Category Archives: entrepreneurs

Y Combinator: Applying, Pitching via Zoom or in Person

All I can say is just do it; if you are thinking about it, it is worth trying to get in. Apply ASAP, don’t delay it. There are no guarantees when applying but it is worth it. Y Combinator is more open then you think if they see a great idea and team. The Y Combinator team is willing to invest early. They invest in startup ideas and people. They take risks in new markets and invest a lot of the time when other investors don’t understand the market. To apply to Y Combinator go here.

Application

Most important things to show on your application:

  • You can build stuff fast.
  • Do you have some users using something you built? If not start building!
  • Have you done something amazing in the past? (E.g. Create Django?)
  • Make sure there are two of you at least (founders). Founder dynamics is important, if you have been friends or been working together for several years, then there is a great dynamic. Friends general won’t just walk away from something that will take the time to build. Startups can be stressful, show that your team can handle the stress of it.
  • Make sure you put a video attachment in your application, it will help.
  • Y Combinator looks for good team dynamics.
  • Conviction in what you are doing.
  • Talk about something you have done amazing in the company or in your life that really stands out.
  • Talk about the passion and idea to the partners.
  • Know your market size.
  • Know your competition.
  • Talk about the vision of your product.
  • Is there something driving you do build this company, startups are the cool thing to do but generally persistence pushes companies forward and having the right motivation will keep you going. Have the right motivation if you are starting a startup.

Pitching in Person

  • The first 30 seconds are super important.
  • Google the top 25 questions Y Combinator will be asking at a zoom or live interview.
    Like these:
    • There is that initial question: What do you guys do?
    • What is the about of time you will need to get to the next stage?
  • Have one person be the presenter during your very fast pitch in person.
  • Practice, practice, practice before meeting with the Y Combinator partners. Ask yourself’s questions the night before being interviewed, think about questions you think you won’t answer well, it helped us, my cofounder and I more than we thought it would. It is fast interview questions, rapid fire that will prep you so you are sharp for this kind of fast interviewing.
  • Find one or more founders that went through YC to talk too. We found two, one of them was the founder of Reddit, Alexis. We also found another founder who really helps us understand the process the day before our in-person interview. Insight into the fast questions you will get will help you think fast on your feet.
  • Record yourself via video and audio, and listen to it over and over. (Use Evernote to record the audio or something else.)
  • Put yourself in the partners shoes, the partners schedules are jam packed so answer accurately.
  • Again talk slow!
  • The partners will go off script … be prepared to go off script.
  • Have your numbers down!
  • Have your market, customer values, growth, LTV down and know it.
  • Do some jumping jacks or something physical to get the nerves out before you go into the interview.
  • Again, listen to a recorded pitch over and over and over again of your pitch before you go in.
  • Think positive so you can go in confident.
  • You need a two minute tag line that makes the partners and everyone connect with you/
  • Put your company and roll in the zoom link so they know who you are.
    • e.g: Daniel Kivatinos CEO StartupName.com
  • If you have a cofounder you don’t want to have a cofounder cutting you off, have smooth handoffs for questions so work that you workout beforehand.

Alexis came to drchrono’s office talking to the early drchrono team before we pitched Y Combinator.

  • One way to think about your pitch to the Y Combinator is this way, all of these can be shuffled around, depending. If you have fast growth shuffle things around  and assume you only have 10 minutes to pitch:

