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Y Combinator's Message to Founders

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Re: Y Combinator's Message to Founders

#251

Post by shortstuffsushi »

lotsofpulp wrote: post #211
shortstuffsushi wrote: post #148

Earlier quoted context omitted.

I believe the example was likely chosen due to the recent controversial bill in congress [0]. However, I think the choice of baby formula shows that some "core" needs in the economy are missing as well, and that the tech bubble struggling. 0: https://www.bloomberg.com/news/articles/2022-05-19/house-pas... (Picked at random from a search for "baby formula bill")

The baby formula shortage is specifically related to one company’s production being shut down, supposedly due to their negligence in maintaining quality in conjunction with policies specific to baby formula that prevent supplies from abroad to come in to fill the void. It seems like a very poor example to refer to when talking about the broad economy’s needs and completely unrelated to a tech bubble.

Sorry, I guess I should have expounded a bit more - I think the example was chosen because of both cultural relevance [0] and because it is something that is a "core" element - I didn't necessarily mean to comment on whether it was an accurate representation of the state of things.

I would tend to agree that one "industry's" quality and policy related failings are not a sign of wider economic failure, although I think another commenter had it right with "covid hangover." There's a lingering supply/demand mismatch in seemingly all consumer markets that seems in large part due to problems that were started or brought to a head during covid.

Re: Y Combinator's Message to Founders

#252

Post by glennon »

dredmorbius wrote: post #59

https://nitter.kavin.rocks/refsrc/status/1527238287471292417 OCR'd text: 4:11 Greetings YC Founders, During this week we've done office hours with a large number of YC companies. They reached out to ask whether they should change their plans around spending, runway, hiring, and funding rounds based on the current state of public markets. What we've told them is that economic downturns often become huge opportunities…

This is a reasonable YC link for Series A milestones: [3] Series A Milestones: https://www.ycombinator.com/library/1k-benchmarks

Re: Y Combinator's Message to Founders

#253

Post by scarface74 »

eloff wrote: post #246
scarface74 wrote: post #159

Earlier quoted context omitted.

The stock market is not the economy. If you are working for a money losing VC backed company and the VCs aren’t willing to keep throwing money at you, that’s because the VCs know startup funding is a Ponzi Scheme and they will be left holding the bag instead of being able to pawn their investment off onto the retail market.

VC backed startups are a Ponzi scheme? I believe all of the FAANG companies started that way (took VC funding in their early days.) How is anybody supposed to take you seriously if you make broad categorical statements that are factually inaccurate?

Actually, my statements are very accurate.

How many tech companies that were founded since Facebook would anyone call “successful”?

Apple only took about $20K of investments and was profitable when it went public

Microsoft didn’t need any investments before it went public. Bill Gates took funding to get professional advice.

Google was profitable before going public and definitely never had billions in losses.

Facebook only went public because it had so many investors that the regulations around reporting got so onerous it was easier to go public. But it also didn’t lose billions of dollars at any point.

Amazon was the outlier, but it was also using its cash flow to expand. Most people knew that they could have been profitable at any point by not expanding. Amazon is the only one of the BigTech companies that is capital intensive.

Well Apple is to some extent. But it has always had high margins.

Even if you look at the second tier profitable tech companies like Intel, Nvidia, Oracle, VMWare, etc., you will see the same thing. None of them had billions of losses (even inflation adjusted) before going public and they were all profitable before their IPO. That means they had a proven profitable business model.

Re: Y Combinator's Message to Founders

#254

Post by wolverine876 »

liuliu wrote: post #170
wolverine876 wrote: post #169

Earlier quoted context omitted.

> "A war causing a massive energy crisis" seems to be a good time to increase energy production with more investment in things like fracking, which from what I heard, people are reluctant to invest due to the economy and rates concerns (they borrow from banks too). Also a bad idea for climate change, which is becoming very expensive.

Agreed. But unfortunately, nobody takes climate change (and related cost) seriously. You need a strong Federal government to enforce that cost structure (and hopefully globally, if strong enough), and the United States won't have a strong Federal government for decades to come.

A priori, let's quit! If people spent as much time talking about and acting on climate change as they do about how hopeless it is - a very convenient public belief for the greenhouse gas producers, even better than FUD! - we'd have fixed it. Get off your rump.

Re: Y Combinator's Message to Founders

#255

Post by eloff »

scarface74 wrote: post #253
eloff wrote: post #246

Earlier quoted context omitted.

