My story of applying, getting in, and being a mom in Y Combinator

You are massively undervaluing YC. It's not just "advice dispensed over diner", there is lot goes on [1]. In startup world, there are just too many bad decisions you can make at any point in time and even just 5 minute advice from an experienced person who has literally seen it all 100s of times is worth all of the 7% cut that you give to YC. In the book[1] you will see several cases described by author where founders are at critical juncture such as what features to work on, what to pivot, which investors to reject and so on. YC also preps you for demos, protects you against signing bad terms and exposes to pretty much all investors that matter in business in one fell swoop. This is all in addition to $120K seed money that they are pretty much guaranteed to lose. If your friend was lending you $120K, wouldn't you offer 10% of your company? IMO, YC's 7% cut is far more reasonable.

Next, you are also massively undervaluing Susan's work. Did you read that she kept failing for 2 years and still kept at it? If you were already rich, would you go through that kind of hustle as opposed to enjoying your margarita on a private island? Did you also read that she was pregnant while making her attempt and with 3-year baby in hand? Do you have any idea how is it like to be pregnant and working on something as taxing as startup while also taking care of 3-year old? If you don't I humbly suggest to ask this to your mom.

Next, Loopt was innovative in its time but unfortunately way too easily and quickly copiable. Being still able to sell that is actually a business success and tells you something about Sam's ability to win over investors and break a way against odds.

[1] http://www.amazon.com/The-Launch-Pad-Inside-Combinator-ebook...

First, I think it's unwise to underestimate the value of good advice early on. Advice and it's best friend encouragement are often necessary ingredients. People do not function best in a vacuum. There is a reason why startups (and lots of things) happen in clusters.

Second, there is a tendency to think for "meritocracy" as a very cold, dead thing. This kind of thinking is like applying an engineering mentality to human culture, society and personal interactions. The result is often a bureaucratic version of meritocracy, like a college application. These are not without their own biases, problems and everything else. They also strip nuance out of the process. This is a serious problem when you're looking for novelty, creativity, black swans, etc.

In any case, imagine Andy Warhol in the 80s with his stable of artists, models, musicians and Warhol Superstars. He supported them in various ways. This paved their access to audiences, money, collaborators, publishers, patrons, etc. etc. Was Andy Warhol running a cronyism ring or was he a prominent figure in a community of artists? Was the Velvet Underground's success a product of cronyism?

There's merit to the concept of cronyism in, for example, the government of a country. But, it's actually just a subcategory within a wider context of human interaction, important human interaction.

I think your definitions of meritocracy and/or cronyism just aren't rich enough to capture what's going on here.

If Leonard Cohen had a show where he introduced new artists he liked (personally and musically), I would pay attention. Leonard Cohen has whatever right to my attention as a listener that I choose to give him. Same for producers, collaborators, record labels, concert organizers and anyone else who values his opinion, or even his favor.

Communities are complex.

Broker:

Middle man during a transaction, ties seller to buyer.

Squatter:

Someone who knowingly infringes on another entity's legal rights hoping to sell the domain name to them at a premium lower than what it would cost to take the domain by force through legal action.

Thanks for sharing, let us know how it goes in the future.

That Jordan guy judging from his behavior even with his reply on Reddit seems like a youngster that wants to make easy bucks and doesn't care about the future.

If I was you I'd make a legal case and go full on him.

It doesn't make sense to evaluate historic seed stage valuation based on current valuation. Any angel investment looks like a bad deal retrospectively for a billion dollar company on that basis.

Investments need to be evaluated on the basis of the valuation at time of investment.

Certainly there are many companies who could raise money at higher valuations elsewhere who go through YC, but almost none of them could raise at a >$15m valuation (YC doesn't typically invest in post-A companies).