Seed Fundraising in 2013 after Y Combinator

Raising our seed was totally different from raising our series A, which I did 12 months later. Our fundraising history might look ok from the outside, but I messed up a lot. Even though our situation was atypical because of Y Combinator, hopefully some can learn from what I wish I hadn’t done for our seed, and what I’d do again. This is the story of how, when Apptimize was 6 months old, composed of consultants and 2 unpaid employees (me and my cofounder), and had zero revenue, I raised $2M in convertible notes.

I. How we started
II. What to talk about
III.  The week of demo day
IV. Who to talk with first
V. Closing the deal
VI. Mistakes with VC’s
VII. What I pitched

I. How we started

The first money into Apptimize was $50K that I put in before we incorporated. We wanted to pay our consultants: my friends around the Bay and people from hacker news. When we got into Y Combinator ~2 months later, they gave us ~$100K.

During Y Combinator, my MIT and trading friends were the first people who gave us money, not because they knew anything about what we were doing but because they knew me and know I’m a smart bet. Our founder friends also introduced us to a ton of investors.

The majority of the money we raised was through introductions through friends, such as Adi who introduced us to a bunch of amazing investors including Merus. One of our investors and friends Tom was the one who introduced us to Google Ventures during Y Combinator. He also led our Angellist syndicate. Friends were invaluable in helping us raise our seed because of the connections and advice they gave. Looking back over my notes, I’m struck afresh by how right they were about everything.

II. What to talk about

When talking with investors, I had 2 areas of discussion: topics that would lead to closing the investment, and topics that would not. Everything was either a selling point, or not. Non-selling points were barriers to go around so that we could go back to talking about Apptimize’s unique advantages. I visualized the conversation as a ride to the mobile monetization bank. I was talking with someone who, like me, believed that putting money and other resources into mobile monetization was a great idea, and I was taking them with me on this journey. If we started detouring into topics that weren’t going to lead to an investment decision, I figured out how to get us back to the freeway towards the goal. Before the end of the conversation, they had to believe that riding with me was equivalent to going to the mobile monetization bank by seeing enough signs that Apptimize would take them there.

Questions like “How much are you raising?” “What are the terms?” “How much are you going to charge your customers?” “How many people are you going to hire?” “Will some competitor do this?” were in the category of “not selling points.” There was little chance of any answer causing them to decide to invest, so the point of the answer is just to say something normal that allowed me to transition to talking about something that will improve the investment decision. The worst type of answer is the type that risks lingering over something that isn’t going to improve the investment decision, because this would waste time. Wasting time is the deadliest sin.

My strategy for these distractions was to answer in a way that didn’t invite more questioning, and transition back to the path to a decision. For example, I didn’t want the amount I was raising to be a topic of conversation because it wasn’t likely to affect the decision, so I gave a normal answer. For our fundraising environment, this was ~$1.5M. I kept all the non-selling point answers short so I didn’t derail and detour into irrelevant weirdness; non selling points were not things I had time to talk about. I didn’t want to linger at the stop signs or create unnecessary stop signs because nothing is happening there. I wanted to just check it off and pass go.

III. The week of demo day

During Y Combinator, PG made ominous remarks to me and my batch mates about how I would have no problem fundraising. It was nice that PG was so confident, but I was unsure. Preparing for demo day, PG told me, “Say in your presentation how successful you were in algorithmic trading. That’s frightening.”

A week before demo day, Tom introduced us to Google Ventures and they were the first institutional money we got for our seed. After 1 meeting, the next day MG emailed to say they were investing.

“We’re getting money!” I showed Geoff the email on my computer while jumping up and down.
“An email is not money in the bank,” he said.

In between demo day rehearsals, banking this money became my #1 goal. Google Ventures’ legal team said, “This was the fastest turnaround we’ve seen.” I kept on top of everything and made sure I got whatever docs they needed within minutes because I was optimizing for getting the money ASAP. Waiting for the wires to hit, I refreshed our bank account every hour. The few weeks I was raising, every morning when I woke up, I’d open the banking app to check for the money.

Going into demo day, with $500K+ committed but little of it banked, I was paranoid because a million things could happen- another financial crisis could destroy the global monetary system and wipe out all our would-be investors, even Google! However, I decided to always talk as though we were definitely getting all the money so that I was in a position of power while raising. In private I was preparing for the worst and called everyone I knew to ask them to invest. Until we had banked the whole $2M, I was still calling people.

