Ryan Hoover, founder of Product Hunt, discusses the formation of the platform and the process of applying to Y Combinator (YC). Product Hunt started as an email list and later evolved into a website, inspired by Reddit and Hacker News. They experienced significant month-over-month growth through manual outreach to makers and founders, resulting in increased site traffic. Raising money for the right reasons is emphasized, as not everyone needs venture capital and running a profitable small business can be a better option. Maker communities, such as Product Hunt, have led to an increase in product creation. Product Hunt raised $1 million from notable tech investors and focused on long-term factors like retention, growth, and revenue. The importance of focusing on monetization early on and going deep on specific product categories is highlighted. Product Hunt faced challenges when expanding into different verticals and the need for urgency and revenue optimization is emphasized. Dalton Caldwell, head of Admissions at Y Combinator, looks for serious and committed individuals in applications who have actually built something and are motivated by their own dreams. Providing financial support and time to quit jobs and focus on projects is crucial.
Ryan's intro
Ryan Hoover is the founder of Product Hunt, a platform for discovering and discussing new products. Users can comment, ask questions, and share what they find interesting.
Dalton's intro
Dalton Caldwell, head of Admissions at Y Combinator, introduces himself and his previous experience at YC during Product Hunt's early stages. He discusses the interview process and mentions Sam Altman as one of the interviewers. Dalton has a question for Ryan Hoover, the founder of Product Hunt.
- Dalton Caldwell, head of Admissions at Y Combinator, introduces himself and his previous experience at YC during Product Hunt's early stages.
- He discusses the interview process for Product Hunt and mentions Sam Altman as one of the interviewers.
- Dalton has a question for Ryan Hoover, the founder of Product Hunt.
Forming Product Hunt and applying to YC
Ryan Hoover discusses the formation of Product Hunt and the process of applying to Y Combinator (YC).
Key points:
- Product Hunt started as a side project, initially as an email list and later evolved into a website.
- The inspiration for the platform came from Reddit and Hacker News.
- After four months of operation, Nicholas from Algo Lea reached out to Ryan, expressing interest in Product Hunt.
- Ryan Hoover met with Gary Tan to discuss whether to continue Product Hunt as a side project or turn it into a company.
- Tan advised Hoover that opportunities like Product Hunt are rare and encouraged him to seize the moment.
- The growth rate of Product Hunt at the time of their YC application was not mentioned.
Product Hunt's growth rate when they applied to YC
Product Hunt's growth rate when they applied to YC was achieved through manual outreach to makers and founders, resulting in increased site traffic. This gave them confidence during the interview process.
- Product Hunt experienced significant month-over-month growth
- Growth was achieved through manual outreach to makers and founders
- Manual outreach resulted in increased site traffic
- Increased traffic gave them confidence during the interview process
Raising money for the right reasons
Raising money for the right reasons is about understanding that not everyone needs venture capital and that running a profitable small business can be a better option. It is important to be genuinely excited about raising money and not seek external validation. Examples of successful companies like Product Hunt and Technium show that raising money is not always necessary for success. The emergence of platforms like Indie Hackers in the same niche as Product Hunt is also mentioned.
Maker communities
Maker communities are online platforms where individuals can share and discover new products. These communities have led to a rise in product creation due to the accessibility and ease of building. Y Combinator plays a role in supporting startups, and the video also touches on the decision-making process for startups regarding raising money.
Key points:
- Maker communities are online platforms for sharing and discovering new products
- Accessibility and ease of building has led to an increase in product creation
- Y Combinator supports startups
- Startups face decisions on whether to raise money or not.
Why raise money for Product Hunt?
Product Hunt raised $1 million from notable tech investors such as GV, Greylock, and SV Angel, surpassing their initial goal of $400k. The decision to raise more capital was driven by the belief that working with a great firm and having more funding would allow them to continue building the company for several years. Marc Andreessen showed interest in the company and eventually led a series A round. The speaker acknowledges that their experience with fundraising was unique and not representative of the typical Y Combinator experience.
- Product Hunt raised $1 million from notable tech investors
- Initial goal was $400k
- Decision to raise more capital driven by belief in working with a great firm and having more funding
- Marc Andreessen led a series A round
- Speaker acknowledges unique fundraising experience
Having buzz during the batch
Having buzz during the batch is not a guarantee of long-term success, as exemplified by companies like Coinbase and Amaze. It is important to focus on long-term factors such as retention, growth, and revenue. While buzz can provide leverage, it should not be taken too seriously as a signal for a company's future success.
- Having buzz does not guarantee long-term success
- Examples of companies like Coinbase and Amaze
- Importance of focusing on long-term factors such as retention, growth, and revenue
- Buzz can provide leverage, but should not be relied upon as a signal for success
YC primarily funds a small percentage of consumer companies, with successful investments like Coinbase. Investing in already popular companies can be challenging.
- YC primarily funds a small percentage of consumer companies
- Successful investments like Coinbase
- Challenges of investing in already popular companies
There is a significant presence of B2B and hard tech companies in the market, despite the misconception that consumer products dominate. B2B and hard tech companies are less talked about due to being perceived as less exciting and harder to understand. Uncertainty of market trends and lack of personal connection to certain industries contribute to the lack of buzz around them.
- B2B and hard tech companies have a significant presence in the market
- Misconception that consumer products dominate
- B2B and hard tech companies are less talked about due to being perceived as less exciting and harder to understand
- Uncertainty of market trends and lack of personal connection contribute to the lack of buzz
Brex changing their idea during YC
Brex changed their idea during YC from working on a VR headset to building a credit card product. This pivot was suggested by Ryan Hoover and turned out to be successful.
