Does this mean that the outside investment of 150k is no longer available? I don't see whats to stop them from investing (150k) anyway, considering it wasn't part of YC in the first place.
In my opinion 80k is a little too low, especially for international founders or those with international teams. I agree, though, that advice from VC would be better in terms of building a business versus just throwing cash at the startup.
The YC VC Program
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Re: The YC VC Program
#12Not everything scales horizontally and shouldn't have to. YC should just stick to a lower number of startups for each cycle.
1) Maintains the prestige of a team being selected.
2) Keeps investment level at previous level.
3) Spend quality time with each team.
Re: The YC VC Program
#13What kind of messy things happen with 150k that don't happen with 80k?
Re: The YC VC Program
#14Pg, are there really many ugly ducklings on demo day, despite the rigorous selection and the subsequent teaching/incubation process?
people often switch ideas in the middle of YC, so there are more than a few who get up on stage with just a couple week's worth of work (if even that). By ugly ducklings in this case he means ideas that may not yet be fully fleshed out or well understood - he's making no statement about the teams themselves, which is what the selection process "solves."
Re: The YC VC Program
#15Does this mean that the outside investment of 150k is no longer available? I don't see whats to stop them from investing (150k) anyway, considering it wasn't part of YC in the first place. In my opinion 80k is a little too low, especially for international founders or those with international teams. I agree, though, that advice from VC would be better in terms of building a business versus just throwing cash at the s…
Then again it lowers the bar for international VC providers to start participating in this kind of model, making US-based funders a little less necessary.
Re: The YC VC Program
#1680k may be a little tight for international founders, as flights and legal fees for visas can be very expensive. Also silly things like paying extra for deposits on rent/bills as you have no US credit history. But otherwise seems reasonable.
80k also substantially complicates hardware, I think. I wouldn't do a $50k hardware build without $100k in the bank.
It seems like the smart thing to do in this case is to then go down the Kickstarter route. I definitely wouldn't suggest it for software, as I genuinely think we got extraordinarily lucky, but for hardware it's an excellent choice.
Re: The YC VC Program
#17What kind of messy things happen with 150k that don't happen with 80k?
I think the assumption is that only the most colossal implosions happen in the first 6mo after YC. It's much easier for 2-3 people plus 1-2 hires to burn through most of $80k in 6mo after YC, vs. 150k. Figure founders consume $3-4k/mo each, and hires cost $10-15k, and you spend $20-30k on corp/legal/etc.
Re: The YC VC Program
#18What kind of messy things happen with 150k that don't happen with 80k?
VC loses $70k
Re: The YC VC Program
#1980k may be a little tight for international founders, as flights and legal fees for visas can be very expensive. Also silly things like paying extra for deposits on rent/bills as you have no US credit history. But otherwise seems reasonable.
80k also substantially complicates hardware, I think. I wouldn't do a $50k hardware build without $100k in the bank.
I don't think that taking this money precludes founders from raising more money if they need it, as they would have needed to do two years ago before the Start Fund.
Re: The YC VC Program
#20Pg, are there really many ugly ducklings on demo day, despite the rigorous selection and the subsequent teaching/incubation process?
people often switch ideas in the middle of YC, so there are more than a few who get up on stage with just a couple week's worth of work (if even that). By ugly ducklings in this case he means ideas that may not yet be fully fleshed out or well understood - he's making no statement about the teams themselves, which is what the selection process "solves."
It's worth noting that in the original story of The Ugly Duckling, the "ugly duckling" is actually a cygnet (baby swan) that looks out of place next to the ducklings it grows up with, and that no one respects until it grows into a beautiful swan. So an ugly duckling would be an idea that will turn out very well even if it looks a little dubious at the beginning.