[HN Gopher] Y Combinator Traded Prestige for Growth
___________________________________________________________________
Y Combinator Traded Prestige for Growth
Author : SvenSchnieders
Score : 457 points
Date : 2024-09-30 13:48 UTC (9 hours ago)
(HTM) web link (unfashionable.blog)
(TXT) w3m dump (unfashionable.blog)
| humansareok1 wrote:
| They seemed to trade quality as well. Its now a net negative
| signal for a company's success if they are accepted into YC.
| stonethrowaway wrote:
| You'll have to expand on this for us plebs. To whom is it a net
| negative signal?
| ToucanLoucan wrote:
| I mean I can't speak for that commenter, but I hold any VC
| backed startup in suspicion for a good amount of time because
| if they can't reach the size demanded by their investors,
| which runs the gamut from ambitious-but-achievable all the
| way to not-in-my-or-your-lifetime, a perfectly profitable
| modestly sized business is almost bound to be shut down and
| it's services terminated with little drama, leaving behind
| potentially useless products, or yet another fucking ZIP file
| to add to the pile of the things I have yet to open up and
| sort into other mediums.
| dylan604 wrote:
| > if they can't reach the size demanded by their investors
|
| In this sense, how is YC any different from any other VC
| firm?
| ToucanLoucan wrote:
| It's not, which is probably why I said VC not YC.
| humansareok1 wrote:
| To anyone with eyes? Job seekers looking for startups to
| join, investors looking for places to put money, etc.
|
| I'm sorry if your company got accepted into YC, better luck
| next time. At least you can hang out with the founders of...
| 100 AI-assisted Code Editors, 'The first Travel Credit Card
| for Gen Z', 'Starbucks memberships for restaurants', 'a video
| first food delivery app, tiktok meets doordash', and 'the
| operating system for vacation rentals'. Truly a staggering
| group of talent.
|
| Those are all real companies in W24 btw...
| blibble wrote:
| have a look at this, it's hilarious
|
| https://www.ycombinator.com/companies?batch=F24&batch=S24&b
| a...
|
| I expect "AI Nip Alert" to show up any day now
| coldcode wrote:
| Many of these are "Use AI For Something" startups. A few
| seemed meaningful but most seem destined to fail.
| fisherjeff wrote:
| Not going to name names, but so far my favorite has been
| "AI for [somewhat arcane process]".
|
| I had no idea how "AI" could possibly be of use, so
| clicked through out of curiosity. Hilariously, it boiled
| down to "we occasionally use an LLM to email people for
| you."
| devin wrote:
| hahahaha, wow! I really thought this was a joke list.
| That's stunning.
| humansareok1 wrote:
| Yeah not a joke. Straight from the W24 batch page... I'm
| sure these weren't even the most absurd.
| myrmidon wrote:
| "100 AI assisted code editors" is not even an exaggeration.
|
| I checked, and over 300 (of ~500) 2024 YC startups have
| some sort of AI tag. I'm quite curious how the current AI
| hype is gonna end...
| Lionga wrote:
| I was laughing thinking how you made up a list of the most
| stupid ideas. Just to be baffled they are really fucking
| there.
| bearjaws wrote:
| A) Security is always an afterthought at YC companies - I
| know from firsthand experience.
|
| B) YC companies are risky to use, obviously we meme about
| people using IBM for "saftey", but there is an opposite side
| of that which is going with a seed stage company - it's very
| risky.
|
| C) Even if you are a happy customer, if you are too niche
| they will typically abandon you. I've been on the decision
| making side for this, sometimes your early customers don't
| fit your new market, so you have to let them down slowly.
| bpodgursky wrote:
| I'm bearish on the giant YC classes but (C) is an entirely
| necessary evil at any successful startup anywhere.
| impostervt wrote:
| Oof just watched a video from the Pear.ai guys and was happy to
| hear they made it into YC. I don't know much about the project,
| but they seem like good people.
| ToucanLoucan wrote:
| "What we're doing isn't technically illegal so stop talking
| about it" isn't generally a phrase used by what I'd call good
| people, but we'll agree to disagree.
| jmull wrote:
| I don't get the objection here.
|
| Forking is part of how open source is supposed to work.
| tightbookkeeper wrote:
| The objection is it's extremely unlikely licenses are being
| followed and they seek to profit from good will of free
| software.
| minimaxir wrote:
| There's a difference between forking to make a OSS project
| better and forking to create a clone just for the sake of
| VC funding that doesn't trickle down back to the original
| code.
|
| Even if it's allowable by the permissive license of the
| original code, it's not a net positive for OSS.
| lupire wrote:
| That's your opinion. Maybe the original authors of this
| project don't care and are just happy that their
| invention is helping people.
|
| I'll take the authors' published intent over your
| speculation.
| askafriend wrote:
| Great take.
| dotty- wrote:
| The beauty of forking/open source is the ability to
| contribute back to the original project or take over an
| abandoned project. In this case, the original project
| Continue.dev isn't abandoned and actually has more
| traction/commits than the PearAI fork. But what PearAI did
| not do is a traditional fork. They took the commit history,
| re-branded everything to PearAI, pushed it up to their own
| repo, and claimed that the contributors of VSCode &
| Continue were their own contributors on Twitter.
|
| That's not the spirit of open source. I'm sure the authors
| of Continue.dev did not intend for their work to be used
| this way, even if the license is permissive of it.
| neilv wrote:
| I'm not sure how to parse this, and one possibility is
| worse than the other.
|
| Did they go through and alter each commit in the history,
| making it look as if the committer was talking about
| brand B instead of brand A at the time they made the
| commit?
|
| Or did they clone the commit history, and add commits to
| rebrand, while keeping the historical commits intact?
| lupire wrote:
| The license is literally a statement of intent.
|
| If they wanted to police use, they could choose a
| different license, like one of the GPL or CC variants.
| jmull wrote:
| Well, VS code isn't abandoned either. Shall we raise the
| pitchforks against Continue too?
| dotty- wrote:
| No, because Continue actually added value on top of VS
| Code. PearAI has not added value on top of Continue --
| yet.
| pessimizer wrote:
| > That's not the spirit of open source.
|
| That's because there's literally no such thing. It's a
| licensing choice, not a seance. If you don't want people
| to use your code, license it correctly.
| karaterobot wrote:
| I think the assumption people are making is that the YC
| selection team are dumb idiots, and don't understand that
| all the founders of that project did was fork an open
| source project and ask them for some money.
|
| (I'm not saying this is what happened; I know _nothing_
| about this project. I am saying this seems like the
| assumption the author of the article and some people in
| this thread are making. I bet that 's not what happened,
| but _if_ YC is actually full of dumb idiots who do zero due
| diligence whatsoever, then I guess I have to agree with the
| article 's thesis.)
| tfehring wrote:
| Just from public information my impression is that prestige was
| never a goal while scaling was in the plans from fairly early on.
|
| Anecdotally, some of the best recent founders I know are opting
| not to apply, which I think is a bad sign. But their reasons have
| nothing to do with the scale, competitiveness, or prestige of the
| program.
| paulgb wrote:
| IMHO this post misses the fact that YC becoming a prestige
| institution is itself a sort of failure mode. You don't want to
| attract founders who figure YC is a low-risk alternative to grad
| school that will look good on their resume.
|
| It's tough to avoid that outcome while still conferring positive
| signal to VCs/potential employees, though.
|
| I'm sure YC/Garry see something in the PearAI founders' ability
| to market themselves, but I find the whole debacle a bit
| embarrassing for YC and I know some of my YC batchmates quietly
| do as well.
| toomuchtodo wrote:
| What would YC 2.0 look like? How would you build it?
| cheschire wrote:
| YC was a child of its time though, right? Are you asking what
| could YC have done differently in the context of its history,
| or are you asking what a new accelerator started today would
| look like?
|
| I ask because I'm not sure that now is the time for a new
| startup accelerator to succeed, and we have no way to predict
| the circumstances that are required for success without
| couching it in some major changes to externalities.
| toomuchtodo wrote:
| Great question; the latter, because as you mention, YC was
| a product of a moment in time and that moment has passed,
| but during that time horizon, they were very successful
| (imho).
|
| Edit: YC says "Build something people want." and so I'm
| going to riff off of that in a bit of a meta way: "Support
| experiments worth conducting." The accelerator bit comes in
| once you've reached product market fit and need fuel for
| the rocket ship, but until then, you're just running an
| economic science experiment.
| neilv wrote:
| AFAICT, as much as YC was a child of their time, they
| (and PG) were also one of the parents of our current
| time.
|
| I'm guessing it was inevitable that Wall Street would
| take over the field, and turn it into a machine.
|
| And therefore it was also inevitable that people who, in
| the past, would've gone to Wall Street, now would flow
| into the space, and take it over.
|
| But YC did put their own spin on that, in which the
| traditional affluent-family, prestigious-school kids
| _could_ also be computer nerds.
| fallinditch wrote:
| It's interesting to consider what the evolution YC 2.0
| could be. I do think we're going to be seeing more
| innovative organizational models that can be facilitated by
| adept use of AI.
|
| For example, a network organization that hires individuals
| and small teams. The organization works on various projects
| and product streams, which which can be spun out as new
| businesses.
|
| This is a flexible model that allows for many different
| outcomes and journeys for the people. Less of a startup
| factory and more of an enterprise garden.
|
| I like the idea of _gateways_ as a system for managing
| ideas and new business developments. Regular gateways every
| 6 or 12 months that assess projects for continuation,
| funding and further development. People can be involved in
| several projects.
|
| I see this type of organization structure as a kind of
| 'hyper network'. By using AI to monitor and report on
| network activity it should be possible to have effective
| management oversight, direction and communication ...
| beneficent controlled creative chaos.
| candiddevmike wrote:
| For founders? I'd buy into the network and mentorship maybe,
| but not with equity. Maybe a subscription or cohort based fee
| schedule.
| jasfi wrote:
| So like accelerators before YC? No thanks.
| ganeshkrishnan wrote:
| completely data driven and pseudonymous. Everyone enters what
| they are building, traction, progress so far, team etc and
| internal team votes based on the data progress without
| looking at founder profile.
|
| make it fair instead of funding the same golden-spoon cliquey
| gang over and over again.
