Observations of Founders: A Selection Process

Jessica Livingston is a co-founder of Y Combinator, the first and most successful startup accelerator. Y Combinator has funded over 5,000 companies, 200 of which are now unicorns, including Airbnb, Dropbox, DoorDash, Stripe, Coinbase, and Reddit. Jessica played a crucial role in YC’s early success, when she was nicknamed the “social radar” because of her uncanny ability to quickly evaluate people—an essential skill when investing in early-stage startups. She’s also the host of the popular podcast The Social Radars, where she interviews billion-dollar-startup founders, and the author of the acclaimed book Founders at Work, which captures the origin stories of some of today’s most interesting companies. In our conversation, we discuss:

• How Jessica gained the affectionate title of the “social radar”

• Why defensive founders are a red flag

• How to develop your social radar

• What she looks for in founders during YC interviews

• How YC’s early inexperience in angel investing led to the batch model

• Her favorite stories from interviews with Airbnb, Rippling, and more

• Lessons learned from hosting her own podcast

• Much more

—

Brought to you by:

• Enterpret—Transform customer feedback into product growth

• Anvil—The fastest way to build software for documents

• Vanta—Automate compliance. Simplify security

—

Find the transcript at: https://www.lennysnewsletter.com/p/the-social-radar-jessica-livingston

—

Where to find Jessica Livingston:

• X: https://x.com/jesslivingston

• LinkedIn: https://www.linkedin.com/in/jessicalivingston1/

• Podcast: https://www.thesocialradars.com/

—

Where to find Lenny:

• Newsletter: https://www.lennysnewsletter.com

• X: https://twitter.com/lennysan

• LinkedIn: https://www.linkedin.com/in/lennyrachitsky/

—

In this episode, we cover:

(00:00) Jessica’s background

(02:42) Thoughts on being under-recognized

(07:52) Jessica’s superpower: the social radar

(15:11) Evaluating founders: key traits and red flags

(21:00) The Airbnb story: a lesson in hustle and determination

(25:57) A YC success story

(28:26) The importance of earnestness

(32:45) Confidence vs. defensiveness

(34:43) Commitment and co-founder disputes

(37:46) Relentless resourcefulness

(40:00) Jessica’s social radar: origins and insights

(43:24) Honing her social radar skills

(45:44) Conviction and scams: a Y Combinator story

(46:50) The interview process: challenges and insights

(48:20) Operationalizing founder evaluation

(49:38) Advice for building social radar skills

(52:08) The “Reading the Mind in the Eyes” quiz

(55:19) Jessica’s podcast: The Social Radars

(01:00:34) Lessons from podcasting and interviewing

(01:09:58) Lightning round

—

Referenced:

• Paul Graham’s post about Jessica: https://paulgraham.com/jessica.html

• Paul Graham on X: https://x.com/paulg

• Robert Tappan Morris: https://en.wikipedia.org/wiki/Robert_Tappan_Morris

• Trevor Blackwell on X: https://x.com/tlbtlbtlb

• Y Combinator: https://www.ycombinator.com/

• “The Founders” examines the rise and legend of PayPal: https://www.economist.com/culture/2022/02/19/the-founders-examines-the-rise-and-legend-of-paypal

• Patrick Collison on X: https://x.com/patrickc

• John Collison on X: https://x.com/collision

• Brian Chesky on LinkedIn: https://www.linkedin.com/in/brianchesky/

• Nate Blecharczyk on LinkedIn: https://www.linkedin.com/in/blecharczyk/

• Joe Gebbia on LinkedIn: https://www.linkedin.com/in/jgebbia/

• Airbnb’s CEO says a $40 cereal box changed the course of the multibillion-dollar company: https://fortune.com/2023/04/19/airbnb-ceo-cereal-box-investors-changed-everything-billion-dollar-company/

