than it should? (When to
pivot)
○ Confidence in investment thesis
■ Unmeasured or decreasing for a long time
■ Intense phase to try and increase confidence
■ Increasing fails
■ Time to pivot
○ Founders have no balance
 ■ Intense, lopsided focus for periods of time are necessary
● Creating markets vs. discovering them?
○ Creating a market is usually either completely worthless or a big opportunity
■ What about my investment thesis can tell me whether this is a good
opportunity or not?
● How do you know you trust someone enough to be a cofounder
○ It’s a risk
○ Establishing at least 20 hours of conversation and time spent together
○ What would tell me this isn’t working?
■ Hash this out and converse about it

Chapter 12: How to Operate (Keith Rabois,

Khosla, Square)
● Building companies is harder than products
● Company building starts from a lovingly drawn-out plan
○ Plan when put into practice is never as clean, held together by people
working 100 hours a week
○ Eventually one wants to build a high performance engine, able to operate
without much oversight
○ “If martians took over ebay, no one would notice for quite a while”
● A manager’s output = output organisation + output neighbouring organisation
● Triaging
○ Company begins in mess and chaos
○ If there aren’t new problems and challenges everyday, it means you’re not innovating
or creating fast enough
○ The idea here is that you’re triaging
○ Discerning colds from pneumonia, figuring out where priorities for problem solving lie
● Editing
○ Simplify and eliminate
■ The more you simplify, the better your team will perform
■ Easily understood > complexity
○ GOAL: reduce amount of corrections/interjections needed to keep team on track
■ It’s okay to need to make lots of corrections on a bad day
■ But this should reduce month to month, quarter to quarter as the company
gets tighter

● Clarify
○ Ask a lot of question to seek clarification
○ Clarifying makes sure the problem statement is clear, everyone is on same page
○ Improves overall performance
● Allocate resources
○ Moving your resources around to favour the landscape
○ Initiatives to new resource allocation can come top down
○ But ideally they should come bottom up
○ Employees seek initiative to do new and useful things, which you then approve as an
editor
● Ensure consistent voice
○ Make sure all external/internal media sounds like it was written by one person
 ○ Keep the tone of the company consistent
○ Apple is one of the best at this
● Delegate
○ Abdicate vs micromanagement
○ You do not do most of the work, but you are responsible for all of it
○ How to manage without abdicating?
■ Task-relevant maturity framework
■ If someone has low maturity, needs more hand-holding
■ If someone has done this a lot, monitor and set high objectives
○ A leader cannot have a single management style
■ Style is dictated by employee, and matters what make that employee most
effective
○ How to decide when to delegate or take control?

○
● Edit the Team
○ Increasing worker count is not always the best way to increase work done
○ Barrel analogy
■ Most people (even great employees) are ammunition
■ More ammunition is great, but rate of fire is limited by number of barrels
(people who channel and increase throughput)
■ Velocity of company increases when you have more barrels and stock them
with ammunition
■
● Scaling

○
○ Note employee personal growth rates vs company growth rates
○ Only keep employees who can keep pace with the company
○ If employees can outpace the company - good! Keep them in new roles constantly
● Insist on Focus
○ Keep employees focused on some very key roles, don’t stretch them thin
● Metrics & Transparency
○ In order for you to not to have to make all the decisions, provide tools so that
everybody can see and make decision for themselves
 ■ Build an internal dashboard that tracks metrics that are in line with company
goals
■ Monitor usage of the dashboard - make sure it’s intuitive, useful and
empowering
○ Make sure all meeting notes and metrics are available to everyone in the company
○ Compensation should be open as well
○ Gathering information by pairing indicators: measure effect and counter effects
■ Release criteria vs ship date
■ Number of hires vs quality of hires
■ Loss rate vs false positives
● Building positive work environment + insisting every part of the company meets standards
○ Ensuring receptionist answers the phone properly
○ Serving good food
○ Working on small things - taking distractions away from employees is one of the key
roles for a COO
● Effort
○ Lead by example

Chapter 13: How to Manage (Ben Horowitz)

