I first read Paul Graham and came to know about his ideas and work in 2005. Like Seth Godin or Guy Kawasaki, Paul Graham is a very accessible writer but he has an edge: He has actually created a successful technology startup earlier, and now he is active promoting technology entrepreneurs through YCombinator and its ground-breaking idea of microfunding, which turned the venture Capital industry on its proverbial head, so to speak. The Wikipedia entry on Paul Graham says this in its introduction to a very remarkable man.

Paul Graham (born 1964) is an American essayist, entrepreneur, investor, and programmer. He is known for his essays on hackers, startups, and programming languages

He is known for his work on Lisp, for co-founding Viaweb (which eventually became Yahoo! Store), and for co-founding the Y Combinator seed capital firm. He is the author of On Lisp (1993), ANSI Common Lisp (1995), and Hackers & Painters (2004).

I thought it would be cool, and useful to collect the best wisdom of Paul Graham, using his excellent collection of essays as a source. As my favorite Paul Graham quote goes, "Be relentlessly useful." I hope this collection helps you all.

On Entrepreneurship: Be relentlessly resourceful.

On importance of hackers: Software has to be designed by hackers who understand design, not designers who know a little about software. If you can't design software as well as implement it, don't start a startup.

What do hackers want? Like all craftsmen, hackers like good tools. In fact, that's an understatement. Good hackers find it unbearable to use bad tools.

It would not be far from the truth to say that a hacker about to write a program decides what language to use, at least subconsciously, based on the total number of characters he'll have to type. If this isn't precisely how hackers think, a language designer would do well to act as if it were.

On Usability: The best thing software can be is easy, but the way to do this is to get the defaults right, not to limit users' choices.

On Patents: I think the problem is more with the patent office than the concept of software patents. Whenever software meets government, bad things happen, because software changes fast and government changes slow.

On Great programmers: When those far removed from the creation of wealth -- undergraduates, reporters, politicians -- hear that the richest 5% of the people have half the total wealth, they tend to think injustice! An experienced programmer would be more likely to think is that all? The top 5% of programmers probably write 99% of the good software.

On Coding: Source code, too, should explain itself. If I could get people to remember just one quote about programming, it would be the one at the beginning of Structure and Interpretation of Computer Programs.

Programs should be written for people to read, and only incidentally for machines to execute.

On Teachers: Your teachers are always telling you [high school students] to behave like adults. I wonder if they'd like it if you did. You may be loud and disorganized, but you're very docile compared to adults.... Imagine the reaction of an FBI agent or taxi driver or reporter to being told they had to ask permission to go the bathroom, and only one person could go at a time.

On education: If I were back in high school and someone asked about my plans, I'd say that my first priority was to learn what the options were. You [high school students] don't need to be in a rush to choose your life's work. What you need to do is discover what you like. You have to work on stuff you like if you want to be good at what you do.

On Planning: The world changes fast, and the rate at which it changes is itself speeding up. In such a world it's not a good idea to have fixed plans.

On Time management: There are two types of schedule, which I'll call the manager's schedule and the maker's schedule. The manager's schedule is for bosses. Find an open slot in your schedule, book them, and you're done.

When you're operating on the maker's schedule, meetings are a disaster....For someone on the maker's schedule, having a meeting is like throwing an exception.

On Procrastination: No matter what you work on, you're not working on everything else. So the question is not how to avoid procrastination, but how to procrastinate well. There are three variants of procrastination, depending on what you do instead of working on something: you could work on (a) nothing, (b) something less important, or (c) something more important. That last type, I'd argue, is good procrastination.

The most dangerous form of procrastination is unacknowledged type-B procrastination [putting off important things to do unimportant things], because it doesn't feel like procrastination. You're "getting things done." Just the wrong things.

On Startups: Remember what a startup is, economically: a way of saying, I want to work faster. Instead of accumulating money slowly by being paid a regular wage for fifty years, I want to get it over with as soon as possible.

Steve Jobs once said that the success or failure of a startup depends on the first ten employees. I agree. If anything, it's more like the first five.

