Paul Graham: An Illogical Startup

Stanford course CS183B: How to start a startup . Started in 2012 under the leadership of Peter Thiel. In the fall of 2014, a new series of lectures by leading entrepreneurs and Y Combinator experts took place:



Being a father is good also because when you need to give someone advice, you can ask yourself: “What would I say to my own children?”. You will notice that this question may give your thoughts the right direction. My children are still small - my two-year-old son today, when asked what will happen to him in a year, said: "I will be a bat." The correct answer would be: "I will be three years old," but the bat version is much more interesting. And although my children are small, I already know that I will tell them about start-ups if they go to college - and that is what I am going to tell you now. You will literally hear what I would say to your children, since most of you are young enough to be my sons and daughters.
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Startups - things are very illogical - I really do not know why. Maybe simply because the knowledge about them has not yet had time to penetrate our culture, but, whatever the reason, the stataps are not an area where one can constantly rely on intuition. In this sense, they look like skiing.

Did any of you guys learn to ski as an adult? When you get up on skis for the first time and you want to slow down, the first thought you have is to lean back, because this instinctive movement "works" in all other situations. But try to do so on skis, and you will fly head over heels from the mountain. As I found out on personal experience, an important element of learning to ski is the ability to suppress this impulse. Over time, this will become a habit, but at first, descending from the mountain, you just try to keep a list of things in your head: you need to alternate the leading leg, try to go on s-curves, not “collapse” on the inside of the foot and all that jazz.

Startups are just as unnatural as skiing, and with regard to startups, there is also a similar list that you first need to remember. Today I will tell you about the first points in this list of illogical things that you need to memorize in order not to let your instincts mislead you.

1. Do not believe your instincts

I just mentioned the first item on this list: startups are so weird that if you follow your instincts, they [instincts] will mislead you. If you memorize this thing alone, then before you make a mistake, you can stop and think.

When I ran the Y Combinator, we joked that our task was to tell the founders things that they would ignore - and that was indeed the case. Time after time, YC partners warned the founders about the mistakes that they were ready to commit, and time after time startups ignored these warnings, and then returned with the words: “It’s a pity that I didn’t listen to you then.” And now, among the co-owners of a startup, there is a strange character, and the founders can do nothing about it.


You can, however, trust your instincts when it comes to people. Until recently, your life was a little like a startup, but the way you interact with people in everyday life and the way this interaction happens in the business world are one thing. In fact, one of the big mistakes that the founders make is that they do not fully trust their intuition to people. They meet someone who, as it seems, makes a good impression, but in the depths of their hearts they suspect something is wrong, and then it all comes out, and the founders can only say:

"You know, I suspected that something would go wrong with this guy, but did not pay attention to it, because he made such a good impression."

There are representatives of a special type of thinking in business, it is typical for founders with technical education, which, I think, all of you have. You think that business is such a somewhat unpleasant task. So when you meet people who seem smart, but slightly unpleasant, you think, “Okay, this must be normal for business,” but it’s not.

Just pick people the same way you choose your friends. This is one of those rare occasions where you can indulge yourself. Work with people that you like, and whom you could respect, and whom you know long enough to be confident in them, because there are a lot of people who can successfully pretend to be "suitable." Just wait for the situation when your interests disperse, and see for yourself.

2. Do not try to become an expert on startups.

The next illogical point - it may disappoint you a little - is that in order to succeed in a startup, you do not need to be an expert on startups. This distinguishes our classes from any others that you can attend.

If you are learning French, you can speak French at the end of the course. You will learn, you will not necessarily speak exactly like a born Frenchman, although it is rather similar. Our classes may teach you to understand startups, but this is not something you need to know. To succeed in a startup, you do not need to be an expert on startups, you need to be an expert on your users .

Mark Zuckerberg succeeded on Facebook, not because he understood startups, he did succeed despite the fact that he didn’t understand anything at startups - Facebook was first registered in Florida [and not in Delaware]. Even you guys understand that this is no good. He succeeded, despite the fact that he did not understand startups, because he was very good at his users.

Most of you do not know the mechanics of attracting investment from business angels, right? If you are worried about this, stop it. I am ready to say that Mark did not know this either. Even if he drew attention to the fact that Ron Conway wrote him a check for a large amount, now he probably does not remember at all.

In essence, I’m not worried about the fact that it’s essentially pointless to study the mechanics of creating a startup, but that it may be dangerous in some way, since another typical mistake of young founders is to go through all the known stages of creating a startup. They have a rather reasonable idea, they attract investments to increase the value of their project, and then they rent an office somewhere on South Market Street in San Francisco [the place where the offices of many successful startups - GitHub, Dropbox, AirBnB are located], gain a team of acquaintances to the team, and suddenly realize that the project is slowly sinking to the bottom, because imitating all the external attributes of a startup, they ignored the only really important thing: they did not create the right product for people .

