Lessons from 1,000+ YC startups: Resilience, tar pit ideas, pivoting, more | Dalton Caldwell (YC)

Dalton Caldwell is Managing Director and Group Partner at Y Combinator. Prior to YC, he was the co-founder and CEO of imeem (acquired by MySpace in 2009) and the co-founder and CEO of App.net. During his time at YC, he’s advised more than 35 YC unicorns, including DoorDash, Amplitude, Webflow, and Retool, and has worked across 21 different YC batches. He’s also racked up more than 6,500 office hours with founders. In our conversation, we discuss:
• Why founders need to adopt the mindset “Just don’t die”
• The most common reason startups fail
• When to pivot, and characteristics of a good pivot
• The concept of “tar pit ideas” and examples of bad startup ideas
• Why investors say no to startups
• The importance of market size in investment decisions
• The pitfalls of founders over-delegating
• Effective ways to talk to customers
• 20 ideas Dalton is looking to fund
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Find the transcript at: www.lennysnewsletter.com/p/le...
Where to find Dalton Caldwell:
• X: / daltonc
• LinkedIn: / daltoncaldwell
Where to find Lenny:
• Newsletter: www.lennysnewsletter.com
• X: / lennysan
• LinkedIn: / lennyrachitsky
In this episode, we cover:
(00:00) Dalton’s background
(04:41) The value of simple advice
(07:04) Dalton’s advice: “Just don’t die”
(08:39) Knowing when to stop
(11:45) Deciding to pivot
(14:26) Characteristics of a good pivot
(17:53) Knowing when to pivot
(19:03) Zip’s journey and finding a market
(21:22) Why Dalton says to “Move towards the mountains and the desert”
(23:45) Tar pit ideas
(26:49) Understanding why investors say no
(29:14) The importance of market size
(32:16) Avoiding over-delegation and hiring senior people too early
(36:43) Why startups fail
(40:30) Effectively talking to customers
(45:17) Examples of startups hustling to talk to customers
(48:01) Patterns of successful startups
(52:05) YC’s Request for Startups
(55:37) Early days of Silicon Valley
(01:05:33) Contrarian corner: growth hacking for early startups
(01:09:28) Failure corner
(01:11:15) Closing thoughts
(01:12:22) Lightning round
Production and marketing by penname.co/. For inquiries about sponsoring the podcast, email [e-mail].
Lenny may be an investor in the companies discussed.

[@ycombinator]

That's a familiar face! Great interview Lenny. We love to see it.

[@LennysPodcast]

Love u 🫶

[@vikrammishra7601]

I'm a simple guy, I see Dalton - I click

[@dronepong]

He has a very calming aura.

[@EcomCarl]

Dalton Caldwell's focus on the essentials and his "just don't die" mantra are crucial reminders for startups navigating the complex landscape. It's a testament to the power of perseverance and adaptability in the face of challenges. 👍

[@ubcVancouver2010]

one of the best podcasts I have heard in a long time. Real person, real experience, real advice. Thx

[@dheenadayalan5873]

"Inspiring and informative, I loved it! Caldwell's reflection on his collective personal experience brings out a lot of gold nuggets for aspiring founders and product fanatics out there. Thank you, Lenny, for your deep insightful questions exploring both breadth and depth (Like always)."

[@acupofwhat]

One of the best podcasts I ever listened to. Nailed every reason why I failed with my startup. Incredible - Thank you from Sweden

[@J35Y1]

What was your startup idea bro? Would love to hear about a start up from Sweden

[@mruhaily]

man your show is improving significantly every episode, i can't thank you enough

[@jungong]

if you enjoy the process and love your customers, just keep going -- yes

[@SacredCASHcow]

when you say it like that it sounds creepy

[@hemakagunasekera271]

This episode was one of my favourite episodes so far! As an early stage founder this is priceless information which I very much find useful!

[@vestaalvesta786]

Watched till the end, something I rarely do. Many thanks for this authentic, down to earth advice episode. :)

[@VincentFulco]

Thanks Lenny and Dalton, much appreciated.

