YC
Dan Siroker at Startup School 2013
@ Y Combinator
10/26/13
Takeaways
DS
Dan Siroker
10/26/13
@ Y Combinator
This is my sixth Startup School, and today I'm sharing what I wish I had heard during my first five times attending.
DS
Dan Siroker
10/26/13
@ Y Combinator
My entrepreneurial journey began in college when I researched machine learning and sentiment classification, aiming to apply it to the stock market.
DS
Dan Siroker
10/26/13
@ Y Combinator
I created a program that analyzed newspaper articles to gauge a company's performance based on the language used to describe it.
DS
Dan Siroker
10/26/13
@ Y Combinator
After graduating, I focused entirely on my startup but struggled to achieve profitability, which taught me the importance of having paying customers.
DS
Dan Siroker
10/26/13
@ Y Combinator
I decided to stop working on my startup and joined Google to learn skills that would help me succeed as an entrepreneur.
DS
Dan Siroker
10/26/13
@ Y Combinator
At Google, I was one of the first product managers for Google Chrome, where I learned the value of a feedback loop in product development.
DS
Dan Siroker
10/26/13
@ Y Combinator
The strategy at Google is to put the word 'Google' in front of products, which helps attract a large number of initial users and valuable feedback.
DS
Dan Siroker
10/26/13
@ Y Combinator
I learned that without customer feedback, I had no idea what to build, which was a critical lesson I missed in my previous startup.
DS
Dan Siroker
10/26/13
@ Y Combinator
After seeing Barack Obama speak at Google, I was inspired to volunteer for his campaign, which led me to run several successful A/B tests.
DS
Dan Siroker
10/26/13
@ Y Combinator
During the campaign, I learned the importance of A/B testing and how to use data to make better decisions.
DS
Dan Siroker
10/26/13
@ Y Combinator
The challenges I faced in the campaign inspired me to start Optimizely, aimed at simplifying the A/B testing process without needing developer involvement.
DS
Dan Siroker
10/26/13
@ Y Combinator
My first startup with a friend was called Carrot Sticks, an online math game for kids that aimed to make learning math fun and social.
DS
Dan Siroker
10/26/13
@ Y Combinator
In building Carrot Sticks, we learned the importance of focusing on feedback from our users, but we struggled because we weren't our target audience.
DS
Dan Siroker
10/26/13
@ Y Combinator
We faced a significant challenge with distribution, as it's tough to get parents and teachers to adopt new technology, often requiring a one-on-one approach without any scale or leverage.
DS
Dan Siroker
10/26/13
@ Y Combinator
In our second venture, Carrot 6, we improved the time from our first line of code to our first paying customer from infinity to six months, but realized our growth pace wasn't sufficient for a large, impactful company.
DS
Dan Siroker
10/26/13
@ Y Combinator
We decided to build a product we wished we had in Carrot 6, which led us to create Spradley, a company we applied to Y Combinator with in Winter 2010.
DS
Dan Siroker
10/26/13
@ Y Combinator
Spradley allows customers to receive discounts if they share their purchase with friends on social media, which we launched live on Carrot 6.
DS
Dan Siroker
10/26/13
@ Y Combinator
While working at Spradley, we focused on creating a feedback loop to improve distribution for our product, which took us about a month to secure our first paying customer.
DS
Dan Siroker
10/26/13
@ Y Combinator
The mantra of Y Combinator is to build something people want, and we learned to constantly improve our product based on customer feedback.
DS
Dan Siroker
10/26/13
@ Y Combinator
We realized that the fundamental model of Spradley didn't work because the social capital required for customers to promote a product outweighed any discount offered.
DS
Dan Siroker
10/26/13
@ Y Combinator
After a month, we pivoted to create products we wished we had, leading to the development of Optimizely, which simplifies A/B testing for users without technical resources.
DS
Dan Siroker
10/26/13
@ Y Combinator
During a call with a former colleague, I pitched Optimizely, and he immediately saw its value, suggesting a price of $1,000 a month, which was significantly more than we made with our previous ventures.
DS
Dan Siroker
10/26/13
@ Y Combinator
We had our first paying customer for Optimizely before writing any code, demonstrating the demand for our product.
DS
Dan Siroker
10/26/13
@ Y Combinator
The first year of Optimizely saw us grow to a team of four and achieve an annual run rate of $1.1 million, focusing on continual product improvement.
DS
Dan Siroker
10/26/13
@ Y Combinator
As we grew, I learned the importance of hiring, developing a standard algorithm to assess candidates against the average to ensure we brought in top talent. We focused on continuous improvement in our hiring process, asking if each candidate was better than the average, which helped us grow our team and improve our startup.
DS
Dan Siroker
10/26/13
@ Y Combinator
In 2008, we gained significant media attention by being associated with both the Obama and Romney campaigns, which helped validate our product and attract customers.
DS
Dan Siroker
10/26/13
@ Y Combinator
We crafted a 'David versus Goliath' narrative against Adobe, which resonated with reporters and helped us gain legitimacy and customers who were frustrated with the incumbent.
DS
Dan Siroker
10/26/13
@ Y Combinator
Our growth strategy involved continuous improvement and innovation, leading to a product that allows users to experiment with changes to their websites to improve conversion rates.
DS
Dan Siroker
10/26/13
@ Y Combinator
The vision for our product is to enable businesses to turn data into actionable insights, with A/B testing as a foundational step toward that goal.
DS
Dan Siroker
10/26/13
@ Y Combinator
The key to our success has been our satisfied customers who act as evangelists for our brand, providing valuable word-of-mouth referrals.
DS
Dan Siroker
10/26/13
@ Y Combinator
The universal startup algorithm involves getting feedback from everything you do, using that feedback to improve, and focusing on continuous improvement to build a lasting company.
DS
Dan Siroker
10/26/13
@ Y Combinator
Entrepreneurs should avoid the activity trap of merely executing tasks; instead, they should focus on defining and refining their business algorithms, as exemplified by Tesla's direct sales model.