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New RFS – Breakthrough Technologies

blog.samaltman.com

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Re: New RFS – Breakthrough Technologies

#11

Post by nawitus »

kyro wrote: post #7

I feel like this is a big shift in focus for YC and for the industry if others follow suit. This will do a lot of good in changing the image of the typical startup, from who starts them to what their ambitions are, signaling to those in other industries that the valley isn't just about young code-slingers and iOS apps. I hope this encourages people in STEM with years of specialized domain experience to look at starti…

It's a huge shift in terms of funding levels. Instead of getting $100k to build a focused software startup focusing essentially on a single "simple" problem, you usually need around $10-$100 million to get started on these big problems.

On the other hand, one can start with $100k which is mainly used to secure the rest of the funding.

This new "shift" is essentially what the Founders Fund is trying to do.

Re: New RFS – Breakthrough Technologies

#12

Post by silverlake »

my idea: a social network for startups who believe they are changing the world. It will be called ignoranceOfYouth.com.

In all seriousness, fixing my local animal shelter's web site has a bigger impact on this planet than 99% of Silly Valley's app lottery.

Re: New RFS – Breakthrough Technologies

#13

Post by the_watcher »

phmagic wrote: post #9
tlb wrote: post #8

Earlier quoted context omitted.

Many first-time entrepreneurs have raised more than $100M. They started with small amounts and showed great results at each stage.

I think that doesn't apply to very long time horizon projects. You might not have anything to show investors as progress until 10 years down the road. You either need enough money upfront or personal money to put in along the way.

This is something that YC can help with, though. They have shown a willingness to be much less risk averse than the average VC, and are at least making an effort to seek out long shots that probably would have trouble raising funds for a 10 year horizon project (such as SpaceX) on their own. YC can help a non-Elon Musk get started in the right direction for some of these projects, put in some money (both through YC VC and as angels), and help introduce these teams to the right partners at the right VC's for raising the right funds at the right time. This doesn't make it a sure thing that this will lead to more Tesla/SpaceX successes, but it can only increase the odds. Bravo.

Re: New RFS – Breakthrough Technologies

#15

Post by aroch »

So my lab is working on treatment and vaccine candidates for early childhood infections -- some of which have severe health impacts in second and third world countries. We're primarily government funded (state and NIH), but we'd love more collaboration with our clinical counterparts, especially not in the US. Would YC back a company whose sole purpose is to interface between wetlab people and people people? I would like to setup a group that does this, but its seems infeasible without the right corporate connections.

Re: New RFS – Breakthrough Technologies

#16

Post by staunch »

tlb wrote: post #8
dsugarman wrote: post #2

SpaceX and Tesla were really possible because of the large amounts of money that Elon put into the companies, it is estimated that Elon invested $100MM into SpaceX. his extremely impressive resume was not enough to receive the level of funding to get the company off the ground (get it?) how can a first time entrepreneur actually receive substantial investment without putting in such a large personal investment?

Many first-time entrepreneurs have raised more than $100M. They started with small amounts and showed great results at each stage.

Tesla would not exist if Elon Musk hadn't bet his personal fortune. He showed terrible results at first so all his investors gave up on him. Your average YC founder would not have been in a position to pony up $40M to do the Series E himself.

Re: New RFS – Breakthrough Technologies

#18

Post by [deleted] »

dsugarman wrote: post #2

SpaceX and Tesla were really possible because of the large amounts of money that Elon put into the companies, it is estimated that Elon invested $100MM into SpaceX. his extremely impressive resume was not enough to receive the level of funding to get the company off the ground (get it?) how can a first time entrepreneur actually receive substantial investment without putting in such a large personal investment?

[deleted]

Re: New RFS – Breakthrough Technologies

#19

Post by rayiner »

kyro wrote: post #7

I feel like this is a big shift in focus for YC and for the industry if others follow suit. This will do a lot of good in changing the image of the typical startup, from who starts them to what their ambitions are, signaling to those in other industries that the valley isn't just about young code-slingers and iOS apps. I hope this encourages people in STEM with years of specialized domain experience to look at starti…

Someone needs to show that you can actually make money with something like this. The problem with these sorts of ventures is that besides being capital-intensive and risky, it can be quite hard to capture the economic benefits of the development in a way that justifies the investment.

There's also the issue of whether Silicon Valley has the requisite infrastructure to facilitate these sorts of projects. If you want to do projects in robotics, DARPA has both money to give you, deep connections with the universities developing the basic science, and a program manager to manage the project that typically has a PhD in the field. There's a lot of downsides to DARPA, namely that everything has to have some sort of military angle, but there's a wealth of technical expertise sloshing around there.

Re: New RFS – Breakthrough Technologies

#20

Post by tasty_freeze »

"It used to be the case that governments funded a lot of development of breakthrough technologies. The bad news is that they have mostly stopped"

That statement is very passive. There has been a shift in the past 30-35 years in public perception as to whether or not government is an agent of good (with noted problems) or if it is unfortunately necessary but the smaller it is the better we are all off. Unfortunately, in my view, those who believe in investing in basic research are losing out to those who believe the existing market structure is always superior.

I'm highly doubtful that YC or other similar groups really have the stomach for the long term investment that is necessary to make up for that loss of government backing. If your model is that waving a couple hundred million dollars around will induce a eureka moment in somebody smart, it is bound to be a failure. Real breakthroughs typically seem like breakthroughs but actually were the result of spending decades and a lot of money searching dead ends and making incremental progress.

At best it seems like YC can pick some slightly higher hanging fruit than the current model allows, but they can't afford to reach very high.

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