Dave McClure
Founder & troublemaker at 500 Startups
Discussion
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Dave McClure
@davemcclure · troublemaker @500startups
The king of curse, the dark lord of disruption, the baron of bull shit... I am ready for you to ask me anything; are you ready for the answers?
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Adam Marx
@adammarx13 · CEO, Glipple, Inc.
@davemcclure Hey Dave, It's a widely repeated statement among VC's and accelerators that (for many of them) the most important thing is the team, the people in which they invest. Given a product/service that has some potential, what sorts of qualities speak to you most in a person or team? To you, what makes someone magnetic?
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Dave McClure
@davemcclure · troublemaker @500startups
@adammarx13 actually we think team is important, but it's hard to tell what people are really like until you get to know them well / work with them a lot... so we tend to look at the product, the customers, and the business as the work product that the team produces. hopefully this avoids bias in looking at people and judging based on what we *THINK* they can do...
Ali Halabi
@xalihalabi · Founder & CEO at Volt
@davemcclure @adammarx13 How do you look at solo / non-technical founders?
Adam Marx
@adammarx13 · CEO, Glipple, Inc.
@davemcclure @adammarx13 That's a good point; one can't know how people really are (especially under pressure) after 1 or 2 simple meetings. Certainly the team needs to be a factor that buttresses an already promising product/service, not something that acts in place of one. Thanks!!
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Dave McClure
@davemcclure · troublemaker @500startups
@xalihalabi @adammarx13 well, if you're solo you better be DAMN GOOD.
and we don't just look for "technical" founders, we look for folks who can:
1) build product (code or visual design)
2) market & sell the product
3) manage & grow the team
mostly we look for founders who fit 1 or more of the above categories, and what is there vs. missing when startups ask us to invest.
we also look a LOT at the potential for growth, and strategies for customer acquisition.
Ryan Hoover
@rrhoover · Founder, Product Hunt
Dave! Welcome (this is going to be fun). I'll kick it off with two easy questions:
1) What's on your homescreen?
2) What app or product are you most embarrassed to admit you use?
Matt Silverman
@mattjsilverman · Product & Design
@rrhoover "whats on your homescreen?" -- such a good question!
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Dave McClure
@davemcclure · troublemaker @500startups
@rrhoover morning Ryan :) my homescreen is full of a bunch of saved links to files... it's kinda messy. but my browser is pretty much constantly open to facebook, twitter, and email... which makes me terribly unproductive ;)
app or product i'm most embarrassed to use? hmm... well i'm a social media douchebag so it's almost everything. but i'm not embarrassed!
Natalya Matyushenko
@ambercamel · Co-founder/COO at Spycob
Hello Dave, How critical it is whether or not a startup generates revenue for its application to accelerator to be successful? We have multiple avenues for collecting payments from customers, some of which we already tested. For example, "Buy for $1" feature that allows to search discounts over 75%.
We grow on 5-7% per week and we don't want to sacrifice growth to short term earnings. Hence, we do not expect our revenue growth to be anywhere close to subscription growth in the near term. Could the Pinterest type of model where the key driver of value is subscription base rather than actual cash flow be something of interest to the accelerator?
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Dave McClure
@davemcclure · troublemaker @500startups
@ambercamel for 500 startups, we like to focus on companies that 1) already have a shipping product, and 2) have some amount of usage and or revenue. the primary reason is it's easier for us to be helpful to companies when they already have users or customers, and we can focus on how to grow the business, improve the UX, and/or increase revenue or profits. these are much harder to work on if companies haven't shipped yet, or don't have much user / revenue traction.
Erik Torenberg
@eriktorenberg · Former Product Hunt
@davemcclure You have SO much to be proud of. What's something you're _not_ proud of?
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Dave McClure
@davemcclure · troublemaker @500startups
@eriktorenberg oh gosh... i'm such a huge fuckup in so many areas.
- i wish i was a better manager, and gave my team more props & respect when they do great shit
- i wish i were a better parent, and had more time to spend with my kids
- i wish it didn't take me so goddamn long to figure out startups & VCs & the valley (i'm still working on it at age 49)
- i wish i weren't such an argumentative douchebag and was a little bit slower to anger / insanity
- i wish i were taller, less bald, less fat, more sexy, and a lot smarter
but then again, all in all i have a pretty fortunate life, and so i don't worry about all that shit and usually i'm just happy & grateful to be here... and hopefully i can be helpful to other folks. that makes me feel good :)
Andrew Ettinger
@andrewett · Product Marketing, Twitter (ex-PH)
Hey @davemcclure, which lesser-known startup/product to have gone through 500 do you wish everyone knew about?