● When making a critical decision, you must understand how it will be interpreted from
each person’s point of view, and their perspective as a whole (culture)

Demote or Fire?
● Executive is great, works hard, well-liked, but not world-class at running his function
○ CEO thinks
■ Tough to fire a great employee
■ Demotion is good cus you can keep him
■ No cultural backlash
○ Exec thinks
■ Doesn’t want demotion, but provides an option
■ Saves embarrassment of getting fired
■ Able to keep growing with the company
○ Everyone else thinks
■ Does he keep the same equity package?
■ Is he gonna work as hard now that he reports to someone else?
■ Do I have the same respect now that he’s demoted?
● The real questions here are:
○ What does it mean to fail on your job?
○ What does it mean to maintain your equity?

Excellent Employee Asks for Raise

● CEO thinks
○ Want to retain them
○ They did great job, it’s fair
○ They will like you if you give them the raise and you want to be liked
 ● Employee thinks
○ WOOHOO MONEY
● Everybody Else
○ Unfair that I didn’t get a raise
○ I did better work, so doubly unfair
○ Maybe I should quit
● Conclusion
○ Everybody feels a responsibility to ask for a raise personally
○ Encouraging behaviour
● Right answer
○ Formal performance evaluation process
○ All the right inputs
○ Run evaluations as frequently as possible
○ No raises outside of the process

History’s Greatest Practitioner

Toussaint L’Overture
● Born an african slave
● Wanted to end slavery, take control of Haiti, make it first class
● Soldier’s perspective
○ Do we get to pillage? We enjoy pillaging
○ If they get to kill us, we should get to kill them
● Culture
○ He banned rape and pillaging in his army to protect the resultant culture
○ Toussaint wanted a first-class culture
○ He believed Haitian culture was inferior to European, and slave culture the
worst of all
■ Whenever he defeated a European power, he would capture and
make their leaders his generals

Dealing with Slaves and Slave Owners After Victory

● Slave perspectives
○ Free us, we fought for this
○ Kill the owners
○ Give us their land
● Toussaint perspective
○ Economy is important, and productive plantation are important
○ We’re mostly slaves
○ We don’t have the expertise to run sugar plantations
○ We earned that land
● Slave owner perspective
○ Our business is predicated on slave labour
○ We paid a lot of money for the slaves
○ We paid for the land
○ We have all the skill and relationships, so you have to deal business with us
 ● Solution
○ End slavery
○ Let the slave owners keep land
○ Require plantation owners to pay salaries to workers
○ Lower the plantation owner taxes so they can keep business going
● Result
○ Only successful slave revolution
○ Let plantation owners keep land
○ Booming economy
○ Under Toussaint, Haiti had more export income than USA
● Conclusion
○ Seek perspectives of the people not in the room
○ Think of the company
○ Think of the culture

Chapter 14: Great User Interviews (Emmett Shear

@ Twitch)

Twitch Story
● Started with Kiko Calendar which was built without talking to any users - did not even
use calendars themselves
● Then built Justin.tv which they used themselves, so they could get away with not
talking to other users
● Could not figure out how to scale justin.tv beyond their narrow use case
● Pivoted to Twitch, at which point they had to learn about video game broadcasting
● Determined that broadcasters were the most important users
● Gathered feedback from existing broadcasters on Twitch.tv
○ Feedback was consistent, clear, led clear feature requests
○ People wanted small features like banlists, removal of trolls, polls
○ Emmett argues if they are willing to put up with these problems and still use
the platform, these problems are not the highest priority
● Instead, gathered feedback from broadcasters on competitor platforms
○ Feedback was completely different
○ People wanted revenue sharing, better video service, stability
● Gathered feedback from non-broadcasters who want to broadcast
○ This is the most important, as they are the people you want to bring on
to expand the size of the market
○ Feedback was different again
○ People say PCs aren’t fast enough, not enough time because training,
publishing strategy online was bad for competitive teams
○ Led to the team trying to make broadcasting more accessible
■ Building Twitch into Xbox, PS4,
Conducting the Interviews
● Who you talk to is as important as the questions you ask
● Where do you go to find target users?
● Initial questionnaires should not focus on specific user flows or features
○ These are distractions
● Listen out for big blockers - is there something inherently wrong with the way people
feel about it?
● Identify one key feature that puts your new product one level above the competition
● Next ask yourself - is it worth it? Is this worth building into a product?
● Validation can happen 2 ways
○ Actually build it (if you’re good at code)
○ Draw out diagrams/work flow and show it to people
■ Don’t fall into the trap of asking ‘is this feature good or not?’
● People will usually say its gr8
■ Can get them to pay for it up front - money where your mouth is

