Y Combinator Startup Podcast - #18 - Q&A with YC Partners at the Female Founders Conference

Episode Date: July 14, 2017

This Q&A was recorded at our fourth annual Female Founders Conference.Partners: Kat Manalac, Jessica Livingston, Adora Cheung, Anu Hariharan, Carolynn Levy, and Kirsty Nathoo.

Hey, this is Craig Cannon, and you're listening to Y Combinators podcast. Today's episode is a Q&A with YC partners, and it was recorded at our fourth annual female founders conference, which took place here in San Francisco this June. Okay, here we go. So I'm really excited to introduce you to all the, not all, but many of the incredible women that I get to work with every day, these are the partners of Y Combinator. And so, yeah. So I would love for, we're going to be answering some of the questions.

that you sent us, and so I'd love for each of you to introduce yourselves, and then we'll just jump in. Okay, shall I stop? Okay, hi again, everyone. I'm Kirstie Nathu. I'm the CFO here at Y Combinator, and I've been involved with YC now since 2010, so I've seen it go through a lot of changes. I'm Carolyn Levy. I'm partner and general counsel at Ycombinator, and I've been here for about five years. Hi, everyone. I'm Anu Hari Huron. I'm a partner. I'm a partner. at Y Combinator's continuity fund. I joined YC last year. The continuity fund is fairly new. We invest primarily in growth-stage companies and help with company building at scale. Hi, my name is Adora Chung. I'm a partner at YC, one of the group partners, meaning I work

directly with the startups. I've been here for about a year now, a little over a year, and I went through YC myself in 2010, I guess when Kirstie started. Yeah. I'm Jessica Livingston. I'm a co-founder of YC. And I'm Kat, and I've been at YC for about four years now and started out as the first director of outreach, so working with a lot of potential applicants like you guys. All right, let's just dive into the questions. So how much industry experience do you typically recommend founders have?

Zero. Zero. Yeah. Well, no, actually, I think for biotech, it's pretty important that the founder have industry experience. But not true for other. Also, it's how do you interpret that question?

Because in my talk earlier, I said that ideas grow organically out of founders' lives, and usually they're working in some given industry, and they're an expert in it, and they say, gosh, this aspect is totally broken. I know how to fix it. And so we love funding people with domain expertise, I guess.

Yeah, usually these people have been in the industry for just a little bit, not too long, so that they are so entrenched in it that they don't know how to fix it or know how to build to fix it. But yeah. Which is long enough to kind of experience the problem

and say like, this is insane, I have to fix it. Right. Yeah. And so, yeah, I think at YC I've seen folks that have had zero industry experience in something that they're launching and then some people that have had many years. So I guess it really just depends.

But there's no, I guess there's no simple answer. to that question. It's no simple answer. I don't think Drew Housden had a whole lot of experience in storage when he got frustrated because he'd left his talk back and he was on the bus to New York. So here's a stats question. What percentage of applications have a female co-founder or how many, what percentage of, you know, I guess the overall population are women. So I'll take this one. I'm going to say. I obsessive. I obsessive. I obsess over. the stats. So right now we're seeing about 13% of the founders that apply to YC are women. And so I just want to let that sink in because I want that to be closer to 50% of the population of people applying. Thank you. And then, so about 22, 23% of the companies have a female founder. And there are very, very few companies that apply that are, you know, female-only teams. And so I would

love to see more of that as well. What is a myth about starting startups or about YC that you wish you could dispel? I cannot answer that question. I'm going to have to write an essay on that one. I'll probably start with that and you all can fill in. I think especially because I joined YC only a year ago and I remember after going through all the interview process and I'm super excited about about having gotten the offer when I was talking to other people and what are some of the myths that I think now that I've spent the year, I can say. So one is, I think it's a myth that we don't invest in non-technical founders. We do.

I think the other myth is that we don't invest in solo founders. I think we encourage having co-founders for various reasons. But there is no strict rule that says it's an absolute no. And the third thing, which actually really surprised me, because I had never thought that in my head, is that YC has no women. So, and I, when I went through the TV process, I actually met. Or it doesn't have a women founder.

Founder, yes. So I think that that's, you know, that I never had that doubt, especially because I had met all of them through the interview experience. And now that I've worked at YC for almost a year, I can certainly say with conviction that, you know, women play a central role in every decision in YC. I can think. I get frustrated because I feel like women often get written out of a lot of stories, right?

