Y Combinator Startup Podcast - Why Startup Founders Should Launch Companies Sooner Than They Think | Office Hours

Episode Date: November 16, 2024

Launching a company is often pictured as a big splashy event with lots of media attention and hype. This can be scary! It also often results in founders delaying their launches, which then stalls the crucial lessons they could be learning. In this episode, YC Partners discuss this common hesitation and why it can be harmful to the journey and growth of a startup.

What's going on is that founders are just, they're embarrassed about the state of their own product. They've come from companies that have mature, polished products. And they compare their launch to like an Apple launch. If Apple fumbles a launch, the world's media is going to write about it. But if some small startup fumbles are launch, no one cares. We don't actually remember all the failed launches, but there are many. There are many. If you don't launch, you're being an idiot.

If you're a first-time founder, you're probably going to take way too long, launch. Today we're sitting down with the YC partners who will talk about exactly that. What are you going to say to yourself that will lull you into that form of slow, slow, dark corner of startup death? And how do you escape it? Let's find out. What are some of the reasons why people don't want to launch their companies sometimes that we run across? I think the first thing is that most founders, like when it's the first time, they don't know, like it's so scary to get out in the world. Like, people are going to see them. You see, like, as long as they have not launched, nobody knows about them.

And what do you think? Yeah, what are they scared of? What are some of the actual fears that I think I'm scared that nobody shows up. Nobody's actually like watched their video or go to their website or try their product. And that's kind of an existential risk for them. You know, if nobody shows up, if nobody tries their product, what have they been spending the last three, six, 12 months of their life on? I think sometimes the implication then is if nobody shows up, I'm done. or if nobody shows up, I'm wrong. I think it's also a liberating. Like, you know, until you've launched the first time,

you're worried about launching. That's kind of scary. Once you've launched once, and then even if it doesn't go well, like, what's the worst case? Nobody sees you? Well, you launch again one week later. Everything's okay.

And so I think that I saw that in a lot of founders once they had launched, they were liberated to do actually other stuff, to learn from customers, of course, and then to improve their product and continue in the right direction versus trying to be optimal for their first launch

so that they would do a big splash. So why is it bad to wait? Well, great question. When you don't launch or when you wait too long to launch, you are missing out and delaying the actual learning that you could be happening

by having real people reacting to what you're doing. It's natural to worry that no one will show up to the party when you launch. But if you find yourself over-rotating on that thought, remember the Airbnb story. Airbnb launched three times before anyone started to pay attention. But each time they launched, they learned something new, improved the product and kept going. But what about some of the more dangerous myths that exist about launching?

Here's Michael and Diana. When it comes to launching, I think it's one of the many topics where founders have what I call pop culture. knowledge. It's like knowledge that is false but widely believed and like one of the most important pieces of pop culture knowledge is that your launch is important. And that you only get one and that people will remember it. I think a secondary piece of pop culture knowledge is that if people try your product once so they don't like it, they'll never try it again. I love these moments because what I usually do with founders when they're nervous about launching is I go through a litany of products that they use every day and I ask them if they ever remember the launch.

Like, did you ever remember Uber's launch? Did you ever remember DoorDash's launched? Do you ever remember Google's launch? And if launches are so important, wouldn't you know about the launches of the most important companies in the world? I think pop culture knowledge is so dangerous in general because, like, it pervades us. Like, it's literally seeping out of every information spouter. No one questions it.

I think the other reason why founders are so precious about it, especially first-time founders, is that a lot of them might have worked at a big company. Yes. And big companies do have these fancy shows to launch. You think of the Apple one. That's like a full, full production show with multi-year in the process that you get this one shot and all the reporters are there. And then as a founder that was an employee,

you get this big carrot and stick. It's like, okay, we have this one launch. We're going to dab, dub to see. And we got to get it right. And the funny thing is big companies and the leadership uses it a bit of a forcing function to get people to move. Yes. And then founders think, oh, I did this at a big company. Of course, this is how my product needs to be done because when I was an engineer at Apple, I had to work for, let's say, the Vision Pro project.

I was like, I don't know, eight years a decade of work. And it's like one shot. Yeah. But that's a myth for startups does not apply. So one of the cool things about YC is that it's not really our job to yell at you. Right. We're not your bosses at all. Not your bosses. And so we tend to advise folks on what to do.

Smart people tend to listen to us, but the kind of general founder will tend to look at what their peers are doing in the batch. And I think that by putting people in a batch together, especially smart people, peer pressure is applied. It's just so effective. Because you see left and right, it's like, oh. this person next to me lodge and I haven't yet. And then they go through office hours or group office hours and they don't have anything to show for. And at least looking good to your fellow founders that you respect,

that internal motivation, if at least overcomes that fear, that fud of this pop culture thing or too precious, that forcing function is so effective. And this is how YC companies have a higher chances of success. don't shoot themselves in the foot by dying of being anonymous? Yeah. Just by launching. As Diana pointed out, if you worked at a big company before starting your own,

you might have the wrong model of launching in your head. Companies like Apple and Google have infinite budgets. They spend years developing new products and millions of dollars on each launch. If you applied that to any of your startup, your company would die long before you launched anything. Next, Gustav and Tom talk about using your launch to find the right customers and learning to love rejection. Most people, when you see a new launch of a new thing, and it wasn't that great, you just don't have time to care. Totally. You're like, great, I'm going to get on my emails.

