Michael Seibel, CEO of YC, is doing an AMA

243 points by mwseibel ↗ HN
YC applications for the Summer 2017 batch are due in a week, so I thought I'd do an AMA to answer questions about applying to YC, how the program works, or anything else. I'll start answering questions at 10am.

316 comments

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The most recent answer I could find re YC funding multiple competing companies is Harj's from 2010. What's YC's stance now?
What things will we take for granted in 10 or 20 years that we don't have now?
I'm hoping it's eink displays in everything.
What happened to pg, is he still involved in YC day to day operation or the application process?
(edited for tone) PG and Jessica are currently on sabbatical in the UK - after running YC for 10+ years they are taking a little break spend more time with their kids
Yes absolutely, I'm only curious because his essays inspire me to think differently about work and attracted me to this community. Thanks for your answer
Same here - thanks for the question :)
> after running YC for 10+ years they deserve a little break no?

With all due respect what is so special about running YC that means you deserve a sabbatical?

They are taking a sabbatical not because they deserve it but because they can afford to do so financially and have left their organization in what they feel are very capable hands.

It is actually atypical in most professions in the US (at least outside of teaching or academics) to be able to step away other than for a somewhat short vacation. And business? It moves to fast and the competition is most likely hard at work step away and someone else is there to take your place.

Hats off to them for creating an organization where they can do this but most people who are in either traditional businesses or professions (medicine, law as only two examples) can't do something like this.

Edit: Predictable downvotes. Everyone looks at this through a lens that says the commenter surely is showing disrespect or lack of knowledge for how special YC is.

Edit2: Noting that it has been edited for tone so...

Surely he just means a break from YC. And running YC was a job that required always being "on-call" in the early days.
"on call"? Plenty of businesses require the entrepreneur to be 'on call'.
Plenty of businesses require non-entrepreneurs to be on call too.
> but most people

PG isn't "most people". He's a super successful guy, so I don't see why you are comparing him to everyone else.

And about him taking a sabbatical: he can do whatever the hell he wants because he can afford to. It's true that many of us can't, but that's just how life is my friend.

With Graham, taking a break (or 'hammock time' as Hickey might phrase it) appears to be a pattern if one can draw a pattern from two data points. After selling Viaweb and working a Yahoo for a bit, Graham wrote and painted and created a new dialect of Lisp for several years before the experiment that led to YCombinator (there may have been consulting and investing in there too, it wouldn't surprise me but since I've never seen anything directly stating there was, it would not surprise me if there wasn't)...and Graham's descriptions of why he did a startup includes not having to get 'a real job' so to speak.

When Graham turned over the public face of YC to Altman, I was like, huh? Since then, I've come to think that 'I'm going to take my money and learn to paint' is one diffs between Altman's and Graham's personalities...though in fairness Graham was well into his thirties when he made his first millions and Altman was just 29 when he became president of YC.

It takes 3 points to confirm a pattern. :) Otherwise, it is nice and fortunate to be able to take time off (if you choose) to raise your kids, especially as a family. Especially when they are young and before school starts.
>what is so special about running YC that means you deserve a sabbatical?

I missed where this was claimed to be "deserved"?

>It is actually atypical in most professions in the US (at least outside of teaching or academics) to be able to step away other than for a somewhat short vacations[...]but most people can't do something like this.

I'm trying to figure out how this is relevant? Would you elaborate? I don't care about disrespect, but ignorance (i.e. lack of of knowledge) and illogical claims are problematic for me. "Special"?

I missed the parent comment before it was "edited for tone," but your comment comes across with a bit of undue animosity.

> I'm trying to figure out how this is relevant? Would you elaborate?

Well to restate my original comment was based on the use of the word "deserve" not the re-edited version. Apparently it was thought that that wasn't well put. And it's unclear to me why I was jumped on other than the obvious reason of this being HN. To your question the relevance of stating what is typical in other professions is because the vast majority of people can't simply take a sabbatical even if they have the money to do so. It's not unusual to make a comparison and the comparison once again had to use of the word 'deserve'. So many people 'deserve' was my point. However by the nature of what they do they simply can't just go away and come back and have everything be the same. Once again this has little to do with whether they can afford to do that or not. You don't want what you have created and worked for to be damaged and often by leaving it in the hands of others (w/o your oversight) that can happen. If you were an architect that was wealthy but had a various projects in play you are not going to go away like this. If you are an attorney with multiple cases in play you are not going to go away like this. If you own a small bodega you are not going to go away like this. If you are Tim Cook you are probably not either or Marissa Mayer (a few years ago). If you are a family practice doctor ditto. That's in addition to (in some businesses or professions) losing important clients that you have worked hard for many years. Or in a small business (or even medium business) where you have clients and customers that could easily leave for a competitor if you are not there personally to clean up and address any problems.