We obsessed over our demo day deck. Rehearsing, I paced the Computer History Museum for hours. We kept changing our pitch up until the last moment. Asking PG to listen to an updated pitch, he exclaimed, “No, I don’t have time for this.” We slunk away as he grumbled, “You’re already doing well with investors.” We’d deviated significantly from the PG approved pitch, but we had our plan and felt good.

Demo day happened.

On demo day, after my pitch I stood at a table while investors crowded around. I did some handshake deals and enjoyed myself. Demo day was really successful for us, and we raised all the money on the most founder favorable terms possible. In the week following demo day, I had more than 25 investor meetings. Jeremy said, “Maybe you should be more selective who you meet with because we’re closing money as fast as you can take the meetings.”

I was still paranoid and almost didn’t go to burning man because the money hadn’t been banked yet.
My friend said, “You’re leaving me hanging here.”
“I can’t think about burning man right now. This raise is my #1 priority and I need help with that.”
He instantly connected me to a ton of investors. He’s amazing.

IV. Who to talk with first

Because we did well on demo day, we were connected with about 100 investors. How did I decide who to meet with in what order? I first figured out if they wanted to go where Apptimize was going. If they weren’t clearly into mobile, I put off the meeting. I also figured out how much they tended to invest. If I couldn’t figure out if it was >$50K, I would put off the meeting. The common theme behind all this was optimizing for my time. If I met with the bigger, more interested investors first, I’d have all the money sooner.

V. Closing the deal

From my experience, there are 2 main types of decision makers: fast and slow. Signs of fast decision makers include talking fast, irritability if you wander off topic, and indifference towards details. Signs of slow decision makers include lists of detailed questions, talking carefully, and wanting more of your time. Slow decision makers might be the first investors I started talking with for my series A, but they were the last ones I talked with for my seed.

Fast decision makers were my targets because my seed was about getting the money as fast as possible and moving on with life. I wanted people who could decide fast, in 1 meeting. When I met most investors, it was clear to me they were fast decision makers and had already largely decided to invest in Apptimize the instant we met. My goal was to go in there, verify their instinct was correct by being badass and answering what they wanted to know, and then getting the money.

I was constantly preparing for the moment when they investor has decided whether Apptimize was the path to the bank. The instant I sensed they’d decided, I asked for the money. This was usually 30 to 45 minutes into the meeting. It was different for different people. I didn’t try to change anyone’s mind, because changing someone’s mind (and keeping it changed) wasn’t an efficient use of my time. I just wanted to get them to decide anything, and then to get them to tell me their decision.
When I sensed they’d decided, I’d say, “Are you interested in investing?”
“How much do you normally invest?”
If they didn’t have 1 number, and said something like, “A range,” or “It depends,” or “I have to run this by whoever,” I would assume they decided not to invest and figure out how to leave for my next meeting.
If they gave me a number, I’d say, “Great, I’ll send you over the docs tonight via Clerky,” and figure out how to leave for my next meeting. Easy. Despite my worries, no one ever backed out.

VI. Mistakes with VC’s

As soon as we started Y Combinator, VC’s asked mutual friends to introduce us. I was torn on whether to take the meetings because during YC you’re supposed to focus on building, not fundraising. Plus there was overall an antagonistic vibe towards VC’s. It was weird because on one hand they’re mocked as herd animals that string you along, waste your time, and pass your information to competitors. On the other hand, they’re everywhere and clearly an important part of the ecosystem.

I hated the idea that someone might waste my time, so I was often suspicious and impatient with VC’s. This was unproductive because I should’ve been either not meeting at all or figuring out what I was looking for in a long term partner. I didn’t understand anything about how venture capital worked, how VC’s are incentivized, or what they cared about. If I went into it thinking this was going to be a waste of time, it did not go well. In addition to naiveté, it was a culture clash because in algorithmic trading everyone is incredibly secretive. I’d often say, “I can’t answer that.” Thus the VC meetings only went well when it was through a warm intro or if I felt a personal connection because I became less guarded.

After we raised $2M, I should’ve stopped raising but we had VC’s who wanted to do our series A. We didn’t need the money then and I was clueless what a series A and having someone on our board really meant.
PG said, “Nancy, don’t get addicted to fundraising.”
“How did you know I’d be good at it?”
“Duh, I’ve seen more than 550 startups. Try to do the A now if you can, but stop if it gets hard.”