On following one's passion: Do what you love doesn't mean, do what you would like to do most this second. Even Einstein probably had moments when he wanted to have a cup of coffee, but told himself he ought to finish what he was working on first.

On Why good hackers have bad business ideas: the biggest cause of bad ideas is the still life effect: you come up with a random idea, plunge into it, and then at each point (a day, a week, a month) feel you've put so much time into it that this must be the idea.

(We must) realize that having invested time in something doesn't make it good.

On Jobs: If you're really productive, why not make employers pay market rate for you? Why go work as an ordinary employee for a big company, when you could start a startup and make them buy it to get you?

Hiring is obsolete: Instead of thinking about what employers want, you're probably better off thinking directly about what users want. To the extent there's any difference between the two, you can even use that to your advantage if you start a company of your own. For example, big companies like docile conformists. But this is merely an artifact of their bigness, not something customers need.

On Writing well: Here's the short version: Write a bad version 1 as fast as you can; rewrite it over and over; cut out everything unnecessary; write in a conversational tone; develop a nose for bad writing, so you can see and fix it in yours; imitate writers you like; if you can't get started, tell someone what you plan to write about, then write down what you said; expect 80% of the ideas in an essay to happen after you start writing it, and 50% of those you start with to be wrong; be confident enough to cut; have friends you trust read your stuff and tell you which bits are confusing or drag; don't (always) make detailed outlines; mull ideas over for a few days before writing; carry a small notebook or scrap paper with you; start writing when you think of the first sentence;

On Writing essays: The difference between a real essay and the things they make you write in school is that a real essay doesn't take a position and then defend it. Defending a position may be a necessary evil in a legal dispute, but it's not the best way to get at the truth, as I think lawyers would be the first to admit.

Questions aren't enough. An essay has to come up with answers.

On Teaching writing: In the late 19th century the teaching of writing was inherited by English professors. This had two drawbacks: (a) an expert on literature need not himself be a good writer, any more than an art historian has to be a good painter, and (b) the subject of writing now tends to be literature, since that's what the professor is interested in.

On Managing Communities: It's pretty clear now that the broken windows theory applies to community sites as well. The theory is that minor forms of bad behavior encourage worse ones: that a neighborhood with lots of graffiti and broken windows becomes one where robberies occur.

On Internet as distraction: I've found a more drastic solution that definitely works: to set up a separate computer for using the Internet.

On Determination: the most important predictor of success is determination...In most domains, talent is overrated compared to determination...The simplest form of determination is sheer willfulness. When you want something, you must have it, no matter what.

Here in sum is how determination seems to work: it consists of willfulness balanced with discipline, aimed by ambition. And fortunately at least two of these three qualities can be cultivated.

Principles for making New things: I like to find (a) simple solutions (b) to overlooked problems (c) that actually need to be solved, and (d) deliver them as informally as possible, (e) starting with a very crude version 1, then (f) iterating rapidly.

On Big organizations: What's so unnatural about working for a big company? The root of the problem is that humans weren't meant to work in such large groups.

On being good: I'm not suggesting you be good in the usual sanctimonious way. I'm suggesting it because it works. It will work not just as a statement of "values," but as a guide to strategy, and even a design spec for software. Don't just not be evil. Be good.

On The next Google: The reason there aren't more Googles is not that investors encourage innovative startups to sell out, but that they won't even fund them...(the) money guys undervalue the most innovative startups.

On handing disagreements: A disagreement hierarchy - Name-calling < Ad Hominem < Responding to Tone < Contradiction < Counterargument < Refutation < Refuting the Central Point

On Charisma: The charisma theory may also explain why Democrats tend to lose presidential elections. The core of the Democrats' ideology seems to be a belief in government. Perhaps this tends to attract people who are earnest, but dull.

What do you wish someone had told you in high school: (Find out) what you want to do with your life...What you need to do is discover what you like. You have to work on stuff you like if you want to be good at what you do.

Why are smart kids so consistently unpopular?: The answer, I think, is that they don't really want to be popular.

Succinctness: Succinctness = power.