Q&A
● What are the most common mistakes?
○ Don’t show people your product. It’s like telling them the feature to look at
○ Talk to people you need to, not the people you have access to
● How hard is it to get buy-in from the rest of the company to build something?
○ Record and show your team the interviews
● Do you insist on Skype interviews or email?
○ Avoid email interviews, as the best parts of the an interview usually come
from questions outside of the script
● What about reaching people in intl market to do interviews?
○ Twitch admittedly still works best in english speaking countries
○ Tried to solve this by hiring Korean speaking folks, translators, etc.
● What channels did you use to reach out and did you compensate?
○ On-site messaging systems
○ Events
○ No compensation
● What about on-site user feedback on the product?
○ It’s great for testing a product pre-launch
○ It doesn’t tell you what to build next
● What makes good user feedback?
○ Want to learn about what user is really thinking
○ Problems, get to know them as a person
○ Don’t colour their opinions with your influence

Chapter 15: How to Design Hardware Products

(Hosain Rahman @ Jawbone)
● Started straight out of school
 ● Developed core technology, built products around that
● Started with headset that became a wearable computer
● Kick-started wireless audio space around bluetooth
● Focus should shift away from vast system of internet of things
○ Focus on the users - personal wearables
● To do this, you need to be great at the full stack
○ Hardware
○ Software
○ Services
○ Data
● All these verticals require different skills and disciplines
○ Initial merge of hardware and software created friction within the company
○ Software used to moving fast, hardware iterations slow
○ Hardware team needed to learn to move fast, software team learnt to focus
on experience before shipping

Product Development Flow

● How does Jawbone create?

● Exploration
○ Building and tinkering
○ Demo Fridays, show and tell
○ Hackathon, using data and insights to think big
○ Unbridled imagination
○ R&D team leads this charge, but everyone is free to join in
○ Executives act as a sounding board to provide guidance
○ REQUIREMENT TO MOVE INTO NEXT PHASE
■ Would CTO put $50k into this project to ‘angel invest’ in them?
● Early validation
○ Checking for robustness of concept
○ Meetings with development managers
○ Use scientific method
■ Feasibility
■ Data and insights
 ■ Hypotheses
■ “Hero experiences”
○ R&D team lead, different depts help with feasibility studies, business cases,
user interviews
○ Executives prioritise emerging concepts and approve budget
○ REQUIREMENT TO MOVE INTO NEXT PHASE
■ Fits into our strategic vision
■ Is it technically feasible to make now
■ Business viability
● Concept
○ Defining the Whys and features
○ Use tools like
■ Storyboards
■ Interaction models
■ User research
■ Hero experience
■ Pitch videos
■ Data and insights
○ Lead by product experience team
■ Supported by hardware/software engineers for feasibility and problem
solving
■ Also by product management team for business use cases
○ Executive team helps imagination/ideation process, determine if idea has legs
○ REQUIREMENT TO MOVE INTO NEXT PHASE
■ Highly resolved whys
■ Clear differentiation strategy from competitors, other company
products
■ Product road map
● Planning
○ Making business plan
○ Building story
○ Quarterly forecasting
○ Retail calendar
○ AOP
○ Tools used
■ Early prototypes
■ Feasibility documents
■ Functional, inspirational briefs
■ Data and insights
○ Lead by product management team
■ Supported by all other depts
■ Sales and marketing team set timeline
■ Finance team lays out capital and forecast
○ Executive team decides trade-offs and signs off on plan
○ REQUIREMENT TO MOVE INTO NEXT PHASE
■ Prioritised features
■ Minimum functionality bar
■ Business plan and product roadmap
 ● Development
○ Continuation of planning phase
○ REQUIREMENT TO MOVE INTO NEXT PHASE
■ Design sign-off
■ Engineering sign-off
■ CEO sign-off
● Continued innovation (post-launch)
○ How to deepen and broaden engagement
○ Continue to increase value for users
○ New ways to tell stories
○ Driven by retail calendar, sprint cycles
○ Tools used
■ Feature briefs
■ UI screenshots
■ Marcomm briefs
■ Data and insights
○ Lead by product management team
○ Executive team provides guidance on goals and strategies
■ Also approves only Jawbone-standard output

