Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

YC Graveyard: 821 inactive Y Combinator startups

ycgraveyard.iamwillwang.com

Post reply on HN
Print view View original

151–160 of 238 posts

Re: YC Graveyard: 821 inactive Y Combinator startups

#151

Post by nradov »

muzani wrote: post #10
smt88 wrote: post #5

Earlier quoted context omitted.

It's certainly much worse. It's often difficult to tell when a company is dead unless they announce it. Many other failures (likely most of YC's portfolio) will have died by being acquired for less than the most recent valuation, meaning YC lost money on the deal. These sometimes look like successful exits unless you know the details.

Companies also almost never announce their death. Startups go to die quietly. Paul Graham says the best indicator is they don't reply to emails, but this is usually something that's not very visible. https://www.paulgraham.com/die.html

That's one signal, but it's surprising how many established companies that appear to still be going concerns also don't reply to emails even when I literally ask about buying something. And I'm not talking about my own little consumer purchases, I mean emails from my work account to vendors with the potential for significant ongoing revenue. Strange.

Re: YC Graveyard: 821 inactive Y Combinator startups

#152

Post by chipotle_coyote »

sebmellen wrote: post #9

I personally know the founders of three YC startups that are functionally dead (raised capital, not developing anything, basically laid off everyone but the founder(s)) but are not on this list. I'd bet it's at least twice that number.

I can think of at least one YC startup -- one that was relatively high-profile, for a hot minute, at least in the developer space -- that just shut down, period, that doesn't seem to be on the list, because I worked there. One extra irony point for its absence: it was basically across the street from Y Combinator's office in Mountain View at the time. :)

Re: YC Graveyard: 821 inactive Y Combinator startups

#153

Post by alooPotato »

persnicker wrote: post #122
slashdev wrote: post #118

Earlier quoted context omitted.

If there’s enough money to pay the founders salaries, but not so much for dividends, this doesn’t help. There are two direct ways to return money to the founders - salaries and dividends. In the U.S. there is a tax advantage to dividends, over an amount anyway. This is not true of all countries.

Neat edge case! Perhaps SAFE notes or other dividend-paying instruments should account for this by capping executive salaries or trigger dividend payouts at a certain salary dollar amount. Though, admittedly, I've never heard of a founder or executive using their salary instead of taking dividends as an end run around paying everyone their fair share of dividends. It seems possible though.

There already is a cap. Founders have a fiduciary duty to their shareholders and can't pay themselves unreasonably. Lots of gray area, but there is a limit.

Re: YC Graveyard: 821 inactive Y Combinator startups

#154

Post by morgante »

robocat wrote: post #27

I'm onehundertpercent pissed off with YC: * The modal win for a founder is $0.00 * PG makes big talk about winner's average returns... Yayyyyy..... However YC gets preferential shares; YC is not aligned with the common shareholders (founders; builders). YC builds a story that they support creators however YC doesn't sit on the same table-side as creators. * I actually believe YC is worthwhile, but I wonder if Ize jus…

> However YC gets preferential shares; YC is not aligned with the common shareholders (founders; builders).

YC invests on a SAFE, the terms are public.[0]

For most companies, pre-seed SAFEs don't end up much above common.

[0] https://www.ycombinator.com/deal

Re: YC Graveyard: 821 inactive Y Combinator startups

#155

Post by that_guy_iain »

CPLX wrote: post #87
that_guy_iain wrote: post #57

Earlier quoted context omitted.

Enough money to keep going doesn't mean just enough money to cover the costs. It means being able to continue paying yourself and all your employees their salaries, meet costs and make a small minimum profit.

You have to add “and return initial capital” to that list. That’s usually what’s at issue here.

The reason that is the issue is because that is not something they actually need to do. It's something the investors want but not generally required as they expect an exit of some sort.

Re: YC Graveyard: 821 inactive Y Combinator startups

#156

Post by mlhpdx »

epistasis wrote: post #132
AbstractH24 wrote: post #119

Earlier quoted context omitted.

Why is the risk being taken by investors greater than the one being taken by employees and founders? If anything, employees are taking a greater risk because you can replace money far more easily than years of your life.

One is risking money, one time, and the money is what could possibly get paid back. If you can find money that doesn't insist on preferred liquidation, good on you. But those with the money tend to have a lot of say on giving it away.

For what it’s worth, which isn’t much, I see signs this precept is changing because of the huge amounts of investible capital fighting for opportunities as the thaw progresses. It’s not going to be a widespread change, though, most will stick with what they’ve known.

Re: YC Graveyard: 821 inactive Y Combinator startups

#157

Post by [deleted] »

idlewords wrote: post #72
smallerfish wrote: post #58

Earlier quoted context omitted.

Sure it is. If your business nets 3 million a year, it takes 5 people to run it, and your customer base is steady, that's lifestyle. Sucks for investors, pretty nice for you if you can keep it running.

In other sectors that's just called a "small business" and celebrated as the fullest expression of the American dream. I've always found it funny that tech treats the idea of a going concern with such distaste.

[deleted]

Re: YC Graveyard: 821 inactive Y Combinator startups

#158

Post by mlhpdx »

nradov wrote: post #143
AbstractH24 wrote: post #119

Earlier quoted context omitted.

Why is the risk being taken by investors greater than the one being taken by employees and founders? If anything, employees are taking a greater risk because you can replace money far more easily than years of your life.

The level of risk is irrelevant. What matters in access to capital is negotiating power. This isn't a charity. If employees want lower risk then they can go work somewhere else.

Likewise, if investors want to invest (deploy capital) they will adapt. There is more balanced leverage recently.

Re: YC Graveyard: 821 inactive Y Combinator startups

#159

Post by nunez »

erikerikson wrote: post #114
baxtr wrote: post #103

Earlier quoted context omitted.

I know a guy who sells kitchens for a living and makes around $2-3 million per year with a profit margin of 60% or so. But he didn’t spend 10s of million dollars to get there.

Or bar owners pulling down similar amounts.

The VERY lucky ones that have been around a long while and own their building, sure.

Re: YC Graveyard: 821 inactive Y Combinator startups

#160

Post by nunez »

baxtr wrote: post #103
idlewords wrote: post #72

Earlier quoted context omitted.

In other sectors that's just called a "small business" and celebrated as the fullest expression of the American dream. I've always found it funny that tech treats the idea of a going concern with such distaste.

I know a guy who sells kitchens for a living and makes around $2-3 million per year with a profit margin of 60% or so. But he didn’t spend 10s of million dollars to get there.

This is kind of like tech sales at huge tech old-cos. Sales people there can pull down insane comp if aligned to the right account with way less work than a traditional sales grind.
Post reply on HN