It took a few weeks for me to realize it was getting hard, but looking back I could’ve realized it faster if I’d known how VC’s work. This experience is what led me to realize that raising seed money is like consumer sales, whereas raising a series A is like enterprise sales. This is not to trivialize the seed- I lost 5 pounds in 1 week going to all those meetings.

After we raised our $2M, I had 40 more VC meetings over the next month that were largely a waste of time because they did not result in much additional money. We were debating whether we should just do our series A at that moment because we had verbal offers, but in retrospect we should’ve stopped, I shouldn’t’ve been so cagey, and I should’ve learned enterprise sales and how VC’s worked. I didn’t fully understand everything I’d messed up here until after our Series A, and that’s another post.

VII. What I pitched

Above I describe avoiding the non-selling points. What were my selling points? What did we actually talk about during the meetings?

My team is the first thing I explain when I introduce Apptimize to anyone. I confess my team is the best team in Silicon Valley (and thus the world) and that getting to choose exactly who I want to work with is one of the main reasons I started my own company. It’s one of my favorite things about being CEO. It’s why I’m dedicated to building the best team in the world and why the best people want to work at Apptimize. Seriously, check out and message me if you want to join us.

The next thing I’d do was show our kick ass demo. Every single person told me they were amazed. Their jaws dropped. They called over their partners to come over to look at it. They’d never seen anything like it, no one they knew had seen anything like it, and there was more magical technology where that came from.

I’d always talk about the vision. Apptimize is about reinventing mobile development. Making and maintaining native apps is totally broken and Apptimize shows people a better way. Anyone who develops on mobile can tell you all the things they hate about it because there are barriers like the app store approval process, the release cycle, the app being installed on a device that doesn’t always have internet, every minor change needing to be put on the roadmap, the difficulty in rolling back a suboptimal change, the mounting challenges in dealing with the fragmentation and variety of mobile users, the opacity in figuring out what’s working and what’s not. Is this how people are going to be making apps in 10 years? Are today’s apps anything like what apps will be in 5 years? Of course not, of course not. Apps will be better and smarter than they are right now. Mobile development will be faster and easier. Apptimize is 10x better than anything else out there and we’re going to be the drivers of that change. Apptimize allows people to innovate 100x more effectively.

The reason I started Apptimize is because we’re enabling mobile teams to innovate more intelligently and efficiently. We enable an effective process for continuous innovation. Right now I see the pain app developers deal with. I see so many apps that flounder despite a lot of work and creativity. It hurts because it’s such a waste of life. Apptimize is fixing this. It’s a no brainer. Do you want to invest?

Good “For My Age”

As a kid, I should’ve broken more rules. I knew so little about what mattered that I couldn’t even imagine how little anything I did mattered. Everything from brushing my baby teeth to “fitting in” was a wasted, once-in-a-lifetime window of opportunity to act without consequences. I knew baby teeth fall out, but I didn’t connect the dots. I should’ve stowed away on airplanes, hacked into the FBI, and snuck into the white house. Nothing matters when you’re a kid! You’re held to the standard of a circus animal and anything you do remotely adult-like is extra, like how we applaud dogs for sitting. Why was kid Nancy role-playing her fake idea of an adult- like a chump!- when she had no idea what being an adult meant? Kid Nancy took on random burdens without realizing the potential benefits.

I guess if I had actually been a kid hoodlum I might not’ve transitioned fast enough into a law abiding adult, so better safe than sorry. But you can see there’s some sort of inefficiency there. Transitions are hard. Our minds are slow to update. The change from kid to adult is painful. You don’t move so much as get dunked from high school into college, college into yuppy real life, yuppy real life into Real real life where family and team members depend on you. Your actions acquire more and more consequences and you affect a bigger and bigger impact on the world.

At least earlier in life you’re alerted to these boundaries and in some ways prepared for them. In high school we noticed that standards were changing. We became aware we had to get our acts together at least by junior year because that stuff would be sent off to colleges. We started doing extracurriculars and conducting pretend lab work during the summer. In college, you know that the pressure is on for you to get stuff down on paper that looks legit enough for you to get a job. You apply for internships and participate in leadership.

