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Y Combinator often backs startups that duplicate other YC companies, data shows

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Re: Y Combinator often backs startups that duplicate other YC companies, data shows

#171

Post by MichaelZuo »

lmm wrote: post #169
MichaelZuo wrote: post #163

Earlier quoted context omitted.

Well they clearly have the potential to sell the same but without any of the add ons, or most of the support or guarantees, and with functionality restricfed. Wouldn’t they do so once they notice there is a serious challenger?

That's the famous innovator's dilemma. It's very hard for a company to sell a product that undercuts a product that makes a lot of revenue for them, even if it's the "right" play. So that wouldn't be a risk I'd worry about in practice.

Well in this case it wouldn’t be undercutting, since the lite version would be totally unusuable for a big complex company.

Re: Y Combinator often backs startups that duplicate other YC companies, data shows

#172

Post by throwaway2037 »

jedberg wrote: post #102
JumpCrisscross wrote: post #52

Earlier quoted context omitted.

> More often than not most of what startups do is not unique The message is also that if your start-up is based on deep tech moats choose another seed. (Think of YC's home runs. None had an industry secret/IP secret sauce.)

YC has only been investing in deep tech for about a decade, I'm not sure that's long enough for them to have had a home run yet. For example, Boom Supersonic was founded 10 years ago, and just this summer completed their second test flight. They are scheduled to launch commercial operations in 2029. Lucid bots was founded in 2018, and just did their Series A to fund their growth of their autonomous drone fleet. I wou…

What is "deep tech"?

Re: Y Combinator often backs startups that duplicate other YC companies, data shows

#173

Post by throwaway2037 »

throwaway314155 wrote: post #129
itsoktocry wrote: post #124

Earlier quoted context omitted.

> It's almost impossible to know if an idea is good at the early stages But identifying the "right" people is easy?

Spoiler alert: it's "easy" when you narrow down to applications who come from wealth and/or went to a prestigious university.

What is wrong with selecting founders who attended a prestigious university? It seems like an excellent signal. Also: "Come from wealth" might be useful if their idea will take a bit longer to germinate. They can survive longer in "ramen profitable" mode.

Re: Y Combinator often backs startups that duplicate other YC companies, data shows

#174

Post by Clubber »

fsckboy wrote: post #123
ActionHank wrote: post #83

Earlier quoted context omitted.

Steve Jobs or maybe just Apple used to pit teams against each other to develop a solution to a problem and then pick the strongest of the two. It also offers a convenient way to pull investment out early if the doppelganger startup isn't meeting targets. Just get the original startup to buy them out. It's not something that is a negative for YC, but it could be for the startups they back.

> Steve Jobs or maybe just Apple used to pit teams against each other to develop a solution to a problem and then pick the strongest of the two. probably that's Apple. Steve Jobs is more famous for jumping from the failing project (Lisa) onto the winning team (Macintosh)

Macintosh was, by all financial accounts, a failure; at least the first iteration. That's what got him fired.

https://www.latimes.com/business/technology/la-fi-tn-how-the...

Re: Y Combinator often backs startups that duplicate other YC companies, data shows

#175

Post by intelVISA »

synergy20 wrote: post #147
osigurdson wrote: post #91

Earlier quoted context omitted.

Agree. I have watched several YC videos where they state this again and again. What they are less specific about is how precisely founders are selected.

last time I read it's concentrated to a few elite school graduates

I think that's the old criteria, doesn't the newer one forgive lesser schools if AI buzzwords are present?

Re: Y Combinator often backs startups that duplicate other YC companies, data shows

#176

Post by sneak »

JohnMakin wrote: post #150
ActionHank wrote: post #83

Earlier quoted context omitted.

Steve Jobs or maybe just Apple used to pit teams against each other to develop a solution to a problem and then pick the strongest of the two. It also offers a convenient way to pull investment out early if the doppelganger startup isn't meeting targets. Just get the original startup to buy them out. It's not something that is a negative for YC, but it could be for the startups they back.

Worked for a major ecommerce company that did this too - It was extremely unpleasant to work under (yet profitable if you won) and I don't like the practice but it was pretty effective. I'd guess that YC would take the "sea turtle" reproduction pattern here of hatching a bunch of mostly similar turtles and hoping a couple of them make it to sea. Stinks for the small guys that don't make it though.

Truly curious, why does it "stink" for the loser? Being funded with pay to pursue a failing business venture with a chance at wild financial success seems like a pretty good gig.

Re: Y Combinator often backs startups that duplicate other YC companies, data shows

#177

Post by lmm »

MichaelZuo wrote: post #171
lmm wrote: post #169

Earlier quoted context omitted.

That's the famous innovator's dilemma. It's very hard for a company to sell a product that undercuts a product that makes a lot of revenue for them, even if it's the "right" play. So that wouldn't be a risk I'd worry about in practice.

Well in this case it wouldn’t be undercutting, since the lite version would be totally unusuable for a big complex company.

It would be a cheaper alternative for at least some use cases. At least some companies that were currently using the big version would switch to the lite version.

Re: Y Combinator often backs startups that duplicate other YC companies, data shows

#178

Post by ethagknight »

billy-ilograph wrote: post #34
ethagknight wrote: post #29

Earlier quoted context omitted.

Seems reasonable to pick two horses in a race you believe is worth running

This creates an extremely obvious conflict of interest.

It’s not a marriage. Have you ever watched any racing of any sort? One team frequently has multiple contestants. First and third is better than just third.

Re: Y Combinator often backs startups that duplicate other YC companies, data shows

#179

Post by JohnMakin »

sneak wrote: post #176
JohnMakin wrote: post #150

Earlier quoted context omitted.

Worked for a major ecommerce company that did this too - It was extremely unpleasant to work under (yet profitable if you won) and I don't like the practice but it was pretty effective. I'd guess that YC would take the "sea turtle" reproduction pattern here of hatching a bunch of mostly similar turtles and hoping a couple of them make it to sea. Stinks for the small guys that don't make it though.

Truly curious, why does it "stink" for the loser? Being funded with pay to pursue a failing business venture with a chance at wild financial success seems like a pretty good gig.

From the perspective of people with capital, it doesn't. From the perspective of a loser it sucks because they may or may not have invested significant emotional, financial, and otherwise non-fungible capital into a future that relied on the success of this venture (and also the people they employed), and I can tell you from personal experience being an underling when this kind of venture collapses really sucks. Maybe not for founders, but for everyone else it definitely does.

Re: Y Combinator often backs startups that duplicate other YC companies, data shows

#180

Post by throwaway2037 »

snarf21 wrote: post #67
mst wrote: post #35

If nothing else, having competition helps validate the market. Which is often an advantage to all companies involved - a lot of the time, you're only notionally competing with each other, your main enemy is "people not using a product in that space at all." e.g. for a lot of business SaaS the only enemy worth caring about is Excel. (I've more than once been involved with companies where the "competitors" were all on…

I see it more as more of a hedge. If you believe in the opportunity, placing extra bets makes sense. Uber and Lyft weren't the only ride share companies but sometimes luck wins out and sometimes execution does. Additionally, if one seems to be winning, you just acqui-hire the "loser" in the winner, use that problem space expertise to scale faster AND you still get to claim a higher exit rate even if it was just to yo…

    > sometimes luck wins out and sometimes execution does
Can you provide an example when lucks wins over execution?
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