| PyWoody wrote:
| I think you mean PearAI[0], not to be confused with Pair AI[1],
| which YC also funded.
|
| [0] https://www.ycombinator.com/companies/pearai
|
| [1] https://www.ycombinator.com/companies/pair-ai
| paulgb wrote:
| oops, thanks, fixed.
| hobofan wrote:
| > You don't want to attract founders who figure YC is a low-
| risk alternative to grad school
|
| Of course YC would want that (in the short- to mid-term).
|
| The only thing YC has to do is produce a portfolio of companies
| that looks good enough that other VCs invest into that. This is
| completely disconnected to building viable businesses, as they
| just don't have to be the ones that are left holding the bag,
| and as an accelerator they are in the best position to do that.
|
| The easiest way to fill that pipeline is to pair current hype
| XYZ with Harvard (or other ivy league) undergrads (or high-
| level ex-FANG people). As long as their ROI stays above a
| certain threshold, that's the main way to scale up YC.
| paulgb wrote:
| YC doesn't benefit from founders who are just looking to pad
| their resume because they don't follow through to a liquidity
| event for YC.
| candiddevmike wrote:
| How do you tell the difference? Especially when so many YCs
| seem almost like comical vaporware or shovelware but with a
| charismatic CEO.
| MOARDONGZPLZ wrote:
| Very true.
|
| Saw one recently that literally forked VSCode and Cursor
| and called it a company with some really shady practices.
| Not even sure what YC was thinking with that one, but it
| indeed falls into the category of comical vaporware.
|
| How did something like this get funded? They must think
| there will be a follow through to liquidity event, but no
| clue how. Maybe YC is playing into the bigger fool theory
| that someone else will come along and pay more so YC can
| extricate their equity.
| ndiddy wrote:
| That's the company that the blog post points to as an
| example.
| hobofan wrote:
| Sure, that would be a theoretical failure mode. But that's
| not really what's happening right now, is it?
|
| YC doesn't look to have a problem of people joining just to
| get the stamp on the resume and then "half-assing" it after
| they get into YC. I think that's something that YC is still
| quite actively selecting against. As long as they are
| selecting companies that make it to a series ~C (which most
| founders will stick around for as long as they are on an
| good-enough upward-presenting) YC can (partially) liquidate
| at good enough fund performance.
| lumost wrote:
| A high-quality early stage team that self-selects out of
| follow-up rounds may be a decent outcome for some VCs. This
| means early liquidity in all of the "positive" events. If
| the founders were high quality, spinning an acquihire out
| can still recoup some of the loss.
|
| The challenge would come where the founders are not
| serious, and instead are viewing YC as a stepping stone to
| a level up position in a big tech/large firm. While I'm
| sure everyone has this idea to some extent as a fallback,
| you need people to be committed to making their business
| work.
| avarun wrote:
| > The only thing YC has to do is produce a portfolio of
| companies that looks good enough that other VCs invest into
| that.
|
| This is completely incorrect. They need liquidity events.
| Simply getting to follow on funding without ever making it to
| an exit is a negative outcome for YC.
| hobofan wrote:
| Liquidity event != exit.
|
| While an exit (= aquisition, IPO and similar) is obviously
| always the optimal end-goal, every round of fundraising is
| a potential liquidity event for all existing stakeholders.
|
| It's very common to have partial liquidation from roughly
| Series B-C onwards on the side of founders (e.g. wanting to
| keep up lifestyle with your C-level peers; removing
| personal financals as stress factor) and earlier investors
| (e.g. their funds entering the liquidation period of their
| lifecycle).
| nordsieck wrote:
| > The only thing YC has to do is produce a portfolio of
| companies that looks good enough that other VCs invest into
| that. This is completely disconnected to building viable
| businesses, as they just don't have to be the ones that are
| left holding the bag, and as an accelerator they are in the
| best position to do that.
|
| That's really short term thinking.
|
| It might work for a class or two, but eventually VCs will
| realize that they're getting bad returns from their
| investments, and YC won't be nearly as attractive as it is
| today.
|
| For long term success, YC needs to pick companies that will
| eventually become successful. Particularly the big, standout
| successes.
|
| > The easiest way to fill that pipeline is to pair current
| hype XYZ with Harvard (or other ivy league) undergrads (or
| high-level ex-FANG people). As long as their ROI stays above
| a certain threshold, that's the main way to scale up YC.
|
| If you think that's the path to good long-term ROI, I have a
| startup to sell you.
| Qworg wrote:
| A question that has probably been answered, but...
|
| In a hits business, does quality picking matter? You want
| to avoid adverse selection, but beyond that - isn't it just
| about scale?
| ethbr1 wrote:
| There are probably a few levels.
|
| Originally, at small scale, you need to pick hits better
| than others (or get lucky).
|
| Next, you want to scale large enough that you can make
| enough bets to amortize individual bet risk across a
| large portfolio.
|
| Then, once you're over _that_ scale, you need to be back
| in the business of picking hits more reliably than the
| next VC.
| hobofan wrote:
| > but eventually VCs will realize that they're getting bad
| returns from their investments
|
| I'm not saying that they are necessarily bad returns. It's
| just that for many reasons there is a strong opportunity
| for a disconnect between viable business models and seed-
| investments. E.g. exit event horizons are currently so
| long[0] that it becomes hard to correlate exit success to
| seed-funding (for better or worse).
|
| > If you think that's the path to good long-term ROI, I
| have a startup to sell you.
|
| Oh, I don't disagree with you. But from the actions of
| YCombinator it seem like either:
|
| - They don't see this as a risk to their long-term ROI (due
| to some factors we are not seeing here)
|
| - They don't have proper means of self-assessing their
| selection quality and think they are scaling well while
| they don't
|
| - The situation is not as bad as the article and some of
| the comments here make it look like, and everything is fine
| with YC
|
| [0]: https://www.ycombinator.com/topcompanies/ <- There are
| many 10+ year old companies on that list without an exit
| and YCombinator isn't even 20 years old yet
| itsoktocry wrote:
| > _That 's really short term thinking._
|
| Isn't that exactly what we're discussing happening to YC?
| amirhirsch wrote:
| YC benefits strongly from network effects; the value for each
| founder grows superlinearly with more founders. Grow faster!
| edouard-harris wrote:
| That's true but there's also a countervailing dilution
| effect. Hard to know exactly where those two lines intersect.
| closeparen wrote:
| A very straightforward way that this manifests: when a VC
| funds a developer tooling company, all their other portfolio
| companies are strongly encouraged to use it. Built in
| customers! The test is how much revenue you can actually
| bring in from outside the VC bubble.
| a1371 wrote:
| For the uninitiated like myself, PearAi just took the source
| code of continue.dev (not fork, they copy pasted) and did some
| clunky work on it. That was their entry to YC.
| neom wrote:
| And to save anyone else looking it up, seems to be
| continue.dev is using Apache License in their repos.
|
| (also, I did some poking around, this is the founder 3 months
| ago talking about using continue
| https://www.youtube.com/watch?v=X0OylwLzBQw&t=257s - no horse
| in this race, just sharing)
| pj_mukh wrote:
| "did some clunky work on it. That was their entry to YC"
|
| For more context, YC doesn't judge your code, never has. It
| was never a code quality competition. Orthogonally, they do
| judge the results (user metrics).
| FactKnower69 wrote:
| >For more context, YC doesn't judge your code, never has.
| It was never a code quality competition.
|
| it shows
| pj_mukh wrote:
| Yea it does! [1].
|
| [1]: https://jaredheyman.medium.com/on-the-176-annual-
| return-of-a...
| moomin wrote:
| Yeah, but they used to care about your moat and "Did some
| easily replicable work on a product anyone can duplicate."
| ain't it.
| pj_mukh wrote:
| Did they? YC regularly funded competitors. This was
| always true. Fundamentally, YC is betting on founders.
| They're optimizing for founders who can move fast enough
| to find a moat before they die, that's it.
|
| They fund competitors because most YC companies usually
| pivot out anyway.
| thornewolf wrote:
| for additional uninitiatedness: one of the founders is
| "Frying Pan", a popular youtuber. There has been previous
| discussion on the fact that the cost to build software is
| approaching 0. If that is given, maybe "taste" is all that
| matters. Funding a ~productless popular youtuber is a great
| way to test if "taste" and "brand" is better to invest in
| than tech in the years to come.
| cal85 wrote:
| Just looked up the etymology of prestige and it's interesting.
|
| It comes from Latin _praestigium_ ( "delusion, illusion"), then
| 1500s French _prestige_ meaning "deceit, imposture, illusion".
| In the 1800s it started to mean "an illusion as to one 's
| personal merit or importance, a flattering illusion".
|
| I would have wrongly guessed it originally meant "good
| reputation" (same as the article author meant it, I assume) and
| that the association with bullshit/fakery is just a modern
| twist from people using the word with cynical irony. But
| bullshit/fakery was in fact the core meaning.
| fuzzfactor wrote:
| That is enlightening.
|
| Without being aware of the etymology I've still had a
| lifetime feeling since childhood that it is very fragile for
| some reason that is hard to pinpoint or bring into focus very
| easily.
|
| Really is about the same feeling as when you _know_ something
| is hype or BS and for that reason more subject to collapse
| like a house of cards.
| fallingknife wrote:
| The "something" that they see is that they have a 1% chance of
| success. YC is an investment strategy. They noticed that equity
| which is 99% sure to be worthless is heavily under priced and
| bought a ton of it. That bet paid off handsomely.
|
| If your batchmates are seeing embarrassment from who else is at
| the top of such a funnel I don't think much of their judgment.
| Investors provide capital, not prestige.
| closeparen wrote:
| YC pretty openly and deliberately tries to convince prospective
| and actual Big Tech employees who are curious or on the fence
| to quit and do a startup already. There's a great Startup
| School video about this [0]. I think the critics are right
| about "doing a startup" and chasing an exit having become an
| equally normal, precedented, socially-supported path as joining
| a big company and chasing promotions. But I'd be surprised if
| YC itself would characterize that as failure.
|
| [0] https://www.youtube.com/watch?v=sM2reZib2RY
| Apocryphon wrote:
| HN is a lot more jaded towards startups and founders' games
| these days. Back in late 2019 there was this thread about a
| pre-YC Garry Tan video where the tone of the discussion was
| fiercely against working for startups, saying it was better
| to join FAANG or start your own company instead:
|
| https://news.ycombinator.com/item?id=21865065
| shekispeaks wrote:
| We can keep going down here, the problem with society can also
| be that prestige in itself is valuable.