But after college, no one warns you about the next transition. There’s no ceremony to ascend, so the post-college life boundaries sneak up on you. No one tells you there’s another event horizon in your late 20’s / early 30’s when you’re undramatically dunked into yet another category of human and the laws of gravity change again. After high school, I stopped celebrating my birthday and the years blended together. After college, I stopped seeing age as a thing. I have friends ages 18 to 70, and I don’t think about their ages (you find that nerds don’t really age).

It wasn’t until this “30 under 30” stuff started happening that I realized how close I was to the boundary of having an unflattering age. If I’d recognized that 29 would be my last laudable age, I would’ve tried to beef up my resume. I might’ve done more public speaking and maybe written a book. I’d probably have tried to get more twitter followers () and set some world records. But I didn’t glimpse this horizon until I was within its radius. I didn’t look up until I saw this “30 under 30” thing and the light hit that if I hadn’t won this year, I never would’ve gotten it.

I was ~22 when I first thought, “Oh crap, I now have to become legitimately accomplished instead of just accomplished ‘for my age.’”

All the stuff I didn’t know as a kid: was I dumb because of my age or was it my role as a person that age? It’s hard to imagine people used to get married at 13. Maybe that’s why human history’s so messed up; for millennia we had teenagers running things. It took me way too long to realize that the line between kid and adult was just not real. I was Hermione: “That’s not fair, Harry!… You can’t put that on people! It’s not our job to do that sort of thing, we’re kids!”

I think I lived my childhood ok. If I had to do it again, I’d say here’s how to be a successful kid:

  • Learn languages while your brain’s language centers are plastic enough to instinctively feel out everything natively.
  • Play with a variety of kids of different ages and learn to deal with different types of people.
  • Get into a moderate amount of trouble (not via boring stuff like drugs/alcohol/vandalism/theft but good original stuff like science experiments) because nothing that bad can happen to you.
  • Take initiative bc adults are nice to precocious kids.
  • Own a differentiated hobby so you can carnally know the direct relationship between relentless hours of practice and excellence.
  • Surprise people with some skill so that you realize no one knows anything and you can decide reality.
  • Deviate from what’s popular and set some trends so you can exercise knowing that human ideas are impermanent and aren’t like the laws of nature.

What does being an adult mean? I think it means realizing the extent of the consequences of your potential ideas and actions, and then figuring out how to navigate that to affect change in the world. It’s amazing the amount of impact you can have on the world.

Here’s everything I’ve figured out about how to prepare for your late 20’s. I’ll check back in a few years, but for now feel free to start altering the course of your life and career based on my advice:

  • Figure out what’s unique about you.
  • Figure out your niche target audience.
  • Expand beyond this niche.
  • Find the biggest problem you can plausibly successfully attack.
  • Talk about it and commit so that if you don’t at least make a dent in your problem it’s really mortifying.
  • Network with people who share ambitions similar to yours, possibly via some kind of incubator. Don’t just befriend or live with whoever happens to be around you because the people you spend the most time with matters and can set the trajectory of your life.
  • Get mentors and advisors.
  • Inspire strangers to give you resources, whether it’s charity, investments, crowdfunding, etc.
  • Identify the attributes of people you admire and sketch out a plan for acquiring those for yourself.

At 30 the bar gets higher. It’s like when you turn 18 and suddenly you’re kicked out of the house and into the army. I haven’t figured out that part yet and will keep you guys updated.

I’m 29. I’m turning 30 in the fall. I have 8 more months to get awards for not yet being 30. After that I will no longer be cool for “my age” until I’m 100 and will have to become legitimately cool for the next 70 years. Publications and societies, THIS IS YOUR LAST CHANCE TO CONSIDER ME FOR 30 UNDER 30 AWARDS. Won’t it be embarrassing for everyone if I turn out to be a bazillionaire and I never won your x under x award? Better to be safe and consider me! You’ll be in good company; here’s some publicity I’ve gotten during the last year of my 20’s:
MIT Alumni Profile,
Startup Beat,
Female Founders,
Forbes 30 under 30,
Alley Watch Women in Tech,
Fox Business News (I still haven’t watched this video- too embarrassing).