  • If you have the chance to pitch in person, be sure to practice your pitch over and over.
  • Record your pitch and listen to it several times to see where you are strong and you’re not strong.
  • You need to be able to communicate, you need to convey information very fast, practice.
  • Have you done a lot with very little? No investors, bootstrapped?
  • Show the product if you have one!
  • Have a demo? Load demo data and be ready to present it!
  • The partners see a ton of pitches, so have a tee shirt on with your logo. Well worth the branding and you can wear it anytime.
  • Sometimes context – “we are the X of X” helps people understand what you are doing.
  • Highlight something impressive, featured in the App Store? Win an award? Have some funding?
  • Have you burned your boats?
  • The pitch:
    • Team: Talk about your backgrounds, the co-founders.
      • Have a good intro.
      • Why you?
      • The team is super important so introduce yourselves in 30 seconds.
      • They want to make sure the founders get along and there isn’t an internal power struggle.
      • What is something you were super proud of?
      • What is your story? (each co-founder) Did you work for Apple? Do you have a Ph.D.?
        • If it is a company that is big you worked at but people don’t know the name, just say the company is the second largest X in the world. The company I worked at made X billion per year.
      • Who is the technical co-founder? Who is the CEO?
      • Michael my co-founder of drchrono talks about the “Humble Brag“
      • How long have the founders known each other? If you are friends you will tough it out when things get tough.
    • Problem: What is the problem?
    • Market: How big is the market? Is there competition? Is there a large amount of capital needed to start?
    • Product: Can you describe the company in 1 minute.
      • Is there tech risk?
    • Traction: Is this just an idea? Prototype? Have real users?
      • Do you have revenue? Do you have growth month over month?
      • Early fast growth helps.
  • We have X number of users, if you have traction, be sure to put that up!

The partners will ask questions and throw curve balls.

One tip: Be confident and walk up to others at Y Combinator and say hi! There are some really amazing founders around at YC.

Be sure to listen to this great lecture from Sam Altman from Startup School

More on pitching and demoing can be found here.

Bodies Don’t Equal Success in a Startup

people

Take a look at the number of employees Kozmo.com and govWorks.com had. Take a look at the funding that Pets.com had, all failures.

It isn’t the amount of people you have in a startup company that makes it successful. It also isn’t the nice office space or the amount of funding you have, it is more than just that. Overhead can create massive problems if you grow without the right plan, the right culture, the right vision, the right team.

The problem with true hyper-growth… It’s the problem like baking a cake in three minutes. You’re in the kitchen and you have sugar, flour, egg on the ceiling. What the hell are you doing?

Marc Andreessen at a Y Combinator talk, spoke about how startups are like baking a cake, you have to put the ingredients in at the right time and timing has to be just right, if any of it is mixed up then the cake will not come out right. Andreessen said at his early days at Netscape days they were hiring around 100 people per week.

It isn’t all the glitz, press and funding that creates success. What makes a company successful? Passion, a great dedicated team, execution, timing, bad or lack of competition, good idea. It is critical to have growth. That growth can be exponential user growth or sales. When the right company with all of these elements gets funding sometimes magic happens, it is hard work but the company grows like crazy.

Look at Apple, it had exponential sales in the early days, a lot of sales. Look at Instagram, it was exponential user growth, a lot of users. Or even CraigsList, they are a very small team, but everyone has heard of them. Growth is what creates a healthy company. If a company is to survive it needs growth.

When your first starting out you might hire a few people but keep making sales and users happy. Sales, support and growth are essential.

The right people in your company are what make it successful, people are everything, but counting the number of bodies in a startup doesn’t mean the company is successful, it is the quality and passion of the people who are there working day in and day out on the company that make a great company.

There’s nothing wrong with staying small. You can do big things with a small team.
~Jason Fried, 37signals founder

How to Start A Tech Company in Healthcare

The best person to start a company with is someone you have known for years. Someone who has a talent, drive and who you have seen work intensely work. Through the course of our life, there are a handful of people in your mind you think you could start a company with. I have only a few people in my mind and picked one when I started the company drchrono.

Michael was my college roommate. He had a talent for understanding complex software and could hack out just about any idea. He was doing a dual major in computer engineering and science major, and it was a breeze for him. I was a psychology and computer science major, and understood people. We took a bunch of classes together and worked well as a team, doing scrum like teamwork. As in all of our courses together. I made a mental note, he would be someone who I could work with in the future. After we both graduated Michael went on to work for Bloomberg LP and I went on to work at several startups in NYC. Several years passed when we got together to talk about working on an idea.

I recall sitting down with Michael in 2008, and we spoke about how we wanted to change healthcare over a cup of coffee. We didn’t have a business model, nor medical backgrounds, but we could build software. He was one of those people on my list I would start a company with.

After swapping personal stories about healthcare, we decided to start a company in that market. From seeing family members have a hard time working with the healthcare system we thought we could make a difference. Doctors were doing everything with fax machines, pen and paper. It was clear to us both healthcare was broken.

