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Why YC went to DC

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Re: Why YC went to DC

#251

Post by cameroncairns »

singleshot_ wrote: post #218
throwaway5959 wrote: post #213

Earlier quoted context omitted.

From what I understand a lot could be classified as R&D. More than one would think.

Read 26 CFR section 1.174-2. “Activities intended to discover information that will eliminate uncertainly concerning the development or improvement of a product.” Specifically, check out example three in this section. I would be very careful about sweeping all my expenses in this category, but my familiarity with this part of the law is not deep. I’d love a 174 practitioner to jump in here but that might be asking a…

Not a practitioner, just a startup cofounder affected by these changes.. not legal or tax advice. You can read the applicable text here:

https://www.law.cornell.edu/uscode/text/26/174

Section 174(c)(3)

``` (3) Software development

For purposes of this section, any amount paid or incurred in connection with the development of any software shall be treated as a research or experimental expenditure.

```

That being said... it's complicated: https://www.thomsonreuters.com/en-us/posts/tax-and-accountin...

We've heard a mix of advice from various tax professionals on what should be classified as R&D or not. The messaging gets expecially mixed since the R&D tax credit is often handled by a 3rd party that specializes in it. The company specializing in the tax credit may be incentivized to classify as much of your activity as R&D as they can, since they are usually paid a percentage of the total credits they are able to claim for your company.

It certainly complicates running a software company. My cofounder and I need to look at the amortization schedule before making any engineering hire as we basically need to consider their salary nearly 100% R&D. I imagine it's even more complicated for founders with overseas teams.

It would certainly be easier for us to do business if Section 174 was revised :)

Re: Why YC went to DC

#253

Post by muzani »

bko wrote: post #155
mrb wrote: post #14

"This year, we’ll fund more than 500 companies out of 50,000 applications, and almost all of them are related to AI in some way." So, what this means: that in 2024, if you want to get VC capital, your startup must be related to AI.

I love the constant flex of their tiny acceptance rate. "We only accept 1% of applicants. Btw everyone should apply!" The collective man hours wasted on appe every year for what is essentially a lottery is insane.

Filling the form wasn't too hard. It's probably the kind of thing every founder should know and be able to answer. It's easier than most job applications. Definitely easier than college applications... if you wanted to compare it to college, getting financial aid has a tiny acceptance rate as well. YC is bundling the education and the financial aid.

Rejection isn't hard either. If you're a founder, you'll be rejected by VCs all the time, and many early stage investors offer far lower amounts and far worse advice. You'll be rejected by your product - MVPs often have to be reworked and pivoted. And then you'll face some more rejection when doing sales and product interviews.

I think it's important to be transparent about the rate though, but also important to make it clear that the low rate doesn't mean they're trying to push people away.

Re: Why YC went to DC

#254

Post by christophilus »

vundercind wrote: post #52
no_wizard wrote: post #22

Earlier quoted context omitted.

I don’t disagree with this assessment but it’s also a narrow view[0] that allows the problem to persist in the first place. Rather, I’d like to see what positive oversight would look like, but that has not been put forth by any of these organizations thus far. It all comes down to “trust us” which is also hard to stomach [0]: most often but not exclusively held by Americans (of which i am one). We collectively fail t…

This is a relatively new and carefully cultivated state of things. I mean, the early phases of this era are a half-century old at this point, but it’s not like it’s a law of nature that at least half the population of the US and about half the politicians must regard government as rarely-useful. It didn’t used to be that way. It’s not an American trait in some holistic historical sense.

I dunno. When I read the founding fathers, they seem pretty skeptical of power structures, both public and private. The way they configured the government, it’s clear that they had little trust that we’d have competent or honest politicians at the helm. Hence all the checks and balances and limitations to federal powers.

Re: Why YC went to DC

#255

Post by 8note »

bumby wrote: post #243
pjmorris wrote: post #240

Earlier quoted context omitted.

> Considering Medicare/Medicaid are currently approaching $1T annually to serve less than 20% of the population how dues your stroke of the pen plan pay for the increase when everyone is enrolled? Most countries manage on ~12% or less of GDP, the US takes ~17% of GDP to pay for healthcare [0]. For example, the UK manages to cover everyone for about 12% of GDP. If the US adopted a plan as ubiquitous as the UK, in the…

This is the frustrating part of these conversations because people act like you can just swap one country for another like they are interchangeable. They aren’t. For example, other countries get to keep drug costs low because the companies that make them get huge profits in the US. If the US charges the same, the profits and R&D also dry up unless you set up another system. Also, the US tends to rely on extreme measu…

New drug funding tends to come from the US government already. Drug company R&D looks more like "what patents can we buy out and jack the prices in?"