We have seen that this happens so often - I mean the situation when people are addicted to the very process of creating a startup - that we even came up with a name for this: “Game House”. Ultimately, I understood why this is happening: the reason why young founders are trying to copy the external attributes of a startup is because they have been taught this all their lives to the present.


And it is not surprising that after their entire life is effectively trained to play such games, the first thing young founders who create a startup try to figure out the rules of this new game. What kind of "extracurricular work" do startups do, what do I need to do? It so happened that the measure of the success of startups is the amount of funds raised - and this is another mistake of the founders. They always want to know what the “trick” is, what tricks exist to help convince investors. And we have to tell them that the best way to convince investors is to establish a really fast-growing startup , and just tell them about it.

Then startups say: well, and what special techniques are there to ensure rapid growth - this question is aggravated by the presence of such a term as Growth Hacks. Wherever you hear someone talk about growth hack, just mentally replace this word with “bullshit” because, as we constantly say to the founders, the only way to make your project grow is to do something that like users and tell them about it . That's all you need, and that's the whole growth hack.

A lot of conversations between partners from YC and the founders begin with the fact that the founders say: "How do I ...", and the partners answer: "Just ...". Why does everyone like to make things so messy? For many years, having been puzzled by this question, I finally understood the reason: people are looking for tricks, cunning moves in everything. They are trained to seek them out.

3. Do not try to outsmart the system.

And this is the third illogical thing you need to know about startups: when you start working on a startup, you can no longer "find loopholes in the system." You can continue to beat the system if you work for a large company. Depending on how bad things are going there, you can succeed with someone’s protection, you can make others look like a productive employee by sending letters late at night or - if you are a smart guy - changing the time settings on your computer - no one checks block headers content, right? Yes, I like the audience that understands my jokes. If I had said this in a business school, they would have asked me: “What? Headers? What have the headlines? ”. Oh, shit, I just realized that I was being recorded on video. From now on, I will tell everything strictly according to plan.

So, in startups, this approach will not work. There is no boss who can be deceived - how to deceive someone who is not? There are only your users, and it is important for all of them that your product do what they want to receive, right? They are like sharks, sharks are too stupid to try to hold them, you cannot wave a red rag and deceive them - in their understanding, either they eat meat or not. The danger, especially for you, is that dishonest play, up to a certain limit, works against investors.

If you know very well what you are talking about, you can fool an investor for one, maybe two rounds of financing, but to do so is not in your interests. I mean that you do this to increase your own capital, so it’s not fair to do this to yourself. This is a waste of your own time: if a startup is doomed, all you do is kill time for it. Therefore, do not try to outsmart the system. In the field of startups, there are cunning tricks in the same way as in other areas, but their significance and effect are an order of magnitude lower than solving real problems.

Anyone who does not understand anything in raising capital, but at the same time does what his users like, will be much easier to get financing than to those who know all the book tricks, but whose product no one uses.

In a sense, the fact that it is impossible to outwit the system in this area is bad news for you. It robs you of your most powerful weapons — after all, you spent twenty years mastering them.

Nevertheless, it seems to me that existence in a world where, in order to win, there is no point in cheating is very exciting. Studying in college, I would have been delighted with the thought that there are situations in the world in which the “short cut” means very little, or even nothing at all. And they are: this is one of the most important things to think about when planning your future. How to “win” at each stage of the performance of work, and what will this gain give you?

This leads us to the fourth illogical truth about startups. If you create a startup, it will capture a huge part of your life, more than you can imagine. And if your startup succeeds, it will absorb your life for a long time, at least for a few years, or even for a dozen years, and possibly for the entire time until the end of your career.

4. It will never be easier

It may seem to you that Larry Page lives a life that can only be envied, but in this life there are moments that definitely do not envy. For him, everything looks as if at the age of 25 he began to run as fast as he could, and since then he has not managed to take a break for a second. Every day, some dirty trick happens in the Google Empire, which only the emperor can figure out, and he, as emperor, really has to deal with it. If he goes on vacation for at least a week, a whole mountain of such dirty tricks is accumulated behind his back, and he has to rake it without complaints, because, first, he, as the “father of the company”, cannot show any shadow of fear or weakness and secondly, if you are a billionaire who complains about the difficulties of life, no one will ever sympathize with you.

This all has a strange side effect: the difficulties of a successful start-uper’s life are hidden from the vast majority of those who have not yet succeeded. Go to the man who just won the race for a hundred meters at the Olympics - he will desperately try to take a breath. Larry Page does the same thing, but you never see it.

Y Combinator has already financed several companies that can be called extremely successful, and in each case the founders said the same thing: "It will never be easier." The causes of problems change, so you may worry about larger things, such as delaying the construction of your new London office, and not about a broken air conditioner in your one-room apartment, but the total amount of anxiety never diminishes . He, perhaps, only grows.