Ambitious without an Ambition

My best friend in 1st grade was the first person who ever told me I was the most ambitious person she knew. As a kid this was easy because most people I knew weren’t very ambitious. My parents were so swamped with work they were hands off raising me, so maybe my Asianness sensed the power vacuum and stepped up so that I effectively tiger-mommed myself. (My team has called me a tiger CEO, which is maybe not entirely flattering. For example, during a team meeting I said, “Hitting this revenue target would be a B+, which is an Asian F.”)

As a kid if I underperformed my expectations, friends would try to comfort me, “You did way better than most.” This type of thinking was alien to me because I held myself to a higher standard than others. Should I compare myself to a girl born in Sudan in the 13th century and congratulate myself for being literate? Of course not- it’d be a miserable failure if I were illiterate and I should compare myself only to people who have my privileges, and I unflinchingly admitted that I sucked compared to Einstein, etc. (who didn’t have half my privileges!).

Growing up, ambition was all I had, and all I understood. I liked proving I was the best. Demoralizing friends during casual games delighted me. Once I challenged my cofounder to photograph Dustin and forced our team to vote on which anonymized photos were better. Afterwards I rubbed in my victory a lot, because, although Jeremy did the camera settings for me (“Nancy, your photo isn’t even in focus”), I was 1) president of the photography club in high school, 2) a classically trained graphic artist, and 3) generally the best at everything. I was only satisfied after he verified, “You’ve crushed my spirit.” I still get competitive about everything from how fast I am at email (I send 400 emails a week within 1 hour of receiving them) to how much Lynn loves me relative to her husband (“You don’t love me more? But you’ve known me longer”).

Ambition as my primary motivator started running out of fuel around when I started considering what my wikipedia article would read while googling myself from my deathbed. (At this time, my mom was on what I hadn’t acknowledged to be her actual deathbed (My mother does not have anything remotely resembling a wikipedia article).) I modeled my deathbed wikipedia article with the most optimistic fit springing from current data, “HFT billionaire, MIT philanthropist, personal history includes leaving at the altar Justin Bieber and Peeta Mellark.”

I noticed I didn’t feel excited by this forecast. Thus was the hallmark of a bad plan: both unlikely to happen, and undesirable to happen.

This feeling was like sighting an iceberg in the horizon. I continued charging towards the South Pole, plowing through the ice, but glanced over every once in a while- had the feeling maybe gotten imperceptibly bigger? I brushed away the suspicion of lostness because near the pole all my compasses point due South- if you blindly follow ambition, direction is meaningless. For most of my life ambition was all I had. It was all I needed. It had taken me far, and it was always there. (I can be sharkish in my inability to not keep pushing. If my life were an epic poem, my fatal flaws would include my drive.)) What would I do if ambition stopped telling me how to go?

I left HFT. I read and I wrote. I walked the earth. My world was Apptimizes all the way down. I built my team. I thought about things you wouldn’t think about unless you were fixated on specific goals that are unusual and hard.

One day I was pondering the 7 deadly sins and thought, “I grapple with few of these. Lust? As if.” I decided I could write a better religion than the Bible and wrote my own version of deadly sins with corresponding virtues:

1. long term thinking vs impatience/ short sightedness
2. curiosity/ learning vs mental laziness
3. agency/ courage vs fear/ passivity
4. sincerity vs dishonesty
5. empathy/ compassion vs cruelty
6. love for something greater than oneself vs selfishness
7. commitment/ passion vs indifference

As I was wordsmithing my list (I never finished that project), I realized I had another thing that motivated me outside of “ambition:” Nancy’s virtue #6: love for something greater than me. For one thing, I loved my team. I learned the power of teams after high school, but I also recognized that the point of Apptimize was not to provide a cozy haven for us to live happily ever after. The point was the users. They’re the thing greater than myself or my team, the ones we must love.

I admit love for users was not natural. In HFT I never had users or clients- we traded our own money because it was all proprietary. I quickly discovered users can be annoying. They are silent, and then they ask something but it’s unclear if they really mean that thing. You try to help but they don’t listen and then you have to find another way to help and suppress the urge to point out if they’d just listened the first time it would’ve been much better for everyone.

I was unkind to our first users. I feel sorry for our early cohort and am amazed by the ones who stuck with us. I was like the crotchety, unfeeling businessman who reluctantly gets won over by exuberant wise child despite repeatedly trying to abandon her to a maid or an intelligent family dog (don’t remember if this is all the same movie, whatever). I thought I knew everything and that it was somehow all about me, but I realized when I don’t listen to our customers my decisions are confused and myopic. When I listen to them I learn so much. My users are the smart ones and I have to pay obsessive attention to everything they say and do.