Re: Why YC went to DC

#256

Post by 8note »

dghlsakjg wrote: post #238
robertlagrant wrote: post #215

Earlier quoted context omitted.

> institute a national, single-payer plan that covers everyone, like every other modern industrialized country The two (real, non-politicians are corrupt) downsides to contend with: - countries do this by limiting what they will spend; in the US you have access to unlimited treatment. E.g. in the UK the NHS will spend £30k for each good year it buys you - this one isn't fair, but the US is where health innovation hap…

I live in Canada and there isn’t a spending limit. The decision of how to treat is made by the doctor. The doctor is then paid. In my experience living on both sides of the border, you get far more care up here since there is no bullshit with finding a facility that accepts your insurance, and cost isn’t a consideration for doctors or patients. People will occasionally travel to the states for drug/therapy trials not…

Canada has spending limits, but they aren't in $, but in procedures.

It varies by province, but Alberta will do n heart surgeries per year, and who gets them is by triage

Re: Why YC went to DC

#257

Post by stackskipton »

rayiner wrote: post #244
luma wrote: post #101

Why should healthcare be tied to employment? "Quit fucking around" and institute a national, single-payer plan that covers everyone, like every other modern industrialized country.

Most developed countries don’t have single payer healthcare. Obamacare is actually modeled on the system used in the Netherlands. And why is “national” a criteria? California doesn’t get single payer unless Montana also gets it? Neither Californians nor Montanans want that. It’s just political games.

>Most developed countries don’t have single payer healthcare. Obamacare is actually modeled on the system used in the Netherlands.

No it's not. Most European countries that run private health insurance keep pretty strong regulatory regime where pricing and coverage is tightly controlled. In America, there is some basic regulatory scheme but pricing, coverage, limits and such is extremely open.

Re: Why YC went to DC

#258

Post by robertlagrant »

dghlsakjg wrote: post #238
robertlagrant wrote: post #215

Earlier quoted context omitted.

> institute a national, single-payer plan that covers everyone, like every other modern industrialized country The two (real, non-politicians are corrupt) downsides to contend with: - countries do this by limiting what they will spend; in the US you have access to unlimited treatment. E.g. in the UK the NHS will spend £30k for each good year it buys you - this one isn't fair, but the US is where health innovation hap…

I live in Canada and there isn’t a spending limit. The decision of how to treat is made by the doctor. The doctor is then paid. In my experience living on both sides of the border, you get far more care up here since there is no bullshit with finding a facility that accepts your insurance, and cost isn’t a consideration for doctors or patients. People will occasionally travel to the states for drug/therapy trials not…

> If you want the proof of it, remember that a huge majority of Canadians live close enough to drive to the US for health care, but don't

I don't understand this point. Obviously Canada offers healthcare, and what it offers is no doubt good. That doesn't mean that it offers everything that can possibly be done. People just won't be aware of what can be done, and/or don't have US health insurance to pay for what can be done.

Re: Why YC went to DC

#259

Post by nradov »

stetrain wrote: post #216
dheera wrote: post #192

Earlier quoted context omitted.

Not only that, but very often health issues are the cause, not result of, bad employment performance.

And it’s great how your employer can change which insurance provider they offer every year and along with it your coverage, provider network, prescription costs, etc. Sometimes even more frequently than once per year if an acquisition takes place.

It's a frustrating situation for employees (and their dependents) but the ability for self-funded employers to shop around and switch health plans is one of the only things that is preventing healthcare prices from rising even faster than they already are. Most of those "insurers" no longer really do insurance, they largely construct provider networks and administer claims on behalf of self-insured group buyers. Some payers drive harder bargains with providers and you can see significant price differences in the price transparency files.

Re: Why YC went to DC

#260

Post by threeseed »

waprin wrote: post #70
mrb wrote: post #14

"This year, we’ll fund more than 500 companies out of 50,000 applications, and almost all of them are related to AI in some way." So, what this means: that in 2024, if you want to get VC capital, your startup must be related to AI.

What’s ironic is that Michael Seibel has discussed many times on the YC podcast that you should avoid building whatever’s hot for VCs because their attention tends to change every year but you’ll be stuck building for a decade. 2020 was remote work, 2021 was web3, now we have the big LLM boom. Honestly it seems there’s a lot of advantages to “riding a wave” and a lot of advantages to being contrarian. But if raising…

Here is Michael and Dalton talking couple of weeks ago about how new technologies create new businesses.

Basically starting with the technology and then finding problems.

The very opposite of what YC has been promoting all these years.

https://www.youtube.com/watch?v=KxjPgGLVJSg

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