|
| Instead of say prestige being the side effect of being good at
| something useful for the society.
| throw14082020 wrote:
| How many times did the author apply and get rejected from YC?
|
| I have heard this sentiment before, from a less successful VC.
| After comparing them based on track record, it was clear YC is in
| a league of its own. I want to get advice from people who have
| built startups before. Looks at YC advisors on YouTube and you'll
| find they're all very successful.
|
| Look at the partners and advisors at most VCs or accelerator
| programs, and you won't find that level of experience. You'll get
| mismanaged and start thinking like an investor instead.
| chronic9304 wrote:
| > How many times did the author apply and get rejected from YC?
|
| Author is not wrong.
|
| This "YC is actually a negative signal" sentiment started back
| in 2018-2019.
|
| The "actual" good entrepreneurs (e.g., the folks you expect
| from Harvard, MIT, Stanford, Berkeley) stopped applying to YC a
| while back.
|
| There are different signaling mechanisms in 2024, which I won't
| reveal here, because the "plebs" will turn it into shit, just
| like they did to YC, leetcode interviews, and FANG ML jobs.
| marviel wrote:
| You have a good hart
| throw14082020 wrote:
| You posting "better" signalling mechanisms (in your opinion)
| will not be the end of them... People don't do things because
| you think they're good. They'll find them by looking and
| copying existing companies' approaches.
|
| You have failed to mention anything except to say
| approximately "YC sucks and I have something better but I
| don't want to share"
| zurfer wrote:
| I don't know what YC thinks, but the mission is not about
| prestige, but to help startups succeed, so these startups can
| make something people want.
|
| Also, YC is mostly back in person and so pretty hard to scale
| (also batch sizes have gone down in the last couple of years).
| HeyLaughingBoy wrote:
| I don't track these things, but as far back as I can remember,
| the appeal of YC was the tutelage of experienced founders,
| availability of office hours, and the atmosphere of being
| surrounded by like-minded, ambitious people.
|
| When did that change?
| jsheard wrote:
| That tight-knit environment couldn't last when they keep taking
| on a bigger volume of startups every year.
|
| 2005 - 8 startups
|
| 2010 - 63 startups
|
| 2015 - 216 startups
|
| 2020 - 435 startups
|
| 2024 - 509 startups _so far_ (likely 600+ when the Fall batch
| is done)
|
| https://www.ycombinator.com/companies
| buggeryorkshire wrote:
| Surprised this doesn't mention meticulous.ai, who seem to spam HN
| with "we're hiring!" each month but i've never heard of anybody
| using them, nor do LI show any new employees. Hey Gabriel, what's
| going on?
| autonomousErwin wrote:
| I thought I was the only one who noticed, I'd much prefer the
| YC companies do a monthly "here's who's hiring" much like the
| "who's hiring" instead of individual ones.
| mpeg wrote:
| Join us as Founding Engineer #207 !
| hobofan wrote:
| I don't think that's really connected to the topic here?
|
| What you are describing here just sounds like one of their
| portfolio companies taking full advantage of one of the perks
| that comes with YC? I don't know what the limit on the "We're
| hiring" posts is for portfolio companies, and I also have a few
| on the top of my mind that showed up a lot, but having that as
| "ads" on this website isn't too bad.
| bluecheese452 wrote:
| HN is rife with these adds masquerading as legit hiring posts.
| One company was "hiring their 3rd engineer" for years.
| intelVISA wrote:
| With the recent drop of batch quality comes more lifestyle
| companies and less disruptors. I can't imagine the YC of even
| 10 years ago funding quite so many zombies 3+ years no product
| but still holding out for the fabled founding engineer...
|
| A half-decent Schemer in found3rm0de would've built 5 failed
| MVPs and exactly one unicorn in that timeframe.
| camjw wrote:
| I've used meticulous.ai!
| tempusalaria wrote:
| What about Imbue which has raised like 300mln, spams fake
| hiring ads all the time, and doesn't have a product...
| petesergeant wrote:
| I briefly worked for Imbue, and got paid for it, and as far
| as I know they are still legitimately hiring -- their current
| team page shows a good number of people who have been hired
| since I was there -- so I don't think "spams fake hiring ads"
| is a fair thing to say; they are legitimately hiring people,
| and paying good money. My impression is that they make the
| top of the hiring funnel as wide as possible but end up
| hiring a tiny fraction of the people who start the process.
| petesergeant wrote:
| I interviewed for Meticulous a few years ago, and I'm pretty
| sure I was almost hired, but it didn't go through because they
| decided they wanted to go fully in-person in London, and I
| didn't want that. Gabriel seemed like a good guy, I was given a
| very believable project demo, Quentin also seems legit, my
| understanding is the product is difficult currently to roll-out
| to smaller customers but they have a good number of larger
| paying customers.
|
| I don't think the continuous hiring posts are anything other
| than a sign that it doesn't cost them anything and they get
| good leads every time they do it.
| underdown wrote:
| This is almost as embarrassing as data centers in space getting
| funded. lol.
| nashashmi wrote:
| Article's assumption is that a totally incompetent set of startup
| founders were admitted to YC because it "loses quality in
| exchange for quantity" (not a direct quote but the gist). And
| this startup was nothing more than a copy of a different startup.
|
| Maybe it is the prestige game that became a death knell for YC.
| Because it is "cool" to be accepted to YC, the "cool people" with
| a coolness factor started applying and tried to game through the
| evaluation process into acceptance. But these cool people aren't
| really cut out for doing sweaty, gross, sleeve-pulling work. So
| they likely fail.
|
| What does Sam do? Refocus the company to drift away from the
| "cool" tech sector where cool people are looking to make their
| name cool. And start doing stuff in multiple sectors (that will
| seem cool in the future!).
|
| What didn't he do? Make the grind of becoming a YC selectee even
| sweatier and harder. Or change the selection process entirely so
| that all previous books trying to get you through the system fall
| flat on their faces.
| djaouen wrote:
| At some point, you _have_ to turn reputational capital into real
| capital. The hope, then, is that you only spend the interest on
| that capital.
| toomuchtodo wrote:
| Do you have to? Doesn't YC have enough capital to spend it on
| meaningful endeavors instead of silly "moonshots"? How much
| would be enough before this happens? Genuine questions, no
| snark.
| lvl155 wrote:
| Counter point: there are so many more accelerators now. It was
| basically getting into MIT/Stanford in term of opening up big
| doors. Now you have schools with accelerators right out of
| undergrads. So, YC has to compete in the space (sort of). It's
| still one of the highest prestige (as in validation) you can get
| EVEN IF YOU FAIL.
| mehulashah wrote:
| I don't agree at all with this post. YC's mission is to help
| founders start companies and help them build sustainable
| businesses. Towards that they've made it super simple to get
| started and funded, and provide guiding principles and support in
| the form of advice and a strong network to help the startups
| survive. They were never about prestige -- that came as a
| byproduct.
|
| Scaling this model is hard, however, and I think they may be
| running into scaling limits. There just may not be that many fast
| growing businesses (startups) every year. We won't know until
| years from now.
| nsedlet wrote:
| I was part of the W12 batch of YC (which was a lot smaller, ~60
| companies, back when Paul Graham was still leading YC).
|
| YC funds a lot of companies and has always had super high
| variance in the companies it funds. Entrepreneurs are a wild
| bunch of people. There have always been companies where the
| founders turned out to be BS artists or sociopaths. Companies
| that folded immediately after the program started. Companies with
| messy cofounder breakups already brewing at the beginning of the
| batch. Companies that turned out to be slightly scammy. Some of
| the founders that were in those companies pivoted and became
| successful.
|
| Picking on Pear AI (which I don't know anything about) as
| evidence of YC failing is silly. It's also a super early stage
| company and you really have no idea what they will do.
|
| The test of YC to me is, can they keep attracting and picking
| some of the best founders (which you can't really tell for
| years). And providing the inspiring, warm, but pushy environment
| that best sets up founders for success, and in turn keeps them
| coming to YC. I'd apply to YC again in a heartbeat if I were ever
| starting another company.
| supafastcoder wrote:
| YC went downhill during Sam Altman and then Garry Tan pushed it
| off a cliff. There's no point in joining YC anymore.
| joeybloey wrote:
| What's the most successful yc company started in the last 5
| years ?
| lupire wrote:
| Is there a tracker or all YC companies and their outcomes?
| Mistletoe wrote:
| https://www.ycombinator.com/companies/
| marviel wrote:
| Replit and Vanta stand out
| ahstilde wrote:
| Zepto, W21, raised last month at $5B valuation. So, in 4
| years.
| reagan83 wrote:
| PG should return and go 'founder mode' on YC and clean house.
| pexabit wrote:
| What happened is adverse selection due to a stubbornly low
| valuation that doesn't even try to keep up, in the midst of a
| growing number of alternatives, worsened by a formal and
| therefore somewhat gameable process of getting in. The kind of
| person who really has an idea they are going to pursue regardless
| that he's actually committed to isn't going to part with his
| equity at the low prices a YC would offer. Instead what you get
| is people creating companies explicitly with the intention of
| applying for VC, which removes an important filter reflecting
| founder buy-in, and therefore average quality; and there's no way
| you can really tell one from the other.
| EarthBlues wrote:
| I don't see how any of the evidence martialed in this article
| proves the conclusion.
|
| There's a tendency in contemporary online culture to want to
| condemn the whole person. It's not enough, it seems, to condemn
| Altman's self-serving decisions with OpenAI. We also have to
| pretend he's a bungling businessman, whose self-inflicted
| downfall is imminent. The same pattern can be observed with other
| public figures. It just doesn't seem to me to beget a workable
| understanding of reality.
|
| I don't have a dog in this fight, except that I like reading HN,
| and I'd like it if this place didn't descend into the kind of
| friend-enemy thinking so prevalent on much of the internet.
| tines wrote:
| > martialed
|
| I think you mean "marshaled," correct?
| lupire wrote:
| It's used as an attack, so both.
| jmward01 wrote:
| > I don't see how any of the evidence martialed in this article
| proves the conclusion.
