After nine years at the helm of Y Combinator, Paul Graham is stepping away from his leadership role at the famed Silicon Valley startup incubator. Taking over as Y Combinator’s president is Sam Altman, the entrepreneur who was part of the first YC startup class in 2005 and has worked as a part-time YC partner since 2011.
The transition will be finalized next month, when the current Winter 2014 Y Combinator batch holds its Demo Day. After that, Graham will no longer head up Y Combinator’s day-to-day operations, such as reviewing applications and serving as a public face of YC. He will, however, continue to hold office hours with startups in the program.
In a phone interview this morning, Graham said that Altman has been tapped to lead Y Combinator into a new chapter of its growth. “Really, what’s going on is that YC needs to get bigger, and I am not really much of a manager. Sam Altman is,” he said.
Graham says he first approached Altman about taking over the reins at Y Combinator in mid-2012. “When I realized that it would be a good time to recruit a successor, he’s the only one I thought of that would be perfect to be the next president,” he said. “I never had a title like that, but now we’re going to create the title.”
Graham has often pointed to Altman as an example of an exceptional leader: In a 2009 essay, Graham named Sam Altman as one of the “five most interesting founders of all time,” alongside Steve Jobs, Cypress Semiconductor founder TJ Rodgers, Google co-founders Larry Page and Sergey Brin, and Gmail inventor Paul Buchheit. He wrote of the then 24-year-old Altman (whose web handle is Sama): “Honestly, Sam is, along with Steve Jobs, the founder I refer to most when I’m advising startups. On questions of design, I ask ‘What would Steve do?’ but on questions of strategy or ambition I ask ‘What would Sama do?’”
Going forward, Graham says that Altman will concentrate on growing Y Combinator’s scale. “Now that we’ve got this new structure that’s more sharded, all we have to do is hire more partners and get more startups. We could probably grow by 10x in our current form,” Graham said. “Sam is much better suited to running a large organization.”
Growth is important now, he said, because of a larger shift in the startup landscape.
“We are in the beginning of a secular change in the number of startups. Starting a startup is becoming a normal thing to do… for very ambitious people, it’s going to be something they at least consider doing,” he said. “Now, how many startups could there be? The limiting factor is the number of good founders, not good ideas. How many good founders are there? Maybe one in every 1,000 people? That is a hell of a lot of startups. If we’re going to fund these people, we have to keep growing.”
Graham The Writer
As for Graham’s future, stepping back from day-to-day duties at Y Combinator will enable him to focus once again on his writing. Before he started YC, Graham’s status as a thought leader was first cemented by his influential essays on topics such as technology and entrepreneurship.
“I would like to go back to writing some more essays. When we first started YC, I could still write essays. But that was when it was just small. Then it got bigger and bigger,” he said. “It’s not so much the time, but it’s the attention. It’s the thing you think about in the shower in the morning. Now I will be able to write essays again, and maybe about topics other than startups.”
At a fundamental level, though, Graham says that the YC experience for startups will largely be unchanged. “A big misconception is that Y Combinator is Paul Graham,” he said. This change, he says, should finally dispel that public perception and build a bigger future for YC modeled in part after organizations that have stood the test of time.
“It’s rare for a company to last 100 years, but for a university it’s nothing. The reason for the difference, I think, is that product companies always have in their DNA some assumption about the kind of thing they’re building, and about their market, and that eventually ends up becoming false. But a university is just a nexus of people… people go there because of the people that are there,” he said. “Now, I’m not claiming that Y Combinator is going to last for centuries. But it could.”
Update: You can read Graham’s blog post announcing the news here.