VC backed startups are a Ponzi scheme? I believe all of the FAANG companies started that way (took VC funding in their early days.) How is anybody supposed to take you seriously if you make broad categorical statements that are factually inaccurate?

Actually, my statements are very accurate. How many tech companies that were founded since Facebook would anyone call “successful”? Apple only took about $20K of investments and was profitable when it went public Microsoft didn’t need any investments before it went public. Bill Gates took funding to get professional advice. Google was profitable before going public and definitely never had billions in losses. Faceboo…

Your statements aren't even accurate in this post.

First of all there have been tons of successful private and public tech companies in the 100M+ range since Facebook which received venture funding. You can find a whole list of them just in this very website, from YC alone. Many of them profitable, not just focusing on growth and future profitablity. I also don't see a reason to limit things arbitrarily to "since Facebook".

Secondly I only fact checked your claim about Apple, but they received much more than $20k of funding. But whether or not those companies were venture funded really doesn't affect my argument. There are tons of successful companies that received venture funding. That you would double down on your claim that it's just a giant Ponzi scheme beggars belief.

Re: Y Combinator's Message to Founders

#256

Post by scarface74 »

eloff wrote: post #255
scarface74 wrote: post #253

Earlier quoted context omitted.

Actually, my statements are very accurate. How many tech companies that were founded since Facebook would anyone call “successful”? Apple only took about $20K of investments and was profitable when it went public Microsoft didn’t need any investments before it went public. Bill Gates took funding to get professional advice. Google was profitable before going public and definitely never had billions in losses. Faceboo…

Your statements aren't even accurate in this post. First of all there have been tons of successful private and public tech companies in the 100M+ range since Facebook which received venture funding. You can find a whole list of them just in this very website, from YC alone. Many of them profitable, not just focusing on growth and future profitablity. I also don't see a reason to limit things arbitrarily to "since Fac…

Name them.

Re: Y Combinator's Message to Founders

#257

Post by sontek »

fastball wrote: post #207
ska wrote: post #179

Earlier quoted context omitted.

> I don't think I've met anyone who was suffering from under-hiring, I've definitely run into this a handful of times, mostly due to runway concerns and "keeping options open".

What were the clear symptoms of under-hiring?

I think I've only worked at companies that under-hired. At small start-ups it that they were worried about runway and so made everyone wear many hats and overwork / crunch on things. At large orgs its just difficult to hire and very competitive, so you always have a hard time hitting your goals even though the roles are very much needed.

I can't think of one org I've ever worked at that hit a sweet spot where you were able to hire exactly as many engineers as you needed while keeping up with growth and attrition.

Re: Y Combinator's Message to Founders

#258

Post by namose »

malfist wrote: post #248
rightbyte wrote: post #37

Earlier quoted context omitted.

With 8% inflation it is essentially better to stuff your bed with some commodity than go for 5% ROI.

So in an 8% inflationary market you'd turn down a 5% ROI for a 0% ROI? How does that make sense?

Commodities usually don’t make 0% return. The price of corn, gold, and gas have all gone up significantly over time (although sometimes not faster than inflation).

Re: Y Combinator's Message to Founders

#259

Post by wozer »

MichaelMoser123 wrote: post #222

I don't remember that they said something like this during COVID, Did they say something like that in 2008, or is that an unprecedented statement? I mean they exist since 2005, what did they say during the "Great Recession" ? (i think they called it like that, at some point...) I mean, i mean: is this one going to be worse than 2008? Fortune magazine is trying to compare our current problems with 2008. They say that…

I believe YCombinator was still very small in 2008. Otherwise, they would probably have said something similar.

Re: Y Combinator's Message to Founders

#260

Post by sbierwagen »

CallMeJim wrote: post #186
sbierwagen wrote: post #128

Earlier quoted context omitted.

>- If you get a meeting, don't take that as a good sign, we still take a lot of meetings. They don't explicitly spell this out, but this is because being a VC is still a job. Even if they're not actually making any deals, management doesn't want to see everyone sitting at a desk scrolling twitter for 8 hours, so instead they do pointless meetings. Matt Levine had a fun Great Recession story which I cannot find right…

When the first deals started closing again, who would have won the deals? The company that stayed home for 12 months? or the company that continued working for 12 months? Imagine swimming hard against a strong current. You get nowhere (or maybe even go backwards slightly!), but when the current changes you make a lot of progress. If you don't swim at all, you go backwards. When the current changes, you may get to whe…

That would be a dynamite answer to give during a job interview for a position in the Goldman Sachs M&A department in 2009.
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