• Parker Conrad on LinkedIn: https://www.linkedin.com/in/parkerconrad/

• Zenefits: https://connect.trinet.com/hr-platform

• Goat: https://www.goat.com/

• Eddy Lu on LinkedIn: https://www.linkedin.com/in/eddylu/

• Drew Houston on LinkedIn: https://www.linkedin.com/in/drewhouston/

• Arash Ferdowsi on LinkedIn: https://www.linkedin.com/in/arashferdowsi/

• Lessons from 1,000+ YC startups: Resilience, tar pit ideas, pivoting, more | Dalton Caldwell (Y Combinator, Managing Director): https://www.lennysnewsletter.com/p/lessons-from-1000-yc-startups

•Bitcoin launderer pleads guilty, admits to massive Bitfinex hack: https://www.cnbc.com/2023/08/03/new-york-man-admits-being-original-bitfinex-hacker-during-guilty-plea-in-dc-to-bitcoin-money-laundering.html

• Paul Graham’s tweet with the facial recognition test: https://x.com/paulg/status/1782875262855663691

• SmartLess podcast: https://www.smartless.com

• Jason Bateman on X: https://x.com/batemanjason

• Will Arnett on X: https://x.com/arnettwill

• Sean Hayes on X: https://x.com/seanhayes

• The Social Radars with Tony Xu, Co-Founder & CEO of DoorDash: https://www.ycombinator.com/library/Ja-tony-xu-co-founder-ceo-of-doordash

• The Social Radars with Brian Chesky: https://www.ycombinator.com/library/JW-brian-chesky-co-founder-ceo-of-airbnb

• The Social Radars with Patrick and John Collison: https://www.ycombinator.com/library/Kx-patrick-john-collison-co-founders-of-stripe

• The Social Radars with Brian Armstrong: https://www.ycombinator.com/library/K3-brian-armstrong-co-founder-and-ceo-of-coinbase

• The Social Radars with Emmett Shear: https://www.ycombinator.com/library/KM-emmett-shear-co-founder-of-twitch

• The Social Radars with Paul Graham: https://www.ycombinator.com/library/JV-paul-graham-co-founder-of-y-combinator-and-viaweb

• The Social Radars with Adora Cheung: https://www.ycombinator.com/library/L0-adora-cheung-co-founder-of-homejoy-instalab

• Founders at Work: Stories of Startups’ Early Days: https://www.amazon.com/Founders-Work-Stories-Startups-Early/dp/1430210788

• Startup School: https://www.startupschool.org/

• The Social Radars with Parker Conrad: https://www.ycombinator.com/library/Ky-parker-conrad-founder-of-zenefits-rippling

• Rippling: https://www.rippling.com/

• Carry on, Jeeves: https://www.amazon.com/Carry-Jeeves-Dover-Thrift-Editions/dp/0486848957

• Very Good, Jeeves: https://www.amazon.com/Very-Good-Jeeves-Wooster-Book-ebook/dp/B0051GST06

• Right Ho, Jeeves: https://www.amazon.com/Right-Ho-Jeeves-P-Wodehouse-ebook/dp/B083FFDNHN/

• Life: https://www.amazon.com/Life-Keith-Richards-ebook/dp/B003UBTX72/

• My Name Is Barbra: https://www.amazon.com/My-Name-Barbra-Streisand/dp/0525429522

• Clarkson’s Farm on Prime: https://www.amazon.com/Clarksons-Farm-Season-1/dp/B095RHJ52R

• Schitt’s Creek on Hulu: https://www.hulu.com/series/schitts-creek-a2e7a946-9652-48a8-884b-3ea7ea4de273

• Yellowstone on Peacock: https://www.peacocktv.com/stream-tv/yellowstone

• Sam Altman on X: https://x.com/sama

• Justin Kan on LinkedIn: https://www.linkedin.com/in/justinkan/

• Alexis Ohanian on X: https://x.com/alexisohanian

• Steve Huffman on LinkedIn: https://www.linkedin.com/in/shuffman56/

• Breaking News: Condé Nast/Wired Acquires Reddit: https://techcrunch.com/2006/10/31/breaking-news-conde-nastwired-acquires-reddit/

• Charles River Venture: https://www.crv.com/

—

Production and marketing by https://penname.co/. For inquiries about sponsoring the podcast, email podcast@lennyrachitsky.com.

—

Lenny may be an investor in the companies discussed.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.lennysnewsletter.com/subscribe