Ok, now I see. I am a mediocre programmer at best, and I live in a rural area. I often take 5 weeks off because I know how to save money (no gf or kids), and I've operated in the capacity of a contractor for 6 yrs. I do have Denver-based, fellow contractors that I can hand stuff off to, but I was always fearful of starting a family I could not support. I see this as a matter of choices.
>Edit: Predictable downvotes. Everyone looks at this through a lens that says the commenter surely is showing disrespect or lack of knowledge for how special YC is.

What makes you think they don't deserve a sabbatical?

More people in general should have longer vacations/sabbaticals in the US. The US is behind on this, and it is detrimental. The sabbatical itself has shrunk from historically being a year or more to just three weeks in some places here.

> More people in general should have longer vacations/sabbaticals in the US. The US is behind on this, and it is detrimental. The sabbatical itself has shrunk from historically being a year or more to just three weeks in some places here.

Perhaps for those that are employees of a larger type organization where there are fill in alternatives this could be a good thing. But for people that are not employees (they own the business or the success of the business has a direct impact on their financial benefits) this is not as easy as it sounds. Or for key employees of a business that have direct relationships to the customers or the product quality of the company.

Why?

Competition. And other alternatives that a customer or a client could use.

Let's say you are an attorney or a consultant. You have clients that give you business. They deal with you because a) they like your work and b) you are there when they need you. c) you have developed a rapport with them.

So now a new problem arises. They contact you but you are away on sabbatical. So what do they do? They try someone else. And maybe they never return. Really.

Or take even the person who cuts your hair. You've been going to them loyally for 10 years. Now they go away for 6 months. During that 6 months you find another person and keep using them.

I was told once that (and don't know if it's true) by a starbucks manager that when they renovate a store they never close it down entirely which would make the renov work much easier. Why? They have found that if you interrupt peoples morning patterns the store will lose business people either brake the habit or they find alternatives.

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Where do you see the trend of companies being politically active and taking a side in the debates happening in society going in the next 5-10 years?
Are there any types of companies or areas of interest that you are focusing on in this batch? And if so, would you please elaborate on it.
i know you've funded a handful of single founders but what is the current outlook on them?

also, how developed must a startup be to apply. should the product already be developed?

While we prefer that a team have co-founders we regularly fund single founders. Also, we fund a wide range of companies from those who are just starting to those who are post-launch and have raised seed funding (and everything in between).
What do you look for when considering a solo-founder? Given that the bar is higher.
At what stage have solo founders generally hired their first employees? I imagine a solo-founder startup would probably require the same amount of manpower, but the leadership structure would just be a little less flat.
How important is the video?
Very important. It's mentioned on their site
What do you think the most over-saturated space is right now? What are the biggest unaddressed opportunities that you have seen?
What's an upcoming changes to YC you're excited for?
I'm really excited for the Startup School MOOC we are launching soon and excited about all the new software we are building to help the new YC batch and all the alumni. Most people don't realize how much of a software company YC is. We run our own internal mini-facebook, internal quora, and a host of other sofware to track companies and read applications.
Thank you for taking the time today. It's neat and rare to have a somewhat direct line to someone in your position.

What's the "big thing" 10 years from now? Ie Are smartphones still the rage and hottest "endpoint"? Did security wind up being the highest demand/pay IT career path? Etc

Honestly, this is not how I think about YC. We don't spend a lot of time thinking about what is going to be "the rage". We are excited about funding great founders and some subset of what early stage founders are interested in today will become the rage 10 years from now.
I was looking more for your prognostication - somewhat like Gates did in "The Road Ahead." I figure you're in a somewhat unique position to speak to what's upcoming on the horizon and likely to be disruptive.
Where do you see e-sports in 5-10 years and what role do platforms like Twitch play?
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With the continued concentration of many tech positions to a handful of tech hubs in the country, are you doing anything to improve the economic conditions of the Midwest US? Or are you primarily investing in the coastal areas alone?

edit: I find your lack of response to this question telling.

