5 1/2 Questions for Geoff Ralston

Geoff Ralston

Entrepreneur, Investor & President at Y Combinator.

Geoff has been president of Y Combinator since early 2019. He has been with YC for over ten years, joining Paul Graham as one of the first non-founder partners in 2011. Geoff has worked with hundreds of YC companies like Stripe, Gingko, Clever, Helion and Boom and has personally angel invested in over 100 companies.

In the early days of the web, Geoff and his team created one of the very first web-based email products, Rocketmail. Rocketmail eventually became Yahoo! Mail when it was acquired by Yahoo! In 1997. At Yahoo! Geoff was a VP of engineering, ran a division for several years as an SVP/GM and completed his career there as Chief Product Officer.

Subsequently Geoff was CEO of Lala Media, which Apple purchased in 2010. When Geoff joined Y Combinator in 2011, he also co-founded and ran Imagine K12, the first educational technology accelerator which funded several well-known edtech startups including ClassDojo, Remind, and Panorama Education. Imagine K12 merged with YC in 2016.

Geoff graduated from Dartmouth College in 1982 with a degree in Computer Science, went out to California to work at Hewlett Packard and eventually returned to school at Stanford to complete his masters in Computer Science. Later, while living abroad in France, he earned his MBA at INSEAD.

Geoff still loves programming, has written software in every job he’s ever had (including as YC’s president) and is the proud author of Angelcalc, which is a popular free cap table / convertible modeling tool. Geoff is married with 3 (mostly grown) children and lives in Atherton, CA.

5-1/2 Questions for Geoff Ralston

1 — In your field what are the top 3 traits for success?

In my field? Yeah, I’m a particularly kind of strange case, and some people might say, that’s easy — you’re a venture capitalist. But at Y Combinator, we don’t really consider ourselves venture capitalists. I’m really a software person when it comes right down to it. So I’m kind of a mix of a software person and a person who invests in the future of other people, which is sort of what some kinds of venture capitalists do. But we also sort of think of ourselves as an educational institution and that we’re sort of a graduate school for founders, maybe an undergraduate and graduate school for founders, because we have programs from the earliest stage through the latter stages of a company’s life cycle.

So it’s not such an easy thing to pin down precisely what my field is.

Let me try to answer the question just in terms of general requirements for whatever success means.

I think you should start with an honest desire to help founders be successful really care that that these other folks are going to find success with your help. The second thing I’ll say is it really helps to be optimistic because every startup you talk to has a relatively small chance of success. That’s just the nature of the game. But boy, does it help to believe and to be optimistic in that in whatever future they’re trying to create. The third thing I’ll say it slightly ironically, is it really helps to have the ability to predict the future. Because that’s what we do as investors or we’re making a prediction of the future of the in fact, what founders do is they tell a story about the future. And it’s your choice as an investor. Their story about the future involves them, as you know. And, you know, they’re the protagonist in which they become a formidable founder at the head of a multinational, multi-billion dollar corporation that is hopefully changing the world for the good. And it’s your choice as to whether you believe in that vision of the future or not. You’re both trying to predict that future. And if you can get good at that and good at seeing that future, then you have a better chance of making good choices.

There’s more I would say about this. You know, it’s certainly one trait for success is that if you have lots of startup experience and you can actually have the ability to process and learn from that experience, then you can pattern match and it helps you as you try to do all this stuff, which again comes down to predicting the future.

The last thing I’ll say is that it helps. It helps to be a little too thick, maybe not quite so linearly, as everyone else does, to have to be unconventional, to see things that other people don’t see to to not really suffer from, from FOMO, from fear of missing out, but actually to see things differently and to be able to take advantage of things in trends, effects that other people aren’t seeing so clearly.

2 — What business skill do you wish you were better at?

If I might, I’ll kind of turn that question around. It feels like it’s posed too negatively. And I’ll say there’s a bunch of things that I try to be good at. All of which I think I would rather be better at. But there’s a bunch of skills that I think matter in in in success in general, but certainly in the sort of things that I do. So I think it’s really important to be good a good listener. I think it’s really important to to be direct and transparent. I think it’s really important to be detailed and to be willing to look at the details. I always try to do everything with integrity and honesty. And I think the best leaders. If you will, exude integrity and honesty. It’s arguable that those are the qualities always desired in leaders, especially in today’s world. But I’ll still stick by them.