Pivoting into something you know well
Pivoting into something you know well is about founders shifting their focus towards areas they are experts in, rather than venturing into unfamiliar territory. It emphasizes playing to one's strengths and finding alignment between the founder and the new direction. The approach of treating a company as an experiment or side project allows for a more organic and personal approach to product development.
Key points:
- Encourages founders to pivot towards their areas of expertise
- Emphasizes playing to one's strengths and finding alignment
- Suggests treating a company as an experiment or side project for a more personal approach to product development.
In retrospect, how would Ryan have advised himself around monetization?
In retrospect, Ryan Hoover would have advised himself to focus on monetization early on in order to extend runway and prove out ideas. He suggests that making money takes time and experimentation, and it is important to cover costs and become profitable. Additionally, he mentions the possibility of going deeper on specific product categories or partnerships, such as tech products or becoming like AngelList. By zeroing in on what he was most excited about as a founder and going deep on those areas, it would have been easier to determine the best monetization strategy.
- Ryan Hoover advises focusing on monetization early on to extend runway and prove out ideas.
- Making money takes time and experimentation, and it is important to cover costs and become profitable.
- Going deeper on specific product categories or partnerships can help determine the best monetization strategy.
- Ryan Hoover considered expanding into different verticals but ultimately decided to stick with the core tech product and prioritize the user experience.
- Product Hunt faced challenges in replicating the success of the original platform when expanding into different verticals.
- Ryan Hoover admits to being naive in thinking they could quickly expand into different product categories and highlights the differences in game discovery compared to product and tech discovery.
Trying to build out other verticals
The attempt to build out other verticals on Product Hunt has been met with challenges and considerations. Here are the key points discussed:
- Product Hunt initially expanded into different verticals like gaming, books, and podcasts to address discovery issues in those areas.
- However, engagement in these verticals was low as the community primarily focused on tech products.
- The idea of creating a separate domain for gaming was considered, but its success was uncertain.
- Instead of expanding horizontally, Product Hunt decided to go deep in their existing verticals.
- They chose to focus on building out other verticals in the technology industry.
- Starting a fund on top of Product Hunt to invest in early-stage opportunities was suggested but rejected as it would drastically change their business nature.
- The conversation also discusses the potential of creating collective action around people's launches to help them sell products or monetize their moments.
- Experimenting with tools to collect beta users' emails was mentioned.
- The importance of micro decisions and effective prioritization, even with ample funding, is highlighted.
Don't act like you have infinite runway
Startups should not act like they have infinite runway. Instead, they should prioritize revenue and focus on optimizing sales funnels. Key points include:
- Many venture-backed companies lack a sense of urgency compared to indie hacker type companies.
- Redesigns that may not significantly impact numbers should be avoided.
- Setting specific key performance indicators (KPIs) and making revenue generation the top priority creates urgency.
Creating urgency and developing products within AngelList
Creating urgency and developing products within AngelList:
- Product Hunt is shifting towards helping users find the best products for their specific needs and building a true product graph.
- They have a process in place where one engineer drives the project forward with support from the design team.
- Product Hunt is exploring the idea of virtual co-working within maker communities.
- The discussion highlights the need for a platform like Product Hunt to support remote workers, freelancers, and curious individuals working on side projects.
- Building a support network for these individuals is crucial, as well as addressing the lack of tools available for remote collaboration.
- Meaningful feedback is a challenge when you don't have a large online following.
- Educational content is not a core focus for Product Hunt.
Tips to launch on Product Hunt
Tips to launch on Product Hunt:
- Ensure clear imagery and taglines for your product
- Seek feedback from people unfamiliar with the product
- Learn from the example of a young coder who launched his first product on Product Hunt and continued to build and launch various products
- Emphasize the importance of feedback loops in the product development process
- Understand the market and be open to feedback
- Be honest and adaptable to succeed on Product Hunt
- Review products and take the process seriously
- Dedicate time to Product Hunt and YC applications.
What Dalton looks for in applications
Dalton Caldwell looks for serious and committed individuals in applications. He values people who have actually built something and are willing to share it with the world. He is less concerned about revenue or design, but more interested in the dedication and passion of the applicant. He evaluates this by looking for prototypes, first users, and revenue generation. He prefers individuals who are motivated by their own dreams and not just seeking to please investors. Dalton sees the ability to take initiative and create something without external influence as a special and valuable trait.
- Dalton Caldwell looks for serious and committed individuals in applications.
- He values people who have actually built something and are willing to share it with the world.
- He is less concerned about revenue or design, but more interested in the dedication and passion of the applicant.
- He evaluates this by looking for prototypes, first users, and revenue generation.
- He prefers individuals who are motivated by their own dreams and not just seeking to please investors.
- Dalton sees the ability to take initiative and create something without external influence as a special and valuable trait.
Giving people the opportunity to start
Giving people the opportunity to start their own ventures by providing financial support and time to quit their jobs and focus on their projects is crucial. The online course "Startup School" by Y Combinator offers grants to serious participants and encourages progress even if they haven't quit their jobs. Structured thinking and confidence-building are emphasized in starting a startup.
What motivated Ryan to leave his job before Product Hunt
- Ryan Hoover left his job before starting Product Hunt because he wanted to do something different and felt he wasn't learning.
- He decided to start his own fund and believed that amazing things can be built on a weekend.
- Hoover emphasizes the importance of starting and making progress, as it screens out those who are not truly curious or committed.
- As an investor, he values progress and small day-to-day interactions when considering companies to invest in.