Yeah, close tab and continue with my life. No one ever says, I will never go to this website ever again because this was bad. It never happens. I have a bookmark fold of all the services I refuse to use because their initial launch was so terrible. So people assume that there's all this kind of like, attention on your product and if it doesn't go well, they'll just doesn't go well. But the truth is like, honestly, most people don't care. Totally. And for founders, it's like the center of their universe, right? They've spent so much time and effort on this thing. For everyone else, it's like

this footnote in their day-to-day life. Yeah. And even the bad launches, most people won't like it anyway. I always talk about like most people are not early adopters. So if people don't care, not early adopters, that's fine. If you just get a small number of people who care a lot, then that's enough. You build on that and maybe they carried up the one feature that is better than GitHub, and then you build on that and you keep going from there. Yeah, totally. One thing I talk to a founders a lot about is founders, especially B2B founders, see early stage sales. It's trying to convince everyone that they want to use your product, right? And it's not about that at all. If you have 100 sign-ups on your website, it's more about filtering down those 100 into the

five or six who actually have the problem that you're addressing, who have such a hair-on-fire problem. they might use your janky MVP solution. They might even feel empathy for your company. They might even feel like, wow, this is the only person who's trying to make my job better. So I should support them. And so it's about filtering. Early stage sales is way more about filtering down to your ideal customers than trying to convince the other. And people say, what about those other 95?

And you say, we'll come back in six months. Here's our feature roadmap. We'll be able to serve you in six or 12 months. We'll see you soon. Another reason people don't want to do this is that it feels good. You really don't have to ask anyone what they think about your performance. product, just ask yourself. And if you ask yourself, I'm not going to upset myself with how things are going.

But other people might do that and it feels bad to put yourself in a position where others might give you criticism or feedback. So it's better to just like, well, if I know everything what everyone's going to say anyway, I'm just keep working on myself. And programmers love to write code. And so they feel like they're spending 10 or 12 hours a day writing more code. And that's being productive, right? That's moving the start-up forwards.

But actually, no, it's doing the thing that's uncomfortable, getting out of the building, talking to customers, getting that critical feedback and truly kind of introspecting on your product is sort of asked, like, is this really the thing that's solving their problem or not? Yeah. Why do you think that's the case? This is a very common behavior, I think. It's that people are afraid of doing the things that feels uncomfortable, whether it's consumer, doing like a bigger launch, or versus B2B, actually talking to customers. Why do people... Lack of social skills? I think there are a lot of programmers who are just very, very comfortable sitting behind a computer writing code.

They're really good at solving all their problems that way. And they're like discrete problems, They're sort of very well-defined problems. Like the code compiles or if the code does not compile. You get out into the real world and the problems are like more, like sometimes trickier, sometimes like more ambiguous. There's a bunch of like social skills you have to have to try and like unpick all of this feedback and it like it feels deep, the uncomfortable when someone's criticizing you. And in a way, it's just easier not to deal with that at all and just sit and live in like

the comfortable little castle of writing code. It might have to do with just like that criticism, you'll take it personally. But in reality, what you think about is that, they're just not your customer. Yeah. And that's fine. Like, if you ever do sales, you will learn to love the rejections. And you get really good at that and doesn't actually bother you anymore.

Or fundraising. Or fundraising. Those are two ways to love and rejections and don't actually get that too intimidated by it. So I think there is a difference of stage here. When you are super small, you should absolutely launch early with the jankiest MVP you have because there's a very little downside. It sort of changes as you grow. Not everyone is going to be an early adopt.

of your product. At YC, we tell founders to focus on building something 100 people love, not something 1 million people kind of like those 100 people who love your product become your viral sales force. Launching will help you find those first 100 customers, or maybe even just the first 10. If someone is willing to pay for the jankiest version of your product, you'll know you're solving a real problem. Now, what do you do? if you launch your product and no one uses it. Here's Harge and Pete. So you've launched, your product is out there, and nobody uses it.

What do you do? Cry. Again, like the best founders just view everything, like we were talking about earlier, like they're learning their sponges. And so I think they just treat this as something, like a problem they need to solve and diagnose. You want to look at like where is like, why are you not getting any users or customers? where's a drop off? I think you treat it like an analytical problem. Like, is it because people aren't returning my, like, replying my emails, like asking to give them a demo?

