I Got Rejected From YC, Then Built a $200M Startup

0:00All right, Saba, what's your story? Meet Saba. I grew up in the middle of nowhere. I was always like relatively entrepreneurial, but never had any major direction. The self-made entrepreneur who transformed no money, no validation, no funding into a multi-million dollar success story. If other people have done it, why are they so special? Why can't we do it? In 2018 with his co-founder Tim, they spotted an

0:27opportunity to start an online business. Nothing but pure hustling got the ember started. It was just brute force. When he and Tim launched their video startup V, they bet everything. No money, no validation, no funding, kicked out of your office. Your interns quit. This is a journey of persistence and brute force. We had no more money in our bank accounts, not being able to afford the train. So yeah, it was a pretty dark place. Would not go there again. Chasing your own dreams. Ask yourself this. If you knew how hard it would be, would you do it? This is the story of how Saba Kenned turned rejection into 10, 20, 30,

1:1040 million in revenue. [Laughter] Welcome to Starter Story. I grew up in the middle of nowhere and I was one of those people because I lived in the middle of nowhere who just spent a lot of time on the internet. Everything I read about technology was like super exciting and through getting a cracked version of Photoshop, I decided to learn how to make graphics and images. I thought that was quite a lot of fun. So that kind of led me into going to college and then university to study design. After I graduated from university, I yeah, I got a job like you're you're told to. Uh and in my

1:56first week at the job, I wanted to quit and actually just do my own thing. I didn't want to be on the treadmill. I didn't want to have a job. I didn't want to have a normal, you know, semi- detached house in the suburbs. I wanted to just like do what I wanted to do. I wanted to own my own time. And I felt like starting the company was probably the only way to actually do that. And then I read in a free newspaper, the app

2:18Candy Crush made a million pounds a day. And I was like, I think I could make an app. I met my co-founder Tim a year after university through this like global hackathon thing. We met online, met up for a coffee, decided to work on some stuff. I don't know, like when you're young, you want to build something. The first thing you need to work out how to do is actually are we

2:43capable of putting something together. And I know that might sound silly, but like the first thing you've got to do is actually go through the cycle once of, hey, we bought a domain. Cool. We now to make a back end, great. We know how to make a landing page. Perfect. So, I think like a lot of the early tries that we had around like different ideas was just can we get something up and running? We'd worked on projects for two or three years together. A lot of those early ideas failed, but I was just really all in and I was like, we're going to make it work. The early days

3:12were really simple. It was like me and him in a co-working space at his university being like, cool, we know we want to make something in video because we're both really passionate about that space and we and we see like the early signs of it becoming really interesting. And the idea was like super simple, like you know, video editing, I've done it for years. I'm a really like technical person, but I find it quite hard. Can we like build basic video editing tools in the browser? Like super basic. And I was

3:39like really inspired by Gy's GIF editor. It was just like upload a video, add text, trim it, done. I was like, can we do something similar like that for video? That was kind of like the initial idea. We just thought that if other people have done it, why are they so special? Why can't we do it? And yeah,

3:56we went all in. We probably had about enough runway for a year. We literally made like no progress. So, I'd normally wake up at 6:00 in the morning, uh, get on my bike, head to the office at 6:30, get there for about 7, and again, just to let you know how frugal we were. When I say office, I mean co-working space. And when I mean co-working space, I mean me and Tim shared the entry card. And then yeah, we'd do that until what, 7, 8 at night, go to the gym, cycle on the bike furiously for an hour, come back, work again, and then try and pick up some

4:35discount food on the way home because uh cuz it was late all the, you know, you get half price in different places in London. So I'd do that and then go to sleep and do it again. Rinse and repeat. We were using this like crisp chat and I remember email them being like, "Hey

