Startup Playbook

📘 The Startup Playbook

By Sam Altman Illustrated by Gregory Koberger

A guide distilling the most generalizable advice from Y Combinator on how to start a startup. The playbook is divided into four key sections: The Idea, The Team, The Product, and Execution.

Read the full playbook here

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🚀 Part I: The Idea

A great idea is the foundation, but execution matters more. However, starting with a good idea makes success much more likely.

• Clarity is Key: You must be able to explain your idea clearly and concisely. Complex ideas often signal muddled thinking.
• Build Something People Want: Ideally, you are the target user. If not, you must understand the target user extremely well.
• Growth & Market: Look for a market that is evolving or growing quickly. It is better to capture a large part of a small market than a small part of a large market.
• Testing: The best way to test an idea is to launch it or try to sell it immediately.

"It's much better to first make a product a small number of users love than a product that a large number of users like."

👥 Part II: A Great Team

Mediocre teams do not build great companies. The most important factor in a startup's success is the strength of the founders.

• Key Characteristics: Look for unstoppability, determination, resourcefulness, and intelligence.
• Co-founders: The best case is a good co-founder; the worst case is a bad co-founder. Being a solo founder is better than having a bad partner.
• Equity: Split equity near-equally among co-founders to prevent resentment and align incentives.

🛠️ Part III: A Great Product

This is the only thing all great companies have in common: they built a product users love.

• Feedback Loops: You must get very close to your users. Watch them use the product and iterate based on their feedback.
• The Cycle: Build -> Measure -> Learn. Keep this cycle as short as possible.
• Do Things That Don't Scale: Recruit users manually if you have to. Hand-hold your early customers to ensure they have a great experience.

📈 Part IV: Great Execution

Once you have a product, you must turn it into a great company. Execution is the process of creating value over a long period.

1. Growth

• Momentum: Growth solves all problems. Lack of growth leads to burnout and internal fighting.
• Focus: Pick a single growth metric and optimize the entire company around it.
• Transparency: Keep metrics visible to the whole company to maintain focus.

2. Focus & Intensity

• Prioritize: Identify the 2-3 most important things and ignore the rest.
• Speed: Making decisions and moving fast is a competitive advantage.
• Obsession: Great founders are often obsessed with their product and company.

3. Jobs of the CEO

• Set the vision and strategy.
• Evangelize the company (to investors, employees, and users).
• Hire and manage the team.
• Raise money and ensure the company doesn't run out of cash.
• Set the execution quality bar.

4. Hiring & Managing

• Don't Hire Too Soon: Hiring slows you down. Only hire when you are desperate.
• Quality over Experience: Value aptitude and "slope" (rate of improvement) over years of experience.
• No Jerks: Do not hire chronically negative people; they destroy culture.

5. Competitors & Fundraising

• Ignore Competitors: 99% of startups die from suicide (internal problems), not murder (competitors).
• Fundraising: Raise money when you need it or when it is available on good terms, but do not let it solve your problems.

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Summary generated based on content from playbook.samaltman.com.