I mean, this is a thing that we've seen time and time again, and I was just telling someone this morning about this. Back when I started at YC, all these reporters would write about YC, and they would refer to Jessica as like, Paul Graham's wife. It was only described as Paul Graham's wife. In YC, you know that Jessica is a founder of YC, right? And it's such bullshit. it. And it was like that she, and she, like, is, like, half of the operating part of YC. And so it would just frustrate us internally. And then yesterday's story came out that referenced Jessica as co-founder. There was no mention of Y for anything. And I was like, progress.

Like, I was just so thrilled that you were given, like, you're due. There was some article that came out that said, Paul Graham, Jessica Livingston's husband. I almost had a party laugh. Can I say something from the whole missing? Because there are, there there are too many for me to even address, and some I get very emotional about. But when I hear things like people come up and say, oh, but you don't fund solo founders, like it breaks my heart. What I'd love for just people who would like to give us a chance is to say, okay, I've read a lot of these articles, I think this is the case.

Let me make sure. Let me just ask if that's true with someone who went through YC and see what their experience was like. So that's my only request if you do come across a myth that you think is true. Remember, there's always several sides to a story and not to believe everything you read on Twitter or in the press. You know, actually, I just want to say one thing. Even after we fund solo female founders, they still don't believe it. I was having a dinner with one of our female founders from last winter. And she said to me, why did you guys fund me?

And I'm like, what a weird question. What do you mean why do we fund you? She's like, well, I'm female. I don't have a co-founder. I was like, seriously, it was like four weeks into the program, and she was still downing. It was depressing a little bit, but. There's a question that this actually nicely dovetails into is that, you know, YC has funded non-technical founders and sometimes even non-technical solo founders.

What was it about those founders when they applied and interviewed at YC that impressed you and, you know, I guess convinced everyone? For me, it's they have a clear vision of what they want to build, and they have a clear roadmap of how to get there step by step. And they understand that today I need to, maybe I lack a technical co-founder, but I know how to hack my way into those next steps. Another good indication is if you've been a product manager or head of a PM somewhere and you've worked with a lot of engineers and you've directed and orchestrated product building before, I think that's a really good historical reference to that you can build product without needing a technical co-founder.

I think it depends on the kind of product as well. Not all products that get built need to have super technical founders. And as long as you have, like you say, the language to be able to understand what takes a long time, what doesn't, to be able to talk to engineers, to be able to set out the product, then that's what's needed. And you don't, not all founders have to be deeply, deeply technical. And lastly, I'll just wrap this up. There is no one type of founder we fund. We never say never about anything.

There are just so many different things we do, so I wouldn't want anyone to think YC never funds blank, because that's not true. Okay, does YC fund and work with later stage companies? I will, you want me to kick that over to you? Yeah, sure. So, yes, yes, we do. So the YC continuity fund that was launched two years ago,

our primary goal is to really help support the companies in the growth state. So we do invest in companies in the later stage. At that stage, what we're really looking for is has the company sort of figured out its product market fit. And, you know, they're really raising money for scale. And many of the activities that we help in that stage is really with company building, right? Because the early stage program does a fantastic job of really helping you figure out how to get product market fit. And, you know, really you're just starting in the initial phase of the company, which is, you know, one to 10 employees or 20.

But when you get to 30 people and you're scaling now to 100 or 200 or even 500 people, the problems are different. Your job as a CEO changes. So we help with a lot of elements in that phase. I think it's also coming back to the idea of myths that people make up their own myths about Y Combinator that bear no resemblance to anything. And so they convince themselves that I'm too early for Y Combinator or I'm too late for Y Combinator. And again, there's no too early and there's no too late.

We fund companies at all stages. And so people make our decisions for us by not applying. Let us make that decision. Okay. Next question is, what advice do you have for a mom who wants to start a company? Do you want some of the moms want to take that? Be prepared to have another baby because that's what startups are like. That's what I always think when I'm talking to founders.

I think, God, this sounds like having another kid because they take that much work. So that's the way I would think about it. Like, it's like having more kids. I actually asked Diane Greenness at our first female founders conference when she came to spoke. I was behind backstage with her and I said, how did you do this? Because I at this point had my two children, one was just a baby. And I was struggling a little bit. It's a lot of work to juggle everything.

