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A New Standard Deal

blog.ycombinator.com

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Re: A New Standard Deal

#11

Post by ecesena »

vikramkr wrote: post #2

A big reason they said they were raising the deal previously was the cost of living in the bay area and increased cost of starting a company today[0]. Are they anticipating that those costs are going to come down now? They suggest that this decreased amount will allow them to fund more companies, and hint that it has to do with economic conditions as well. But, if that amount of money is still needed to live in the b…

It almost likely will be remote-friendly due to covid, no?

Also, with -$25k/deal they can fund 6 startup where they could found 5 before.

So remote-friendly = less cost, +20% batch size at the same cost. It makes sense to me.

Re: A New Standard Deal

#12

Post by sharkjacobs »

headcanon wrote: post #4
vikramkr wrote: post #2

A big reason they said they were raising the deal previously was the cost of living in the bay area and increased cost of starting a company today[0]. Are they anticipating that those costs are going to come down now? They suggest that this decreased amount will allow them to fund more companies, and hint that it has to do with economic conditions as well. But, if that amount of money is still needed to live in the b…

If cost of living is so high, I wonder why they wouldn't invest in a dorm-like living space for founders? I'm not familiar with the area, so I imagine there's reasons for it, but being able to focus on work instead of life-maintenance details seems like it would benefit the organization.

Providing employees with some kind of inexpensive nutrient slurry would also be a great way to help mitigate the high cost of living.

Re: A New Standard Deal

#13

Post by tlb »

headcanon wrote: post #4
vikramkr wrote: post #2

A big reason they said they were raising the deal previously was the cost of living in the bay area and increased cost of starting a company today[0]. Are they anticipating that those costs are going to come down now? They suggest that this decreased amount will allow them to fund more companies, and hint that it has to do with economic conditions as well. But, if that amount of money is still needed to live in the b…

If cost of living is so high, I wonder why they wouldn't invest in a dorm-like living space for founders? I'm not familiar with the area, so I imagine there's reasons for it, but being able to focus on work instead of life-maintenance details seems like it would benefit the organization.

(a) It's not clear why YC could run an apartment complex better or cheaper than the many companies who already do it (including some YC-funded startups like https://zeusliving.com)

(b) Founders tend to be independent-minded people who like to do things their own way.

Re: A New Standard Deal

#14

Post by PragmaticPulp »

phkahler wrote: post #10

I figured the increase to over 100k is when non-technical people started doing it. They hire people to make their MVP instead of the founders themselves. Or am I wrong about that?

$100K won't buy enough professional services to build, launch, and operate an MVP unless the app is very simple. If it's simple enough that anyone can drop $50K-100K on design services and have your business cloned, it's not a very defensible startup idea.

There are occasional exceptions, but typically the founding team must have the majority talent and skills required to launch the MVP.

Re: A New Standard Deal

#15

Post by PaulWaldman »

Per the blog post, this is to enable funding more companies in the future. How is YC able to scale funding all these companies? Are the ratios of partners to companies consistent? Does it scale linearly? Or as YC grows do they leverage their outside network more?

Re: A New Standard Deal

#16

Post by dmor »

vikramkr wrote: post #2

A big reason they said they were raising the deal previously was the cost of living in the bay area and increased cost of starting a company today[0]. Are they anticipating that those costs are going to come down now? They suggest that this decreased amount will allow them to fund more companies, and hint that it has to do with economic conditions as well. But, if that amount of money is still needed to live in the b…

Rents in San Francisco’s SOMA neighborhood dropped 9% in May https://www.google.com/amp/s/sf.curbed.com/platform/amp/2020...

My guess is that the departures will continue as unemployment rates grown and that when federal and state payments run out we will see a further decline.

I think companies will soon have to justify why they can afford to have an office with remote as the better (and cheaper option). Other than headcount, rent is usually the largest line item for a startup

Re: A New Standard Deal

#17

Post by kortilla »

stellar678 wrote: post #7
headcanon wrote: post #4

Earlier quoted context omitted.

If cost of living is so high, I wonder why they wouldn't invest in a dorm-like living space for founders? I'm not familiar with the area, so I imagine there's reasons for it, but being able to focus on work instead of life-maintenance details seems like it would benefit the organization.

Among other things, I'd expect this is because YC is trying to break free of the idea that the only way to be a successful startup founder is to be a young, single, attachment-free man. Successful startups are created by all kinds of people in all kinds of different life situations, and YC needs to be careful to be inviting to as broad an array of people as possible. At the same time, I agree that dorm-style living (…

Are women unable to live in dorms?

Re: A New Standard Deal

#18

Post by randomchars »

kortilla wrote: post #17
stellar678 wrote: post #7

Earlier quoted context omitted.

Among other things, I'd expect this is because YC is trying to break free of the idea that the only way to be a successful startup founder is to be a young, single, attachment-free man. Successful startups are created by all kinds of people in all kinds of different life situations, and YC needs to be careful to be inviting to as broad an array of people as possible. At the same time, I agree that dorm-style living (…

Are women unable to live in dorms?

> young, single, attachment-free man.

Some YC founders bring their whole family with them. Also, at some point in life, living a dorm starts to sound like torture.

Re: A New Standard Deal

#19

Post by throwaway_jobs »

headcanon wrote: post #4
vikramkr wrote: post #2

A big reason they said they were raising the deal previously was the cost of living in the bay area and increased cost of starting a company today[0]. Are they anticipating that those costs are going to come down now? They suggest that this decreased amount will allow them to fund more companies, and hint that it has to do with economic conditions as well. But, if that amount of money is still needed to live in the b…

If cost of living is so high, I wonder why they wouldn't invest in a dorm-like living space for founders? I'm not familiar with the area, so I imagine there's reasons for it, but being able to focus on work instead of life-maintenance details seems like it would benefit the organization.

Liability. Someone slips and falls, someone is (sexually) assaulted in the dorm, etc...

It would probably be exceptionally helpful for a lot of YC founders I imagine, but in addition to the liability, the optics are kind of creepy in that certain SV culture kind of way they likely want to avoid.

Re: A New Standard Deal

#20

Post by gojomo »

headcanon wrote: post #4
vikramkr wrote: post #2

A big reason they said they were raising the deal previously was the cost of living in the bay area and increased cost of starting a company today[0]. Are they anticipating that those costs are going to come down now? They suggest that this decreased amount will allow them to fund more companies, and hint that it has to do with economic conditions as well. But, if that amount of money is still needed to live in the b…

If cost of living is so high, I wonder why they wouldn't invest in a dorm-like living space for founders? I'm not familiar with the area, so I imagine there's reasons for it, but being able to focus on work instead of life-maintenance details seems like it would benefit the organization.

Founders may find & cluster in such spaces, themselves. Once upon a time, an SF high-rise got the nickname 'Yscraper' for all the YCers there:

https://www.sfgate.com/business/article/Justin-tv-to-get-boo...

And, there have been dorm-like living spaces throughout the Bay Area often favored by founders & young transplants. See, eg:

https://www.nytimes.com/2018/03/04/technology/dorm-living-gr...

I'd expect YC might informally be able to point out such places, or formally invest in some with the right vision, but would not necessarily get further into managing housing themselves. And, too much density/interaction with disparate teams might at some point become counterproductive, compared to the classic "intense founders of the same entity living together to the exclusion of other distractions" model, or the rising capabilities of mostly-remote teams.

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