The Launch Pad

Taggar says that as he thinks about earlier examples of YC startups that tried a new product release or something else that had caused worry and anxiety before it was introduced, he cannot think of a single instance in which the outcome was “unfixably bad.” He reminds them that experiments offer an opportunity to learn from users. “You try out some

Another thought occurs to Taggar about how to assess startup ideas, one used by Sequoia Capital. “One of the big things they focus on is ‘proxy for demand.’ Which basically means when looking at some new idea, they want to see what people are doing at the moment? What kinds of crappy solutions are they hacking together at the moment.” They’ll ask f

Each company receives a tiny dollop of capital, $11,000 to $20,000, for which it gives up 7 percent of its equity.

Graham has his own term but it is a clunker: a “quantum of utility,” which means, in his words, a product that would make the world “one incremental bit better.”

He says that at the beginning of the summer the Start Fund’s backers, Yuri Milner and Ron Conway, had made $150,000 investments in startups that in almost every case were undeserving.

If you want to, you can spend all of your time refactoring your code or rewriting how you deal with database seeks or something—you could do that and that would be ‘work,’ in some sense of the word. But it wouldn’t be work in the sense of getting you new users or anything that was actually important.”

“If we take 6 percent, we have to improve a startup’s outcome by 6.4 percent for them to end up net ahead,” he said. “That’s a ridiculously low bar. So the IQ test is whether they grasp that.”5 When Graham finishes his last

One meaning of the verb form “to hack” refers to finding a clever way to beat a system.

After three hours of presentations, it is time for the group to vote. Each founder is to send in two text messages to indicate the two favorite startups—excluding their own, of course.