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Reflections on my time in Y Combinator

chrisfrantz.com

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Re: Reflections on my time in Y Combinator

#41

Post by therusskiy »

chrisfrantz wrote: post #36
therusskiy wrote: post #30

Very strange hearing such stories. I remember a company I worked for went through a YC interview. We were rejected with "we are not sure you can deliver". At that point, we had built 2 mobile apps, a big customer wesbite, rich portals for partners, contractors and admins, had thousands of customers, were almost profitable. Our CEO had a history of delivering in that he sold his previous startup. I must sound bitter,…

I could be wrong here, but it sounds like you would have been further along than anyone I met in the batch. The majority of folks I spent time with were starting from scratch.

The founder never told it in great detail, but he did say he thought "they started on the wrong foot" with the interviewers.

Now that I think about it, you mentioned you had a laugh together.

Like with everything in life, there's probably a big subconcious bias towards people you like that extends to products they build.

Re: Reflections on my time in Y Combinator

#42

Post by falsemove »

Thanks for sharing. It seems like everyone was mostly focused on sales and some were doing quite well. Were there any strategies that stood out to you that were working? Was there some leg up provided to companies in their sales efforts who were in YC?

Re: Reflections on my time in Y Combinator

#43

Post by balsam »

upupandup wrote: post #37
therusskiy wrote: post #30

Very strange hearing such stories. I remember a company I worked for went through a YC interview. We were rejected with "we are not sure you can deliver". At that point, we had built 2 mobile apps, a big customer wesbite, rich portals for partners, contractors and admins, had thousands of customers, were almost profitable. Our CEO had a history of delivering in that he sold his previous startup. I must sound bitter,…

I'm willing to bet race has some underlying influence whether they like to admit it or not.

Probably not skin color, but maybe founder was born in an authoritarian place (like Russia)? Far more likely that he used Windows, Word, or preferred Java, though.

Re: Reflections on my time in Y Combinator

#44

Post by intelVISA »

bko wrote: post #9

This was a great read, but after reading it and how the group got funded with just an idea and a mock-up that took 15 minutes to make would make me less likely to apply for YC in the future. Imagine you're building a business and put a lot of thought into the the product and start building it out. And you're basically getting the same deal as someone who just came up with an idea and wung the whole process? Sure, you…

We considered YC at my last venture but these stories seem too frequent nowadays, we opted to just grind out an MVP instead and pitch directly.

Re: Reflections on my time in Y Combinator

#45

Post by sevazhidkov »

swyx wrote: post #34
yurisagalov wrote: post #32

Earlier quoted context omitted.

I think it's really hard to put a purely monetary value on YC, but I think it definitely does a disservice to say that the program only adds $5-10M worth of value. If you speak to YC alumni, you'll hear from many of them that YC made them dream bigger. There's a founder in the comments here who said YC was an "ambition multiplier" for him[1]. How do you value that? [1] https://news.ycombinator.com/item?id=32556060

right, sure, that is a huge value. but it's not, for example, $1B worth of value. should John Carmack do YC? no. etc. the goal of rational decisionmaking is to try to convert all factors into some kind of comparable numbers, and $ is just one utility function on which to project all these nonmonetary qualities. call it "utils" if you like ( https://en.wikipedia.org/wiki/Utility#Cardinal ). so fair point if you disagr…

The problem with these monetary estimates is that they involve current valuations, which are probabilistically based on future outcomes, not enterprise value.

PG once formalized YC value prop as average outcome multiplier [1]. Whatever the current valuation, would YC improve your expected outcome over lifetime of the company on 7.5%? If yes, then you should do it.

[1] http://www.paulgraham.com/equity.html?viewfullsite=1

Re: Reflections on my time in Y Combinator

#46

Post by whiddershins »

bko wrote: post #17
ipaddr wrote: post #14

Earlier quoted context omitted.

