This also keeps YC relevant even though the world in which they were created largely no longer exists:
- In 2005, there were essentially no sources for early stage capital. Now you can't tell someone about your startup at a meetup without five people trying to throw money in your face.
- In 2005, information about starting a startup was an oral tradition, and web technology was so primitive that making a scalable website basically required a CS degree. This meant that you really had to either be a business person or a CS person, whereas now being both is table stakes.
- In 2005, not only was it essentially impossible to meet VCs without some sort of special connections, it was difficult even to figure out who they were. These days they're all on LinkedIn, blogs, angellist, mattermark, etc., and as soon as you have any sort of traction they already know about you.
- In 2005, people still spent time dreaming about what the world would be like when everyone was connected to the Internet. Now the sociology is well understood, the infrastructure has matured, strategies and tactics have become commoditized, etc.
By giving away equity-free grants that come with access and advice, this basically positions YC as the next YC, regardless of what else is going on the world.