|
| Agreed. Making this level clam requires a lot more evidence. It
| would have been better if the author presented this idea as
| something like 'YC better watch out, quality does matter' or
| something like that. Even then they would need to bring in more
| evidence and outside examples of industries where this trend
| took hold.
| ninetyninenine wrote:
| https://news.ycombinator.com/item?id=41697929
|
| Only punishment and court judgement requires that level of
| evidence.
|
| Corruption often never gets exposed at all and at best is
| only revealed through weaker anecdotal evidence or even
| rumors.
|
| A blurry picture is often better than no picture at all. Form
| your own opinion about my link above. If it's actually true,
| then that post I made is likely the only thing you'll ever
| read about it.
| s1artibartfast wrote:
| The solution to a low volume of information isn't to place
| extra emphasis on weak data.
|
| A blurry picture is better than none, but this behavior
| seems like taking a blurry picture, creatively
| extrapolating it to crystal clarity, and then fervently
| claiming it is reality.
|
| Confidence and conviction in an arbitrary belief can help
| an idea compete in an information poor environment, but
| that doesnt mean it isn't delusional.
| jmward01 wrote:
| To make my comment clearer, the article made many
| statements like:
|
| > If the main appeal of joining YC isn't the mentorship but
| the prestige of being able to write "YC W22" in your
| Twitter bio and on your company's landing page
|
| and
|
| > Take Harvard, for instance: the reason they don't accept
| a higher percentage of applicants isn't because they can't
| scale--they have the resources to build more facilities or
| could even switch to remote like YC--but because they
| choose not to.
|
| These statements are made with no backing evidence for
| them. They could be right, but without any evidence that
| they are I just have to take it on faith that they are,
| which I won't. At least link to another article making the
| case for these statements.
|
| This is just bad writing and it is a problem with modern
| journalism and blogging. The author may, or may not, have a
| great point, but they did nothing to actually argue their
| point except point out one tweet at the end. Even that was
| predicated on the many statements before being true. Take
| away all the unsubstantiated claims in this article and you
| are left with, at best, a re-tweet and an argument that
| Dorai is being a little overly defensive and that may
| indicate something worth looking into.
| ninetyninenine wrote:
| https://news.ycombinator.com/item?id=41697929
|
| Hn claims to be largely independent of the YC fund. But we will
| never know the full truth.
| nsokolsky wrote:
| Yep, ideally OP should formalize their theory into a bet and
| accept people to bet against them. Say, $5k on OpenAI <insert
| some horrible outcome> in 10 years. Money could be kept in
| escrow with a trusted third party.
| pbiggar wrote:
| One of the biggest shocks to me was that YC now invests in war
| and killing people. Before their closest connecting to killing
| people was investing in companies that had severe negative
| effects for society, like Doordash or AirBnb. Now they're helping
| people make missiles.
|
| https://www.ycombinator.com/companies/ares-industries
| yayitswei wrote:
| YC did not have prestige in their early years (Jessica mentions
| they had to beg their friends to come to demo days). Yet people
| were dropping out of Harvard to join. So it seems prestige is not
| necessary for success and in fact may be a negative signal.
| lupire wrote:
| So it was prestigious, but it wasn't seen as a profitable
| investment before it made its first dollar.
| jeffreyrogers wrote:
| It wasn't. If you told someone you dropped out of Harvard
| back then they would think you were making an odd choice.
| That said, it was never very risky since Harvard will take
| you back if you drop out, but it was at least unusual.
| pyb wrote:
| It was very prestigious by ~2007, but only within a much
| smaller niche of programmers nerds.
| pj_mukh wrote:
| "The issue isn't that PearAI did something illegal--it's that
| they got funded by YC with nothing more than a codebase copied
| from another YC-backed company. This shows that (1) YC is willing
| to fund just about anything, (2) they're not doing any real due
| diligence, and (3) they don't particularly care about their
| existing portfolio companies."
|
| This shows a fundamental misunderstanding on how YC functions.
| YCombinator was _never_ a test of how good (or unique) your code
| was. At its core it was a filter of _people_ , people who can
| work well together and people who can build something useful.
| That's it. You can read more about this straight from one of the
| founders [1]. The fact that you used open-source code (within
| legal bounds) to get their quicker just shows your
| resourcefulness, something YC actually optimizes for.
|
| More often than not, "good people" tend to be domain experts
| sometimes really good and unique coders but that, to me, was
| always a byproduct of the search pattern.
|
| You can obviously disagree with this methodology, but it has
| worked pretty well.
|
| [1]: https://foundersatwork.posthaven.com/the-social-radar-
| what-i...
| vergessenmir wrote:
| VC firms are betting on the people. Most early startups are
| still looking for their market fit. The VC firm is betting that
| the people are able to identify that market which they'll be
| able to scale.
| shombaboor wrote:
| yc is a club looking for members. A lot of the members share
| similar traits/backgrounds which is why there's sorta this
| "populist" backlash. It's not meritocracy for ideas or
| viability.
| jasfi wrote:
| I think the real pain point you're hitting on there is that
| people feel like they don't get selected when they deserve to
| be. While there are those who don't deserve it but get selected
| anyway.
| yunohn wrote:
| While I often feel this sadness/jealousy myself, and most
| probably a lot of the rage bait X replies do too (despite not
| admitting it) - someday they have to wake up and realize that
| life is/has always been that way.
|
| Despite our collective desire, Tech is not a guaranteed
| meritocracy either.
| noobermin wrote:
| I think something people might be missing is the context around
| this post, which is that the founders are being dragged on
| twitter, essentially.
|
| Since a lot of you hate the site, I'll summarise briefly: one
| of the founders did a thread starting with the following post:
|
| "
|
| I just quit my 270 000$ job at Coinbase to join the first
| YCombinator fall batch with my cofounder @not_nang
|
| We're building PearAI, an open source AI code editor. Think a
| better Copilot, or open source Cursor. But you've heard this
| spiel already...
|
| "
|
| One thing not conveyed here is the first line is in unicode
| bold and the end is littered with emoji spam. Essentially, the
| post ticked a few rage inducing boxes for a certain kind of
| tech twitter user. It was rather cringe, reading like a thread
| from get-rich-quick influencer types while also likely imbueing
| some readers and quote tweets with a little jealousy they
| wouldn't openly admit. This was probably the impetus that
| pushed one or two angry people to poke around their product and
| find out about the open source code cloning and the fact the
| founders were overselling (which founder doesn't, I guess...)
| which lead to a rout of publicly mocking them and YC in
| general, resulting in blog posts like the OP, I guess.
|
| I personally don't really think one company amongst the whole
| batch is enough to judge the start of a trend for YC "trading
| prestige for growth" or whatever. I think the discussion of
| prestige is in general is an interesting one, I just don't
| think PearAI is indicative of it more than they themselves just
| being hucksters which happens in tech in general.
| octopod12 wrote:
| The founders showed hustle, as every founder must. nothing
| wrong with that in my book.
|
| But they need adult-guidance on communication. You dont go
| around twitter boasting about your 270K job etc. They need to
| show grown up hustle (grit, perseverence, etc). Not high-
| school (mine is bigger than yours) hustle.
| spamizbad wrote:
| I feel like that "270K job" comment was some sort of
| cultural signal to Zoomer devs on the FAANG leetcode job
| grind. I'm in my 40s so it just seems both tacky and
| unimpressive but maybe for folks half my age it's a
| meaningful signal towards competency?
| FactKnower69 wrote:
| 270k is on the low end and would indicate incompetency if
| anything if you're older than mid-20s, esp since it's not
| like he's taking a pay cut to work in a cool or
| interesting field (coinbase lmao)
| OGWhales wrote:
| 270k is on the low end?
| Apocryphon wrote:
| Depends on the equity
| adamrezich wrote:
| Assuming that this isn't sarcasm, this is what happens
| when you permit social media to distort your sense of
| reality.
| JohnMakin wrote:
| The simpler break-down here is that they are crappy con
| artists and need to be be better at con-artisting. Which is
| fine, but please let's not pretend it's very different.
| pj_mukh wrote:
| This is an indictment of Twitter tbh. Not YC. A lot (most?)
| YC founders aren't even on Twitter.
| octopod12 wrote:
| the founders were status-signaling on twitter.
|
| it is clear they are in it for the "status" of being YC.
| and they dont care a whit about solving anybody's problem.
|
| they do this for a while, get it on the resume and go back
| to their 270K jobs after a few months.
|
| this in and of itself is a hustle, lol. they hustled YC.
| yunohn wrote:
| Honestly, I hate X/Twitter specifically for this - the
| click/rage bait cesspool that it has become in the past year
| after content engagement became monetized.
|
| Every other day, or at least every week, there is a new topic
| that everyone piles-on rage and hate to - even accounts that
| have nothing to do with the topic. This is because eyeballs
| make users money from X - so getting any audience possible,
| and getting them inflamed enough to engage is the point.
|
| Even worse, the algorithm is gamed such that the latest rage
| is pushed to every other users eyeballs, resulting in a
| constant stream of hate in your feed.
| sottol wrote:
| Part of the earlier appeal of YC was that it was a batch of
| approval that, at least imo, was a strong signal to VCs to take a
| good look at the company and more-likely-than-not invest in.
|
| With larger batches and more lax selection that signal is so weak
| that YC comapnies are mostly like other companies with some
| traction.
| mattcantstop wrote:
| There is a part in the Netflix culture doc where it talks about
| how sometimes people do bad things, and Netflix tries to not
| overcorrect by implementing burdensome policies on the company as
| a knee-jerk reaction to a single bad actor.
|
| The conclusion (YC's brand has been tarnished because of the
| lower quality companies in their larger batches who do bad
| things) doesn't follow from the evidence of this ONE company
| doing something that people could view as a low integrity move.
|
| This exact situation could have occurred even if they kept their
| acceptance rates, and cohorts, incredibly small. There can always
| be bad actors (not saying this company is a bad actor though). I
| think you wanted to share your conclusion, even if the available
| evidence didn't necessarily support your claim.
| sneak wrote:
| "It takes two points to establish a line, and three for a
| curve."
| bko wrote:
| I think the bigger issue is that the main signal to YC (and
| other elite institutions) is the acceptance rate (<1%). That's
| probably the #1 thing people know about YC. A lot of people try
| to get in, and few do.