And I said, how did you run via? and, you know, have kids while you were doing all that. And she gave me some good advice, which was she really made an effort to outsource a lot of things that didn't have to do with specifically her children. So she had a gardener. She had someone who came in to clean her house and did all these things because she couldn't do everything. So outsource the stuff that can be done by someone else.

You know, I used Instacart all the time. My God, anything that could be delivered, I have. had delivered, save me a drive to the grocery store, drive wherever. And so I always appreciated that advice because it seems reasonable, but I hadn't really implemented it. Yeah, I would say, you know, if you're really passionate about something, do it. It doesn't matter. The timing is never right.

There is no perfect time to start something. You know, three years ago, I met Nicole Shariafarb. She started a company, and I actually met her because she was pitching her startup to us at the time. and I had just delivered a baby at that time, and I thought my life was crazy. And so I finished the pitch meeting, and I told her, Nicole, my kid is really sick. Is it okay if I get back to you in two days? And she understood.

And she never mentioned anything. I later got to know that she had just delivered twins two days after my kid, and I was like, wow, what was I thinking? So I just think that, you know, there are a lot of women who I have seen quite a few. I mean, it's not in mass numbers, but who, at least in recent years, I've seen, there's no right time, and you cannot wait for the perfect time. So if you are really committed and you know that is the thing you want to work, go do it. There's actually a really good example backstage, the proven founders.

So we just accept them as batch. And when they interviewed us, I had no clue, but they were both pregnant. And so they're hobbling backstage hustling and, like, talking to people and trying to get users for their product, but they're like, pregnant, but they're doing it. So if you're passionate about it, you can... How far apart are their due dates? I think one month?

That will probably be hectic. They said they're going to share babysitters, they're going to share everything, so we'll see. So next question is, if you're working on a side project, at what point would you feel comfortable going full-time on it?

When should you bail out of your job, or think about taking time off school? I think there's two pieces to that. One is you feel like you're ready to go all in, obviously, and it's like getting some traction. That's a good sign. Two is, I mean, financial concern.

So if you have low personal burn, I mean, this is why really young people start-ups probably more than maybe older folks. But if you're in a financially good place to take off for a year, that's probably a good place to start. And I'd say try to focus full-time as soon. as you can, if it's okay with you financially, try to do it sooner than later. We always say, like, you've got to burn the boat before you can really make the kind of progress. You can. But then again, I'm talking out of both sides of my mouth because a lot of times I say,

don't quit your job. If you're thinking of starting a startup, work on something on the side and see how it goes. But the point is once it starts getting a little traction, the sooner you can focus full-time, the better, obviously, it is for that company. And I really liked what Morgan had said. while she was working at into it, she'd started the first version of Blavity. And then there was like that moment where, you know, she'd started to build, you know, an audience, but also was so passionate. It just, like, pulled her out. I thought that was pretty cool.

It's also one of the reasons why YC exists, because you can, if you're ready, you come apply, get in, you can quit your job. It's a forcing function. So here's a question about investors. So this person says, I'm told much of the small talk that investors. do is really a disguised way of identifying distractions. So specifically when investors ask about your kids or your social life, is that just a way that they're trying to identify red flags? And what's the best way to handle those questions or handle this like casual seeming chit-chat?

You have a good answer for this. Okay. I can take it. I mean, it's not just, I think the question is actually broader than investor. I actually started my career as an engineer. and went to the East Coast and then came back to Silicon Valley. So I've gotten this question many times, meaning when I was married, they wanted to know if I was on mommy track. I had a baby 10 years later. And when I was pregnant, it was like, am I going to quit? And now that I have a child, sometimes, you know,

there are questions that aren't how much time I can give. But to be like honest, like if you pick the right work setting, you don't run into that, right? So, but how do you handle these questions? One, if these questions are with an intention of they're trying to find distractions, it's a red flag, like, you may not want to work with that person because they truly don't understand where you come from and how committed you are to doing what you're doing.