[@MikeeJ]

The columbo show was a great answer by Dalton, I’ve been studying Columbo and the way he disarms people, it’s very helpful in sales situations

[@AnomalyHQ]

Always great to hear from Dalton

[@Asimovo-RoboDevOps1]

Thanks for the insights Dalton and Lenny

[@lilyandemariam630]

9 mins in and I’m sooooo glad I clicked on this today. Love this! ❤❤

[@buzz1ebee]

Great interview! Thanks for sharing. Always great to hear from Dalton. Lots of simple but great advice in there. The pitch for Siphox sounds a lot like the pitch for Theranos, they must be fuming that those frauds caused so much reputational damage.

[@natekryn9840]

This guy's sounds like someone I actually couldn't learn from. I'm 100% confident that's not my problem, either.

[@davidlpz22]

Curious. Why in particular do you think that?

[@natekryn9840]

@@davidlpz22 someone like you or I, should think that, because this appears to be an entire episode, of u contextualized, inquisitions? Information? Apparently it makes sense? Here's, an easy way, Dave. Bud. If I can say that, it's like asking David Cho to earn a Michelin star off the Sweet Tomatoes buffet. Does, that make sense to anything you're familiar with?

[@rickitekgaaso2927]

agree with dalton. ur throwing nuance questions.

[@mukhsin.mukhtariy]

the way Dalton expresses himself in like a dominant way is making me bend my knees, that's another level of confidence, I hope I will get there

[@nickram321]

** - They REALLY want it - They REALLY believe in themselves - They REALLY believe they can make it work - They believe that they're the one for this

[@robertolsthoorn6146]

Dalton is the 🐐

[@leadgenjay]

Solid insights on the "Just don't die" philosophy, Dalton. Entrepreneurs should also remember that pivoting isn't just about changing the product; it's about iterating until you find a market fit, even if it means targeting a completely different audience than initially planned. And always validate the new direction with real customer feedback before going all in.

[@Ivan-dg9ww]

You can increase the conversion rate of your ads if you add a QR code with a link to your page at the advertised resource

[@minhNguyen-dk3vq]

soo good thank you for the pod

[@kyhwin2000]

Great episode!

[@brandon6490]

Thanks guys!

[@americanonobrasil2128]

Lenny’s podcast is the best startup/founder podcast around!!!

[@nftsasha]

this is so, so good!!! ty

[@thegeez001]

Love Dalton! He always has great insight.

[@ghostrich3948]

Amazing interview! I would love the list of 20 startup ideas. Is that going to be linked or did I just not see it? 🤔

[@LennysPodcast]

Here you go! www.ycombinator.com/blog/ycs-latest-request-for-startups

[@realmosworld]

I think the customer meetings can be via zoom. Not all of them need to be in person.

[@theimproooooooover]

Banger episode! Thank you Dalton and Lenny!

[@earlytoarrive]

Dalton vs Gustaf viewcount battle begins

[@OvercomerIdemudia]

Lol. Lenny would love this.

[@jamesjara4638]

Wou so deep!

[@davidlpz22]

Hilarious part of 20 mins on. Uber has 40k corporate employees. Uber built today could see a 10x reduction in staffing.

[@JosePinzon-hb7cx]

Everything is designed in my mind in simple spanglish

[@gomini3707]

Damn I have been binging on Columbo

[@williamschulz9018]

The companies like Brex that were despondent at times were perhaps just more honest founders and perhaps that's why they were more successful.

[@slightlygruff]

people will not remember you fondly. They'll forget you after you're out of their sight

[@realmosworld]

Columbo is outstanding

[@george_davituri]

was interesting 👍⭐

[@ubermensch6676]

We DEMAND more people from YC!!!!

[@LennysPodcast]

Haha! Who would you love to see?

[@earlytoarrive]

@@LennysPodcast Paul & Jessica - together

[@LennysPodcast]

@@earlytoarrive How epic would that be!

