Building Y Combinator with Garry Tan: What It Really Takes to Build a Successful Startup

Podcast: Building One with Tomer Cohen
Host: Tomer Cohen, LinkedIn's Chief Product Officer
Guest: Garry Tan, President and CEO of Y Combinator
Release Date: June 3, 2025

1. Introduction

In the episode titled "Building Y Combinator with Garry Tan: What It Really Takes to Build a Successful Startup," host Tomer Cohen engages in an insightful conversation with Garry Tan, the influential President and CEO of Y Combinator (YC). The discussion delves deep into the essence of building successful startups, drawing from Garry's extensive experience both as a YC alumnus and as the current head of the most renowned startup accelerator globally.

2. Garry Tan’s Journey and Y Combinator’s Evolution

Garry Tan recounts his early days in Silicon Valley, highlighting how Y Combinator (YC) stood out even when accelerators were not a new concept. He states, “When I came to Silicon Valley in 2008, Y Combinator was somewhat of a hidden gem, a new type of accelerator with a big promise to supercharge the potential of your startup” (00:57). Garry emphasizes YC's unique positioning that has led to the success of numerous companies like Airbnb, Coinbase, Stripe, and DoorDash, solidifying YC as potentially the most successful startup accelerator of all time.

3. Key Lessons on Building Startups

a. Focus Over Optics

One of the core lessons Garry imparts is the importance of obsessive focus on users and products over chasing public relations or being merely visible. He explains, “What you spend your time on is indicative of whether you’re building something real or just playing startup house” (50:39). This distinction is crucial in determining the authenticity and potential success of a startup.

b. Importance of Honest Data Evaluation

Garry highlights the necessity of relying on genuine user data rather than subjective feedback. He warns against the pitfalls of self-deception and emphasizes, “The logs don't lie, the analytics don't lie” (09:35). Founders must dig deeper beyond what users verbally express during interviews and focus on actual usage metrics to gauge their product’s true performance.

4. The Importance of User Focus

Using Airbnb as a prime example, Garry illustrates how YC mentors founders to immerse themselves in understanding their users’ needs. Initially struggling with growth, the Airbnb founders were advised to concentrate on their existing user base in New York City instead of dispersing their focus. This led them to enhance their platform by investing in professional photography for their listings, resulting in a significant growth spike. Garry notes, “They went and spent time with the hosts, asked them, like, why are you using Airbnb? What’s the experience been?” (19:04).

5. The Role of Co-Founders

Garry underscores the critical role of co-founders in a startup's success. He asserts, “Having co-founders who are truly your equal, who complement each other, changes the outcome of companies far more” (26:01). A balanced founding team, often comprising a hacker, a hustler, and a designer, brings diverse strengths and resilience, enabling the team to face challenges collectively and effectively.

6. Navigating Challenges: The Valley of Despair

Garry introduces the concept of the “Valley of Despair,” a phase where a startup’s product is viable but not gaining the expected traction. He advises founders to distinguish between motion and progress, urging them to be brutally honest about what they can control and to focus on actionable areas like product features, pricing, and team dynamics. “Don’t mistake motion for progress. Just because it’s not broken, it doesn’t mean it’s working” (50:39).

7. Agency and Taste in the Age of AI

Discussing the future of entrepreneurship, Garry emphasizes the twin pillars of agency and taste. He explains that while agency—the ability to act and make decisions—can be cultivated through programs like YC, taste—judgment about what to build and understanding user resonance—requires time and experience. In the context of AI advancements, Garry believes that how founders think and their ability to evaluate and apply data meaningfully will be paramount.

8. YC’s Transformative Environment

Garry attributes YC’s success to its intense and immersive environment that fosters rapid transformation in founders. He likens being part of YC to being in a “sprint of your life,” where founders are constantly pushed to prioritize effectively and make swift, informed decisions. This environment is designed to shock the system and redefine founders’ realities, ensuring they emerge more formidable and capable of steering their startups toward success.

9. Conclusion

The episode concludes with Garry Tan reiterating the significance of authentic leadership, user-centric development, and resilient founding teams. He acknowledges that while many startups embark on their journey with determination, only a fraction navigate the complexities successfully. Garry's insights serve as a beacon for aspiring entrepreneurs, emphasizing that true success lies in relentless user focus, strategic iteration, and the strength of the founding team.

Notable Quotes:

• “It just takes a while to build that trust.” – Tomer Cohen (00:11)
• “The problem that I was trying to solve, it was all I was thinking about.” – Paul Graham (00:16)
• “When you get sort of lost in the trappings of success, that's the difference between playing house and actually doing it.” – Paul Graham (09:29)
• “One of the most emotionally difficult phases in the journey of the builder is when your product is good but not good enough.” – Gary Tan (50:39)

This comprehensive discussion with Garry Tan offers invaluable perspectives for both new and seasoned entrepreneurs, shedding light on the nuanced realities of building and scaling successful startups. By emphasizing authenticity, user-centricity, and the importance of strong co-founding teams, the episode serves as a motivational and educational resource for those navigating the intricate landscape of product development and entrepreneurship.