[Which one of those do you spend more conscious time trying to improve? ]

Probably listening. It’s really. Easy not to listen. And here’s why. I’ve thought a lot about this. The reason it’s hard to listen is because we spend so much time listening to ourselves. The reason it’s hard to listen to others is because we spend so much time listening to ourselves. We all have an inner dialog. What does CJ think of me? I wonder how. I wonder how I’m doing. I wonder how I look on this show. I wonder how I sound. Do I sound smart or do I sound stupid? Do I make a mistake there? And instead of paying attention to maybe what’s going on with you, I’m paying so much attention to it, to myself. And that’s why it can be really hard to listen to other people and why you have to actually focus, say, okay, this this particular moment is not about me just for this moment. It’s going to be about what what is being communicated to me. So I’d say it’s listening that that I spend the most time on.

Let me let me give you a couple other skills that I think are really important. One is being able to give valuable and sometimes difficult feedback. That’s hard. And I wouldn’t say focus a lot of it all the time. It’s just a one. Whenever I do it I realized you can that be doing that well is a very key skill.

And the last thing I’ll say is, is that especially in a leadership position, but this is true throughout life and in anything you do is you have to make hard decisions based on incomplete data. It’s always true and getting better and better at that. You know, doing things like trying to predict the future is a pretty critical skill to have to work on.

3 — When was the last time that you misjudged someone based on their initial appearance or initial impression.

You know, I actually think that it and there’s some evidence that we all have sort of a niceness detector, but it turns out there’s actually something genetic that if you show people pictures, there’s some consistency in who we think are nicer and who we think aren’t nice or kind or whatever. And I think mine’s pretty good.

I don’t know if this will be the answer that you’re looking at, but I will say that one of the biggest surprises in my career was took place at sort of one of my first real startups, which was this company that built Rocket Mail and which turned into Yahoo! Mail back before the new millennium in the nineties. And this company called 411. And I joined two guys in that company. I led engineering, one was the CTO, and one was the CEO. And my impression was that the CEO and I were going to get along famously. We really, you know, we sort of shared politics, we shared a sensibility and and we really got along, didn’t really like the CTO as much. He was, you know, very right wing, kind of annoying, kind of, you know, I thought, you know, he was a little hard to talk to. And by several years later. Wasn’t so close to the CEO at all, and I was tight as you can imagine, with the CTO. We really built everything together. We had fought wars together. We saw the same way. Our politics were so radically different, but it didn’t matter. We were just, you know, we were much better. It was it was really surprising to see that switch take place.

[Where there was a turning point. Or was it just a matter of time? ]

It was a matter of time. It was an evolutionary thing. It’s not like we were enemies or anything. It’s just that I got closer and closer to the CTO — It felt like we were fighting the good fight together.

4 — Have you ever worked in a “toxic”” work environment? Tell us about it.

How about if we talk about what the elements of a positive environment are, and then you can just then you can just take the inverse of that for now?

And look, you know, I actually have never been — I’ve been in certainly difficult situations with folks that happens all the time and have had to make some hard decisions and have a tense situation — but I’ve never actually worked in a in a toxic work environment. But, you know. If you think about how you create a positive environment, it’s all about how you hire, who you hire and the values you claim in in whatever context you’re in. And then and not just claim it’s the value. It’s about walking the walk of those values to make them real. It is. It’s about the things we were talking about earlier, integrity and honesty and and transparency and about a culture where where those things matter and where those values matter. It’s about thinking about being a humane human as opposed to, you know, a a a piece of machinery that is executing for some purpose. And and I think you can do all these things while creating an organization, an organization that is both effective and efficient. And it’s an interesting juxtaposition, I think, to think about how to create an organization that works really well. But where everyone isn’t just a cog in a machine, where people matter and the things that matter to people matter.

5 — Tell us about a time in your career that you made a mistake — a real blunder.