The Experience Framework

● Whys
○ What is the core user problem?
○ That once we solve, users can’t live without?
■ For Jawbone, the introduction of a $199 speaker for your mobile
phone was unthinkable to a regular user or focus group
■ But once released, it dominated 78% of the market
● EXAMPLE: Audio experience
○ My content isn’t as mobile as it could be
■ It’s all concentrated on my mobile
○ The content should be seamless across time and space
○ For Jawbone, speakers were the way to get into homes and become the hub
of service and software
● Experience Continuum
○ How to flow users into a ‘future world’
○ Allows thinking about feature trade-offs
■ If we can’t add feature to current gen, users will be ready for it when
next gen comes
○ TODAY
 ■ Beautiful portable speakers that seamlessly sync music content
○ TOMORROW
■ Introduce occasion-based listening experiences that reinforce
portability, extensibility, social engagement through hardware,
software, services
○ FUTURE
■ Full ecosystem of aware, autonomous products
■ Adapt to user’s environment, habits, audio sources
● It’s all about creating experiences, not just hardware

The Whys of Up24 (Minimalist fitness tracker)

● Real-time feedback to track and achieve goals today, rather than try to do better
tomorrow
● Understand my data in a more meaningful, timely way to make the value obvious
● I need guidance and structure on motivating activities to keep me going
● I want ongoing encouragement and validation
● I want a fluid/frictionless way to log activities, to never ‘miss’ a sleep

Q&A
● How do you communicate or check for trade-offs across the company when you’re
focusing on one vertical?
○ When you start small it's easy
○ When big, you have to force communication
○ Everyone has to share their pains so you can balance priorities across
different silos
○ Always refer to the original vision board of the product
○ Does the product still meet those requirements?
● If a startup wants to build an ecosystem, where to start?
○ Almost everything we build is a system
○ Even the standalone app is a system
○ Still about trade-offs between verticals to get the best product
● How to decide when to expand?
○ Some of it is planned
○ NA > Europe > Asia
○ Some of it is opportunistic
■ Great partner
■ Strong cultural fit
■ Partnership with Apple store
○ Manufacturing took place in China
■ Gradually had their own Chinese team on the ground
● Do you run Jawbone like a hardware or software company?
○ Merging both is difficult
○ We’re not following any example model
■ Likely not been done in this way before
○ Trying to merge different disciplines is both fun and painful
 ■ Need to cherry pick the best parts of both disciplines and come up
with their own model of what works

Chapter 16: Legal and Accounting for Startups

(Kirsty Nathoo, Carolynn Levy)
● Boring but necessary to know the broad picture
● Will save a lot of pain, money

Formation
● Keep it simple
● Form a separate legal entity to prevent personal liability
● Delaware is the best place to form corporations
○ Standardised, clear, familiar
● How do you set that up?
○ Fax paperwork to Delaware
○ Sets up a shell company
○ Everybody must have titles for CEO, president, secretary, etc.
○ Be clear about the split between you and company as separate identities
● Can use law firms and online services
○ YC uses Clerky to incorporate
● Keep signed documents in a safe place
○ If big funding round, acquisition, THIS IS SUPER IMPORTANT

