TechTalk: A Y Combinator success story
Untold Stories Budapest Special Edition
Estimated reading time: 5 minutes
Long story short, Alexei’s tale began in 2013 in Paris, where together with two of his co-founders they launched a company called Motionlead. As he describes it, their goal was “to monetize an app’s audience with better ad technology”. They got into Y Combinator’s program in 2014 as the very first French company ever to be accepted, moved to the US, then they started to expand. Today, they’re a blooming tech company and Alexei’s gone onto investing in other companies (about 30-40), too. He is an active member of the tech community in the US, but especially in Europe.
Well, to go bits by bits into the story, Csongor nicely starts off their chat by asking Alexei about his experience of the YC program and the biggest takeaways that might help today’s startups to embark on their journey. Alexei confidently states that it was the most intense experience they’ve been through, yet they’ve had so much fun. He then goes into details: the program is 3 months long, so they had to move to Mountain View (California), where they worked day in, day out. They used to get up really early because of the different time zones, as they wanted to get in contact with their European customers. At the time, they didn’t have any network in the US, but through YC they got to know other founders and companies in the same boat as they were, which helped them grow in every way. What he liked the most about it, though, was that they could work together with companies of different stages, so they shared feedback, problems and successes with each other. “It’s like an Alcoholics Anonymous for startups” - he funnily states. Overall, this whole experience helped and allowed them to penetrate the US market a lot quicker than in any other scenario. When Csongor asks about the reason they chose YC, Alexei says that at the time they were avid readers of Hacker News, YC’s blog.
For startups that are considering applying, Alexei gives the following tips to improve their applications: it should always be short and straight to the point. YC is a venture fund, a VC, so they prefer to invest in a company that has 1% chance of becoming a $10 billion company, rather than a company that has a 50% chance of becoming a $10 million company. The narrative should always be: “it’s going to be really hard, it’s going to be painful, there’s only a small chance we’ll succeed, but if we do we’re going to be the best company in the world!” By looking at plenty of European applications himself, he can surely say that this kind of mindset is somewhat missing from startups here, as compared to those in the US. Yet, the most important might just be the combination of a long term vision and a short term execution plan! Whatever happens, “if YC’s accepted you in the program, it means you have something valuable.”
YC’s been active on expanding their scopes, they launched Startup School, Investor School etc. They’re holding summer and winter interviews with about 150 companies per batch, and they’ve recently opened two new interview centers, one in Paris and one in Bangalore, India. They also have a lot of office hours worldwide. All for the reason to be able to get in touch with more founders internationally, as they sure need newer and fresher perspectives to the somewhat tunnel vision of companies in Silicon Valley. Alexei says “They’re really trying to democratize access to capital, access to just evangelizing the possibility of launching a company.” Then he further goes by saying “I think we’re gonna see a lot of success coming from this international expansion.”
Well, to describe the interview process as such, he shares their experience. At the time they were just students with no network, they went to San Francisco for 3 days, they rented a Mustang and had a 45-minute drive to Mountain View and they actually ‘prepared’ for their interview just during that car ride. They didn’t know the expectations of the market and what YC expects from them, because they hadn’t talked to any founders. But they knew their metrics and their business very well. The interview itself is actually only 10 minutes, “you’re not even past the door yet and they already start shooting questions”. They go so much into detail, they know a lot as they examine the applications really well beforehand. After the interview, they had a good feeling, so they went surfing. Applicants actually receive a call if the process was successful or an e-mail if they failed. With a huge smile on his face, Alexei further tells that in the evening they went to a French wine bar, which was the perfect venue both for celebration or to drink and forget.
Investing in companies is fascinating for Alexei, as working with other founders who are experts in their markets has helped him a lot in his daily life, too. Feeding his intellectual curiosity, he enjoys to see the level of advancement that these companies have on their market. Of course, “cheering from the sidelines” is much easier than building a company yourself - he adds. “Listening to everyone else helps you to build your own company” as you get acquainted with many different problems. It is a great learning opportunity for both founders and investors. “It’s good to help some other companies” he says, as even if he doesn’t invest in them, he tries to help as much as possible to bring them closer to success. He likes to call these “founder psychology sessions”, because “half the companies that fail, fail because of a founder dispute” and that’s what he teaches them to avoid.
If you'd like to see and/or hear the whole interview, head on over to our Blog and watch the video or listen to the podcast either on Spotify or on Podomatic!