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JC
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JC
@shiftj
YC Founder • Advisor • Investor • Builder
Earth Katılım Temmuz 2025
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@shiftj Funny enough working on a project now that’s exactly this as an AL consultant
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Pattern I'm seeing in YC companies: They're starting to look like private equity companies.
The playbook:
1. AI Consultancy for SMBs
2. Identify high value workflow
3. Automate it
Once automated it should have a tangible benefit on:
1. Capacity
2. Costs
3. Revenue
This proves your ability to improve the financials of a traditional business.
You know who loves that? Private Equity.
So from there you've got two options:
1. Sell to PE firms, roll out to portcos
2. Become a PE firm, buy SMBs
The largest blocker is identifying the waste.
Once you've found it, there's massive opportunity for scale.
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Things I had to learn the hard way (as a YC founder):
- Simple > Complex
- Momentum is gold
- No hires > bad hires
- Distribution > product
- Customers > investors
- Fast calls > "right" decisions
- Good market > good founder
- Sales acumen is a requirement
- PMF is not forever, you work for it
- Don't talk to customers, listen to them
- $$ accelerates wins, doesn't fix problems
So what did I miss?
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@shiftj Agree! I also found those are the investors who pays the least attention during the pitch/talk, and would just look at decks later on. It feels a completely waste of time, for both parties
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As a YC founder who’s raised >$3M, here’s my unpopular opinion:
Pitch decks aren’t that useful.
Here’s why:
1/ They suck as email teasers
I’d rather get a tight email than a long deck.
- Too much info.
- No real intent when they read it.
- A short blurb does the job better.
Don’t assign me a 20-slide deck as homework.
Give me something I can opt into.
2/ I don’t like them when pitching
This isn’t Shark Tank.
Fundraising is person-to-person. It’s sales.
Don’t walk slide-by-slide.
Use visuals if needed.
But have a conversation.
Not a presentation.
3/ They’re over-relied on
Good deck ≠ good fundraise.
You can have a bad deck and raise just fine.
What matters:
- Story.
- Founders.
- Business.
A deck should make me want to meet you.
Not tell the story for you.
4/ There are better first touches
In sales, you don’t send a full brochure first.
You send:
- What you do.
- The pain.
- Why it matters.
Simple. Quick. Skimmable.
Get them to opt in.
If they’re interested, they’ll ask for more.
That’s the goal.
Sending a big-ass brochure upfront kills attention.
It’s also a bad format for conveying your story.
Do that in sales, you'll never hear back.
Things I use:
- Email snippet
- Loom
- One-pager
- Investor memo
5/ Where decks are useful
They’re not all bad.
Use them for:
- Teaser to book a call
- Visual aid during a call
- Something to share after
--
The real issue:
Decks abstract your ability to tell the story.
You’ll always do that better.
p.s. I raised >$3M without a pitch deck. Your mileage may vary.
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@jc_jianchu_xu Personally, I've found investors who over-index on decks (especially detailed ones) to be of a worse variety anyways.
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@shiftj Exactly! Same thought after a couple of rounds of fundraising. A solid product, even just idea is much more powerful than a fancy deck. In fact, I’d strongly consider against those who asked for a detailed deck
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YC most certainly helps, you're right on that.
But non-response to email is often a symptom of other things:
- no warm intro
- email blurb not enticing enough
- low traction
- unrelated market
A VCs job is to find great investment opportunities. They'll take a call if they see one.
It is quite literally their job.
Just need to look like one.
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Here’s what most CEOs won’t tell you.
We can’t defend everything.
We don’t even try.
Here’s how you take advantage of that 👇
As a small team, you have more leverage than you think.
One key reason: you need less money.
That alone lets you go where incumbents won’t. Most companies define a tight ICP and optimize everything around it.
Anything outside of that is a distraction.
So entire pockets of the market get ignored:
• Less lucrative
• Slower
• Slightly different workflows
• Not worth building new product or GTM for
These add up to real revenue.
Just not at their scale.
That’s your opening.
—
Now layer in what’s changed: AI has compressed build time.
What used to take months or years now takes days or weeks.
Small teams can hit feature parity fast and spend time on domain + UX instead.
—
Let’s take legal tech.
Harvey AI is one of the fastest-growing AI companies right now:
~$190M ARR
~3–4x growth in a year
~$11B valuation
Think: Cursor, but for lawyers.
Their ICP is large firms + enterprise legal teams.
