Jan 11, 2023 · 29m · y-combinator
The Secrets To Setting Smarter Goals · Y Combinator
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Y Combinator partners Michael Seibel and Dalton Caldwell break down common goal-setting and execution pitfalls that early-stage startup founders face. By exploring the concept of 'play stupid games, win stupid prizes,' they highlight how unrealistic targets, vanity metrics, and premature scaling hinder growth, emphasizing the importance of honest diagnostic goals and disciplined execution.
Statements from this episode (19)
Seibel: Overly aggressive startup goals demotivate founders and stem from fear
“When people set goals that are so aggressive, they aren't motivational. And they're basically missing the understanding of what the purpose of setting a goal is, right? Like you want to motivate yourself to act smarter, faster, more intelligently than you woul…”
Seibel: Monetizing startups should track revenue rather than registered users
“For companies who charge their customers money, somehow creating a goal incremented in something that's not money Hey, my product costs 10 dollars a month, but I'm measuring registered users. I want to hit, you know, a thousand registered users, and it's like,…”
Caldwell: Founders invent fake metrics to avoid measuring whether products work
“The actual meaning of the metric, which is to capture if it's working or not. You know, it's like every, every which way people are so creative in finding ways to like, not actually measure the thing that they know they're supposed to be measuring.”
Seibel: Startup Funding Rounds Are Often Announced Long After Closing
“Sorry, but lots of things are announced way after they happen. Way, way after.”
Caldwell: Sandbagging goals harms founders who work for themselves
“If you're used to doing that, and that's how you think all things should work, when you start working for yourself, when you are your own boss, you are screwing yourself.”
Seibel: YC Evaluates Progress on Hard Problems, Not Arbitrary Goal Metrics
“First of all, we're not grading. We're not your teacher. We're not your boss. And second of all, like your job is to work on the hardest problem in your company like that. Like if you've made progress on the hardest problems in your company, you're doing well.”
Caldwell: Founders must acknowledge failure instead of weaving victim narratives
“If something doesn't work to accept it, to acknowledge it, to look at it, but realize you're the boss of yourself and you should just not feel a need to make a million excuses or have like create this long narrative where you're the victim and everyone else, i…”
Seibel: Maximizing fundraising leads to lost control and impossible pivots
“Often you lose control of your company. So like when you confront the challenges, suddenly, you know, your board can fire you. Often you find yourself burning tons of money because all the people who gave you money expect you to spend it. Oftentimes you have t…”
Seibel: Hiring more employees to move faster is a founder lie
“It's always about moving fast. That's the lie. It's like, if we had this, we could finally move as fast as like, you know, we could finally build all the things that I want us to build.”
Caldwell: Laying off overhired staff was my biggest failure
“I know that's how I feel like personally is the biggest failures I've ever had. We're definitely having to let people go that I shouldn't have hired.”
Caldwell: Most VC content targets late-stage founders despite early-stage audiences
“So much of the VC content is aimed at late stage founders, which is pretty weird. It's like putting out content that's like, you know, how to care for your Ferrari or something like, again, I don't really know who a lot of this. The majority of the people that…”
Caldwell: Ex-Google executives join early startups because they underperformed or misunderstood reality
“What usually happens is they either are, either they joined your startup because they're, they weren't doing well. I'm trying to think of a nice way to say it. Either there's a reason they joined your startup and left Google, or they had expectations that you …”
Seibel: Startups scaling negative unit economics will eventually face financial reality
“I think people don't realize that either some stage of investors or at some point in your company, someone's going to pull out your finances and do basic arithmetic and ask themselves, is this real?
And like eventually you will be judged based on like, is this…”
Seibel: Startups often attempt corporate acquisitions far too early
“It just often means the folks who are thinking about it in startup land tend to be thinking about it too early. This is like another example of like taking later stage advice too early. When like the advice you should be taking is make your core business work.”
Caldwell: Founders spending all day on Twitter lose touch with real money
“If you spend all day on Twitter and discord and everything's a game and everything to joke, everything's silly, you can kind of, I just have noticed some folks lose themselves and not realize that the numbers in the spreadsheet are real dollars”
Seibel: Successful Founders Spend Negligible Time on Angel Investments
“When you're a good founder, oftentimes you know other good people, and the opportunity you have to give them money requires almost no time or effort, and so you just, and like, if you're a good founder, oftentimes people are offering you Deals. And so like, yo…”
Seibel: Brian Chesky Angel Invested in Socialcam via a Brief Email
“I remember when I was starting social cam, I emailed Brian Chesky saying, do you want to angel invest? He was like, sure. That's it. Like that was like, that was the entire time that he spent probably less than”
Caldwell: Founders Angel Investing Alienate Employees and Strain Capital
“The prizes that you win playing the game is congratulations. Now a bunch of your money is tied up in illiquid investments that may or may not show up. So now maybe you're like financially strapped. Maybe you're worried about other stuff. You're worried about y…”