Michael Seibel – Lessons from Thousands of Startups

**Patrick O'Shaughnessy** (0:00)
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Hello and welcome everyone. I'm Patrick O'Shaughnessy and this is Invest Like the Best. This show is an open-ended exploration of markets, ideas, methods, stories, and of strategies that will help you better invest both your time and your money. You can learn more and stay up to date at investorfieldguide.com.

**SPEAKER_2** (1:21)
Patrick O'Shaughnessy is the CEO of O'Shaughnessy Asset Management. All opinions expressed by Patrick and podcast guests are solely their own opinions and do not reflect the opinion of O'Shaughnessy Asset Management. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions.
Clients of O'Shaughnessy Asset Management may maintain positions and the securities discussed in this podcast.

**Patrick O'Shaughnessy** (1:46)
My guest this week is Michael Seibel. Michael is a partner at Y Combinator and the CEO of their startup Accelerator. He was the co-founder and CEO of Justin TV, which eventually became Twitch and Socialcam. In this conversation, we discuss all Michael has learned reviewing thousands of applications to YC, interviewing countless new entrepreneurs and watching young companies begin to grow and occasionally finding product market fit.
Listeners will also enjoy when Michael traps me big time in my thinking about AirBnb and his framework for great problems to solve. Enjoy this great conversation with Michael Seibel.
Michael, I've been really looking forward to doing this with you. I always try to think of titles for the episodes ahead of them. And one I consider for you is the man who gets to see the future. And that's true because of anyone in the world, maybe you see more nascent new companies and founders being built of just about anybody. And so I thought it an interesting place to begin since I know demo day just wrapped up. So I'm sure you've been working your tail off to ask for what sort of some of the emerging trends, assuming you do believe that you get to see the future in some way that you saw in this most recent batch of young founders.

**Michael Seibel** (2:55)
I'll zoom out to the past couple years to generalize. The first trend that I'm seeing is a social trend, I would say. And the way that I would describe it, not social like social media, the way I would describe it is founders having more concern about the impact their startup is having on the country or on the world.
And founders being braver and taking on kind of core challenges, whether it's the healthcare, we have companies trying to attack mass incarceration.
I think that there's been a little bit of a feeling like if we want these problems to be fixed in our society, we have to be part of the solution. We can't just lean back. And I think that's qualitatively different than when I started in 2006, 2007 Certainly the kind of next big change is not going to be surprised to anyone is B2B SaaS. What's interesting is that B2B SaaS has been the trend for what, 10 years, maybe 12 years? And I would say that it's not slowing down at all. One sub trend within that that I find interesting is I'm starting to see a lot of companies build verticalized software for small business. If you think of a product like Square, they kind of want to revolutionize the POS across all of small business. And I think they've gotten a lot of small business basically onboarded into modern software. And then we've seen a number of YC startups, Squire is one of them, but there are others who take a chunk of that, like a slice of that small business, Squire is going after barbershops and hair salons, and basically saying, I not only want to be your POS, but I want to try to help you do as many things as possible in your stack as possible.