Equity Allocation
● How to divide the pie?
○ Ideas alone are worth nothing
○ Execution is worth most of all
○ Should probably be split equal among co founders
■ Disproportionate split is a red flag
■ Are founders not revealing any bad blood/ill feelings?
■ Honesty about expectations for the future
○ Look forward, not backwards
■ Is everyone in it for the long haul?
■ Everyone should be in it 100%
■ Doesn’t matter about who did code, education, idea, etc.
■ If moving forward, everyone is 100% committed, an even split is
natural
● Even as a founder, you must attain your shares from the company (a separate entity)
through a stock purchase agreement
○ Two-way transaction
○ Usually in the form of cash/stock payments over time in exchange for IP,
code, inventions that the company now owns
○ This stock is referred to as being restricted
 ■ It vests over time
● Restricted stock involves a VERY VERY important document
○ 83b election affects individual and company taxes
○ Not doing this document properly can blow up deals
○ Keep proof-of-submission or investors may walk away if the paperwork
disappears

Vesting
● Earning the personal ownership of the shares over time
○ If you leave before the vesting period is over, the company will get unvested
shares back
● What should a typical vesting period be?
○ Standard in SV is 4 years with a 1 year cliff
○ After 1 year, the founder owns 25% of his shares
○ The remainder vest monthly over the next 3 years
● What happens when a founder leaves before vesting period is over?
○ If founder leaves before a year, they get nothing
○ If they leave after a year, company repurchases the remaining 75% at
whatever share price the founder paid for it
● Why would you have vesting?
○ Keeps founders committed to the company
● Should solo founders have vesting?
○ Yes, skin in the game still applies
○ If an investor is brought in, they will also have vesting
○ Not fair that the founder has no vesting then
● Vesting sets the tone for the company - everyone is in this for the long haul

Fundraising
● Two ways to raise money
○ Priced or non-priced rounds
● Seed round = price not set
● Series X round = price set
● Non-priced rounds is the fastest way to get done
○ Conducting through convertible notes or safes
○ Basically a smart contract which dictates the amount of shares an investor
receives at the end of a priced round
○ Basically this investor is not yet a shareholder, and will have fundamentally
different rights
● Investors at such an early round want something in return
○ That’s where the valuation cap comes in
○ For a seed round, an investor might come in at $100,000 at a 5 mil cap = 2%
of the company
○ At a later priced round, where the valuation of the company is set at 20 mil,
original investor gets 20/5 = 4 times as many shares as a new investor at that
round
 ● Can use Clerky again for fundraising docs
● Future dilution is something that founders must think about before giving away
shares willy nilly
● Investors must be sophisticated
○ Must have enough money to invest
○ They must understand that startups is a risky investment
○ “Accredited investors”
○ Investors who want money back later is a problem

Investor Terminology
● Board seat
○ Sometimes investors will ask for a seat on the board
○ Most of the time you want to say no
○ Be very sure the investor is someone who brings a lot of value to the table
○ If someone can help with strategy and direction for real, that’s priceless
● Advisors
○ So many people want to give advice, but few give good stuff
○ All investors should be advisors by default, with no additional returns
○ If they’re already invested in the company, they should want it to do well
○ Asking for more shares/money is a red flag
● Pro rata rights
○ The right to maintain your % ownership by buying more shares in the
company in the future
○ Allows one to prevent dilution on their own shares in the company
○ A common request from investors, not necessarily a bad thing
○ As a founder, you MUST know how this works
○ Key insight: for an investor to maintain pro-rata right, it means the founders
likely have to suffer more dilution
● Information rights
○ Investors want rights to know information about your company
○ Periodic updates to investors is a good thing
○ Avenue to ask for help from investors on hiring, advice, etc.
○ But be careful when investors demand things like monthly budget reports,
weekly updates, not okay

