Michael Seibel knows a thing or two about starting businesses. And not just starting new companies but making them successful. So who better to distill some wisdom on how to be an entrepreneur and how to tell if you have what it takes to be an entrepreneur.

Seibel often discovers and advises young startups. In fact, he became the first African-American partner and CEO at revered startup incubator Y Combinator in 2014 where he strived to make the competitive three-month-long program more diverse.

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Seibel, 36, co-founded Justin.tv in 2007, which evolved into Twitch in 2014 and he sold it to Amazon for $970 million. Next came Socialcam, a company he co-founded in 2012 and which later sold for $60 million. Besides launching companies, he also has an impressive list of successful companies he has advice and funding, such as Waze. Waze sold to Google for more than $1 billion. There’s also Cruise, which was sold to GM for a similar amount. He has also invested travel companies like NexTravel and health and beauty products for people of color, such as Walker and Company.

“I was a co-founder and CEO of Justin.tv from 2007 – 2011 and the co-founder and CEO of Socialcam in 2012. During 2012, Socialcam participated in Y Combinator, raised angel financing from a group of amazing investors, and sold to Autodesk Inc. for $60m (link). Needless to say — it was a busy year. In 2014 Justin.tv became Twitch Interactive and under the leadership of Emmett Shear and Kevin Lin sold to Amazon for $970m,” Seibel, who has lived in the Bay Area for the past 10 years, told the Y Combinator blog.

Prior to entering the tech sector, Seibel worked as the finance director for a U.S. Senate campaign. He also likes to tell the story of how he got kicked out of Yale in his senior year for poor grades and a lack of enthusiasm for school until he hit a turning point and discovered his true passion. He went on to graduate from Yale with a degree in political science.

According to Seibel, there are certain facts entrepreneurial wannabees need to face. Most startups fail.  “The vast majority of startups are not successful,” he said. Also, if you are great at technology you can also find a great job as an employee and not have the responsibilities of being a business owner. “For talented technical people, it’s relatively easy to get a job and make a large salary,” he pointed out.

Initially, Seibel himself wasn’t thinking about entrepreneurship.

“Doing startups was never my plan but looking at my history in high school and college I really needed to be an underdog in order to motivate myself to succeed. Startups are the classic underdog, 99% of the time – they fail. This was so motivating that I didn’t even need to believe in our first idea to stay excited (remember… we started as an online reality TV show),” he shared.  “Throughout almost all of the history of Justin.tv and Twitch we were expected to lose. We were funded by YC in 2007 but it wasn’t nearly as well known as it is today and most investors ignored us. After demo day no matter how hard we tried we could only raise $180k in angel investment. As we built our business we couldn’t attract the highest ranked VCs, couldn’t hire the most sought-after engineers, and were constantly fighting to just stay alive at a time when video startups were considered horrible cash combusting businesses with no ability to monetize.”

It was a hard and frustrating road for Seibel, who learned a lot from the experience “On 5 separate occasions over 5 years we almost died. Once receiving a bandwidth bill for more money than we had in our bank account, once needing a loan from Justin and Emmett, and once having less than 2 months of runway and $1m in monthly expenses. All of these adversities were exactly what we needed to stay hungry. We couldn’t be killed, we wouldn’t go away, and 8 years after we started we succeeded,” he said.

So, from what he has learned, Seibel says there are questions people looking to launch a startup need to ask themselves. They are: Do I like being the underdog?; Do I seek the hard challenges that most people shy away from?; Do I thrive when I take personal responsibility for success or failure?

“If you answer yes three times, then maybe starting a startup is for you,” he said adding a warning. “I cannot promise that doing a tech startup will make you rich (in fact the odds are against you becoming rich), but I can promise that it is one of the most challenging things you can choose to do. It will push you past your limits, force you to learn faster, and maybe show you that once in a while the impossible is possible.”

“Every year that you don’t die, your chances of being successful go up” — @mwseibel on perseverance https://t.co/dRJSsw1sM5

— Ryan Hoover (@rrhoover) November 29, 2018