Okay, like, can I tweak the messaging? Is that what's going on? Am I targeting the wrong people? And then you just like week by week, you're like, okay, like you tweak one variable. Like, okay, I'm going to try a different messaging copy in my emails, see if I get more people booking demos. And if that works, great. And if it doesn't, you're like, okay, like maybe I'm just talking the wrong people. Maybe I'm trying to sell into like a thousand person enterprise companies and I should, should be targeting smaller companies. I always find like it's like tweaking those variables one by one is like how you kind of dig yourself out of the whole.

Let's say you've launched your app that you've been out there for a little bit of time and you still just don't have users or growth. Like how do you know when it's time to keep tweaking and how do you know when it's time to just like call it a day and pivot into something else? I think that's a good question. It's one of these things that I think is more art than science. The way that I would prompt a founder that was in that situation is something isn't working, right? You're out there, you've been trying, you're pulling every lever you can think

of to pull and just nobody's biting, nobody's using your product, which one of your assumptions was wrong, right? And that like, it doesn't mean that this is a bad idea. It doesn't mean that you need to pivot to something else necessarily, but it does mean that you've made a bad assumption and you need to figure out what that is and develop a new hypothesis about the world. Yeah. If you launch and no one uses your product, it's not. not the end of the world. You can use your launch to diagnose the problem. It might be a messaging problem, or maybe you're targeting the wrong customer. Once you identify the problem and fix it, you can always launch again. Founders often find reasons to launch later because they're afraid.

How do you break that fear? It turns out, if you focus on your goal, that's the way. Here's Aaron and Serby. What's really hard is the mental mindset that you have to be in. And I think a lot of times people have that fear. And one of the ways that I found to try to break out of that fear cycle that's in your brain is if you look at risky decisions and you say to yourself, well, my goal with this is actually to learn, then I can't fail. You know, if your goal with your launch is to learn, it's not like, oh, we got to make $10,000 in revenue or whatever. It's just to learn. Then, like, you would do it way faster. And you will be successful, no matter what happens, even if somebody says, this product's stupid, I hate it. Like, you've learned something and

that's progress, so now you can get to the right direction faster. Every bit of learning is so valuable, right? In the early days, you're kind of just going out there and it feels like you're throwing darts at a wall, but every time you do throw a dart, you learn something about where the bullseye might be, you know, you get a little bit closer. So what advice would you have for founders who are in this pre-launch phase and are feeling a little bit of that fear? What would you say to encourage them? I would encourage them to cut the scope of what they think they need to build. Brex, you know, which was started out as credit card for startups, they didn't even have a way to create user accounts. Like you just like emailed them your password and that's how they set up

the account for you, you know? And like they didn't have a dashboard and like all these things, if you were planning out the features of all the stuff that you would need before you can launch fully, they were like, we don't need that. Like we just want the core thing. And I think actually one of the benefits of launching way before you even feel ready is it's the best way to test if somebody really wants it. If you give somebody a janky product and they still use it, then that speaks volumes about how important that problem is that you're solving. Absolutely. I remember one of our earliest launches before we pivoted to creative market, we actually went through YC as color lovers, a creative design community. And we had been around

for a little while and we decided to relaunch our product and so we had spent forever like rebuilding the code base and you know adding all these new features and took forever and we planned this big press event at the yC office and we're inviting these reporters and invited all of our batchmates and stuff and uh we launched the new product that day the new version of it and everything goes to shit basically page loads take 30 seconds the whole site is down And it turned out that what happened was the Google bots realized that we had changed all these pages and started indexing us really heavily like crawling it. And it was like a denial of service attack that we put on our own site. And it took us forever.

We were freaking out. And at the end of the day, nobody cared in either direction. People weren't like, wow, there's this brand new thing. And we saw some huge spike and uptick. And at the same time, nobody cared that it was down. We just eventually fixed it. And everyone kind of went on their way. Yeah, right, right, right.

But in the moment, it feels absolutely catastrophic. And the problem was we put so many eggs in that basket of the launch being successful. And if you just kind of take the pressure off, you know, and not try to make it some big event, then it's just a lot easier and a lot more focused on the thing that really matters, which is just learning and growing from it. Absolutely. Is there such a thing as launching too early? I think the only version of launching too early is when your product doesn't actually work.

It adds no value, you know. It's like the website's immediately broken. Yeah, exactly. It's like you click the button and nothing happens. That might be too early. Yeah, like make the product work. Right. But I think the disconnect that founders have a lot of times is the level of polish that needs to happen.

Or whether you need to be able to like actually create user accounts or, you know, again, doing things that don't scale. The founder can just manually handle some of that stuff in the background rather than building out an automated system that's going to take another three weeks and push back your launch. Right. So like in general, no, I don't think you can launch too early as long as there's some, you know, minimum value that the product actually provides. Launch early. Launch often. The best founders use launches to diagnose problems, find their early adopters, iterate on the product based on customer feedback, and then they launch again. You can see early stage YC startups launch their new products on Ycombinator.com slash launch. And right here on YouTube, on Instagram. on X, on TikTok, all the different social platforms.

So someday, we hope we get to see your products launch there too. Until next time, I'm Gary Tan, and we'll see you on the next episode of Office Hours.