The Official SaaStr Podcast: SaaS | Founders | Investors SaaStr 378: The 5 Things That Kill Startups After Their Seed Rounds and How to Avoid them with Michael Seibel, CEO @ Y Combinator
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Sep 24, 2020 
In this lively discussion, Michael Seibel, CEO of Y Combinator and experienced mentor, delves into the top pitfalls that threaten startups post-seed funding. He highlights how founders can mistakenly perceive fake product-market fit and the dangers of letting investors dictate operations. Michael emphasizes the importance of honest KPIs, maintaining low burn rates, and fostering strong co-founder relationships. He also warns against the perils of slow product development and shares strategies to accelerate progress, ensuring startups thrive beyond initial funding.
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Real Definition Of Product–Market Fit
- Product-market fit is primarily a numbers problem: breaking product plus profitable usage, not a feeling.
- True fit shows retention, organic spread, and unit economics that make growth sustainable.
Use One KPI And Cap Your Burn
- Pick one honest KPI (usually revenue) and stick with it to avoid self-deception.
- Cap your burn pre-product-market-fit and force early revenue hires to be self‑funding.
Hire Technical Cofounders And Essential Staff
- Start with strong technical cofounders to reduce early hiring and ship faster.
- Hire only people who will feel essential within three months or let them go.
