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The YC VC Program

ycombinator.com

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41–50 of 171 posts

Re: The YC VC Program

#41

Post by ibdknox »

kami8845 wrote: post #34
pg wrote: post #23

Earlier quoted context omitted.

We certainly didn't kick SV Angel out. They're among our favorite investors in fact. It just didn't make sense with their fund size to keep doing these investments. Unlike the other investors, they are what's now called a "super angel" fund, and those are much smaller.

I'm certain there are some companies that need more runway than others. Is it possible for, say, hardware companies to renegotiate for, e.g. 30k per VC rather than the current 20k?

This doesn't preclude a company from seeking funding elsewhere and I can imagine very, very few companies at this stage that could legitimately burn through $80k in 3 months. If that doesn't get you close enough to at least prove something that could be used as a basis for raising more, it's probably time to take a step back and figure out if that's really the best strategy for moving forward.

Re: The YC VC Program

#42

Post by namank »

I'm not sure if one amount will fit all startups.

Because categorization is important for organization, how about having startup brackets?

base: 80k international: 100k hardware:120k ...

Re: The YC VC Program

#43

Post by waterlesscloud »

jedberg wrote: post #3

This is great! I always thought the $150k was too much of a runway. It allowed the poor startups to limp along for too long. And besides, the real value from these investments isn't the money, it is the mindshare you get with the VCs. This will help make that mindshare greater.

I get why it's great for investors, but why is it great for founders? Especially when they could use the time to change plans.

Re: The YC VC Program

#44

Post by mustpax »

ssebro wrote: post #5

What stops other investment firms from making identical blanket investments, or how do you guys plan to stop that?

Presumably Conway and Milner did not like how the initial approach was working out either and were looking for a change.

Re: The YC VC Program

#46

Post by kami8845 »

ibdknox wrote: post #41
kami8845 wrote: post #34

Earlier quoted context omitted.

I'm certain there are some companies that need more runway than others. Is it possible for, say, hardware companies to renegotiate for, e.g. 30k per VC rather than the current 20k?

This doesn't preclude a company from seeking funding elsewhere and I can imagine very, very few companies at this stage that could legitimately burn through $80k in 3 months. If that doesn't get you close enough to at least prove something that could be used as a basis for raising more, it's probably time to take a step back and figure out if that's really the best strategy for moving forward.

Yes. But this takes time away from building things when you only have 3 months before demo day, and I'm sure there's always stigma attached to pursuing "outside-money" when everyone else is fine taking the 80k from the 4 investors YC trusts.

Re: The YC VC Program

#47

Post by jedberg »

waterlesscloud wrote: post #43
jedberg wrote: post #3

This is great! I always thought the $150k was too much of a runway. It allowed the poor startups to limp along for too long. And besides, the real value from these investments isn't the money, it is the mindshare you get with the VCs. This will help make that mindshare greater.

I get why it's great for investors, but why is it great for founders? Especially when they could use the time to change plans.

It's often hard to step out and see that the idea just doesn't have legs, especially if you've invested so much of your time and effort into it.

When you come to the end of that runway, you need to make a hard decision.

Also, when you change plans, you can look for new investment in the new idea. The assumption is that if you can't get follow on funding for your current idea, then it really is in your interest to come to the end of that runway sooner so you can be forced to make that hard decision and focus your efforts elsewhere.

Re: The YC VC Program

#48

Post by bsims »

dmmalam wrote: post #9

80k 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.

Can I use this quote? Working on a company built around supplementing credit information to solve this problem. Would be curious to hear an international perspective on this.

Re: The YC VC Program

#49

Post by johnrgrace »

Good call, guaranteeing $150K plus the seed money for the given inputs was far in excess of what you could raise elsewhere for comparable inputs. Simply the seed money, social capital, and demo day was attractive enough for me to apply.

Re: The YC VC Program

#50

Post by ibdknox »

polshaw wrote: post #45

What equity is given for this (/how has it changed?) and is this pre defined or 'negotiated' ?

This is a convertible note[1], just like the previous incarnations. Which means that the amount of equity it is worth isn't determined until a priced round happens (where a valuation is set).

[1]: http://techcrunch.com/2012/04/21/convertible-note-seed-finan...

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