So I've read that they wrote it in Lisp at Paul Graham's request or to win favor. Does anyone know if writing your startup code in Lisp still has that benefit?
That myth came from a few posts by a person who was a huge proponent of Lisp, in an era were web (front and backend) development was much easier, and web-related libraries were lacking in all languages (so it wasn't like Lisp's smaller popularity would hurt you there).
It's an example of one.
If they didn't get lucky and Yahoo! bought some other company in the same domain in their place (they already have a few competitors) the whole "Lisp as a secret weapon" would be moot.
Statistically speaking, 99.9% of succesful startups were written not in any Lisp, and 0.1% of them in Lisp. Not the biggest 0.1% either, more towards the bottom, in the context of web company deals during the ramp up to the dot-com bust. Viaweb was sold for $50 million. For context, Yahoo! bought Broadcast.com a year later for 5 billion and doc.com startups of the era routinely raising and burning $50-$100 million for fun - heck, Razorfish (a design consultancy) built websites for clients like Levis, Sony, Mercedes Benz, etc. for $20-$40 million (and that's late-90s era websites, nothing especially fancy).
Of course all that's irrelevant to whether Viaweb was written in Lisp. Which is my point, exactly. What's more, Yahoo! even scrapped all their Lisp code soon after.
Now, writing your startup code in a productive language, that doesn't slow down the development team, allows for easy+quality hires, and so on - even if it's not the best for when you get huge, is a benefit. That hardly requires Lisp.