Does YC have any evolving thesis as it comes to particular technologies, such as Blockchain or Quantum technologies? For example, are there attempts to achieve internal consensus on the use of Ethereum?

(Full disclosure: I applied with an Ethereum wallet one year ago and got an interview but was told that the path to market wasn't clear enough. The project was ultimately absorbed into a different incubator. )

At YC we don't have strongly held opinions on exactly how technology will develop over the next 10 years. We simply want to fund the strongest teams and help them accomplish their goals.
Is that equally true of the incubator side and Research?
What are key things international (UK) applicants should be aware of?
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Hey Michael, thanks for doing this. Can you comment on the responsibility of companies like Y Combinator (or more generally, Google, Apple, etc) to be involved in causes for social change? How does a company like yours draw the line on profitability vs activism, and how do you choose which causes to stand behind?
Out of all the companies that YC has funded, which one do you consider to be the best? How about the second best?

By best I mean one which has had the most positive impact on people's life, where positive impact is some function of just two variables - the number of people affected and the intensity of that affect.

Also of these two variables which one do you weigh more and why?

Hey Michael, Thanks for the AMA. How do you approach an application when you have no domain knowledge of the field in which the startup is working in?
That is a great question! First I look at how clearly the founders communicate their idea and their insights. When someone has a truly deep understanding of their domain, they are able to explain it to intelligent people from any background.
Hi Michael, as a tech person, I'm not articulate enough to sell my ideas (and I have lots of them :)) or explain problems that need to be solved. Does YC sees that articulate founders (speech & presentation/looks) is a pre-requisite? Looking back at recent YC allumni, there have been 'easy' problems solutions (eg, tea bot, uber condom, smart mattress etc). I have a feeling that it was not easy for Mark Z to explain what Facebook all about. I understand that founders need to be able to sell ideas to VC. How can YC help companies with not-so-articulate founders? Thank you.
What skills / traits are you looking for in nontechnical founders?
Propensity to/rate at which they are becoming technical?
How do you feel about non-profit startups developing pure Open Source software and services in exchange for donations, in the interests of bettering the ecosystem itself? Could a nascent Mozilla be a YC nonprofit?
Or perhaps they could pre-mine a coin they would be paid in: https://startupboy.com/2014/04/01/the-fifth-protocol/
This is probably off-topic, but this proposal seems dystopic and anti-disruptive. The ability to mine coins is proportional to current ownership of capital (i.e., ability to calculate proof-of-work). You "eliminate" spam by allowing the richest to send you emails. You charge for DDoS attacks. Uber and Lyft get traffic signal priority over individual drivers, and that's assuming that Uber and Lyft could even get started in a world where taxi medallion holders could just buy all the green lights and resell them to everyone other than Uber and Lyft. And if you can bid on computing capacity itself with proof-of-work, you're well on your way to a Yudkowskian horror story of sentient Ethereum smart contracts buying computer factories for themselves.

If I'm trying to write open source outside the confines of traditional capitalism, the last thing I want to do is require that people's usage of it is proportional to their riches.

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I'm extremely interested in this, as the current funding model for startups restricts new technology to companies that are fiduciarily compelled to monopolize their market, siphoning user data and (potentially) damaging civic society in the process. Startups are still a very good vehicle for most problems, but for certain classes of problems, sometimes make things worse, and I'm curious if YCombinator is interested in helping out with those types of initiatives.
To be clear: YC accepts non-profits each round.

www.ycombinator.com/nonprofits/

The question of whether open-source producing non-profits fit into YC is still a good one. I couldn't find an info on whether they have already accepted such non-profits, but the incubator Fast Forward has:

> Intelehealth built an open-source intelligence engine for assessing primary care conditions

https://qz.com/792685/silicon-valley-wants-to-save-the-world...

Sure, and I'm aware of the non-profit initiatives. I don't think many people have considered producing actual software under a not-for-profit (except for Khan Academy?), probably because it's insanely expensive. Would YCombinator help facilitate funding a fully open Facebook or Twitter clone, for instance? It sounds outlandish to consider, but it seems equally outlandish to consider the 2020 election happening over essentially the same social stack & people will just be okay with that.