4:49guys, we can't afford 100 bucks a month. Can you do less?" They're like, "Yeah, yeah, 20 $20 a month, fine." So like everything we would like nickel and dime every single purchase um to just keep operating expenses as low as possible. We ended up in this like VC's office working and those VCs then kicked us out of their office. So we're now like officeless. The interns that we hired both quit on the same day and we were like stuck. We tried to get funding and we got rejected like many many many times and we both had crypto fortunately and we had to sell it to keep the

5:22company going. Right. two years of no money, no validation, nothing, no funding, kicked out of your office, your interns quit. It felt like it all unraveled. It was like a really, really tough time. Even like going to see friends for their birthdays, not being able to afford the train, all commuting around the city was on a bike. Lunch every day was like pre-made. I couldn't go out and see friends on Friday because they'd want to go for dinner or go for drinks, and I couldn't afford that. Just totally scraping by. And everyone at the same time is, you know, progress, you know, they're in their late 20s, they're

5:56progressing in their careers, they're buying houses, and there's me who's just like emptied my bank account. So, we both now have jobs at this point. And that was nice because, you know, finally I can like, you know, do normal things with normal people again and visit my friends and go for dinner. But at the same time, we still even at that point took half of our salaries every month religiously, put it back into the company account and then used that money to hire two other engineers who would build for us who yeah really helped us build the company today. And over the next like 8 9 months, things started to

6:31really take off. We went from like zero users to 30,000 monthly users in like 9 months. We've got some money saved up now. We've got users. They're not paying, but maybe maybe we're on to something. Hey there, this is Pat. I'm the creator of this channel, and I'm actually working on this video right now. What happens next to these guys is actually what inspired me to create this video, and it has to do with them getting rejected on a really big stage. What also inspires me

6:59is the sponsor of this video, Post Talk. But hold on, before you fast forward, I want to show you something crazy right now on my computer. I'm on v.io's io's site right now the company that Saba founded and I'm inspecting the code and look what they use Post hog I'll do the same on my site and you can see we use Post hog too why because it's a great analytics tool that all startups and online businesses should use if they want to grow I can tell you all about their features but instead I'll just jump in and show you how I use it every single day so this is Post Hog I use the

7:36product analytics feature the most but they also of amazing stuff like web analytics, session replay, AB testing, and way more. Anytime we launch something new at Starter Story, I go to Post Hog and create a new report with the most important data points, study the data, make changes, and then I can see exactly how those changes actually impact the data. I'll pop into this report right here where I can track conversion on our homepage. What's also cool is I can drill down by source, run AB tests on this, and more. These dashboards fuel our business. I mean, just look at how many different ones I have saved on here. There's just no

8:12other tools this powerful in the market. You can set it up with just one line of code and the free plan is super generous. A million events for free and after that it's fractions of a penny per event. Crazy. So, if you want to try out Post Hog, and you should cuz why not,

8:27hit the first link in the description. You can install it for free, but please when you go there, tell them you came from Starter Story. All right, let's get back to the story. We got to about 30,000 monthly users. We both have full-time jobs. We have these two guys helping us out on the side. And we've saved up enough money at this point that we're like, maybe we should try to apply to Y Combinator, this like famous startup accelerator. We've got good traction at this point, 30,000 monthly users. We've shown we're like super gritty because we've been doing it for 2 years. We've invested all our

9:01money in it multiple times over and we think that maybe this is our like big break. We apply and to our amaze event, we get in to this interview round and you know, we've been through so much to get to this point. We go into the interview, we come out. The way that White Combinator works is really simple. If you get in, they give you a call. If you don't get in, they send you an email rejection letter. So that evening, we're like refreshing our phone, waiting for the email, and we think to ourselves, I think we got it. I think we got it. And I looked at this email and it was like,

9:33sorry. you know that you know that first line it always gets you the first line the rejection just gets you that unfortunately this batch you haven't been selected. We're looking at this rejection email that we got and there's another line that stood out to me and it says we don't understand why you haven't charged your users or something like that. And so we thought to ourselves, why don't we try and implement their feedback over the weekend and then email them on Monday or basically just go to the Y combinator office and be like, "Guys, we saw your feedback. We hear you. We've implemented it. We've actually got paid users. Will