|
| The main criticism I have of YC is their constants chants of
| "everyone should apply!". Here is what you commonly hear:
|
| YC: You should apply to YC!
|
| Person: But I don't have a product
|
| YC: You should still apply, we let in a lot of people with just
| an idea!
|
| Person: But I don't have a co-founder
|
| YC: You should still apply, successful solo founders have made
| it into the program!
|
| Person: But I [perfectly valid reason not to waste your time]
|
| YC: You should still apply!
|
| Person: Wow, you're being very encouraging, does this means I
| have a chance to get in?
|
| YC: Almost certainly not!
|
| At a certain point, I can't really take the org's mission in
| good faith with this kind of messaging. They want a high
| application rate, a low acceptance rate (even with bigger batch
| sizes). Just infinite optionality and founders being strung
| along.
|
| I wrote more about it in a blog post
|
| https://mleverything.substack.com/p/dont-play-status-games
| jedberg wrote:
| The reason they want you to apply is twofold -- the
| application itself is a good exercise in getting you to think
| about things you should be thinking about. Honestly even if
| you have no intention at all of applying to YC you should
| still fill out the application for yourself, it makes you
| think about important things.
|
| And the second reason is that they get to see as many options
| as possible, because that's obviously better for them. If
| every startup in the world applied and they could choose, of
| course that would be better.
|
| It has nothing to do with "juicing the numbers".
| pdonis wrote:
| _> If every startup in the world applied and they could
| choose, of course that would be better._
|
| Would it? With numbers that large, how could anyone
| possibly do a meaningful comparison and pick out the twenty
| or thirty or fifty that would get in?
|
| In other words, if it's obvious to everybody that you are
| getting too many applications to meaningfully evaluate all
| of them, they everybody knows that you are _not_
| meaningfully evaluating all of them. You 're applying some
| kind of mindless algorithmic filter to narrow down the
| possibilities. But that's not YC's brand. YC's brand is
| providing meaningful evaluation of startups. Once that
| brand is undermined, it's gone.
| munificent wrote:
| _> they get to see as many options as possible, because
| that 's obviously better for them._
|
| That assumes that evaluating a candidate is zero-cost,
| which surely isn't true.
| bko wrote:
| I'm convinced those that say "I think its a good exercise
| filling out an application" have never actually read the
| application
|
| Here are a few questions:
|
| "How far along are you?"
|
| "What tech stack are you using, or planning to use, to
| build this product?"
|
| "Why did you pick this idea to work on? Do you have domain
| expertise in this area? How do you know people need what
| you're making?"
|
| "Who are your competitors? What do you understand about
| your business that they don't?"
|
| "How do or will you make money? How much could you make?"
|
| It's really not that deep or thought provoking. Its fine,
| you should have answers for these questions, but its hardly
| worth a founders time going over this as closely as many
| do.
|
| > And the second reason is that they get to see as many
| options as possible, because that's obviously better for
| them
|
| Yes, that's the infinite optionality for them. If I was
| running YC, I would obv promote the same strategy. As a
| founder, I think their incentives don't necessarily align
| with mine.
| edouard-harris wrote:
| I've read the application. In fact I've filled it out
| three times, once successfully and twice not. It is
| indeed an excellent exercise. Among many other things: if
| you're a first-time founder then it teaches you what's
| important, and if you're a second-time founder then it
| reminds you. (Many second-timers do sometimes need to be
| reminded, myself included.)
| dzonga wrote:
| i realised this too late. and then noticed -- the type of
| founder they let me. for us the unwashed masses, who are blue
| collar coders who went to state school. we're just filling up
| rejection numbers.
|
| yet the arbiter of what determines who succeeds is not YC but
| the market.
| foldr wrote:
| I don't think the main issue here is that a YC company acted
| with questionable ethics. As you say, people are people and
| that can happen with even the strictest due diligence.
|
| The problem for YC's prestige stems from funding a company with
| an unoriginal idea and not even the beginnings of a prototype.
| I'm aware that YC funds founders more than it funds specific
| ideas or projects. Nonetheless, you'd expect an impressive
| group of founders to do more than just fork an existing open
| source project.
|
| In short, cases like this show that YC is getting (non-
| illegally) scammed by some of its applicants. That makes YC
| look foolish.
| mattcantstop wrote:
| Even the evidence listed (the retweeted tweet in the article)
| doesn't support the claim of the author to me. If you open
| source software and give it a license that permits commercial
| use on top of it, then you are okay with that use. If I was a
| cohort of a team that built an open sourced AI editor I would
| think they would WANT me to build on top of it. Otherwise,
| why permit that use? They may have a bad business model,
| where their business does not work if they open source their
| tech and other companies build competitors on top of it. But
| that's a questions for them and their decision to open
| source. But it doesn't seem shady to use open source software
| from another company that permits commercial use.
| foldr wrote:
| The point of my comment is that the alleged shadiness is
| largely irrelevant, so I'm not sure what you response is
| directed at.
| noobermin wrote:
| > This decline will continue until cool, innovative companies no
| longer see any reason to apply.
|
| I am the furthest thing from a business man / start-up news
| addict, but even I know that the point of starting a company is
| to make money (perhaps fulfilling a need or niche, sure) and
| "being cool" should have nothing to do with it. Hell, "cool"
| often doesn't really square with being "innovative" anyway.
| sneak wrote:
| Startups determine their ability to execute, and thus generate
| revenue (or promises of same) from appearing "cool" to
| prospective talent and future investors. Without it, they
| wither and die.
| authorfly wrote:
| Eh yes, but half a million in income sure helps you avoid
| death too, and most of them are moments from death when they
| apply.
| hollerith wrote:
| Please don't refer to an investment as "income". It hurts
| the ears of those of us who know a little accounting.
|
| I have no objection to, "half a million in _cash_ sure
| helps you . . "
| authorfly wrote:
| I understand that.
|
| However review my last month or so of post history for my
| views on earned/employment income, unearned income and
| asset income.
|
| In essence I differentiate between revenue within income,
| but not income/investment. I don't think taxes should
| either. Specifically, I think capital gains/intermingling
| of asset taxes while requiring up to date taxed-upfront
| employment taxes is one of the worst decisions society
| ever made.
| ninetyninenine wrote:
| It's true. With 40k applications and roughly only 100s
| accepted... they likely only chose pearai because of nepotism. It
| would be self sabotage if they regularly do this so likely only a
| few companies are selected this way with pearai being one.
|
| The above is a very educated guess on pearai, but whether or not
| YC engages in nepotism or not is unmistakable to me. They do and
| there is real corruption in the selection process. It's not just
| gross incompetence.
|
| Not only is there actual evidence that can be sourced but I can
| offer anecdotal evidence from inside sources from within the
| family involved with a company that passed via nepotism.
|
| the company is called dreamworld. See here:
| https://www.pcgamer.com/dreamworld-infinite-world-mmo-kickst...
|
| There's whole YouTube videos about them including a post from one
| of the founders ex girlfriend. It's all very shady the articles
| around them.
|
| I encountered this company by being close friends with someone
| that is within the family related to the founders of dreamworld.
| I was literally told that the company succeeded because of family
| connections from dreamworlds ceo:
|
| https://www.linkedin.com/in/garrisonbellack
|
| Garrison is the ceo of dreamworld. And he's from a rich family
| headed by his dad:
|
| https://www.linkedin.com/in/john-r-bellack
|
| who is part of some super rich real estate fund.
|
| The bellacks regularly have big family gatherings in Tahoe and
| one of the attendees is Geoff ralston the previous president of
| YC.
|
| Source not only confirmed dreamworld got selected via favors from
| Geoff but that Geoff was telling stories at this family retreat
| about how he had to fire Sam Altman from YC after getting a call
| from Paul graham. Yes pg fired Sam Altman from YC.
|
| Dreamworld as it is right now got additional seed funding from
| VCs via connections as well and they are sitting on a pot of
| assets which is generating net positive income while that company
| can just stay afloat indefinitely. They don't go through the
| hardships and risks other startup do thanks to nepotism.
|
| There are other people in the bellack family creating startups
| and looking to Geoff to funnel them through YC via nepotism so
| Geoff is primed to make it happen again for sure.
|
| So yeah. I'm sure Geoff isn't the only person from within YC who
| does that.
|
| Hacker news is pretty pristine, but the fund itself does shady
| stuff.
|
| At least I think hacker news is pristine. Let's see what happens
| to my post and my account. Maybe the moderators will be more
| strict with me? And use that to ban me? I am a bit rough with my
| opinions. But who knows?
| meindnoch wrote:
| Saved this post.
| KerryJones wrote:
| "Yes pg fired Sam Altman from YC."
|
| How can you be so certain?
|
| https://techcrunch.com/2024/05/30/paul-graham-claims-altman-...
| ninetyninenine wrote:
| I saw that too.
|
| Pg is lying according to my source. I mean my whole post is
| about corruption. It fits the story that pg is capable of
| lying.
|
| Keep in mind. I'm a random guy on the internet and my source
| isn't 100 percent solid from my pov either. So keep that in
| mind when judging this whole thing.
|
| Overall this is what happened: some person at the family
| retreat listened to Geoff tell the story about how pg made
| the decision to fire Altman and that person relayed the story
| to me.
|
| Overall from the fuzzy evidence I'm thinking he was actually
| fired but I'm not 100 percent on that either.
|
| You'll have to be your own judge for this. This is one of
| those things that people will never know for sure.
|
| Same with the nepotism. Nothing will ever be proven here. The
| best info an average layman can get is rumors from someone
| willing to relay this gossip anonymously on a forum and you
| can't even be sure if this guy (me) is making all this stuff
| up. You'll have to form your own opinion and take a leap of
| faith in either direction or leave it as an unknown.
| s17n wrote:
| Weird that his example of YC's decline is a company putting
| together a hacky MVP based on open source code, which is an
| absolutely classic YC thing to do.
| aabhay wrote:
| We were in YC S22 and it definitely has become a status seeker
| magnet. However, entrepreneurship is itself a status seeker
| magnet.
|
| The point the author misses is that you need to think of YC not
| as an organization but as a segment of time for personal and team
| reflection. It can help you develop a coherent narrative for your
| path and goals. Others may deride this characterization and say
| it's too expensive. But the only way to enforce that kind of
| reflection is to raise the stakes and give it a real opportunity
| cost.