Expenses
● Business expenses
○ Cost of carrying out business
■ Hosting
■ Rent
■ Salaries
○ Important for logging on company tax returns
■ Reduces tax that company pays
○ Non-business expenses incurred by the company actually increase the taxes
the company has to pay
 ● Investors gave a lot of money, and they want to see that money make the co
succeed
○ Make sure what you spend on business expenses are indeed for the business
○ Difficult to separate this in the early stages, when your office is your house,
etc.
● Bookkeeping is important
○ Keep all your receipts
○ When you eventually engage a bookkeeper, all these receipts are important

Wages and Firing

● Founder Employment
○ Founders are employees of the company and must be paid wages
○ Minimum wage is advised
● Companies must pay payroll taxes
○ Setting up payroll service is worth spending money on
○ Companies have blew up by avoiding payroll taxes
● Founder Breakups
○ Paying all founders is important
○ If one founder leaves, he/she may use a lack of wages as leverage to get
more money for leaving
○ This is typically in the form of vesting acceleration
○ AVOID THIS AT ALL COSTS

Hiring Employees
● Is the new hire an employee or contractor?
○ Both sign documents that assign IP they create to the company
○ Contractors set their own hours
■ Given a clear project and end result
■ Use their own equipment
■ No say in day-to-day dealings
■ Taxes are the responsibility of the individual
■ Company will give 1099 document to the contractor which they will
use for personal tax returns
○ Employee
■ Companies responsible for taxes
■ Receives a W2 form for personal tax returns
■ Need to be paid minimum wage
■ Workers Compensation Insurance is important to prevent fines
■ Proof of work in the USA
● You must use a payroll service provider to handle complex payroll for you
○ Zenpayroll is one good service

Firing Employees
● Firing is hard
 ○ Requires a founder to do what is right, not what is easy
● Fire fast
○ Do not put off the difficult conversation
○ Don’t let the bad employee linger
○ May make good employees quit
● Communicate effectively
○ Make clear direct statements
○ Don’t make excuses
○ Don’t apologise
○ Face to face with a third party present
● Pay all wages and accrue vacation
● Cut-off access to digital systems ASAP
● Repurchase unvested stock

Biggest Takeaways
● Keep it simple, organised
● Be fair and forward-looking about equity ownership. VEST
● Stock doesn’t buy itself
● Be savvy about financing documents
● Founders must get paid
● Employees must sign docs to assign IP to company
● Fire quickly and professionally
● Know your key metrics
○ Cash position, burn rate, runway
● Follow the rules and take it seriously

Q&A
● How to search for accountant and when?
○ Bookkeeper vs. CPA/accountant
■ Bookkeepers handle receipts and expenses
■ CPA handles ANNUAL tax returns
○ Probably okay for founders in the early days to do this themselves
○ But best to engage a service like indinero to handle this
■ Not worth a founder’s time to figure this shit out
○ Look for CPA/bookkeeper/lawyers via reference
■ Make sure they specialise in startups
● What about fees and legal council?
○ Incorporation can be done for cheap online, without a lawyer
○ Use Clerky to handle most standardised fundraising/incorporation things
● What about crypto & equity?
○ Banks will struggle to deal with this
○ No general advice, it’s product specific
Chapter 17: Sales and Marketing; How to Talk to
Investors (Tyler Bosmeny @ Clever, YC Partners)
● People think about building a great product first, and then hiring the sales people
after
● Truth is that the salesperson is YOU
○ Build or sell - nothing else matters
○ Pick a founder to own this completely
○ Founder passion trumps sales experience

The Sales Funnel

Prospecting
● Who will even take your call?
○ Find the innovators (<2.5%)
○ It’s a game of probabilities
○ Reach out to >100 companies
○ Top 3 methods
■ Network
■ Conferences
● Small, niche places
● Set up meetings beforehand
● Email all attendees
■ Cold emails
● Simple, straight to the point
● Who are you
● What are you doing
● Why should I be interested
● CTA

Conversations
● Now that you’re on the phone:
○ TALK LESS
○ Let the customer speak (70%)
○ Ask good questions to understand their problem?
■ Why did you agree to take my call?
 ■ How do you currently solve this problem?
■ What would your ideal solution look like?
● Follow-up religiously
○ Even with perfect customers, there will be many no-replies
○ Especially with high-profile busy customers
○ Drive things to closure in an inhuman, unreasonable way
● Get people to a yes or no as quickly as you can

