Is there a calculation for REAL ROI?
Not based on current valuation but based on actual exits and money returned to YC?
YC Stats
61–70 of 148 posts
Re: YC Stats
#62As a clarification, by 'shutdown' do you mean failed, or does that include people who sold or were aquihired? Good to see the 90% of startups fail 'statistic' blown out the water with some facts!
~11% of their investments were in the last batch so I wouldn't read the ~30% dead rate as conclusive, a lot will need more time to die.
Re: YC Stats
#63Also, please do not take this as encouragement to start an accelerator.
Accelerators on the whole are a terrible business, and we try to be up front about that with everyone who comes to us for advice.
Re: YC Stats
#64Is there a calculation for REAL ROI? Not based on current valuation but based on actual exits and money returned to YC?
Doesn't look like. But 5% of 65 billion is 3.25 billion. Nice ballpark stats.
Re: YC Stats
#65Sam also just tweeted that 300 YC companies are no longer around. Amazing how much transparent they are and how great YC is at picking and training. So many really crazy ideas that most would think are insane and YC is able to find the ones that make sense and help them. Seems like that's a bit less than 1/3 of all YC companies Tweet is here: https://twitter.com/sama/status/636586179970752512
The failure rate is probably skewed low by YCs growth rate. For example, 1/9 of the companies were in their most recent batch, and it's unlikely that any of them have gone out of business yet.
Still impressive though. Any success rate over say 10-20% seems really impressive for an incubator.
Re: YC Stats
#66[deleted]
Re: YC Stats
#67"Market cap" is a poorly-chosen descriptor because the vast majority (all?) of the companies in YC's portfolio are private. The use of the term "market cap" is especially ironic given Sam's recent post on "financial misstatements"[1]. If founders are expected to use financial terms accurately and appropriately, shouldn't investors be expected to do the same? [1] http://blog.samaltman.com/financial-misstatements
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Re: YC Stats
#68[deleted]
Re: YC Stats
#69Earlier quoted context omitted.
YC filters applicants for dedicated founders who will not give up easily. It is amazing what can be accomplished by manic perseverance.
Last week I saw this from Sam. > If we don’t invest in these companies, they don’t happen… The thing about Y Combinator that’s cool is that most companies won’t happen if we don’t fund them.[1] I thought YC was always looking to fund those that would exist with or without YC. I have seen less and less "crazy bets" every batch, but I have to say there's more diversity of founders and topics (biotech, energy, farming).…
YC has said that Airbnb would have failed without their help. How could they not update their thinking? Being determined to succeed is necessary but insufficient. Every successful startup received a big helping hand early in its life. YC's business is to provide that opportunity to founders that otherwise wouldn't have it, such as Airbnb, which no other investor would back.
Re: YC Stats
#70Ok, so I did some quick numbers on performance. It looks like the first batch was in 2005, meaning ycombinator has been at this for 10 years. Have they always funded with 120k? Assuming that (and not present valuing the older money): Total Investment: ~$131,600,000 Total Companies Value: >$65,000,000,000 YCombinator's 7% Value: $4,550,000,000 Total Return: 3357% Annualized Return: 42.5% Obviously, it costs more than…
Need to take dilution into account here. If we assume a (optimistic?) 1% stake, that's $650M. YC recently (1-2 years ago?) started giving 120k. Before that, it was 10-20k. So let's say half of what you said is the total investment = 65M. That's a 10X return. I actually was expecting higher. Am I missing something in my numbers?
that's probably roughly right. But why did you expect higher? they are generating somewhere around 20-30% IRR. That seems massive in the current low yield low return environment