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YC Stats

blog.ycombinator.com

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Re: YC Stats

#141

Post by loumf »

T2_t2 wrote: post #124
lawstudent2 wrote: post #97

Earlier quoted context omitted.

No - I stand by that as a literal use. Does 65B represent the actual money value that people will pay for the shares of 100% of the ~600 currently existing YC companies? Does it tell us the average value? The mean? Standard deviation? Quintile distributions? P/E? Is that number just based on valuations from funding rounds? Projections? It is literally meaningless. It is not verifiable. The standards that are used to…

AirBnB: $24 Billion. DropBox: $10 Billion. Zenefits: $4.5 Billion Stripe: $3.5 Billion. Instacart: $2 Billion Twitch: $1 Billion Total: $45 Billion. Source: http://graphics.wsj.com/billion-dollar-club/ So they value the rest of the portfolio at $20 billion. Does that seem reasonable?

I believe that they just added up acquisition amounts and the last funding rounds of each company. I don't believe that number represents what "they value" the portfolio at beyond that.

Re: YC Stats

#142

Post by gress »

austenallred wrote: post #118
gress wrote: post #115

Earlier quoted context omitted.

Public stock prices are decided by supply-demand balance. In no way does this valuation resemble that mechanism.

Public stock prices are the last price someone was willing to buy that stock at. Private stock prices are the last price someone was willing to buy that stock at. It is slightly less simple, because you may give a discount for advice, but private stock prices are definitely reliant upon supply and demand. If one investor wants to set your valuation at $1B and another at $100m, you go with the one who offered a $1B va…

I don't know if you are making a disingenuous argument or you just don't know about liquidity, or indeed the effects of sample size on estimating a changing value, but what you've said here has no relationship with reality.

Re: YC Stats

#143

Post by 001sky »

vasilipupkin wrote: post #139
001sky wrote: post #100

Earlier quoted context omitted.

20-30% irr is not very high given the risk involved. a lower risk portfolio that is leveraged can give you this return quite easily (in a mechanical sense). in that case you have or take a low-risk low return investment and add risk and return by adding say 10x leverage to a 3% return. In this case, the more relevant number is $$ in and $$ out. and also the optionality to continue the business going forward. That is…

A leveraged portfolio is a bad comparison because you could also leverage this portfolio. Let's compare apples to apples. There is no unlevered investment right now that can give you such high returns, that I can think of.

No, its not a bad comparison. Any decent investment vehicle is not putting money out the door unless they are clearing 20% in their base case returns. The point is you expressly RAROC the two portfolios. A retail investor is not going to look at any of this as relevant, so avoiding leverage is pointless. Anyone benchmarking this asset class has access to leverage (and in this market, at low yields).

Re: YC Stats

#144

Post by qq66 »

downandout wrote: post #136
qq66 wrote: post #135

Earlier quoted context omitted.

YouTube has massive bandwidth costs, and it became profitable. Bandwidth keeps getting cheaper, user attention maintains its value or gets more valuable over time.

Which is why I said most companies with large bandwidth costs do not become profitable. YouTube eventually is one notable, glaring exception. But even they took years, billions of dollars in infrastructure investment and losses on bandwidth, access to a massive existing base of advertisers that already trusted its parent company, and arguably the best monetization team in the history of capitalism to achieve profitab…

Netflix and maybe Hulu are also profitable, but they are paid services which is a different beast. No reason that Twitch couldn't have paid/free tiers like Hulu someday though.

Re: YC Stats

#145

Post by gok2 »

kevin wrote: post #41
lordnacho wrote: post #10

Since applications are opening tomorrow, it would be interesting to have a breakdown of interviews/acceptances based on various criteria: sole founder, has revenue, has user, etc... It would allow prospective applicants to think about whether to apply, and hopefully keep the pile a manageable size for the people reading it.

Might be interesting, but the odds are the wrong way to think about this. Our wins come from the margins and we're looking for people to beat the odds. Most of the time we are surprised what ends up becoming big. The numbers reveal that it's hard, but startups were ALWAYS hard. It's still the hardest thing I've ever done and most founders say the same. As far as YC is concerned, we don't want people to try to make th…

Yes the odds are wrong. But I think there are now too many good applications submitted with high growth or revenue that you guys will just skip through next Zuckerberg before his startup takes off. Your application method currently does not in anyway measure how much the users love the product, how big it can be. My thoughts are that YC at the moment is currently pretty blind to really great startups that haven't got traction yet.

Thats why fellowship experiment is going on, but I think you guys would have more time to read applications and "discover" great startups if you didn't encourage every steve-jobs-wannabe to apply.

just my 2 cents

Re: YC Stats

#146

Post by austenallred »

gress wrote: post #142
austenallred wrote: post #118

Earlier quoted context omitted.

Public stock prices are the last price someone was willing to buy that stock at. Private stock prices are the last price someone was willing to buy that stock at. It is slightly less simple, because you may give a discount for advice, but private stock prices are definitely reliant upon supply and demand. If one investor wants to set your valuation at $1B and another at $100m, you go with the one who offered a $1B va…

I don't know if you are making a disingenuous argument or you just don't know about liquidity, or indeed the effects of sample size on estimating a changing value, but what you've said here has no relationship with reality.

How does it not?

Re: YC Stats

#147

Post by vasilipupkin »

001sky wrote: post #143
vasilipupkin wrote: post #139

Earlier quoted context omitted.

A leveraged portfolio is a bad comparison because you could also leverage this portfolio. Let's compare apples to apples. There is no unlevered investment right now that can give you such high returns, that I can think of.

No, its not a bad comparison. Any decent investment vehicle is not putting money out the door unless they are clearing 20% in their base case returns. The point is you expressly RAROC the two portfolios. A retail investor is not going to look at any of this as relevant, so avoiding leverage is pointless. Anyone benchmarking this asset class has access to leverage (and in this market, at low yields).

right. But since I can lever anything, leverage as a factor is irrelevant. I could also lever this portfolio and get 100%. The point is you need to compare apples to apples, not apples to oranges.

Re: YC Stats

#148

Post by [deleted] »

vasilipupkin wrote: post #147
001sky wrote: post #143

Earlier quoted context omitted.

No, its not a bad comparison. Any decent investment vehicle is not putting money out the door unless they are clearing 20% in their base case returns. The point is you expressly RAROC the two portfolios. A retail investor is not going to look at any of this as relevant, so avoiding leverage is pointless. Anyone benchmarking this asset class has access to leverage (and in this market, at low yields).

right. But since I can lever anything, leverage as a factor is irrelevant. I could also lever this portfolio and get 100%. The point is you need to compare apples to apples, not apples to oranges.

[deleted]
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