So in those cases, like if, you know, someone asked me about staffing on a project and whether I was going to be pregnant, I would just, and if I felt that it was an uncomfortable question because they're trying to figure it out, I just asked, you know, openly, like, why is it a concern? and often when you put people on the spot, they sometimes give it to you assets. And one of these managers had told me, well, I'm a little concerned

because this project is really intense, so I just want to be sure. And I just responded, I knew the situation, so I just said, look, I won't be signing up for this if I didn't know I could do it. And that was enough to, you know, shut the problem aside and move on.

So I think it depends on the situation. Some of them I do think maybe they're just asking just to get to know you. And that's sort of their way to break the eyes. You have to tease apart why the question came. But if you sense that they're doing this because they want to figure out if there's your distraction, just ask them openly. And that has always worked for me.

And more often, after a few years, there was a joke within our front. Nobody would ever ask me that question. So that's another way to do that. There's a flip side to this, which is that I think we have heard from some founders that married co-founders, that they didn't disclose to investors that they were married, and then it kind of went on for too long, and then they didn't actually know when to disclose it without it being super awkward.

So that's something to navigate as well. I don't know what the exact right answer is there, but that can come up. So it's probably best to sort of be upfront about some of this stuff. It kind of depends, but you don't want to hide the ball on this stuff because it can get awkward later. Yeah, I mean, I think what Laura was saying in her talk about transparency and being really transparent with investors is important

because that's, you know, she was saying that she hopes, like, that, you know, she expects the same from them. Like, they'll be honest with her. And so I think probably it's best to bring up sooner than later. And if they don't, you know, invest in married couples, then, like, forget them, if you have made. But most of the investors I've talked to are not concerned by that. They just want to know, right? I guess. So, so we only have a couple minutes left. So one question is, who are your men? mentors. And what, is there anything, I guess, really quick that they've taught you that stuck with you? I'll go first. I think that I don't have a specific mentor that I can point to. And it kind of makes me laugh this question because when I was at the law firm where I worked before a white combinator,

I was in a women's group and we endlessly debated the whole topic of mentorship because there's this whole debate like, should it be organic or should you connect people? We just, all we did was talk about it. But I didn't actually have a specific mentor, but I realized, like, I learned a lot of stuff from every single one of my colleagues. I continue to learn from my colleagues at YC. And one of my biggest takeaways that I've learned from my colleagues is customer service. And that applies in the legal world as well as everywhere else. Always give good customer service.

Always put your client, customer, whatever it is, first. It's kind of hard, I guess, in doing what we're doing, which is such an unusual thing. that a lot of, you know, you kind of pick pieces of information up from lots of different people, and it's all pieces of a jigsaw that you piece together, but definitely the people that we work with.

I'm the same way, I pick up different things from different people, and I just have this patchwork quilt of fabulous lessons that I've learned from people. And I'm, when the dinners are going on at YC and there's a founder telling their story, I am listening just as intently as all the founders in the group. I mean, I learned so much

from the people that come through the doors of YC and my colleagues. When I was starting my startup, when I first came to Silicon Valley, there were some people that were influential and helped me along the way. So my former boss, the first startup, Max Levchen, he helped me a lot. And he, in fact, funded part of my startup, then Paul Graham, of course.

But I would say in terms of running my startup and someone to talk to on a weekly or even monthly basis, I didn't have that person, and I wish I did, and I wish I had seeked that person out, I guess. And I think it's helpful to have someone who's not your investor, you're not related to, who's not your friend, per se, like a personal friend who you can talk to about these things and bounce ideas off of.

Do you have any tips for folks looking for those people? Finding those people? So I didn't find one, so I guess. This is not debate. It's not a debate, endless debate. you find the person. It's tough because you do want it to be organic, right, to some extent. But I think for me, some of the most important, like, recurring people in my life have been

advocates, so, like, not just mentors, but people have always advocated for me. I think I used to work with Alexis O'Hanney and the founder of Reddit. He's always been, like a cheerleader, like a supporter. You know, I – but I think I would say the same thing. I pick up a lot from everyone I work with, especially you guys. and then also the founders that come in, I'm constantly learning. And then I also, as their companies grow,

I also learn as, you know, they kind of share their experience with me. So I guess we are out of time. And so I hope you've learned as much as we have learned today, listening to the founders here. Thank you for us, ladies. All right, thanks for listening. So if you want to read the transcript

or watch the video, you can check out blog. commodator.com. and as always, please remember to rate the show and subscribe. Okay, see you next time.