Team and Execution with Sam Altman (How to Start a Startup 2014: Lecture 2)

Uh, before I jump into today's lecture, I wanted to answer a few questions people emailed me, saying they had questions about the last lecture they ran out of time for. So if you have a question about what we covered last time, I'm welcome to answer it now. Starting with you. Uh, it should be on. Can you not hear me? No? Maybe you can ask them to turn it on? Uh, hopefully they'll come on. Anybody else? Yes?

Uh, so one question that was submitted online was: how do I identify if a market has a fast growth rate now and also for the next 10 years? All right, so the question is how you identify markets that are growing quickly. Um, the good news about this is this is one of the big advantages students have. Um, you should just trust your instincts on this. Um, older people have to basically guess about the technologies that are sort of what young people are using, right? Because young people get older and they become the dominant market. Um, but you can just watch what you're doing and what your friends are doing, and, um, you will almost certainly have better instincts on fast-growing markets than anybody older than you.

So the answer to this is just trust your instincts. Think about what you're using. More think about what you're using, what you're seeing people your age begin to start using. Um, that will almost certainly be the future. Maybe I can do one more question on the last lecture before we start. Um, this isn't really the last lecture, but another question online is: uh, how do you deal with burnout while still being effective and remaining effective? Yeah, sure.

Um, so the question is how you deal with burnout as a founder. Uh, this— the answer to this is just that it sucks and you keep going. Um, unlike a student where you can sort of like throw up your hands and say, you know what? I'm really burned out. I'm just going to like get bad grades this quarter. Uh, one of the hard parts about running a startup is that it's real life, and um, you just have to get through it.

Uh, the canonical advice is like go on vacation or whatever. Um, that never works for founders. It's sort of all-consuming in this way. It's very difficult to understand. So what you do is you just keep going. Um, you rely on people. Uh, it's like really important and founder depression is the serious thing and you need to have the support network. Um, but the way through burnout is just to address the challenges, address the things that are going wrong, and you'll eventually, uh, feel better.

All right, so last week we— or last lecture we covered the idea and the product. Um, and I want to just emphasize again that if you don't get those right, none of the rest of this is going to save you. Um, today we're going to talk about how to hire, uh, and how to execute. Hopefully, you don't execute the people you hire.

Um, sometimes, uh, so first I want to talk about co-founders. Um, co-founder relationships are among the most important in the entire company. Um, and everyone says that you need to watch out for tension brewing among co-founders, um, and address it immediately and that's all true. And certainly in YC's case, the number one cause of early death for startups is co-founder blowups.

But for some reason, a lot of people treat choosing their co-founder with even less importance than they put on hiring. Um, don't do this. This is one of the most important decisions you make in the life of your startup and you need to treat it as such. And for some reason, students are really bad at this. They just pick someone. They're like: I want to start a business, you want to start a business, let's start a startup together.

Um, there are these like co-founder dating things where you're like, hey, I'm looking for a co-founder. We don't really know each other. Let's start a company. And this is like crazy. Um, you would never hire someone like this and yet people are willing to choose their business partners this way. Um, it's really, really bad. Choosing a random co-founder or choosing someone you don't have a long history with, choosing someone that you're not friends with, so that when things are really going wrong, you have this sort of past history to bind you together, um, usually ends up in disaster.

We had one YC batch where nine of about 75 companies added on a random co-founder between when we interviewed the companies and when they started, and all nine of those teams fell apart in the next year.

Uh, the track record for founders that don't already know each other is really bad. Um, a good way to meet a co-founder is in college. Uh, if you're not in college and you don't know a co-founder, the next best thing I think is to go work in an interesting company. If you work at Facebook or Google or something like that, um, it's probably almost as co-founder rich as Stanford.

Uh, it's better to have no co-founder, uh, than to have a bad co-founder, but it's still bad to be a solo founder. Um, I was just