| vessenes wrote:
| The blog post is dumb, in the extreme. Sven doesn't know the
| PearAI founders, the key metric YC says they assess when they
| make a funding decision. Where they forked a codebase from is a
| deminimus consideration -- as Gary says, if it's in the license,
| it's in the license. Maybe Sven thinks that's unethical, although
| in this case it's funny to complain on behalf of YC, "Hey, YC,
| your money went to an open source codebase, and then some more of
| your money got to use it! You guys suck!"
|
| Comments here miss a lot as well, (although I agree that YC's
| prestige days are over) -- PG's plan was ALWAYS to be able to do
| more. He lays out the reasoning in an essay maybe eight years ago
| -- if your portfolio looks like 1-2 companies (now 3) out of 500
| made 80% of the returns, what should you do?
|
| There are basically three answers to this: Rejoice, Write 497
| less checks next time, or write 1,000 more checks in the hope of
| getting a fourth.
|
| PG's head was at: write 1,000 more checks. I like this attitude a
| lot, and believe there are good social, macroeconomic and
| financial reasons to act this way. Of course you will put up with
| more failures in that mode -- you already went and got the "good"
| ones -- you are now picking ones you didn't love that much in the
| sure knowledge that you'll happily be wrong about one (or maybe
| even two) of them.
|
| Especially when you're considering what to do mid-ZIRP, this is I
| think the only rational strategy if you want to make more money
| and help the world see more cool things.
|
| That said, one thing YC _companies_ benefitted from immensely in
| the height of the prestige era was just that, prestige; it was a
| virtuous cycle in that getting in to YC guaranteed a quality seed
| and probably A round just on the name. In that way, it was like
| getting in to Stanford or MIT. Today, along with mentoring, one
| of the main benefits is the larger _network_ internally, and this
| is a different thing. Possibly better, possibly not. I do think
| that if the prestige is needed for their model, they're probably
| over scaled for today's markets and venture money.
|
| Of bigger concern, I would say should be the question: "what does
| pre-seed/seed even look like in five years?" -- Much of what seed
| capital is for can be done with quality LLMs today -- and I
| expect that trend to continue. We saw the rise of pre-seed firms
| in exactly this economic environment -- through the middle of the
| dotcom one boom, a tech startup was EXPENSIVE -- ten engineers,
| $30k sparcstations, long data center contracts -- the cash was
| needed. YC started at an inflection point when open source
| tooling and availability was driving that cost down.
|
| The next YC / early stage fund is going to look very, very
| different than the last one. And that's okay! It will be fun to
| see what's next.
| elAhmo wrote:
| There was a discussion a few weeks ago about YC betting on
| essentially the same product of adding support for chatting with
| LLMs inside your IDE (Continue.dev, Void, double.bot), which is a
| great example of this. No differentiation between investments,
| just spray-and-pray technique hoping that at least one of the
| contenders will succeed.
|
| I understand that in broader terms, VCs operate in this way -
| investing in many things hoping that one will stick. And if this
| is spread across different products, industries, ideas, then it
| is a good signal that your company was handpicked and got
| attention of one of the best VCs, among many many contenders.
|
| With examples like this, this signal is basically gone and
| getting a YC investment means nothing.
| jeffreyrogers wrote:
| YC gets such great terms (because they invest so early and have
| great deal flow) that it's hard to see them declining unless the
| current venture model stops working. It does seem that recent YC
| batches are less impressive, but IMO that's less due to the
| quality of person that YC attracts and more that there's less
| low-hanging fruit. The "software is eating the world" thesis
| still seems true but now it's a lot harder to compete just on
| software you often need domain expertise in a complicated field.
| codingwagie wrote:
| Starting a startup is now a prestige game. Its a career path.
| Spend enough time with ivy league grads and youll realize this is
| true
| dgreensp wrote:
| Full disclosure, I'm a YC alum whose last start-up was acquired
| by Google, who applied to this batch and didn't get an interview.
|
| YC is not the stamp of quality it once was, to be sure, though it
| still works as social proof, because investors (especially VCs)
| want to invest in companies other investors like (or failing
| that, companies they imagine other investors _would_ like). YC
| would say that they aren 't trying to be a stamp of quality _or_
| social proof, they are just trying to help start-ups.
|
| If I had to take a stab at articulating how YC has changed, it's
| that it's become a VC, picking ideas to generate returns.
|
| This rejection email from 2022 that someone posted online cements
| the idea for me (excerpted):
|
| "Unfortunately, we've decided not to fund {Company} this batch.
| We enjoyed our conversation today and were impressed by you as
| founders building something they are passionate about bringing
| into being. However we weren't convinced that this product
| strategy is going to yield a big company in its current form. ...
|
| Of course, things are very early and you are still figuring out
| the right way to build and structure your business. If you're
| able to make significant progress with it, we'd be very
| interested in hearing about it for a future batch."
|
| Original YC would not reject founders over their _current product
| strategy_ and because they haven 't figured out the right way to
| structure their business--haven't put together the "proof" that
| they could be on track to be a unicorn, etc. That's a VC
| rejection. Of course, YC gets many thousands of applications and
| has to reject most of them. You could say they shouldn't be
| criticized for trying to give a little feedback.
|
| It's just hard to convey the sense from the early days of YC that
| they really didn't care about the return, or the progress so far,
| or VCs, or fads, or anything. That said, I really was at the
| right place at the right time and got very lucky.
|
| Finally, I want to call out the phenomenon in the world of VC
| where the ability to generate hype _alone_ is enough to make you
| and your investors a lot of money, even if there isn 't a lot of
| substance in your company (and even if things are morally or
| ethically questionable), through the mechanism of greater fools.
| Cryptocurrency is a whole exploration of this effect, turning
| hype into money by building a streamlined mechanism for bringing
| in greater fools, but we can also look at examples like Theranos.
| (There's actually a ton of money at the top of society looking
| for somewhere to go, which ideally would be routed to more worthy
| ventures than it is, but that's a whole topic in itself.) The
| point is, the greater fool "strat" works. In a moral vacuum, if
| you are trying to maximize returns, you lean into it.
|
| If I were running a fund like YC with basically unlimited money
| at my disposal, balancing the goals (strategies?) of 1) make
| money for money's sake, 2) advance technology for technology's
| sake (let's go to Mars, etc), and 3) make the world a better
| place, I would focus on (3). Like can we at least _try_ to build
| a unicorn that feeds people, and maybe fail, rather than trying
| to build FooBarBazCoin that eats the word, and failing? We mostly
| see a mix of (1) and (2).
| KerryJones wrote:
| This hits pretty dead center from what I've seen.
|
| You really hit home for at #3, that's the type of companies I
| want to see.
|
| If you start such a fund, I'd really enjoy working on that
| project.
| qq66 wrote:
| He won't be starting such a fund for awhile, because the two
| of us are building company to make technology to foster a
| creative and curious childhood. We would be a good fit for
| any investors trying to do (3) though :)
|
| https://cartwheelcomputer.com/
|
| amal@cartwheelcomputer.com
| blitzar wrote:
| It does not seem very "viral" or income-generating. I know
| this is premature at this point, but children don't have
| much disposable income, is it reasonable to expect to make
| money off of this?
| KerryJones wrote:
| This feels like a side tangent, but why have you focused on
| technology for creative and curious childhood? I.e. Maria
| Montessori (founder of the Montessori methodology of
| teaching) did a pretty good job showing that's the natural
| state of kids, and there's quite a bit in her teachings
| about the importance of physical things, being outdoors,
| etc.
|
| There's some pretty strong reasoning that technology might
| in fact be the problem, and while I'm sure you can make
| better technology with that focus in mind, it seems like a
| better approach might not be technology.
|
| Here's a few articles that lead to this point:
|
| https://www.noahpinion.blog/p/honestly-its-probably-the-
| phon...
|
| https://www.henrikkarlsson.xyz/p/childhoods
| KerryJones wrote:
| This feels like a side tangent, but why have you focused on
| technology for creative and curious childhood? I'm curious
| if you have considered the following:
|
| I.e. Maria Montessori (founder of the Montessori
| methodology of teaching) did a pretty good job showing
| that's the natural state of kids, and there's quite a bit
| in her teachings about the importance of physical things,
| being outdoors, etc.
|
| There's some pretty strong reasoning that technology might
| in fact be the problem, and while I'm sure you can make
| better technology with that focus in mind, it seems like a
| better approach might not be technology.
|
| Here's a few articles that lead to this point:
|
| https://www.noahpinion.blog/p/honestly-its-probably-the-
| phon...
|
| https://www.henrikkarlsson.xyz/p/childhoods
| stonethrowaway wrote:
| Because it turns out #1 is one hell of a drug.
| exBarrelSpoiler wrote:
| Hey, it's the author of the tweet quoted by the article!
| jhanschoo wrote:
| > It's just hard to convey the sense from the early days of YC
| that they really didn't care about the return, or the progress
| so far, or VCs, or fads, or anything. That said, I really was
| at the right place at the right time and got very lucky.
|
| It seems to me that there was an early '10s milieu that enabled
| YC to behave like it did. Web apps and mobile fundamentally
| transformed everyday life and communication in very visible
| ways and there seemed to be a lot of low hanging fruit. I
| observe, similar to your 2), that YC seemed to have a bias
| toward products for tech people by tech people, and that wasn't
| a bad strategy, because there was still a lot of plumbing to
| do; there still is, but I feel that there are established
| solutions for the mass market to a degree that there wasn't.
| cherryteastain wrote:
| > It seems to me that there was an early '10s milieu that
| enabled YC to behave like it did.
|
| Definitely, it's called ZIRP and QE.
| stackskipton wrote:
| I think so many questions about "Why did business X operate
| like this in 10s?" Is answered with that statement.
|
| So much was funded on economic smack high. A few sobered up
| and a ton bottomed out bad.
| skeeter2020 wrote:
| There were a lot of preferable options for connected,
| generally non-technical people after the dot-com implosion,
| for the first ~15 years of the 2000's. I joined a comp sci
| grad and his engineer brother in a software startup because
| we couldn't get jobs with an established company, big corp,
| investment bank or other much more likley "sure thing". The
| equation has completely changed, and the startup landscape
| with it.