Makes sense:
Big budgets
High leverage
Clear ROI
But that comes with ~$250k+ pricing.
Which excludes most of the market.
And legal is massively fragmented: solo practitioners + small firms make up the majority.
Too small for Harvey to prioritize.
Not worth the distraction.
But very real.
—
This is the pattern most people miss.
You’re not too late.
You’re just looking at the part of the market everyone else is fighting over.
The opportunity is in the parts they can’t justify touching.
—
We built something for this exact pocket.
In production with an initial user.
Looking for a CEO/operator to take this to market.
DM me if that’s you.
—
You don’t beat incumbents.
You go where they can’t afford to follow.
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If you haven't asked this question, you're probably selling to the wrong customer.
The deadliest mistake a startup can make..
Question: "Who are your dream 10?"
👇
1/ Your dream 10 = the perfect customers
If you could pick any 10 companies in the world to have as customers, who would they be?
• Highest pain
• Biggest budgets
• Best reputation (social proof that attracts more customers)
These 10 become the foundation the rest of the company grows from.
2/ Most founders don't think this way
They go for the easy sale instead of the right sale.
I've watched founders sell to indie hackers, small businesses, anyone who will respond.
Then they build features for the wrong market.
Why? Fear.
3/ I saw two YC companies with the same product
One targeted enterprise. High budgets. Real pain. Closed deals fast.
The other targeted whoever they could get in touch with. Anything they could get.
Results:
• Enterprise company: raised millions, scaled fast, still alive
• Mid-market company: struggled to raise, stalled growth, shut down
Same product. Different customer.
4/ The mid-market founder told me later:
His product was perfect for enterprise. But he was scared:
• "I can't close enterprise deals"
• "They won't pay that much"
• "How can I even get in touch"
So he took what he could get.
5/ Scarcity vs abundance mindset
Scarcity: "I'd be lucky if I got somebody"
→ Take any customer
→ Build wrong features
→ Get stuck
Abundance: "The right customers exist"
→ Target best fit first
→ Build for real pain
→ Scale fast
6/ Good customers vs bad customers
Good customers:
• Have money
• Feel real pain
• Have budget
Bad customers:
• Check maybe one box
• Take forever to close
• Can't afford your solution
—
Most founders know their dream 10.
They're just too scared to pursue them.
That fear is what kills startups.
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If I had to make $1m in the next 12 months, this is what I would:
4 Step Plan:
1. Partner with a private equity / rollup company
2. Identify 1 area to improve efficiency
3. Build software to automate it
4. Prove the results
Then? Roll out to every portfolio company.
Why this works:
1/ Private Equity thrives on efficiency gains
- More margin => more profit
- More profit => higher multiples
- Higher multiples => higher return
PE firms are hungry for a new edge.
2/ Sales is efficient and scalable
- Closing 1 firm gives you 10-100 customers.
- Every firm in the industry will want the same thing.
Your first customer unlocks the rest.
--
Anyone doing this?
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@alameenpd Depends on the company and your goals. Some may benefit, others won't.
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You don’t need investors to get to $1m.
In fact, it's more impressive that way.
Yana Welinder@yanatweets
14 YC startups hit $1M ARR before demo day 🤯 That's before raising a dollar of VC. AI is massively expanding who gets to build. No more gatekeepers.
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Bullish on Anthropic.
Are they the fastest moving team in the world right now?
Paweł Huryn@PawelHuryn
73 product releases in 52 days. That's not a launch cadence — that's a different kind of company. I tracked every Anthropic release from Feb 1 to Mar 23 by going through @bcherny, @trq212, @noahzweben, @felixrieseberg, @lydiahallie, @amorriscode, @feldman, @dickson_tsai, and @claudeai. Built a calendar with first-announcement attribution. Look at the acceleration. February had bursts with gaps between them. March 9 onward is almost every single day — Code Review, Channels, Dispatch, Computer Use, back to back. The individual features get coverage. The shipping velocity doesn't. It should.
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Good day to start a company.
Bad day to be an incumbent.
Todd Saunders@toddsaunders
We’re about to witness the largest wealth transfer in the history of software. A single operator with domain expertise and AI tools can now build what used to require a 50 person team in just a few weeks. This is why I’m so long vertical agencies. They have distribution, brand and trust. If they can leverage AI to now build software, they can take the market from the incumbent software companies.
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This isn’t 5 years out. It’s here now.
