Smash Notes

Back to Garry Tan on the Past, Present, and Future of YC, with Garry Tan.

How Did Bathroom Notes Get Airbnb Funded Early?

The weekly growth chart on bathroom Post-it notes is why Airbnb raised from Sequoia before demo day. Garry Tan says they needed revenue on the site to grow 10% every single week, and they nailed it.

He says the number one thing is that objects in motion stay in motion, and objects at rest stay at rest. Y Combinator is the moment founders learn to run fast. Billion dollar companies look back when a thousand person company is going slow and try to tap the energy of the first week and the first eight weeks. Airbnb got rejected by all the legends too. Brian Chesky used to obscure who the people were. Mike Maples later posted that he was the one who said no. He is one of the biggest legends in venture, and the story is lore now.

Saying no to a founder who ends up creating the next Airbnb gives Garry Tan heartburn. He is sure the miss will happen, and he turns the shame into energy so Y Combinator fixes the miss and funds the next founder. Brian Chesky taught him to exercise founder mode. Then Y Combinator will fund 30 to 50% of all the companies that matter. They have to take their own advice and do the startup way 10 times out of 10: quick and dirty, then feedback, then a fix the next time, rather than spending a whole bunch of money to hire a bunch of people. At 20 years, post-product market fit, the default is manager mode. He pulls Y Combinator back to founder mode.

Grokipedia·Airbnb·Garry Tan

Transcript

Garry Tan on the Past, Present, and Future of YC ·

The Peel with Turner Novak

More from this episode

  1. How Did a Summer Internship Experiment Grow Y Combinator?On the show, Garry Tan says the program started as an experiment by Paul Graham and Jessica Livingston to give small amounts of money, almost…
  2. Why Did Garry Tan Call Going Direct the Counterbalance After Reporters Refused to Publish a Proposition?Garry Tan sent an understanding of an actual proposition to a number of reporters, and the reporters would not publish it.
  3. How Did Airbnb Make Y Combinator Write Bigger Checks?On The Peel, Dropbox becoming a billion-dollar startup around 2011 was called one lucky year.
  4. How Did Office Hours Turn Garry Tan Into an Investor?Garry Tan joined YC with no plan to invest. After he raised and quit his startup, he was really burnt out and needed to recuperate.
  5. How Did Coinbase Carry Initialized Fund One?Initialized Fund One was a $7 million fund that returned more than 55x DPI. Most of that return came from Coinbase and Instacart.
  6. What Share of Giant Startups Came From Y Combinator?Garry Tan says Y Combinator is a managed marketplace for the smartest people starting the next companies, and he calls the setup a good thing.
  7. Why Does Surviving Rejection Mark a Y Combinator Founder?Garry Tan says 99% of people who apply to Y Combinator end up getting a mortal ego wound by being rejected.
  8. How Many Y Combinator Applications Get Rejected?On The Peel, Y Combinator gets about 80,000 applications a year. Something like 78,500 of them are mortal wounds, the rejections handed out.
  9. Why Do Two Y Combinator Years Beat Twenty in Venture?Two or three years of YC time as a partner is equivalent to 20 years in venture. The 15 partners are practitioners of product market fit.
  10. Why Did Y Combinator Stretch the Batch to 13 Weeks?Garry Tan says Y Combinator just extended the program to 13 weeks. The team talks to people about how things went and what can be done better.
  11. Why Did Y Combinator Build Bookface?Bookface is internal software at Y Combinator. On The Peel, Turner Novak had heard about Bookface and asked whether Garry Tan made it. Garry Tan said yes.

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