Y Combinator
Jul 30, 2019

Startup School Podcast Preview with Kevin Hale (evaluating ideas)

Summary

Y Combinator’s startup school kicked off on 22nd July 2019 and they’re putting out all the lessons as podcasts / videos over here. Whether you’re taking part or not.

Back to the podcast… this is the first of the lessons and Kevin Hale walks through the process of evaluating ideas and how founders, who are looking for VC funding, should think about startups.

Interesting to hear ideas talked about from the perspective of what an investor is looking for. And don’t dismiss the episode because you’re not looking for funding – it offers a different perspective on whether you’ve got an idea that has a chance of working.

3 lessons…

  • An idea is a hypothesis about why a company could grow quickly and has 3 parts – a problem, a solution and an insight.
  • Great problems are… popular, growing, need solving frequently, urgent and expensive to solve. Even better if they are mandatory from regulation.
  • Insight is the unfair advantage. For example:
  1. You are one of the only people in the world who can solve this
  2. Market is growing at 20% per year
  3. Product is 10x better than competition
  4. Acquisition model can’t only be paid – should also include free (word of mouth)
  5. Is a monopoly – the bigger it gets the harder it is to defeat.

Today’s episode is a preview of the Startup School podcast.

We’re putting all the Startup School lectures on their own podcast feed. You can subscribe here:  
iTunes
RSS

This is the first lecture from Startup School 2019. It’s Kevin Hale on How to Evaluate Startup Ideas.

It’s also not too late to sign up for Startup School.

The course just started and the deadline to sign up is August 4th. Select companies who complete the course will also receive 15,000 dollars in equity-free funding.

Y Combinator invests a small amount of money ($150k) in a large number of startups (recently 200), twice a year.

Learn more about YC and apply for funding here: https://www.ycombinator.com/apply/

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Topics

00:00 - Intro

00:42 - Why we're starting with evaluating ideas

2:07 - YC doesn't just fund companies with traction

3:31 - How can I predict if an investor will like my idea?

5:57 - A startup idea is a hypothesis

7:37 - The problem

11:37 - The solution

13:07 - The insight

14:42 - Founder's unfair advantage

15:42 - Market growing 20% a year

16:22 - Product 10x better

17:12- Acquisition model

18:37 - Monopoly

19:32 - Threshold belief

19:52- Miracle belief

20:42 - Example: YC

24:02 - Example: Wufoo