21–30 of 38 posts
Is it true that Dropbox/AirBNB make up most of YC's (monetary) value? I know they're the big ones, but it still sounds fishy. What about Reddit, for example? Heroku? The company that built Draw Something? (I forget their name). Also, many of the 400 companies who have been through YC are very recent, and simply haven't had a chance to grow as much as Dropbox has. Other than these questions, I think the article does m…
Is it true that Dropbox/AirBNB make up most of YC's (monetary) value? I know they're the big ones, but it still sounds fishy. What about Reddit, for example? Heroku? The company that built Draw Something? (I forget their name). Also, many of the 400 companies who have been through YC are very recent, and simply haven't had a chance to grow as much as Dropbox has. Other than these questions, I think the article does m…
OMGPOP
The article mentions that most of YC's value is in just two companies (Dropbox, AirBNB) out of some 400 funded. That would be awful performance for a traditional VC, but the amount of time and money put in by YC into each of those 400 companies is between 1/100 and 1/1000 of how much a traditional VC would put into a deal. So, if you're comparing to a traditional VC model, compare YC to one that has made e.g. 10 inve…
For a VC 2 out of 400 would be spectacularly bad, for an incubator to have 2 winners of that magnitude is actually really good and there are a few others that have already exited (Heroku, YC08 iirc for instance) that increase that even further.
Add in stripe and the current crop of 'hot' stuff and YC is looking pretty good.
But you still can't compare it with a VC, it's a different model, different risk/reward.
> And even though most YC companies have no problems raising additional capital, the program has only produced two big “winners.”
The word 'only' has no place in that sentence, it is a pretty good record for early stage investing, and it does not take into account stripe, heroku and others.
(A) Lot of accelerators are readily accepting foreign companies and entrepreneurs. Helping provide them a base and also help with visa issues. Which would be very tough on their own.
(B) Many of these ideas are not well polished and need to refined further and converted into a viable business. And accelerators also help founders hyper-focus on the product.
With that said if you have a little cash for a few months time, have already started to work on your MVP and have decent connections in the industry. Then working in a co-working space and hacking your product is the best thing to do.
But each case is unique IMHO.
healthenclave: your comments are dead, looks like you've been hellbanned. Can't quite tell why since you literally only have that one comment.
Is it true that Dropbox/AirBNB make up most of YC's (monetary) value? I know they're the big ones, but it still sounds fishy. What about Reddit, for example? Heroku? The company that built Draw Something? (I forget their name). Also, many of the 400 companies who have been through YC are very recent, and simply haven't had a chance to grow as much as Dropbox has. Other than these questions, I think the article does m…
1) Yes. It's true of angel investments generally too, the top companies form a disproportionately large percentage of the value. 2) Yes, you basically need to do cohort analysis for meaningful results. 3) It depends what you mean by "most seed accelerators don't matter", certainly there's a big drop-off in quality in startups as you go further down the rankings of seed accelerators and VCs pay less attention to them.…
Follow-up question/observation: the article makes it see like only Dropbox and AirBNB were "winners", which I understood to mean they were the only 2 that gave YC a return. Here's the quote from the article:
'And even though most YC companies have no problems raising additional capital, the program has only produced two big “winners.” Dropbox and Airbnb make up three quarters of the value of Y Combinator’s $10 billion portfolio. That’s two huge successes out of something like 400 companies.'
Is this only true because Dropbox and Airbnb are spectacularly successful? E.g., if another YC company became the next Google next year, would the article have said "YC has produced only 1 success", and Drobpox/Airbnb would be relegated to "not as good as the Google-sized success"?
What is telling to me is that nobody, not PG or anybody else could have predicted which of the 400 ended up to be billion dollar companies. But for those two that made it to that magical marker being in YC made all the difference. > And even though most YC companies have no problems raising additional capital, the program has only produced two big “winners.” The word 'only' has no place in that sentence, it is a pret…