10:08you change, you know, will you reconsider us?" Bang on. 9:00 a.m. Monday morning, we sent them an email like, "Hey guys, thank you so much for your feedback. We implemented it. We got 20 paid users. Would you reconsider? We've got this. We're here for it. like we want to we want to learn and we're like you know fingers crossed like maybe

10:28just maybe we're in for another shot. You know what happened? Yeah. We got another rejection email and still to this day I help killed them on [Music] Twitter. But at that point there was prey combinator which is a company that makes no revenue and now there's post a company that makes some revenue. Once we got back to the UK after California I did one thing which was only focus on growth. Like the only thing I had to do was make traffic higher than the day or the week before and make revenue higher than the day or the week before. It felt like every 4 to 6 months I was learning

11:12how to do a new job. And the skill set that really made it fly was SEO. I had to work out how to do marketing. Divide that. What What does that mean? Well, I have to choose what kind of marketing am I going to do. Because I had no money. It was only like SEO. Okay, how do you

11:27do SEO? We have to write landing pages. Well, I'm very dyslexic, but I'm going to have to work that out anyway, right? So, I'm just going to write all these terribly worded, you know, misspelled landing pages, which is a true story. I did. People search for things like trim video, crop video. There's actually about 500 of these search terms. So, I built a landing page for every single one of those things. And then I'd record YouTube videos for every single landing page. It was just brute force, like absolutely brute force. After that journey, things just started growing super fast. At that point, it was just like off to the races. 0 to 1 million in

12:02the first year. 4 months later 2 million. 2 months later 3 million and then 6 months after that it was 6 million. So it was 0 to 1 1 to 6. This like proper growth phase of the company going from 10 20 30 40 million in revenue. I don't know it was like a bit of a middle finger to all the people who didn't want to invest in me or YC turning me down. It was a bit of a hey, we're good. You know, like, you know, you're lost. The founding and the starting of the company is definitely like the most interesting part of the journey. And it

12:40becomes this like marathon. This is like an endurance sport, right? You're not on the roller coaster anymore. You're in like dayto-day combat. And I feel like at the start it's more like jumping through hoops, you know, and like trying to work out the next trick and how to get around that corner. And then once it starts going and scaling, it's more like how can I just keep drumming the beat of the company, you know, and keep keep things moving and keep growth up. And it's just really hard to run a business like dealing with people and like directing them and trying to do whatever you can that's like in the best interest

13:13of them, but also the company at the same time. Like it's genuinely really really challenging and the bigger you get, the harder it is and you only feel more and more vulnerable. I do anyway. I'm so paranoid all the time about the company, what we're doing. Are we doing the right things? I love it. I absolutely love it. I've got the best job in the world and I'm so so fortunate to be able to do it. But yeah, it's just tough. The company could have failed at so many points. It could have failed when the two interns quit. It could have failed when we ran out of money. It

13:48could have failed when we got kicked out of our office. It could have failed when we didn't get into YC, right? Like there is so many points where I could have been or we could have been like, "Nah, nah." Like, it's over. It obviously doesn't work. But every single time we kept going. And I'm so grateful for all of

14:10those learnings. so grateful. Thank you guys for watching. This was really fun to put together. Maybe one day Saba and Starter Story will be on Netflix. This story particularly hits home for me. And part of the reason why I wanted to create it was because I was rejected from YC three times. That also fueled me. And it's cool to see other people build huge multi-million dollar businesses that were also rejected. So if there's any lesson there, keep building, guys. Keep going. I'm going to put a link in the description if you want to check out Starter Story Build, which is our new boot camp where you'll come up with an

14:46idea, build it, ship it in 12 days using only AI tools. I think it's really cool. Okay, link is in the description for that. Otherwise, I'll see you guys in the next one. Peace.