Closing
● YC has standard agreement templates
● Remember your goals
○ Get customers
○ Get validation
○ Get revenue
● Common traps
○ Redlining
■ Don’t quibble over minor points
■ Keep your ego out of the way
○ 1 more feature
■ Sometimes customers will say, ‘I’d use your product, but it’s missing
one feature’
■ First reaction is to promise to build that feature for them
■ But the reality is that companies will rarely follow up on that promise
■ Avoid building one thing for one customer
■ Either:
● Sign a conditional agreement in writing
● Or wait to hear more demand from more customers (if this is
really worth building)
○ Free trials
■ This is a reasonable request, BUT
■ Early on, you need revenue, commitment and validation
■ People will usually flake out
■ Offer an annual contract with a cancellation period after delivery

Revenue
● 5 ways to build a big business
 ○
○ Flea/mice/rabbits rely on marketing
○ Deer rely on inside sales
○ Elephants rely on field sales
● Price your product carefully to fall into the category that you want
○ If you’re a rabbit and charge 1000/year, flying out to see that customer for
demos, setup, presentations will NOT BE WORTH IT
● [email protected]

Talking to Investors
● The best way to make your pitch better is to make your company better

Before Meeting
● How to pitch?
○ 30 second pitch
■ What does your company do?
● Assume audience knows nothing
● One sentence mom test, simple language
■ How big is the market?
● Do some research, not difficult to get
■ How much traction do you have?
● ‘We launched in Jan, growing 30% month on month”
● If no customers, convince investor that you’re working quickly
● ‘Started work in Jan, beta in March, launch by next month’
○ 2 minute pitch
■ 30s pitch
■ Unique insight
● Opportunity to tell audience something they didn’t know
● Something the big players don’t understand
● Aha moment! Watch for this expression
● Crystallise to 2 sentences
■ How you make money
 ● Business model
● One sentence long, make sure it’s clear and stand by it
■ Team
● If someone has done something impressive, call that out
● Don’t ramble on awards, phds, whatever
● Focus on how many founders, how many technical, how many
business, how long have you known each other
● Everyone working full-time
● How you met
■ ASK FOR MONEY
● Convertible note? Safe? What’s the cap?
● How much are you asking for?
● Minimum check size
● When to fundraise?
○ Investors like traction
○ Unfortunately, you will be in a situation where you won’t have much traction
■ SInce you’re the one asking for money, they are strong, you are weak
■ How do you flip the equation?
■ You want a situation where investors WANT to give you money
● You are strong, they are weak
● Good time to start fundraising
○ To create a situation where people want to fund you, you need to:
○ Spread the word
■ Press
■ Friends
○ Plan such that you don’t need much funds to grow
■ 95% of startups can bring product to market with very little money
■ Take the mindset of, “we’re all on this train that’s leaving the station. If
you wanna invest, great. If not, we have other options”
○ Always be able to show you have a committed team that’s working fast
● How to setup investor meetings
○ Warm intros are best
■ Previous founders
■ Referrals from other investors are so-so
○ Think in parallel
■ Fundraising is a sprint
■ Line up all your meetings in a single week
■ “Hey we’re in build mode for the next 2 weeks. Can we do a meeting 3
weeks from now?”
● Gives you buffer time to line everyone up then
● Hints that you’re not desperate - we’re busy
○ Fundraising should be something one person takes charge of
■ Don’t distract the whole company

During Meeting
● Bad Example
○ Make sure the listener understands what you’re talking about
 ○ Know your numbers
○ Tell your market-size through a bottom-up analysis - don’t just name drop big
companies
○ Understand something that is counter-intuitive
○ Team should be uniquely suited to this business
○ Drive the conversation to a conclusion
● Good Example
○ Capture interest, told an interesting story, engage with listener
○ Demonstrate insights and command of the market with passion, not
intellectual dismissiveness
○ Collaborative meeting - not a 1-1 interview
○ Asked for money with details and such
○ Drove to a close
■ We’re closing the round, these are our other backers, etc.