We really didn’t think too much about our name, jumping in with the name drchrono from day one. We picked that name as it related to time. We wanted to build something that took people and managed health over time, “dr” for doctor and “chrono” for time. There was no hard path for the company, but we had a vision for connecting doctors and patients and tracking health.

Michael quit his job of eight years to start the company with me. This was a commitment check for me to see if he was serious about doing this startup. Michael quitting his job showed to me he was serious, very serious.

We started working out of a small place called the Sunshine Suites, where we rented two desks. It was an on-demand office space with virtual offices in New York City. We then moved into an incubator space were we expanded the team.


he company jumped on an unconventional band wagon of using the cloud back in 2009, most companies were just starting to think about cloud. Most medical records company during 2009 were not using the cloud, part of our vision is to run all medicine in the cloud, the data, scheduling, billing, etc. Other companies were building for the desktop or using Adobe Flex, Flash or .Net, we decided that was the wrong route and it was a mistake. So we built on the same type of infrastructure that Google was using, Python and Linux. It pays off to really look at the tech stack you use, not to jump on a tech fad band wagon, it can hurt you in the long run. There are a number of healthcare companies in the cloud that are using bad tech stacks and they just aren’t able to build fast which hurts them. Using a good technology stack is critical to having an amazing experience for your customer.

For the first year, we spoke to doctors, one by one, shadowing and listing to them, asking them what they wanted. We would rapidly iterate over the feedback and repeat. We interviewed and shadowed doctors in hospitals, in large clinics as well as private practice doctors.

Ever entrepreneur should take as much feedback as possible and work on it, but remember filtering is critical. We get feedback from all kinds of doctors and patients; we picked what makes the most sense. Some physicians would give amazing input and others would give unproductive feedback. We still shadow doctors today, and that is how we know what we are doing right and what we are doing wrong. Software is an ever evolving thing that needs care.

After working for over a year, we built out a medical platform that could do medical billing, scheduling and email reminds to patients. In April 2010 the iPad came out, and I pushed us to build an app for it, I believed mobile was the future and it is. Thousands of doctors downloaded the initial release. We were the first medical records app on the iPad. It was an inflection point. It pushed us to build the best mobile EHR in the world. Today we have the highest rated medical records app in the iTunes app store. Our goal is to create the best healthcare experience through technology and we are doing just that.

Doing a startup in healthcare is not an easy thing. I tell entrepreneurs who want to jump into the healthcare space to do a startup be ready to take at least 7+ years of your life to create something meaningful and passion is a must and find people who are as passionate as you to build the company with.

It takes years to build something meaningful in healthcare. drchrono isn’t an overnight success, it was years of hard work. Yes most startups are a long journey, but startups in healthcare are the hardest type of companies to build. Overnight successes just don’t happen in healthcare.

When Michael my cofounder and I started drchrono, no one told us that it would take years to make something meaningful, it is our passion for changing healthcare that pushes us every day. We feel like we have only started.

drchrono now has over 45,000+ thousand physicians signed up and over 2,500,000+ million patients.

Startup School

Startup School

This year I had the honor of attending “Startup School“. It was an awakening, seeing the truth behind building a great company. I come from the east cost, I think we have great support like NextNY, the New York Tech Meetup, great incubators, and great advisors but the West Coast has some true gems. Support coming from Y Combinator and the startup schoool is amazing. Paul Graham gives great direction. It is eye opening.

I listened to founders talk, like Mark Zuckerberg of Facebook and Reid Hoffman of LinkedIn, it was worth the trip to CA. I recommend if you ever have the chance to go, take it.

Startup School 2010Startup School 2010Startup School 2010Startup School 2010

To hear some great info from the startup school, watch this video from 2009.

Watch live video from Startup School on Justin.tv


Watch live video from HackerTV on Justin.tv

Check out some of the great companies that came out of Y Combinator.

Free Lunch Friday Notes August 6th 2010

NYCSeed‘s managing director Owen Davis came by the Rose Tech Incubator this week to give a talk on what investors look for in startup’s. Some of the key points Owen mentioned that I took away from the talk are below. (NYCSeed only invests in the 5 NY borrows).