(Obviously, a clone itself wouldn't suffice, you'd need to start with federated identity, and....)

FWIW, YCombinator has funded a fully open, federated Facebook clone:

https://www.crunchbase.com/organization/diaspora#/entity

It didn't work out so well, mostly because a.) actually cloning Facebook is pretty hard and b.) users don't seem to want to switch to fully-open Facebook or Twitter clones.

Haha, interesting, I didn't know they went through YC at some point.

I'm making a strong bet that people do want to switch to fully-open social clones, because it's hard for me to imagine citizens of 2024 or 2028 conducting an effective political system using today's monolithic social technology. But the current ecosystem sucks for it.

A lot of YC non-profits produce "actual software". I know Watsi does, because I run the product and engineering team there.
Oh, certainly, I didn't meant to say that non-profits didn't create software, just that they're not primarily software companies, or working in domains that compete with traditional big vendors. Love the work you do at Watsi!
This is interesting. I think there's still a deeper question of how to fund open-source technologies. Patreon seems to put the burden on individuals rather than companies. Maybe the answer is non-profits.
The nascent Mozilla was Netscape and a well funded company that achieved a multi-billion dollar exit (final valuation $10 Billion per Wikipedia)[1]. As a commercial operation it was able to hire a significant engineering staff to work heads down on browser development over a sustained period. In contrast most non-profits have to hire for and focus on donor development and don't have a period of massive commercial growth fueled by venture capital.

The Mozilla Foundation has a wholly owned for commercial entity, the Mozilla Corporation.

[1] If there was a nascent non-profit in the chain that led to Mozilla, it would be NCSA [https://en.wikipedia.org/wiki/National_Center_for_Supercompu...] where Andreesen was developing Mosaic.

> In contrast most non-profits have to hire for and focus on donor development and don't have a period of massive commercial growth fueled by venture capital.

Everyone has to pay for marketing, and I'll give you the part about growth.

But is this because something inherent in a nonprofit stops it from growing? Is it that there are fewer nonprofits to sample wins from? Or is that venture capital is simply not structured to consider the upside of funding anything other than a bet on a huge exit?

I'm not sure. What I was trying to think about was 'what is a nascent Mozilla?' and the conclusion I came to is that it would have to look more like a fully formed organization or a commercial entity than something that would be obviously nascent and non-profit.

Thinking a bit more, big software related non-profits appear to be spin-offs from industry (Eclipse Foundation, Linux Foundation) or academia (Apache Foundation also from NCSA). In each case, the software came first as was the case with Mozilla and the funding followed because corporations found they had an interest in the software's continued development.

On the other hand, OpenAI might be a counter example where the money is coming to support research so that's a possible case where YC has funded a 'non-profit' at scale...though the model was recruitment rather than application.

Do you think the startup ecosystem is too focused on the Bay Area? Is YCombinator funding startups that don't have a Bay Area presence?
Over 35% of the current batch is international (moved from outside of the US to participate in YC). Almost all of my startup friends from when I did YC came from outside of the Bay Area. One of the great things about YC (and why I'm a partner here) is that we run an open application process with no pre-requisites. You don't have to know anyone, come from some particular background, go to some specific school, or be from the Bay Area.
Hi Michael,

Thanks for doing this!

My question is: How can we make a better environment for discovering cures/vaccines? Can we create a almost like a "YC" for research of biological sciences.

Although, I don't know much about this area, I feel there needs to be a better way to allow the most intelligent people have the resources they need to discover cures/vaccines etc, with no external barriers. Thank you.

The modern biotech sector as a whole (excluding pure pharmaceutical therapeutics) is a pretty small compared with the tech sector. It's really challenging to build a company in a new ecosystem like that. Getting resources into the system in order to get the flywheel running is tough. Good ideas on jumpstarting what will inevitably a valuable technology would be great to hear. But like all research, it's an investment - obvious returns might not come in the short-term.
For AI companies, they might have to do things manually in the beginning to collect data and train their algorithms. Many people criticize them as wannabe AI companies. What are your thoughts on such early stage companies applying to YC?