Starting work on a successful startup is the same as deciding to have children: as if you press a button, and everything in your life changes irrevocably. To be honest, children are, of course, wonderful, but if you need to remember one single thing from this lecture, remember this: there are a lot of things that are much easier to do before you have children - and many of these things make you a better parent when you still have children. In the affluent countries, the majority postpones the "pushing of a button" for a while, and I think that you are perfectly familiar with this rather intimate procedure. But at the same time, when it comes to startups, many believe that they should be created during college.


What you really need to know is what your user wants. This can not be learned without creating a company, which means that in fact you can learn startups only from your own experience. In college, this will not work because of the reason I just mentioned. A startup will consume all your time. If you create a startup in college, as a student, you will not be able to “sit on two chairs”, because if you create a startup, you will no longer be a student. Nominally you will be a student, but not for long.


Mark Zuckerberg will never be able to leisurely rest abroad. If he travels to another country, he either makes a de facto formal visit or hides incognito at a fashionable hotel like George V in Paris.

He will never be able to travel with a backpack on his back around Thailand - do people even do that anyway? Do people travel around Thailand with backpacks? Oh, for the first time in the whole lecture, I see that the audience showed enthusiasm. It was necessary in Thailand to talk about it all.

He can do what you cannot do — for example, take a plane to travel abroad. Very big plane. But success forced out happy accidents, insights, spontaneity from his life. Facebook manages it as much as it manages Facebook.

Despite the fact that being under a certain pressure of a project that you consider to be the work of your whole life is not bad, there are some advantages in insights . Among other things, they give you more options to choose the direction of "the work of your whole life." In this case, you do not even need to pay for it.

You donate nothing if you refrain from creating a startup in the early twenties, because the probability of success in this enterprise will only grow if you wait. The likelihood that you are at your twenty start a third-party project that “shoots” in the same way as Facebook, after which you will have to choose whether to stay in the project or leave and choose to stay is astronomically small.

Because usually startups "shoot" only when they are strongly encouraged by the founders. Extremely stupid to try to achieve this in twenty with a little.

Is it worth doing at a different age? It’s pretty hard to create a startup - if I haven’t yet clarified this point, I’ll try again. So, creating a startup is very hard . And if it is really too hard, what if you are not prepared for such difficulties?

5. You never know for sure

The answer is contained in the fifth illogical truth about startups: you never know for sure. Thanks to the accumulated experience, you already have an idea of ​​what prospects you could open up if you wanted to become mathematicians or professional footballers. This is not every audience say. But in your life, you hardly ever did something similar to creating a startup - unless your life before this point was very, very strange.

I mean, creating a startup will make a big difference if you succeed. Therefore, you should try to evaluate not who you are now, but who you could become. And who can give this exact answer? Certainly not me. For the past nine years, I have only been doing what I tried to guess - this was my work (I wrote “predict” in the notes, and said “guess” instead — a Freudian reservations).

Seriously, it's very easy to determine in ten minutes how smart a person is. Throw a pair of tennis balls over the net and see if he can beat them off so that they don’t fly to where it’s not clear - it’s easy. The most difficult and important part of my job was to predict how stubborn and ambitious the candidates will be.

In solving this problem, perhaps, there is no more experienced person than me. I can say that the expert understands this: not so much. My experience has taught me to remain completely unbiased about which startups from each set will become stars. Sometimes the founders think they knew what the future was for them. Some come, being sure that they cut the Y Combinator into a nut just as they did with the few tests that were completely far from reality that they encountered in life before. Others come, thinking that they fell into Y Combinator by mistake, and hope that no one will know about it.

There is practically no correlation between these approaches and the future future of a startup. I read that the same is true for the army. Boastful recruits have no more chances to become professional fighters than quiet ones, most likely for the same reason. The tasks that need to be addressed at this stage are too different from everything that a person has encountered before. If the prospect of creating a startup scares you to death - better not do it. Unless you are one of those people who succeed in something, stepping over fear. Otherwise, if you're just not sure if you can succeed, the only way to check this is to create a startup, but not right now.

So, if you want to create a startup one day, what do you have to do in college now? There are two tasks that now need to be solved: to come up with an idea and find co-founders. Both are achieved in the same way, which leads us to the sixth and last illogical truth about startups.

6. Do not try to grind out the idea.

You can think up a startup idea without thinking specifically about such ideas. I have written a whole essay on this subject and do not want to repeat it here in its entirety. In short, the point is that if you deliberately try to invent a startup idea, you will get not just a bad idea, but a bad idea that looks plausible. And this means that such an idea will mislead you and everyone around. You will spend a lot of time before you realize that there is nothing good in your idea. You can come up with a good idea for a startup by stepping back. Instead of consciously making an effort and inventing what to do, you should address the state in which ideas come to you.

In essence, this process proceeds so uncontrollably to your consciousness that at first you will not understand that the thought that came to your mind may be the idea of ​​a startup. Yahoo, Google, Facebook, Apple were created that way. , – . , , , , , , .



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[ Translation of the next lecture by Adora Chyung ]