Owen Davis of NYCSeed at the Roes Tech Incubator

FUNDING CRITERIA

To anyone doing a startup, “Time matters”. Owen mentioned that committing large amounts of time to R and D is a bad mistake.
Timing has to be in your favor, things have to be aligned. Your technology and the timing is key. You can build something great but is there a demand for it?

Owen recommends 2 person teams, I hear this magic number a lot, google, yahoo, etc. Startups with 2 founders is the magic number. It shows a demonstrations team work, difference in dynamic. With a team of two you have a sounding board.

Another key thing is to have a prototype complete.

Showing you have tech leads on as founders is the DNA of the company it is important. Moment by moment technology changes.

Angels and VCs like to see a good sized market, show a clear path to revenue.

TYPE OF STARTUP COMPANIES

Network Effect
-Hard to invest in these
-Risk
–e.g.: Gaming companies
–e.g.: iPhone apps
–e.g.: YouTube lost 40 or 50 million a year
-not real innovation

Application Oriented
-look at market
-build an application
–e.g.: ticketfly.com
–e.g.:quickbooks

Innovation
e.g.: google’s rank algorithm
e.g.: Advertising space, customer segmentation of ads
Investors believe or don’t believe in the innovation you have.

Some companies have pricing power, if coke raised it’s prices they would be ok.
If a copper wire company raised it’s prices it would take a toll on them

Some examples of companies that have a little higher prices are:
zappos.com has customer loyalty.
Amazon charges more then others.
Wholefoods charges much more then others.

Team
Having a good team culture is important.
Be honest and be transparent that is what is important.

WHAT MAKES A COMPANY FUNDABLE
Big Market
Team

A “good business” is not necessarily fundable.
A lot of great biz that will be successful without funding.

GOOD TRENDS
-how do u derive meaning out of data
-New ways to data mine
-Project management tools
-Online learning
-Digital advertising
-Billboard industry
-Local search
-Building a better Craigslist
-Building better Email

Free Lunch Friday Notes July 30 2010

Kirill Sheynkman came over to the Rose Tech Incubator and spoke about pitching to VC’s. I took some high notes personal notes from the talk.

The pitch.
Tell them what you are doing.

Market.
Why now?
“We are a _____ for ____ a market worth $$$.”
What is the pain you are addressing.
Who are the people that have the pain.
How many are there?

Product.
Why this.

Team.
Why us.

Deal.
Why now.
Let them know your realistic goals.
Milestones.
Think about the next round.
Expect 35%-40% for a series A.
2 1/2 post round B.
How are you going to get to this point?
Think about the next round
Who will sign the check?

Down Rounds are bad!

Funding cycles.
The approach.
The first meeting.
The second meeting.
The partner meeting.
Due diligence (can take weeks).
Close (4 to 6 weeks to get a deal done.)

Start to pitch 6 months before the next round. It is the CEO’s job full time to be raising money.
It is the board of directors job to manage how well the CEO’s performance is going for a company.

Check out Kirill’s blog, he is also on twitter.

Free Lunch Friday Notes July 23 2010

We were honored this week to have David Rose talking about the direction that companies are going.

I took a few notes on what he had mentioned.

First he mention some great outsourcing resources:

David also mentioned that we should take a look at the books Wikinomic sand Three Moves Ahead a book by Bob Rice.

How to Contact An Investor

There are a few ways to contact investors.

I believe the best way to do this is to find someone who can make a warm introduction for you via email. Then taking it from there. If you can find someone that you know who knows the investor.

Sending an email without knowing an investor before hand is hard because investors get 100’s of email a day from potentail companies to invest in.

Listening to Jason Calacanis’s on the podcast This Week In Startups he talks about the best way to contact investors via email. Some great advise from him, never send powerpoints, don’t email investors at strange hours of the night with your business ideas. Screenshots or a URL are good. Listen to these few minutes, they are very good: mp3.

Howard Morgan from First Round Capital says he will never open a .doc file. He doesn’t want to get a computer virus.

This is the email:

Hi Mr [THEM],

This is dot dot dot, I’m taking on this market, I’d love to tell you more if your interested. Here is my URL.

[YOU]