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Why I turned down my Y Combinator interview

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Re: Why I turned down my Y Combinator interview

#101

Post by grwthckrmstr »

fictionfuture wrote: post #29
shafyy wrote: post #23

I was expecting a shitty article after a clickbaity title, but was positively surprised. Not new information, but well argued!

I agree. To support it, my first company was bootstrapped and did around $10m in revenues but then was ultimately killed by competition and ecosystem issues. I pocketed most this money (after taxes) ... had I raised money I'd be broke right now...

Kudos to you for building a company to $10mn revenues. I hope to achieve similar success in the coming years and honestly, I'd pat myself on the back of I just hit $1mn revenues with decent profits.

Re: Why I turned down my Y Combinator interview

#102

Post by dgudkov »

pbreit wrote: post #89
dgudkov wrote: post #84

Earlier quoted context omitted.

>Take the money and play your own game. Any example here?

Minority investors have zero control over you. People think they have to play the VC's game and they simply do not.

The level of control depends on the term sheet. As far as I understand, there is always a degree of control/preference, even when VC's share is minor. I haven't heard of term sheets that would give total carte blanche to the founder.

Re: Why I turned down my Y Combinator interview

#103

Post by ksikka »

rsweeney21 wrote: post #35
danvoell wrote: post #27

I don't view YC as a VC, am I wrong? This whole post is about VCs pushing you to the brink. YC doesn't push companies too hard, do they? Why not do YC and NOT raise VC money afterward but take advantage of the network?

YC is a non-traditional VC, but still a VC. VCs expect a certain growth rate (2-3x annually for the first five years) that almost always requires follow on funding. You could do what you are describing, but if you are up-front with your plans to grow slowly, most VCs will pass on you.

1. What are you basing this answer on? 2. If you don't want to meet their expectations, what can they actually do?

Re: Why I turned down my Y Combinator interview

#104

Post by avinium »

pbreit wrote: post #89
dgudkov wrote: post #84

Earlier quoted context omitted.

>Take the money and play your own game. Any example here?

Minority investors have zero control over you. People think they have to play the VC's game and they simply do not.

As with everything, the devil's in the details.

If your funding arrangement allows a minority investor to veto future fundraising, subordinate liquidation preferences, etc etc, they can kill your company.

Of course, most deals aren't on such onerous terms - but they do happen.

Re: Why I turned down my Y Combinator interview

#105

Post by CalChris »

m_ke wrote: post #22

These days going through Y Combinator practically guarantees success for B2B/SaaS startups. Their network is so big now that you can hit growth targets that most VCs look for just by selling to other YC companies. Then you can throw the late stage logos on your landing page and use that to lure in enterprise customers.

Its network seems kiretsu-like from the outside.

Re: Why I turned down my Y Combinator interview

#106

Post by randomsearch »

xiphias2 wrote: post #55
kerng wrote: post #25

Over the years there was a shift from let's change the world by creating great technology to let's make a quick buck. The motivation seems to have changed, and its showing...

I believe ,,let's change the world'' was most of the time a way for employers/shareholders to make employees work insane hours. Elon Musk is changing the world, works insane hours, but still lives the billionaire lifestyle by lending against his Tesla stock, while the other employees just get the insane hours part.

Fair point, but bad example.

Re: Why I turned down my Y Combinator interview

#107

Post by rsweeney21 »

ksikka wrote: post #103
rsweeney21 wrote: post #35

Earlier quoted context omitted.

YC is a non-traditional VC, but still a VC. VCs expect a certain growth rate (2-3x annually for the first five years) that almost always requires follow on funding. You could do what you are describing, but if you are up-front with your plans to grow slowly, most VCs will pass on you.

1. What are you basing this answer on? 2. If you don't want to meet their expectations, what can they actually do?

1. Hundreds of pitch meetings with VCs. Plus they are pretty open about their expectations.

2. Fire you. Sue you for fraud. Talk badly about you in the media. Not saying they would, but there is a lot a deep pocketed VC could do to make your life miserable. It's generally a bad idea to lie to your investors. :)

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