Who cares what someone else received vs what value they give? What I care about is what I receive vs what value I sell makes sense at my stage. This is about making your startup succeed not beating other companies in the program on terms. If an investment of 7% for 750,000 makes sense go for it. Who cares if someone else gets 8% or 6%.. it's not your money.

If you think having a product/revenue is valuable and you have a product/revenue and someone offers you some terms and they don't care about your product or revenue, then you're probably not getting the best deal you could get. It could be the best deal, sure, but that's the floor, because that's the deal you could get without a product or revenue. So that's a big indicator that you're getting a worse deal than you c…

It’s the best deal you could get from YC, which might be the best deal you can get.

It remains irrelevant what deal others are getting.

Re: Reflections on my time in Y Combinator

#47

Post by upupandup »

therusskiy wrote: post #39
upupandup wrote: post #37

Earlier quoted context omitted.

I'm willing to bet race has some underlying influence whether they like to admit it or not.

The founder was jewish in his late 30s :-)

I mean just the fact that there is overwhelming presentation from one group not speaking to your founder here. Sounds like if he's that far in the game, they won't be able to steer him

Re: Reflections on my time in Y Combinator

#48

Post by upupandup »

dheera wrote: post #35
therusskiy wrote: post #33

Earlier quoted context omitted.

Isn't running a business and especially a startup is supposed to be risky? "We have an idea that's not materialized yet, give us money so we can live comfortably and reap all benefits it it works out and not lose anything if it doesn't." - sounds like a wishful thinking.

> Isn't running a business and especially a startup is supposed to be risky? No, it is risky, and you want to actively eliminate as many of the risks as possible. Having a decent sized pile of cash is one way out of several of the risks. Supply chain shortages, founder medical expenses, mishaps and accidents, rising costs of living, personal emergencies happening to founders or employees requiring leave, there are a…

If something is risky, you should treat it as such. What I see people caught up in the startup/hustle/entrepreneur porn is the belief that they are different. No, statistics still show 95% of startups fail. You shouldn't be telling people to spend your youth on something that has 5% of less of success.

Re: Reflections on my time in Y Combinator

#49

Post by swyx »

sevazhidkov wrote: post #45
swyx wrote: post #34

Earlier quoted context omitted.

right, sure, that is a huge value. but it's not, for example, $1B worth of value. should John Carmack do YC? no. etc. the goal of rational decisionmaking is to try to convert all factors into some kind of comparable numbers, and $ is just one utility function on which to project all these nonmonetary qualities. call it "utils" if you like ( https://en.wikipedia.org/wiki/Utility#Cardinal ). so fair point if you disagr…

The problem with these monetary estimates is that they involve current valuations, which are probabilistically based on future outcomes, not enterprise value. PG once formalized YC value prop as average outcome multiplier [1]. Whatever the current valuation, would YC improve your expected outcome over lifetime of the company on 7.5%? If yes, then you should do it. [1] http://www.paulgraham.com/equity.html?viewfullsit…

interesting framing. (and awfully convenient for yc/pg, haha, but fine)

this feels like a second order analogue to the "ideas vs execution" debate - we know that idea is worth ~0, execution worth ~100 - but the harder question is - what is YC-fueled 3 months (where lets say you spend max 24 hours with YC partners/peers/events) + say 1-2 years worth of residual relevant connections worth vs a ~10 year hard grind on your own?

not gonna get the answer here but was fun to contemplate :)

Re: Reflections on my time in Y Combinator

#50

Post by renewiltord »

bko wrote: post #9

This was a great read, but after reading it and how the group got funded with just an idea and a mock-up that took 15 minutes to make would make me less likely to apply for YC in the future. Imagine you're building a business and put a lot of thought into the the product and start building it out. And you're basically getting the same deal as someone who just came up with an idea and wung the whole process? Sure, you…

That's how YC works, but you can pitch to other investors if you want to. Yep, YC is flat rate.
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