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Dave McClure
@davemcclure · troublemaker @500startups
@andrewmettinger there's a bunch, but at the moment some of our best accelerator companies are:
- TalkDesk
- Intercom
- Tout
- Mayvenn
- Conta Azul (brazil)
- Realty Shares
- Love With Food
- PicCollage
-
there are many many others... apologies i just picked a few favorites :)
Alex Finkielsztein
@alfink92
Hey @davemcclure what are your favorite books? and what are you reading now?
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Dave McClure
@davemcclure · troublemaker @500startups
@alfink92 some of my favorite books:
- Guns Germs & Steel
- Don't Make Me Think
- Godel, Escher, Bach: An Eternal Golden Braid
- The Mystery of Capital
- Spent: Sex, Evolution & Consumer Behavior
- Flatland
- Ender's Game
- Snowcrash
Ben Tossell
@bentossell · Community Lead, Product Hunt
@davemcclure Hey Dave - what is the craziest thing you've seen in a pitch that you can tell us about?
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Dave McClure
@davemcclure · troublemaker @500startups
@bentossell umm... someone tried to pass themselves off as a massage therapist / gift from one of our partners, and then tried to pitch their startup while i was getting a massage. pretty uncomfortable / weird / sketchy experience. and i wouldn't talk to that entrepreneur ever again... so PLEASE DON'T FUCKING TRY THIS PEOPLE. #ahem
Ed Choudhry
@edch2020 · Founder and CEO of Sample Labs
@davemcclure @bentossell I thought ours was up there by putting red bull coolers in both offices for a couple weeks with our ipad app but dave was out the country that whole time.. :(
Alex Cook
@aacook · Maker, building Growth Report
Hey Dave, thanks so much for doing this AMA. A couple weeks ago Sam Altman released a post about the "Post YC Slump" (http://blog.samaltman.com/the-po...). He talked about how some YC startups grow quickly and then flatline after YC ends. Sam also gave some great advice on reporting on growth to investors and friends. Curious if you see a similar pattern at 500? Do your teams continue to update 500 on their progress after the accelerator is over?
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Dave McClure
@davemcclure · troublemaker @500startups
@aacook i think the experience is perhaps similar... lots of folks come out of 500 on a "high" and feeling like it was a great experience, but honestly the hard work of building a company is just beginning. that's not really a bad thing -- eventually, summer camp or college come to an end, and you have to get down to business and figure out what you want to do with your life, your startup, your product, and you need to build a sustainable business that produces products / services your users & customers care about... that's not easy, and even harder getting that to scale big. there are lots of moments of self-doubt, stalling out on product or customers, ups & downs, etc etc you have to motivate yourself and others every day to keep working hard, even if you don't always feel like it (or sometimes when you feel like shit). i don't have all the answers, but i know many folks get tired / fall by the wayside... it's not easy being an entrepreneur and getting a startup off the ground.
V.S.VIVEK
@vsvivek93 · Unoccupied
@davemcclure Hey Dave, Thank you for doing the AMA. I have two questions regarding the Indian ecosystems.
What are your thoughts about the Indian ecosystem? And how far is it from reaching the maturity of the valley?
In the valley there is a lot of activity and knowledge sharing surrounding the startups like (designers , product , marketers and many other similar groups) but this is not the case in india, Would 500 startups be interested to look into startups which want to change that for india in specific?
Ameya Sahasrabudhe
@astronautameya · CEO, Ithaka
@vsvivek93 They recently opened up in South East Asia and accept indian startups regularly, I'd say pretty soon.
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Dave McClure
@davemcclure · troublemaker @500startups
@vsvivek93 i think there is huge potential in the Indian startup ecosystem -- we've done ~50 investments in India over the past 3-4 years, and we expect that to continue and/or grow to 20+ investments per year in future (maybe more).
we've always been bullish on India startups, however after the Modi government came to power it seems like there's a lot more business optimism in the country, particularly among local VC community. also Softbank putting $1B into SnapDeal, FlipKart raising big money, and other Japanese / Chinese / other investors coming into to the market has made people a lot more positive about the future.
we think valuations/prices may be getting a bit ahead of themselves lately, but we are still very bullish on the long-term prospects for startups in India.
talk to Pankaj Jain (@pjain) on our team for more details about our India strategy & plans, and also to Shalini Prakash (@shalini_prakash) in Bangalore :)
V.S.VIVEK
@vsvivek93 · Unoccupied
@davemcclure @vsvivek93 Thanks Dave ! Will certainly do that