Well, I’ll tell you about a time I made a really hard decision that I think was the right one. So exactly the opposite of what you’re asking, but also tell you about a kind of a fun mistake I made. So. one of the hardest things I’ve done when I just started in this job was to shut down an initiative that my predecessor had kicked off, and it had gone quite far. We were we were launching in another country, and we’d never done that. Y Combinator had been in Mountain View, California. And if people wanted to work with us, they always came to us. And we had always been that way. And this one time we decided to do initiative another country. And it was super complicated. We hired a guy that I had known for two decades, amazing person. He was great, you know, dual citizenship. And he was exactly the right person to run this with this organization. But it was really as I took over and I looked deeply into it, it was a bad idea. And I had to, sort of cut it off — tell him we’re not doing it separate. Announced this thing and it was super hard and super complicated. Hurt a lot of feelings, but it was the right thing to do. And especially in retrospect, it turned out well. That was really hard.

And getting hard things right and being willing to do that, I think is a critical success factor for whatever you’re doing in life, but especially if you are in a leadership position. And in some sense we’re all in leadership positions of ourselves. So sometimes you have to do that.

But let me tell you something that just something that went wrong, which this is this might not be exactly what you’re looking for, but it’s actually at that company I was talking about earlier, 411, where our initial goal was to be the directory- you know, 411 back in the day, you remember, CJ, was what you dialed on a phone when you wanted information. And we were information. If you wanted to look up someone’s phone number, you dial 411 and say, I’m looking for CJ Cornell and wherever. And they say, okay, and then a voice would give you the phone number. We were we were in the white pages and later the Yellow Pages before we launched our Web based email product. We weren’t about so much looking at phone numbers, we were about finding someone’s email address, which was hard at the time because there wasn’t a directory of email addresses.

So we wanted to create the largest directory of email addresses, and it turned out that one of the largest existent directories back in the day was at AOL. They had lots of people and you could look up anyone and get their AOL email address. There are millions. And so we said, Well, let’s just put all those email addresses in our directory. How are we going to get them? It turns out if you log into AOL, you can just look at the directory — it’s sort of publicly available. So I thought to myself, Well, why don’t I just create a little bot that logs into my AOL account and list the directory and then transfers it back. So I wrote some software. It was really fun that, you know, kind of hacked AOL a little bit.

Now, was this precisely legit according to their terms of service? You know, it was this is the wild, wild west. These are the early days of the Internet. It seemed fine. So I wrote the software and launched it, and I think it was Friday — and that was the weekend. And when we came back to work probably Sunday, because that was how intense this was. I think I had racked up a $25,000 bill! And we were like, Oh, wait, what? Anyway, we know that AOL Security got involved and we got involved and we negotiated. And that was the end of trying to hack AOL.

[ ….note for the younger folks: this was at a time when they charged per-minute to use a service like AOL.]

Yeah, well, it was it was worse than just the huge charges! Because my little process, you know, kicked off other processes that added up time. And it was that I did it in a way, that I didn’t understand very deeply.

5–1/2 — BONUS “Color” Question

If you were to make a documentary film about a current issue … what would it be?

I don’t know if this would make a good documentary, but it’s something that I’ve been struggling to understand is. I kind of have the impression that we’re in special times. Call it an inflection point. Where things are changing in fundamental ways or about to change or in process of change. I don’t know which and maybe it’s because of some of the apocalyptic political rhetoric of today or the wildfires, the droughts, the pandemics, the wars, you know, that seem to be going on, climate change, changing the world. All these things are wrapped up in this feeling that there’s massive change in our in every aspect of our lives, how we work. People talk a lot about the future of work and of school and of health care, etc., and how we live in every way our political systems, our social constructs. Certainly, technology is changing extraordinarily rapidly, and the changes that technology are going to bring in the next years, maybe decades, maybe before, are going to be extraordinary. And I think, you know, human beings like us have a very narrow perspective on any particular temporal period. We’re just that’s the nature of of of the beast of us. So it’s really hard to know whether we’re in an outstanding time, an inflection point or just in some bigger picture that’s taking place over a longer period of time.

And I might try to put together a documentary that goes around and sort of ask that question and looks to see what is really happening. And are we in the midst of fundamental shifts that will impact human society forever? Or is this just another period like seventies, eighties, the nineties through the aughts? Is that all the same or is this something kind of fundamental? So the the the documentary would be exploring the question of whether we truly are at an inflection point.