| ChrisMarshallNY wrote:
| _> ... yield a big company ..._
|
| I assume that this sort of says it all.
|
| Everyone wants "big."
|
| The article talks about brand curation, really.
|
| That seems to be a lost art, these days. I worked for a
| corporation that had one of the most powerful brands in the
| world (but has taken some real hits). I watched them dilute
| that brand, and make lots of money, but really get clobbered.
| They are now regrouping, and, I hope, re-establishing their
| original luster.
|
| They were able to take a fairly small corporation, and compete
| with mega companies, on the strength of their brand. When they
| grew rather explosively, in the 1990s, they sowed the seeds of
| their own demise, in the mid-2010s.
| ethbr1 wrote:
| Strong brand value seems like insurance.
|
| You don't think about it when you _don 't_ need it, but it
| bails your ass out of otherwise-impossible situations when
| you _do_ need it.
|
| Everything's fine for uninsured property... until it's not.
| fuzzfactor wrote:
| I would say you could trade hard-earned goodwill and
| respect for a number of different things, maybe because it
| is such an unquantifiable asset.
|
| I think earned leadership can be legitimately exploited
| where everybody wins up to a point, and if you put your
| mind to it you can engineer an operation to approach that
| point more successfully than those who do not.
|
| You could be monetizing your "prestige", at a maximum
| sustainable level, without drawing down the asset.
|
| OTOH it would be possible to go overboard on the march to
| maximum monetization, and arrive where the asset begins to
| dwindle. It may not be such a clear picture since it's so
| unquantifiable, and dwindling returns as a consequence can
| be some of the most easily misattributed.
| kashkhan wrote:
| the whole mythology is nobody knows what will be a big
| company in general.
|
| The known big company spaces are heavily oversubscribed so
| nothing can be predicted.
|
| The unknown big company spaces are unknown by definition.
| renewiltord wrote:
| That doesn't provide any information since an incubator like
| YC is hoping for Stripe/Reddit successes. That's not changed.
|
| But I know W20 guys who pivoted inside YC three times, and
| eventually raised money. Their company didn't exist when they
| applied. So what OP (of Etherpad IIRC fame) posted about the
| rejection comes as a surprise to me.
| nextos wrote:
| > That seems to be a lost art, these days. [...] I watched
| them dilute that brand, and make lots of money, but really
| get clobbered.
|
| Maybe this is the normal lifecycle of a successful
| organization, unless one decides to grow more slowly?
| Infinite growth is what ruins most things. Scaling is _hard_.
|
| YC seemed to attract genuine founders, back when starting
| something up was not so trendy. As it became fashionable, and
| YC began to be seen as the Harvard of startups, it has still
| attracted some great founders but also some less genuine
| ones. All successful organizations experience this issue.
|
| A key element here is that neither PG nor Jessica Livingston
| seem to be actively filtering out people. I doubt anyone from
| batches curated by them would have posted on Twitter bragging
| about quitting a $270k job to work on a re-licensed fork.
|
| It was sad to read about this whole affair and, frankly, I
| think discussion on HN has become less interesting,
| reflecting a similar trend. Front pages were full of
| technical discussion back in the late 2000s and early 2010s.
| Content of that kind is less frequent these days.
| codingwagie wrote:
| What I am seeing is that among Harvard/Stanford grads, being
| the CEO of a venture backed startup is the highest status. Some
| of them hate technology and view programming as "low class".
| But they still go into it, so when they see their peers its
| something to brag about. They may even stretch the runway as
| far as possible to maintain the status.
|
| YC is just another brand they can add. It was so odd for me
| when I first realized this is how it works. And the investors
| are often just investing based on where they went to school.
| Real metrics dont come into play until later, during which they
| have the capital to hire people that actually know what theyre
| doing.
| blitzar wrote:
| Founder, CEO and Serial Entrepreneur.
|
| How many here have that (unironically) on their linkedin
| profile ...?
| mlhpdx wrote:
| If you ever go after 3) sign me up.
|
| The most inexplicable miss by VCs (YC included)is the lack of
| interest in funding climate change remediation. Billions of
| people to help and billions of dollars to be made. E.g.: Could
| funding protection of Tuvalu's dry land and status as a nation
| pay dividends through licensing/leasing fishing rights?
|
| Such things are an area for innovation, and tech could be a
| part of it, but isn't.
| tim333 wrote:
| I'm not sure it's a lack of interest so much as a shortage of
| good startups.
|
| Here's YC's statement of interest
| https://www.ycombinator.com/blog/rfs-climatetech
|
| They say they have funded over 100 of them.
|
| Prometheus seems a good one
| https://www.ycombinator.com/companies/prometheus
| https://x.com/paulg/status/1385338452544217095
| candiddevmike wrote:
| Prometheus has all the hallmarks of vaporware, over
| promised (self proclaimed "first electrofuel unicorn" lol)
| and under delivered. They've been at it for over 5 years
| and 120M dollars later they have nothing to really show.
|
| 120M could have bought a lot of rainforest or planted a lot
| of trees.
| mike_hearn wrote:
| That's not inexplicable. There's not much interest in it
| because a lot of things founders believe about climate are
| false and believing false things is a quick way to lose
| money. Tuvalu is a good example of this phenomenon. If you'd
| invested in a startup planning to make money by protecting
| Tuvalu from global warming, you would have lost all your
| money because Tuvalu is growing, not shrinking.
|
| https://www.nature.com/articles/s41467-018-02954-1
|
| _Results highlight a net increase in land area in Tuvalu of
| 73.5 ha (2.9%), despite sea-level rise, and land area
| increase in eight of nine atolls. Island change has lacked
| uniformity with 74% increasing and 27% decreasing in size.
| Results challenge perceptions of island loss, showing islands
| are dynamic features that will persist as sites for
| habitation over the next century_
|
| You didn't get unlucky with your choice of Tuvalu, a lot of
| common beliefs about the impact of climate change are like
| that. There's little discussion of this phenomenon, because
| it's taboo to criticize climate related narratives. Only
| argumentative gits like me are willing to do it. But the
| smart money knows this and quietly stays away.
|
| BTW this isn't specific to climate. I've known and talked to
| a few VCs over the years, and what I learned is that if
| there's an important and valuable area they're all
| collectively ignoring it's usually because they know things
| that other people don't. For instance, you may have noticed
| that Silicon Valley VCs usually avoid biotech startups,
| despite biotech being seen at one time as a high tech
| industry with potential similar to computing. That's because
| such startups often come out of academia, and VCs were aware
| of the replication crisis/fraud problems in biology earlier
| than most.
| mlhpdx wrote:
| The study you reference is from 5 years ago, perhaps the
| impacts cited here[1] are less "incorrect".
|
| My anecdotal evidence of VC's level of knowledge is very
| consistent with people at large. That is, flawed.
|
| [1] https://zenodo.org/records/8069320
| michaelt wrote:
| _> Original YC would not reject founders over their current
| product strategy and because they haven 't figured out the
| right way to structure their business--haven't put together the
| "proof" that they could be on track to be a unicorn, etc._
|
| Imagine you ran a startup accelerator that didn't invest in a
| particular business model or product, but instead invested in a
| _team of founders_ you thought had the potential to produce
| _something_ great, even if it takes a few pivots.
|
| Now imagine you _didn 't_ want to invest in a given company.
| Would your rejection letter say you disliked the founders, as
| people?
|
| Of course not, you want to be on friendly terms, just in case.
| Far safer to just be "unconvinced" about their "product
| strategy" in its "current form".
| codegeek wrote:
| YC's original appeal was for builders/creators who were truly
| passionate about building a great product that solved a real
| problem. Dropbox for example at the time.
|
| In my opinion, effectiveness of anything dilutes over time
| especially as you increase volume. There is no way you can
| maintain the same level of vetting and quality when you have a
| batch of 50 vs batch of 500+ which is now where YC is. So they
| must have to pivot to a different model of vetting companies.
|
| I am curious as to why they continue to do more batches instead
| of less. Is it really a numbers game now ?
|
| For example, what was the last truly great product out of YC
| built by a true hacker/team ?
| qq66 wrote:
| Supabase is one.
| blitzar wrote:
| This sounds like an episode of "Shark Tank" - If you have $1
| mil in orders which will generate a profit of 500k they will
| fight each other to invest 100k for 40% of your company. If you
| dont have a full order book and a production pipeline - no
| bueno.
|
| I can only assume your product didnt fit into the current hype
| investment bucket (you should have put Ai in the pitch and you
| would have been funded). LPs in the VC funds want their
| Blockchain Ai and whatever hype they hear about exposure - the
| VCs have to deliver it and have it in their portfolio. The
| investment hype cycle is self reinfocing; as the investment
| headlines get bigger and the hype gets bigger.
| matt_lee wrote:
| When we got accepted into S23, our call started with Seibel
| saying something along the lines of "We like you, but we're
| pretty sure you're going to have to pivot." A non-trivial
| amount of my batch mates also joined with minimal product
| strategy, so I don't think you can read too much into the
| rejections.
|
| I don't have anything to add re: YC over the years, just that
| my anecdotal experience differs.
| w10-1 wrote:
| ---
|
| There's actually a ton of money at the top of society looking
| for somewhere to go, which ideally would be routed to more
| worthy ventures than it is, but that's a whole topic in itself
|
| ---
|
| Forget "ideally": the experience and world-view of the
| collective deciders for that money is financial. Other factors
| are filtered out. Vanity investments - for the glory of the
| human race or technological progress - only reflect
| inefficiency and excess discretion that are squeezed out with a
| few selection iterations or process controls. (This is setting
| aside the large cohort of big-money behind overt/covert
| national funds, with major non-financial strategic objectives.)
|
| That finance focus won't change with YC's focus or with more
| morality or regulation. The only path I see is innovation not
| in finance or technology but in law: to somehow create and sell
| a stake in the future, to avoid future environment and peoples
| being now basically a huge externality sink.
|
| "YC's reputation" matters mainly insofar as it provides access
| and credibility for individual YC startup's, based on their
| collective promise. If governance access and credibility were
| conditioned on long history/holding period of protections for
| future, then both selection and resources would flow in favor,
| and we'd have a race to the top instead of the bottom.
| ganeshkrishnan wrote:
| >Original YC would not reject founders over their current
| product strategy and because they haven't figured out the right
| way to structure their business--haven't put together the
| "proof" that they could be on track to be a unicorn, etc.