Two Types of judgment: The first type of judgment, the type where judging you is the end goal, include court cases, grades in classes, and most competitions. ..There is a second much larger class of judgments where judging you is only a means to something else. These include college admissions, hiring and investment decisions, and of course the judgments made in dating. This kind of judgment is not really about you.

On Being wise and smart: (Wisdom) is knowing what to do in a lot of situations..."Wise" and "smart" are both ways of saying someone knows what to do. The difference is that "wise" means one has a high average outcome across all situations, and "smart" means one does spectacularly well in a few.

On Founders: Things we look for in founders - 1. Determination 2. Flexibility 3. Imagination 4. Naughtiness 5. Friendship

On Young founders: As a young founder your strengths are: stamina, poverty, rootlessness, colleagues, and ignorance.

What goes wrong with young founders is that they build stuff that looks like class projects.

There seem to be two big things missing in class projects: (1) an iterative definition of a real problem and (2) intensity.

Don't drop out of college to start a startup. There's no rush. There will be plenty of time to start companies after you graduate. In fact, it may be just as well to go work for an existing company for a couple years after you graduate, to learn how companies work.

On living on the margins: One reason so many good ideas come from the margin is simply that there's so much of it. There have to be more outsiders than insiders, if insider means anything.

The Island Test: What, besides clothes and toiletries, do you make a point of packing? That's what you're addicted to.

Question things: Keep track of opinions that get people in trouble, and start asking, could this be true? Ok, it may be heretical (or whatever modern equivalent), but might it also be true?...Figure out which of our taboos future generations will laugh at is to start with the labels.

Tips for good programming: 1. Avoid distractions. 2. Work in long stretches. 3. Use succinct languages. 4. Keep rewriting your program. 5. Write readable code. 6. Work in small groups. 7. Don't have multiple people editing the same piece of code. 8. Start small.
Artists ship: For good programmers, one of the best things about working for a startup is that there are few checks on releases. In true startups, there are no external checks at all. If you have an idea for a new feature in the morning, you can write it and push it to the production servers before lunch. And when you can do that, you have more ideas.

On Good design: 1. Good design is simple. 2. Good design is timeless. 3. Good design solves the right problem. 4. Good design is suggestive. 5. Good design is often slightly funny. 6. Good design is hard. 7. Good design looks easy. 8. Good design uses symmetry. 9. Good design resembles nature. 10. Good design is redesign. 11. Good design can copy. 12. Good design is often strange. 13. Good design happens in chunks. 14. Good design is often daring.

On Presenting to investors: 1. Explain what you're doing. 2. Get rapidly to demo. 3. Better a narrow description than a vague one. 4. Don't talk and drive. 5. Don't talk about secondary matters at length. 6. Don't get too deeply into business models.7. Talk slowly and clearly at the audience. 8. Have one person talk. 9. Seem confident. 10. Don't try to seem more than you are. 11. Don't put too many words on slides. 12. Specific numbers are good. 13. Tell stories about users. 14. Make a soundbite stick in their heads.

On Starting up: You need three things to create a successful startup: to start with good people, to make something customers actually want, and to spend as little money as possible.

On Startup ideas: There are two types of startup ideas: those that grow organically out of your own life, and those that you decide, from afar, are going to be necessary to some class of users other than you. Apple was the first type. The iPhone is the phone Steve Jobs wants.

On Startup Mistakes: 1. Single Founder 2. Bad Location 3. Marginal Niche 4. Derivative Idea 5. Obstinacy 6. Hiring Bad Programmers 7. Choosing the Wrong Platform 8. Slowness in Launching 9. Launching Too Early 10. Having No Specific User in Mind 11. Raising Too Little Money 12. Spending Too Much 13. Raising Too Much Money 14. Poor Investor Management 15. Sacrificing Users to (Supposed) Profit 16. Not Wanting to Get Your Hands Dirty 17. Fights Between Founders 18. A Half-Hearted Effort

Startup tips: 1. Pick good cofounders. 2. Launch fast. 3. Let your idea evolve. 4. Understand your users. 5. Better to make a few users love you than a lot ambivalent 6. Offer surprisingly good customer service. 7. You make what you measure. 8. Spend little. 9. Get ramen profitable. (Make just enough to pay the founders' living expenses.) 10. Avoid distractions. 11. Don't get demoralized. 12. Don't give up. 13. Deals fall through. (Shit happens)