The instant we had a user tell us they discovered a valuable insight, with the extra exclamation point in their email conveying excitement, I saw that customer success is what it’s all about. No matter how frustrating and exhausting, we’re nothing without our users. The smallest sign of excitement or happiness from them makes my day.

I stopped thinking about my own achievements or my team achievements and started thinking about our users’ achievements. Instead of how much more badass I would be, I thought about how much more badass our users would be. Instead of being ambitious for me or my team, I am ambitious for our users. Instead of my wikipedia article saying anything about me taking over the world, I think of how our users’ wikipedia articles say they took over the world, and it won’t mention Apptimize because our users do it on their own and we’re just one of the ways they figured out how to kick more ass.

Everyone on our team from sales to engineering has woken up at 6am and stayed up till midnight to take customer calls and push new builds. Once we accidentally forwarded an internal support discussion to users and were proud of not being in the least embarrassed by our casual thread- in fact we were secretly going the extra mile to make sure everything would work swimmingly. My team has worked on Thanksgiving, Christmas, and Saturdays (while calling it vacation)- not for the team- but to keep our promises to our users. That’s love. That’s commitment. That’s the right kind of ambition. That’s my religion.

I’m excited for 2015 because I can’t wait to figure out how to help our users accomplish even more this year. In case you want to try out some new apps for 2015, here are some Apptimize customers who kick ass (Maybe Apptimize is installed on your mobile device right now! (If you use one of these apps and say, “I summon the spirit of Apptimize,” 3 times I’ll jump out of your phone and tell you to stop goofing off and get to work!)):

Strava: Top 10, running and biking
Omvana: #1 meditation
Runtastic: #1 fitness in 80+ countries

Vevo: #1 premium music videos
Rhapsody: Top 10

Glassdoor: Top 10 jobs postings and reviews
eToro: Top 10 social trading

Yik Yak: Top 10 anonymous social media
Glide: Top 10 video texting
Flipagram: #1 free app in 80+ countries, make video stories

Travel: Search 4 million cars
Autotrader: Buy and sell your car
HotelTonight: Book a hotel instantly on your phone

Rakuten: World’s #7 largest e-commerce company
ReTale/ KaufDA: Weekly offers
OLX: Top 10 in >100 countries, classifieds
Stubhub: #1 ticket marketplace

Be Ready

It’s been almost 2 years since we started Apptimize. I think part of how we got here is by not knowing how hard it was going to be, like Columbus blithely sailing to India without knowing what the heck he was doing. When I heard the story about Columbus as a kid, I thought, “What an idiot.” Who starts sailing to somewhere with a bunch of ships without knowing the way? But every day we all launch towards a new world and rewrite the maps as we go.

When I started Apptimize I knew what our core strength would be: technological superiority. After working with a top team at GETCO where we were inventing technologies decades ahead of what anyone had, I knew how big a difference the team made and started recruiting the best people I knew from MIT and YC. I asked everyone who the best engineer they knew was and why. The first people we worked with were people whose references considered to be “un-hirable because they’re so good they just want to do their own thing.” Nevertheless I convinced some of them to join Apptimize. Everybody we hired, I made sure they were on board with the vision of inventing technology that would transform mobile innovation. Improving other people’s ability to innovate was what I had concluded was the highest leverage thing I could work on.

I’ve been lucky to have always worked on teams that are really good at engineering, and when you have a hammer, everything looks like a nail. For ages I viewed every problem as a technological issue. Didn’t matter what it was, technology will solve it. (Abortion? Duh, just invent a machine that sucks the fetus out and incubates it somewhere so you don’t have to choose between the rights of the mother and the rights of the child. Middle East crisis? Simply invent a machine, etc, etc.)

One of the first users who deployed Apptimize was a company I’d never heard of. I looked them up was surprised they simply put us into their very popular app, especially since this was a huge company that had just IPO-ed. Awesome! Basically they realized we had the best technology, way better than they could build in house. We didn’t need to do any marketing- they somehow found us despite us not being in the top search results for anything including our own name. They signed up despite our terrible website. They managed to integrate our SDK without any documentation and they deployed without ever talking with us. This was working.