| That's a VC rejection. Of course, YC gets many thousands of
| applications and has to reject most of them. You could say they
| shouldn't be criticized for trying to give a little feedback.
|
| My controversial opinion is that they should stop giving
| feedback. "Tis better to be silent and be thought a fool, than
| to speak and remove all doubt."
|
| My startup got rejected because "valuation is unlikely to cross
| 100 million". Everyone is entitled to their opinion but we are
| already at 10m valuation and AI in ecommerce doesn't really
| have 100m cap.
|
| Most of the founders on reddit and discord take the YC feedback
| as gospel and give up/pivot when its absolutely the last thing
| they should be doing. Unfortunately we will always have this
| power imbalance between VC and startups
| martythemaniak wrote:
| Everyone is missing the reason they got accepted: they are some
| kind of tech influencers have 300k subs on YouTube.
|
| You have 10 mins to pitch your idea, so they went in and said
| "look, we work for coinbase, we're competent. Look, we have 300k
| subs on YouTube, we know how to sell shit and get attention. Look
| we have <some random AI thing>, we got it all" and that's all it
| takes. The problem is, they want to sell dev tools and those tend
| to be more grounded in reality than <some random social media
| thing> where their attitude and skills might be a better fit.
| Lots of devs like calling out bullshit as a hobby and making fun
| of shoddily built stuff, so it's a tough audience.
|
| YC doesn't do "due diligence" and never has, not worth it for the
| $125k they put in. The real danger is they become known as the
| place for bullshit peddlers, influencers, etc.
|
| Edit: 344k subs:
| https://youtube.com/@fryingpan?si=QIPTDvJATXFNYBPM
| idkwhattocallme wrote:
| I always thought YC growth was to fuel it's portco's initial
| traction. My understanding is that they solved each other's
| problems and then raised on traction largely within their own
| ecosystem. Having a wide breadth of companies would better enable
| this
| ahstilde wrote:
| > (1) YC is willing to fund just about anything, (2) they're not
| doing any real due diligence, and (3) they don't particularly
| care about their existing portfolio companies.
|
| YC never said they were anything else, though? YC's strategy is
| simple.
|
| Vet for y intercept, do little due diligence, and make it up
| through investing in enough people.
|
| They never claim to be perfect. In fact, there's a number of YC
| founders who have had scandals:
|
| - Bitfinex $4.5 B hack was a YC founder
|
| - uBiome (wire fraud) was a YC co:
| https://news.ycombinator.com/item?id=30899352
|
| - Stablegain ($44M crypto fraud) was a YC co
| https://news.ycombinator.com/item?id=31461634
|
| - DreamWorld is a YC co:
| https://news.ycombinator.com/item?id=26898266
|
| I guess hucksters are inevitable?
| jedberg wrote:
| This entire article is premised on the idea that YC accepts more
| startups now than before, but if I'm not mistaken, their
| acceptance rate has gone _down_ every batch.
|
| And since the OP specifically called out Harvard as a paragon of
| prestige institution, it should be noted that YC acceptance rate
| is lower than Harvard's too.
| siliconc0w wrote:
| It's pretty clear that many VCs are starting to play the carry-
| game, it's much easier to scale up and make money on carry than
| it is picking winners or even pricing the 'winners' correctly as
| we saw during ZIRP. Tax advantaged too.
| solumos wrote:
| Something that I think is a bit misguided about this is that YC,
| at founding, was pretty unfashionable itself. The "accelerator"
| model wasn't particularly proven, and the thesis was that there
| was an untapped talent pool of "hackers" who just needed to
| figure out how to run a business and get connected to the right
| people/resources in order to be successful founders. Compared to
| other accelerator-type opportunities at the time (and some that
| still exist), YC was extremely founder friendly.
|
| YC 1.0 made good on that vision -- the success rate in the early
| batches is indicative of that. Once PG stepped back and handed
| the reigns over to Sam Altman, YC focused more on scaling up,
| while the startup ecosystem grew significantly as well,
| specifically around "Web 2.0". At the time, it wasn't
| particularly difficult to create a venture-backable web business
| if you had the technical skills and the right resources to
| achieve distribution. Along the same lines, being a startup
| founder became a viable alternative to becoming a banker or
| management consultant for high-achieving individuals. So
| naturally YC, as a backer of hyper-successful startups that
| generally have an easier time fundraising, became a magnet for
| the status-seeking subset of high-achieving individuals, leading
| to it becoming more of a stamp of prestige.
|
| Since Sam Altman's tenure, it seems like a lot of the initial
| edge that YC had at founding is significantly diluted. There are
| a lot of aspiring founders seeking funding, but the Web 2.0
| opportunity doesn't really exist anymore (at least not at the
| same scale). So today, YC looks much more like a large seed fund
| that funds more specialized businesses rather than the types of
| founders of the initial cohorts (i.e. hackers that want to build
| Web 2.0 businesses), and I think people are overly critical of
| that scale up. 2005 was a very specific point in time for the
| startup industry, and the YC thesis was not only well-timed, but
| extremely effective through ~2014 -- but it's been difficult for
| them to figure out how to continue the momentum given changes in
| the ecosystem.
| jppope wrote:
| Well said. Things change
| nostrademons wrote:
| Note that when YCombinator first started in 2005 (the batch that
| Sam Altman was part of, as a college dropout), they were not
| prestigious. They largely funded college students that nobody
| else would invest in. But part of Paul Graham's philosophy for it
| is that "If you do anything well enough, you'll _make_ it
| prestigious " [1].
|
| Rather, I think that what's happened with YCombinator is that
| it's followed the growth arc common to all institutions. You
| start with somebody who has a good idea and a passion for making
| things better for some subset of humanity. That attracts other
| people in a virtuous cycle. But eventually you hit a growth limit
| and saturate your market. At that point, the focus of the people
| in charge turns to wealth extraction, leveraging your brand,
| reputation, and market position to make ever increasing profits.
| Eventually you squeeze everything there is out of your market,
| your product is shit, your employees don't care about you
| anymore, and you get replaced by a younger more beautiful
| que^H^H^Hstartup.
|
| I wouldn't bother applying to YC now - I don't feel like they
| give enough for the equity they take, their advice has become
| formulaic and well-known, and I'd rather go do what I love. But
| in 2005, when nobody was funding college students and the popular
| wisdom was that the Internet was a dead fad, they were
| revolutionary.
|
| [1] https://paulgraham.com/love.html
| SandersAK wrote:
| I love the posts about how YC was better back in the day. It was
| the same, it's the same. It's just bigger and there's more
| timeline now to reflect.
|
| If you think the partners (the core of which have been there
| since day 1) have really changed their outlook that much then
| you've not been paying attention.
|
| YC has always been a smorgasbord of status seekers, dreamers,
| ruthless pragmatists, creators and artists. It's a big community
| that keeps growing, the good parts and the bad parts.
|
| There were scandals then, there are scandals now. They pick some
| teams perfectly and others totally wrong. The most important
| thing is that they keep doing it every year and more people get
| access and a shot at doing their thing.
|
| FWIW I was YC W14 and yes it was totally better back then and we
| were all geniuses and pure lovers of startups only with no ego...
| tptacek wrote:
| You were just waiting for _somebody_ to get on the front page
| with _something_ about PearAI, which was the main character on
| Twitter yesterday; might as well be this.
| mlsu wrote:
| This reminds me of something that appeared on hacker news a
| couple days ago:
|
| https://sohl-dickstein.github.io/2022/11/06/strong-Goodhart....
|
| Basically, the proxy objective is "getting into YC" -- the real
| objective is producing value of course.
|
| We've started optimizing for the proxy. Which produces outcomes
| like this, where YC is a Thing You Do, after Graduating From
| Stanford, and before Becoming a YC Alum.
| phendrenad2 wrote:
| Nitpick:
|
| > People don't attend Harvard for the lectures, which are all on
| YouTube anyway
|
| This is very much NOT true. Only a few introductory lectures are
| on YouTube.
| phendrenad2 wrote:
| > they got funded by YC with nothing more than a codebase copied
| from another YC-backed company. This shows that (1) YC is willing
| to fund just about anything,
|
| I don't see it that way. This is NOT the first time YC has funded
| startups that are in direct competition. It seems to me that
| having multiple companies with the same product makes your net
| larger for customer acquisition, and the startups can always
| merge later.
| andrewstuart wrote:
| Meh. Maybe a bit.
|
| Being a YC company is still prestigious.
|
| The vast majority of people familiar with the YC name don't
| follow it close enough to know it's volume of investments is
| higher.
| kshri24 wrote:
| Agree completely. That entire PeerAI BS put a really bad taste in
| my mouth w.r.t YC. It is fine to fund Companies that might create
| products with their own sweat/labor which might compete with
| their existing portfolio companies. That is healthy competition.
| But what happened here is not that!
|
| If I fork a popular repository on GitHub, say Plausible, change
| the name of the product and then apply to YC, you are telling me
| I have a non-zero chance of getting selected if I just come up
| with a better business plan than the Plausible team? WTAF? That
| is horrible! Where are the standards here?
|
| And no YC cannot hide behind the "You choose a wrong License"
| argument. That is legal BS and does not apply to TRUST built
| between Investors and Founders.
|
| This is serious credibility damage to YC.
|
| Disgusted.
| tim333 wrote:
| Meh.
|
| >The issue, however, is that they never truly grasped the factors
| behind their success, which is why YC's peak is already behind
| them--it's likely all downhill from here.
|
| I haven't been to YC but I read Paul Graham and get the
| impression he has a pretty good idea of the factors behind their
| succcess and this guy who I think hasn't been and does not live
| in the US does not.
|
| YC wasn't pesitigious at the start but went out of the way to
| help startups and encourage them to 'build something people want'
| and I think that goes on.
| sub7 wrote:
| YC appears to be spending all it's time marketing itself on
| Twitter and pretty much all the partners, including the lead have
| companies that were acquihired i.e. failures
|
| Class size of 7 = quality, class size of 300 or whatever = noise
| filter
|
| But they again only need that 1 company to be the 1000x and
| return LP capital at a decent multiple. Any pool of their batch
| size is likely to produce that and allow them to self platitude
| after the fact.
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