From 2x Entrepreneur to Partner at Y Combinator - The View from Both Sides of the Table
Michael has been involved with several of the most important companies in the video space, including Twitch (acquired by Amazon for $970 million) and Socialcam (acquired by Autodesk for $60 million). In addition, Michael is as a Partner at Y Combinator, one of the premier accelerator and venture capital organizations in the technology industry. We had the opportunity to learn more about Michael’s past experience and his advice for budding entrepreneurs.
Name: Michael Seibel
Grew up in: Brooklyn, NY and East Brunswick, NJ
Role: Partner, Y-Combinator
Favorite Book(s): Shogun by James Clavell
Degree: Political Science
What issues are you most passionate about?
Politics, startups, food/cooking, and travel.
Who is one person you follow on social media who you think others should follow?
No idea – I mostly use Facebook and follow my friends.
What news outlets or media sources do you read on a regular basis?
TechCrunch, Techmeme, Google News, Meet the Press, and a number of podcasts including: Planet Money, Freakonomics, Intelligence Squared US, and This American Life.
How did you get into the world of technology?
My friend Justin Kan asked me to help him with his new company, Justin.tv, in October 2006. Back then Justin.tv was going to be an online reality TV show. It was a crazy idea but the team was great (Justin Kan, Emmett Shear, and Kyle Vogt) and it felt like a once in a lifetime experience.
There are at least 4 occasions between Justin.tv and Socialcam where we were very close to dead.
Who has been your most important professional mentor(s) and why?
I never had one all encompassing mentor. Different people have been helpful to me at different times.
What has been the most meaningful professional experience you’ve had and why?
Selling a company and it was so much harder than I ever thought possible.
What is the most difficult professional or personal challenge you’ve had to overcome?
Almost running out of money. There are at least 4 occasions between Justin.tv and Socialcam where we were very close to dead.
To be honest, being a startup founder wasn’t in my “plan”.
What advice do you have for young people of color who are looking to get into technology?
- Start early – this is a young person’s game and you don’t need more than an undergrad degree.
- If you are math and science inclined, be a CS major in college.
- Try to get a job at a small startup doing just about anything – don’t optimize for title/responsibility.
- Save money – continue living like a college student for as long as possible.
- Try to have your first product launched by 26.
Richard Kerby wrote a thoughtful piece on the lack of diversity in venture capital. As a current partner at Y Combinator (YC), do you consider yourself a venture capitalist? More pointedly, how and when did you first become an investor?
Being a startup founder I’ve often had a slightly adversarial relationship with VCs because they kept on saying no when we needed money. With that said – its hard to look at my role at YC and say that I am not an investor. I made my first angel investment in 2012 and I’ve been a full time partner at YC since November 2014.
You have been a serial entrepreneur and seem to have turned an unlikely startup idea (Justin.tv) into a series of entrepreneurial successes (Socialcam and Twitch.tv) which you have described eloquently in the past. What were some of the lessons you have learned during the process that you believe are broadly applicable to others (e.g. following passions, building teams, scaling businesses, raising capital, exiting with suitable partner, or anything else you would like to discuss)?
- Work with people that you’ve had a previous relationship with (either business or personal). The number one risk to a startup is the founding team breaking up because of a fight.
- Run your company cheap – you should try to be close to break-even as much as possible.
- Only go into fundraising with an edge: significant user growth, revenue growth, profitability, etc.
- Try to only hire people that are smarter than you – adding people will not always allow you to do more things (especially in the beginning).
- Have a development cycle and stick to it.
- Measure, measure, measure and everyone in the company needs to be able to see the stats.
- Everyone in the company (in the early days) should be talking to customers.
When did you first realize you wanted to be an entrepreneur?
LOL – I think I realized only after I already was one. To be honest, being a startup founder wasn’t in my “plan”.
What has been the hardest part about being an entrepreneur for you?
Work/life/health balance and maintaining strong relationships under high levels of stress.
I think being an investor is about figuring out the feedback/help that will best inspire/reinvigorate a committed operator.
Are you working on a new venture now? If so can you talk about it?
I am working on a number of projects from my role in YC:
- I am working on ways to make it easier for people to apply to work at YC companies (more on this soon).
- I am also helping to develop a college class that can be installed in universities across the country that is modeled after YC and will produce launched products/companies in 4 months.
- I am working on a project to help hardware companies grow and prosper in YC.
- I am working on a project to help significantly increase voter registration in America.
How do the keys for success as an operator compare with your keys to success as an investor?
I think being an operator is about 100% commitment and a buck stops here attitude. I think being an investor is about figuring out the feedback/help that will best inspire/reinvigorate a committed operator.
How does your experience as a partner with Y Combinator inform your philosophy of operating a startup?
The YC philosophy and my philosophy on how to operate a company are 100% intertwined.
How does your experience as a startup founder and CEO impact your approach to Y Combinator?
I feel like I can draw on more personal experiences and relationships. Also I still have product insights that haven’t gotten too rusty (yet).
From the outside there seems to be a significant increase in the number of minority and women led startups at Y Combinator. Is this the case? If so what seems to be driving the change?
Yes – our diversity is increasing which is something I am super happy about. I think there are 4 things that are helping us:
- We have diversity within our partnership (we are not a 100% white male firm).
- The Female Founders Conference – which I think is a truly great event.
- We talk about diversity – we announce our stats.
- One on one outreach – we do so much direct outreach to female and minority founders – I spend as much time talking to/advising founders who want to apply to YC as I spend helping the companies in YC.
Do you have any personal or professional goals with Y Combinator that you would like to share?
I want to make YC stronger in every way – my goal is for YC to be an entity that will still be killing it in 100 years.
You were a startup CEO very early in your career. What do you think best prepared you for that experience?
Not sure if anything can prepare you – my advantage is that I started young so I had a lot of time to learn.
What advice would you give to startup CEOs?
Most of what I’ve already said above.
If we could help you with one thing what would you like that to be?
Send me any startups that you think should be in YC – I’ll spend personal time with each and every one of them.
Is there anything else you would like to add?
For everyone who reads this and is starting a tech startup – my door is always open. Email me at firstname.lastname@example.org.