Examples:
1/ Companies are already hiring less.
Nearly every major company in the world has an AI initiative. Everyone is actively thinking about automating jobs, improving efficiency.
Startups act as early adopters giving a view into how future companies will operate.
Startups themselves are hiring less. We’ve never seen this large of companies run by such small teams.
The trend is already here, and growing.
2/ AI can already automate these jobs.
To test this out, I built an AI Paralegal and ran it on real cases. It not only worked but found key evidence the lawyers missed.
Teams of paralegals and junior attorneys beat by a single AI Agent.
The gap isn’t tech, it’s just adoption.
It’s not 5 years out, it’s already here.
CG@cgtwts
Anthropic CEO: “50% of all entry-level Lawyers, Consultants, and Finance Professionals will be completely wiped out within the next 1–5 years." grad students and junior hires are cooked.
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Paid ads can kill your startup.
The more successful your campaign, the more dangerous it becomes.
Here's why:
1/ They’re a good way to start
My two favorite ways to test an idea: outbound and paid search. Fast, effective, cheap.
Easy pipeline.
2/ But highly indefensible
Unlike outbound, you don't own the channel. They can change pricing overnight and kill your ROAS - destroying your main revenue channel.
If that’s your own lead source you’re done.
3/ Get more expensive over time
Re-targeting, look-a-likes, conversion optimization - all help. But there's a cap.
To scale, you have to spend more to win more:
• Whoever spends the most, wins
• Competition copies your campaigns, drives up costs
Neither are good dynamics.
4/ When you lose, you're f*cked
Limited levers when ads underperform:
• Change creative
• Increase spend
• Improve targeting
If those don't work, you're out of options. A well-capitalized competitor can outspend you, take your traffic, and flush you out entirely.
Not many ways to course correct.
5/ So diversify quickly
Don't let your business rely on ads as the main revenue source - even if they're performing well.
Treat paid ads as fickle, short-term moves that will eventually become ineffective.
—
Takeaway: Paid ads are a quick start but risky as a primary channel.
Diversify early.
andrew chen@andrewchen
There's a vast marketing industrial complex of agencies/consultants/advisors/whatever that promotes tech startups spending billions of dollars of unaccountable marketing budget. They're triggered by my anti-paid stance but here's the reality: - paid marketing is much, much worse than organic on every metric (conversion, ROI, etc) - startups work on a fast time scale and can't manage LTV/CAC correctly beyond a months timeframe - risk is asymmetric. a few bad cohorts can kill you (and btw, this has definitely happened) - the age of easy/cheap ad inventory is over. Pricing is controlled by an oligopoly, it's all being algorithmically bid up, and ROI sucks at scale - paid UA has S-curves. Early spend looks good, but plateaus and it's easy to get addicted - if your product is growing organically already, you might just be cannibalizing and pulling forward demand you'd already get anyway - high reliance on paid indicates weakness in the core product and value prop - you can't build a 100m+ DAU product with the majority coming from paid UA (it's just obv math) - going majority paid UA makes it 10x harder to raise VC capital down the line. For all the reasons on this list the main benefit of paid is simple: your agency/consultant/whatever spends money, some numbers go up, and you feel like you're doing something. It's simple to understand, you can apply it to every type of product, and every big co does it right? Billions of dollars swap hands just based on this dynamic. But for startups I argue it's the growth lever of last resort, since it's the most commoditized form of distribution -- you should try to exhaust your other ideas, invest deeper in your product, and grow based on whats unique in the ways that only your startup can grow. That way your channels are as defensible as possible, built around your killer value prop After all one day, you hit your CAC ceiling, your channel saturates, or worse, your competitors just do the same, copying your distribution strategy, dragging the whole industry into a prisoner's dilemma. When that happens, it's hard to incubate a bunch of new 0-1 channels to save your forecasts. The temptation is just to stretch payback periods, buy more, and ride it out. That's a dark path...
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Sunday project: Helping attorneys parse through thousands of evidence documents.
> Find angles you didn’t think of.
> Find the smoking gun.
> Win the case.
These cases are worth millions and I may have found one already..
Stay tuned.
JC@shiftj
I just saw my lawyer friend *literally* read 1,000 pages of documents trying to pull out the facts for his case. It took him 3 days, what a waste of time.. Friends don't let friends manually read 1k pages of documents. Going to spend the weekend automating that for him. If you've got any lawyer friends, send em my way. Happy to share the love.
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