This week’s New York Times Magazine feature on Y Combinator and Paul Graham has a wealth of detail on how the startup accelerator preps entrepreneurs to pitch their companies at demo day. Reporter Nathaniel Rich also gets a look at Graham’s effort to diagnose his own biases:
Several years ago, Paul Graham—whom everybody calls P.G.—began to film the interviews he and his partners held with prospective Y.C. inductees. When reviewing the footage, he focused on the interviews with start-ups that ultimately failed. Like any savvy marketing executive, he wanted to isolate patterns that portended ill, which he called “negative predictors.” He was already aware of a few—investors tended to be biased against older founders, for instance. “The cutoff in investors’ heads is 32,” Graham says. “After 32, they start to be a little skeptical.” And Graham knew that he had his own biases. “I can be tricked by anyone who looks like Mark Zuckerberg. There was a guy once who we funded who was terrible. I said: ‘How could he be bad? He looks like Zuckerberg!’ ”
When I talk to people about why women and minorities are underrepresented in VC-backed startups, I hear this all the time: Investors are looking for entrepreneurs who look like Mark Zuckerberg. Blip.tv co-founder Dina Kaplan told me exactly that in a 2010 interview: “There’s an expectation that the next Mark Zuckerberg will look like Mark Zuckerberg.” People usually mean this in the broader sense: that investors look at young white men differently than they look at entrepreneurs with different demographic profiles.
Graham deserves credit for interrogating his biases and sharing at least some of the results. (He’s previously noted that Y Combinator was more receptive to pitches after lunch.) But that self-reflection is the exception in Silicon Valley, not the norm. The venture capitalists who pack Y Combinator’s demo days have their own hidden biases that influence who gets funded. How should entrepreneurs prepare? Perhaps start with a hoodie.