Hardest lessons for startups to learn: 1. Release Early. 2. Keep Pumping Out Features. 3. Make Users Happy.4. Fear the Right Things. (What you should fear, as a startup, is not the established players (or disasters), but other startups you don't know exist yet.) 5. Commitment Is a Self-Fulfilling Prophecy. 6. There Is Always Room. (For new stuff) 7. Don't Get Your Hopes Up. 8. Speed, not Money

On startup failures: If we send them an email asking what's up, and they don't reply, that's a really bad sign. So far that is a 100% accurate predictor of death...Maybe if you can arrange that we keep hearing from you, you won't die.

On creating Silicon Valleys: The question of how to make a silicon valley becomes: who are the right people, and how do you get them to move?

I think you only need two kinds of people to create a technology hub: rich people and nerds...Everyone else will move.

On Bootstrapping: If you factor out the "bootstrapped" companies that were actually funded by their founders through savings or a day job, the remainder either (a) got really lucky, which is hard to do on demand, or (b) began life as consulting companies and gradually transformed themselves into product companies.

On Fundraising: 1. Have low expectations. 2. Keep working on your startup. 3. Be conservative. 4. Be flexible. 5. Be independent. 6. Don't take rejection personally. 7. Be able to downshift into consulting (if appropriate). 8. Avoid inexperienced investors. 9. Know where you stand.

On investors: 1. The investors are what make a startup hub. 2. Angel investors are the most critical. 3. Angels don't like publicity. 4. Most investors, especially VCs, are not like founders. 5. Most investors are momentum investors. 6. Most investors are looking for big hits. 7. VCs want to invest large amounts. 8. Valuations are fiction. 9. Investors look for founders like the current stars. 10. The contribution of investors tends to be underestimated. 11. VCs are afraid of looking bad. 12. Being turned down by investors doesn't mean much. 13. Investors are emotional. 14. The negotiation never stops till the closing. 15. Investors like to co-invest. 16. Investors collude. 17. Large-scale investors care about their portfolio, not any individual company. 18. Investors have different risk profiles from founders. 19. Investors vary greatly. 20. Investors don't realize how much it costs to raise money from them. 21. Investors don't like to say no. (We're really excited about your project, and we want to keep in close touch as you develop it further.) 22. You need investors. 23. Investors like it when you don't need them.

The Equity equation: In the general case, if n is the fraction of the company you're giving up, the deal is a good one if it makes the company worth more than 1/(1 - n).

On Convertible notes: The reason startups have been using more convertible notes in angel rounds is that they make deals close faster...Convertible notes let startups beat deadlocks by rewarding investors willing to move first with lower (effective) valuations.

On The existing Venture capital model: There is a huge, unexploited opportunity in startup funding. There is a growing disconnect between VCs, whose current business model requires them to invest large amounts, and a large class of startups that need less than they used to. Increasingly, startups want a couple hundred thousand dollars, not a couple million.

On Super angels: I think VCs should be more worried about super-angels than vice versa. Despite their name, the super-angels are really mini VC funds, and they clearly have existing VCs in their sights.

On Technological progress: The world is more addictive than it was 40 years ago. And unless the forms of technological progress that produced these things are subject to different laws than technological progress in general, the world will get more addictive in the next 40 years than it did in the last 40.

On Nations: As a rule of thumb, the more qualifiers there are before the name of a country, the more corrupt the rulers. A country called The Socialist People's Democratic Republic of X is probably the last place in the world you'd want to live.

On Lies: Adults lie constantly to kids. I'm not saying we should stop, but I think we should at least examine which lies we tell and why.

On Wealth: If you try to attack wealth, you end up nailing risk as well, and with it growth. If we want a fairer world, I think we're better off attacking one step downstream, where wealth turns into power.

On Luxury spending: People trying to sell you expensive things (will) say "it's an investment."

I am sure you would have your own favorite piece of wisdom from the great Paul Graham. Please share.

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