[@earlytoarrive]

@@LennysPodcast The OG Avengers! Also would love to see you interviewing/giving feedback to some early stage founders. Not sure on logistics, but would be an amazing insight for you to take varied 10 YC co's who have just finished a batch, 15-20 minute interview with each, 2 way discussion of them outlining how they are setting themselves up on product & growth, and you feeding back wisdom. Dalton's comment on tailoring advice for different stages was good, but you can apply Lenny San kaizen at all stages.

[@ubermensch6676]

@@LennysPodcast PG, Michael S, Garry, anyone really

[@reefreshedinc]

📌

[@Andrew-tt5lv]

What’s wrong with paying influencers? 😅

[@bigblitz]

Instructions unclear, I'm dead now

[@J35Y1]

Wyd here?

[@nonefvnfvnjnjnjevjenjvonej3384]

would brex be successful without yc though? it seems yc is a bit of a ponzi scheme these days where the companies sell to each other and grow their valuations and then get bought out by a large tech.

[@matthewmorley7218]

YC founder here. A ponzi scheme by definition is one where no actual value is created. Brex is used by something like 30% of batches to this day which wouldn't happen if the product wasn't any good. Do founders sell to each other? Absolutely. Do they sometimes sell to them even though they aren't their ideal customers and just buy each others product? For sure. But they'll churn just like any other customer would. It's entirely fair to ask the question but 9/10 founders are just building for themselves and who better to sell to than other founders (if that's who your customer is).

[@nonefvnfvnjnjnjevjenjvonej3384]

@@matthewmorley7218 fair assessment matthew but i would say ponzi is also stuff like herbalife where you can argue they have value but the growth is unnatural. wouldnt you say yc in particular due to the strong early successes have fallen into this trap recently?

[@AlexWilkinsonYYC]

Ponzi scheme is a zero sum system - so someone must lose for the other person to win. Unethical. Brex would be more like building a hammer that is used by you and all your friends, so everyone benefits. Ethical.

[@louigiist]

YC is a very elitist org by design. And I don’t blame it. However it’s pretty misleading for regular middle class founders who didn’t graduate from Stanford. How do regular founders succeed? We need much greater emphasis on smart founders who don’t have a network, don’t have money, don’t have anything, live in countries without entrepreneurial culture. How can we do this?

[@J.Colfer]

You can start by building your own network, and save some cash on the side. Those obstacles are rarely outside your control if you really think about it (I’m from a 3rd world country and managed to do just this).

[@AlexWilkinsonYYC]

YC is the least elitist big name VC by a long shot. They literally have a form on their website anyone can fill out with no introduction required. Also no Stanford degree required. The YC founders in my city in Canada did not go to Stanford, and had no US investor network when they got in. And to answer your question, you just build things repeatedly until people start paying you a lot of money for something you made. There is an amount of luck involved, which is why it's hard to give specific advice about exactly what to "do".

[@denysolleik9896]

@@AlexWilkinsonYYCbut they require you to have a website and business name. Yet they claim they accept only ideas. Misleading. It turns people away. Those fields are required to submit the form. There’s literally validation logic there.

[@louigiist]

@@AlexWilkinsonYYC Sure, I take your points. By the way it’s not wrong to be elitist, it’s actually good in some ways. It’s about making money at the end of the day. And that means managing risk by choosing safe bets.

[@AlexWilkinsonYYC]

@@denysolleik9896 If you don't have a business registered they can't do the SAFE to invest in your company. If you don't have a website it would indicate the person may not be a self-starter, which would be a red flag for many investors. A website can be created for free, and there really isn't a reason to... not have one?

[@dhikshith12]

that big hand with like 20 fingers thumbs up is very distracting....

[@RobbenBanks153]

Or just stop, let it crash, get over yourself, and go do something *actually* helpful to people. It’s just a game. I’m a founder, too btw. None of us is a messiah

[@samwstout]

you need help

[@johnnysanchez8709]

Great stuff Lenny! Keep it up.🫡