After Meeting
● Follow up!
○ Anything other than check is a no
● Work on creating demand (supply/demand)
○ Say that there are other people in the round
○ “Mike is willing to fill up the round, but we want to bring you on”
● Do diligence on the investors
○ Be very careful who you’re selling to
● Know when to stop fundraising
○ Don’t get addicted to it
● Build your company properly (fundraising is not the goal)

Chapter 18: Later-Stage Advice (Sam Altman)

● Catered for months 12-24
● After product-market fit
● Waste of time until you have something working

Management
● Establish structure
○ Needed at about 25 employees
○ Every employee should have a manager, every manager should know their
reports
○ Know how to change structure, add new people
● Management structure
○ Avoid fancy new management structures
○ Keep it lightweight and straightforward
● Shifting from building a GREAT PRODUCT to GREAT COMPANY
● Failure cases
○ Being afraid to hire senior people is a big mistake
 ■ They bring experience and insight
■ Don’t hire too early
○ Hero Mode
■ Extreme leading by example is unsustainable
■ Don’t stay in this until you burnout
○ Bad Delegation
■ Not giving enough responsibility
■ WRONG: “Here’s this big thing. Research and get back to me. I’ll
decide, then you go and implement it”
■ CORRECT: “You’re really smart, and I trust you. There’s this thing we
need to do, and you can make the decision on whether to do this or
not. Let me know what you decide”
○ Not developing a personal tracking and productivity system
■ Keep track of what everybody is doing in as systematic way
● Codify how you do things and why you do things
○ Cultural values and strategy
○ Put it down in a wiki
○ If you don’t do this, other people will get their own impressions from unverified
sources

HR
● Once set-up, can speed you up
○ Have clear structure
■ Clear path
■ How can I advance my careers
○ Performance feedback loop
■ Speed and frequency
■ Simple
■ Make it clear how feedback loops tie to compensation and penalising
○ Compensation tied to performance
○ Equity - be generous
■ Investors will give bad advice
■ Distribute 3-5% per year
■ According to YC data, the best companies give out to employees well
● Stock and Vesting
○ Refresher grants
■ Don’t wait for people to just wait around to let their stock vest
■ Be ahead of the curve, offer them refreshed vest plans
○ New structures
■ 6 years
■ Pyramid vesting
■ Continuous forward vesting
○ Use a good option management system
● 50 employee requirements
○ Sexual harassment policy
○ Diversity training
 ● Monitor for burnout
○ You don’t want people to work in product mode all the time
○ You want them to take vacations and try new things
● Hiring process
○ Full-time recruiters
■ Don’t bring on too early, bring on when you need high volume
○ Internal announcements
■ Send new incoming offers to the whole company (up till a reasonable
size)
■ Oftentimes people will know the incoming person, and can call out if a
bad hire
○ Ramp-up new hires
■ What does the first week look like?
■ Buddy system?
○ Diversity on the team
■ Start this early
■ Don’t let your first 20 be all dudes, or you institute a culture which is
difficult to fix
○ Growth of early employees
■ Scenario where an early employee wants a role, but she just doesn’t
suit it. Company has evolved past an early employee. How do you
deal with them?
■ Be proactive about it, think ahead when company is still small
■ Talk to them, find out what they want, chart out a clear path for them
○

Company Productivity
● Alignment
○ No. 1 reason companies drop in productivity is when not everyone is on same
page
○ Or worse, work against each other
○ More than half the battle
● Clear roadmap and goals
○ Everyone knows the roadmap for next 3-6 months
○ All employees can say the same top 3 goals
● Figure out values early
● Be run by product, not process
○ Some process/framework is necessary for product dev, but don’t let it be the
main driver
○ Ship everyday
■ Continued focus on delivery
● Have transparency and rhythm in communication
○ Weekly management meetings
○ All-hands meetings
○ Quarterly/annual planning
○ Offsites