Then our dashboard went down just as they were logging in to check out some test results. They were disenchanted and didn’t try to log back in for months.
“Sorry our dashboard was down for a few hours. This will never happen again!”
I reasoned the problem was that they lost confidence in our technology. A crack in one area signaled fissures in other spots. The solution was to attack the technology even more and make every single part amazing.

We worked on the product. I kept the prospective customer updated on all the new stuff we were doing, “We just added this feature that could be useful to you guys that no one else can ever build!” Eventually they were sufficiently impressed by our new features that they tried to install our update to use us again. I was surprised by how willing they were to try again considering the activation energy required to move their giant organization towards this idea again. “They must really want our product,” I thought. “They can’t build this in-house so they’re willing to endure a lot to try to use us.”

Then they couldn’t figure out how to install the new SDK because it was different from the old SDK. We explained, “The new SDK is fundamentally different. It’s better and does not require any programming at all to install. Can you start with a clean app and just follow these instructions? This SDK is easier and will give you a lot more power.” Awesome, right? Everyone else who’d tried the new SDK loved it. The number of support emails about how to install went to almost zero.

This company was different. They weren’t getting it and kept trying to install it the way they installed the first time.
“I’m not seeing the place to add the code snippet.”
“…There is no code snippet. Can you take out any code snippets you still have in there?”
After some back and forth, they gave up again.

After all the energy we put into making everything super fast and easy, after all our talk of saving our users time, they said, “We don’t have time but maybe in a few quarters.”

I lost 10 pounds of delusions right there. I learned a lot from that experience about a lot of different areas and don’t think we really made that many bad decisions, but I do think my perspective had been wrong in many ways. After all the resources we devoted into simplifying our deployments and making our product better and better, we discovered that the one customer it failed for was the one customer for which it mattered most. I had believed that if we had a product people wanted and the best technology, then we’d be good to go. I’d believed that the quality of our core features would be tested after the user set up the SDK. But that’s not what happened at all. The gap between reality and my expectations was oceanic. When you’re building a startup, a million things like this happen every day that teach you things you’d never learn in school.

One gap between school and reality is the way you’re judged on your work. In school there usually aren’t instances where everything relies on you getting the right things right at a particular moment that could happen at any time. Teachers are like, “Well, you got this one problem wrong but your work was ok so you get partial credit, and your other answers imply you understand the material, and I didn’t put anything on the test that I know we haven’t covered, so your total score is a B.” That’s not life.

In real life you can have done everything well but if you fail at this one thing then it’s all a fail. You also have to handle things that you couldn’t possibly know and that no normal person would be good at. Customers are like, “Your onboarding is annoying so I judge all the rest of your product as terrible, my browser is wonky with your site right now so I’m not going to assess this other stuff so it’s an auto-fail, why aren’t you amazing at graphic design in addition to everything else, you didn’t respond to my email in the middle of the night and now I’m never going to read it, so your score in mobile technology is an F.”

There are these clutch moments all around us where everything you’ve been working on for years comes down to one thing happening correctly and you simply have to nail it. If the customer can’t install your product, it doesn’t matter how amazing it is because they’ll never get to use it- you might as well have spent that whole time watching TV instead of building an awesome framework or whatever.

People have started messaging me about the YC interviews. I was debating whether YC tries to bridge that gap between real life. YC interviews are not real life; they’re like school because you know when and how you’ll get tested on certain areas. It’s not like you’ll suddenly have to demonstrate you know how to field a PR disaster if your product isn’t even launched. You’re at a certain stage and they only ask you things relevant at that stage and they only test that knowledge in a particular way. In real life, no one cares what stage you’re in- you better be ready when the test hits.

When we had our YC interview, everything we’d been working on came together for 10 minutes where we convinced some of the smartest people alive that we somewhat knew what we were doing. It was one of the first times we’ve ever had to pitch to skeptics, which sounds hard but is simple if you practice because you already know what they’re going to ask. No one has ever asked me a question I haven’t thought of already because all I do is think about the mobile space and the probability of someone coming up with a new question in a few minutes is low. Thus just work on an answer that people will 1) understand and 2) believe. In this type of situation, anything is possible if you prepare.

If you have an interview, please message me because I’m happy to help practice. I emailed many people when we were prepping for our YC interview and every single one of them met with us. It’s possible I’m a genius wrt cold emails, but for me the lesson is to pay it forward. Please give me a chance to do that!