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

201–210 of 238 posts

Re: YC Graveyard: 821 inactive Y Combinator startups

#201

Post by zoogeny »

zenyc wrote: post #77

I love seeing the 'YC Graveyard' project. It’s a great reminder of the incredible ideas and effort behind each startup, even if things didn’t pan out. We’ve been working on giving some of these inactive startups a second chance by acquiring them and exploring ways to repurpose or revive their tech. If anyone’s been involved with an inactive YC project and wants to chat about what’s possible, I’d love to connect.

Sometimes the right idea is tried at the wrong time. It is a decent idea to at least keep an eye on these.

Re: YC Graveyard: 821 inactive Y Combinator startups

#202

Post by tonygiorgio »

nradov wrote: post #189
jjmarr wrote: post #175

Earlier quoted context omitted.

It's not inherently fraudulent to sell something for below market value. If I sell something I bought for $1 million for $1 in an arm's length transaction, I'm realizing a loss of $999,999 even if the asset was worth $500,000. And it'd be a rational decision if it cost me $5 million in opportunity costs to do that $500k sale.

That's not how US capital gains tax law works. It's legal to sell something at below market value, but you have to use the fair market value when calculating a loss for tax purposes. Of course some people cheat.

Should be easy to determine when a 409a evaluation was done.

Re: YC Graveyard: 821 inactive Y Combinator startups

#203

Post by pavlov »

AbstractH24 wrote: post #116
jll29 wrote: post #51

There are not just startups that become unicorns and startups that fold. Investors' worst nightmare is if you just make enough money to keep going, but you don't grow ("lifestyle business" as they use it is a derogatory term). That's because they prefer a sudden death where they can write down the investment and deduct their loss from taxes than an investment where they never see any money again. And then there are "…

Worse than becoming lifestyle company is becoming a zombie startup. Zombie is when founders get rid of almost everyone except what they need to give the impression of effort, do little work, but draw an income and slowly spend down the money they raised until it’s gone. I was one of the very few survivors at a startup that turned into a zombie in 2020 (went from 100+ employees to 10 in a matter of weeks). In some way…

IMO that’s not a zombie because it has an expiration date (when the money raised runs out).

A proper zombie is a lifestyle company without the lifestyle — enough revenue to maintain an eternal startup crunch and trying to make a product work, but without the resources to actually grow. Doesn’t die, doesn’t quite live.

Re: YC Graveyard: 821 inactive Y Combinator startups

#204

Post by ultrasaurus »

dustingetz wrote: post #65
jasode wrote: post #63

Earlier quoted context omitted.

>However YC gets preferential shares; It's not that YC specifically gets "preferred shares" -- it's that investors in general insist on liquidation preferences when buying non-liquid shares in unproven private companies. How would an alternative scenario of investors buying common shares of illiquid stock in a private company actually be realistic? Maybe the startup founders could hypothetically insist on selling onl…

preferred shares prevent cookie cutter founder fraud. Founder raises $1M at 10 post. Founder decides to sell 6 months later for 2 mil. Investors get 200k back founder gets 1.8 mil. Now run this math for AI unicorns.

Or to make it even more obvious: Founder raises $1MM then immediately sells the company for $900k :)

Some terms are going to need to exist to prevent that, so the investor shares will always be preferred. Beyond that there are in fact a lot of other terms that are in some deals but not others (2x preference, pro rata, etc..)

Re: YC Graveyard: 821 inactive Y Combinator startups

#206

Post by AlotOfReading »

whiplash451 wrote: post #195
AlotOfReading wrote: post #172

Earlier quoted context omitted.

I'd argue there there aren't any single positions at large tech companies with founder level responsibility by design. It's a pretty decent compensation though. The base salary of a mid-level position at Amazon with substantially better equity terms (no cliff, no one deciding your bonus will be cut without your input, etc). It's a far cry from the PG ideal of salaryless founders surviving on instant ramen in their ga…

I think the parent's point is that $200K would be the base in FANG, but you're missing on massive RSUs as the founder in a startup.

Yes, I got that. What I'm pointing out is that your upside isn't capped compared to a place like Amazon where your bonus will get cut if the RSUs do too well and you have some degree of control over any compensation shenanigans and layoffs.

It's not unequivocally better, but it's certainly a trade-off that some people would be willing to make.

Re: YC Graveyard: 821 inactive Y Combinator startups

#209

Post by intelVISA »

xenospn wrote: post #68
tinco wrote: post #59

Earlier quoted context omitted.

They pay themselves 200k/y in a pre-market fit startup? That's insane and I guess on the investors for going over the traditional preseed amounts. Or do you mean that they're zombie startups that make enough to pay the founder 200k/year?

I think a lot of gen z founders see nothing wrong with paying themselves a FAANG salary. My generation, not so much (I’m 45).

Things are more expensive now.

Re: YC Graveyard: 821 inactive Y Combinator startups

#210

Post by jjmarr »

nradov wrote: post #189
jjmarr wrote: post #175

Earlier quoted context omitted.

It's not inherently fraudulent to sell something for below market value. If I sell something I bought for $1 million for $1 in an arm's length transaction, I'm realizing a loss of $999,999 even if the asset was worth $500,000. And it'd be a rational decision if it cost me $5 million in opportunity costs to do that $500k sale.

That's not how US capital gains tax law works. It's legal to sell something at below market value, but you have to use the fair market value when calculating a loss for tax purposes. Of course some people cheat.

I'm reading the IRS website and it says:

https://www.irs.gov/taxtopics/tc409

> When you sell a capital asset, the difference between the adjusted basis in the asset and the amount you realized from the sale is a capital gain or a capital loss.

Am I misinterpreting this?

Post reply on HN