> 26% of founders are underrepresented (which we define as Black, Latinx, or Women), and 36% of the companies have one or more underrepresented founder
Does being in one of those groups give you an advantage when applying, a la affirmative action?
Does anyone of Hispanic ancestry actually use the term “LatinX”? The Spanish language is explicitly gendered and there’s no such thing.
> However, for the population it is meant to describe, only 23% of U.S. adults who self-identify as Hispanic or Latino have heard of the term Latinx, and just 3% say they use it to describe themselves, according to a nationally representative, bilingual survey of U.S. Hispanic adults conducted in December 2019 by Pew Research Center.
Ya it’s pretty obvious whenever I see LatinX that they have zero Latino/Latina representation inside the company.
I would be intrigued though has YC ever formally come out and said they are looking to increase diversity and thereby decrease the amount of Asian and White male founders they accept each batch?
Also why does YC not report on LGBTQ stats for their founders then? Surely they are also underrepresented in the Startup world as well.
100% correct. I would love to see more detailed breakdowns of each founding team.
% of elite vs non elite college, public vs private, how many founders are first gen immigrants, etc.
Yeah why not just say Latin? In Spanish only the very few most extreme people say words like "latinx" (but never "latinX") mainstream people say "latinos y latinas" or "latinas y latinos" or "latin@s." Some people still just say "latinos" always. But English is not a gendered language, so just drop the X. But then, if you do that, the game is over, you're not signaling how obedient you are to the machine, you're actually thinking for yourself. And you're not allowing it to tell you how to talk, which means you're not allowing it to tell you how to talk in your mind, ie think. Literal thought control. For every 10 times you use a word in your inner monologue, you'll use it in real life. But if you get fired from your sustenance of your life and dignity, literally no matter how much job security you had, you can't use that word in real life ever. So then you have to stop using that word in your mind. And that changes how you think, you start feeling pain when other people use that word, for when people who are entitled to say that word say it, or when they spell the letters out forcing you to create it in your head, pain pain pain.
And I find it wrong that I can't remove slurs from my music. It's basic--if I can get cancelled for using a word, I can't sing it, I don't want to listen to absolutely any music which includes it. So for instance there's a song by an African musician, I think he's from West Africa, his name is Akon. Quite famous I believe. He created a song that was played frequently at dance halls and has a lot of musical merit. The song's name is "Sexy Bitch." I hate that word though, I can't stare at that word, it's so disgusting on so many different levels, for so many different people, in particular in this case because it's talking about women. And the chorus is like...I just can't write it. Instead, I found a sanitized version that is not disgusting and has all the same musical merit, called "Sexy Chick."
Damn, she's a sexy chick, sexy chick,
Damn, she's a sexy chick, damn girl!
Damn, she's a sexy chick, sexy chick,
Damn, she's a sexy chick, damn girl!
But it's incredibly hard to find, only on iTunes, not on my Apple Music, not on my Youtube, super censored. Because Akon apparently has the right and obligation, because he's African, to be misogynistic, like that has more victim points than being a woman, and these media are so mysogynistic in actuality--regardless of their donations to nonprofits and shit--that they don't want people to have even an alternative to listening to this man calling every woman on the dancefloor a bitch. I have trouble figuring out to what degree his being African plays a role, I want to ignore it but the machine is pulling all the stops to make it blatant, but for sure it does, "Blurred Lines" was much milder and got into so much trouble. The song repeats the word "bitch" like thirty times, that word "bitch" is the payload of the beat, if you want to listen to the beat you are under strict orders from the machine to accept women being called bitches. It's disgusting.
I emailed YCombinator about tokenism I think ten years ago, maybe 12, that they needed to throw the machine a bone in a couple of ways--this was before they ever talked about over- or under-representation, percentages of each type of founder, all of that--because the machine is like a bulldozer with a wrecking ball and you can't face it directly, only get it to hit at an angle. And if you do that, it'll cross by you, saying, "you best watch yourself."
> Does being in one of those groups give you an advantage when applying, a la affirmative action?
Probably not. What's really weird about it is that YC is international and they are applying US ethnic labels (and representation levels) to international companies. i.e. 54% of Latinx founded companies are in Latin America and 60% of Black-founded companies are in Africa. (per directory: https://www.ycombinator.com/companies?batch=w2020&batch=W22)
Which means the underrepresented/overrepresented doesn't even make sense (except for US-facing political reasons). If you use the world population as your benchmark:
* Latino founders are if anything slightly overrepresented (10% of world; 12% of founders)
* South Asian founders should be considered underrepresented (22% of world; 15% of founders)
* Assuming "Asian" means East or southeast Asia, such founders are also underrepresented (28% of world; 18% of founders)
Alternatively, YC should do what universities do and only report ethnic data for American companies.
I'd love to get insight into which of the batch were the 29% that applied with just an idea and were accepted. I think it'd be interesting to see where they are super bullish versus maybe where they need to see some proving out or how those with just an idea presented themselves.
I've been in the interview now 3-4 times and it's always fun (in the sense you will absolutely find out where you have weak points), but it's an absolute blitz that's over before you know it and you have to be absolutely on point. The amount of adrenaline you can work up for a 10minute conversation is surprisingly high.
My point, is that I imagine those 29% have both really great ideas and are also incredibly sharp people.
I'm working on a better description. The end goal is human-level conversation and related use cases, but that is too far off. The 1st real use case is that you can give it sentences and it parses them to JSON that can be used to call APIs. Those API calls provide the answers.
Hmm ok, so am I right in thinking that it would be used for natural language API integrations? Like a search-based interface or an Alexa Skills type thing? Interesting nonetheless - I'm unusually out of touch with the industry development of ML, despite it being extremely adjacent to my interests, so sometimes these ideas don't make immediate sense to me. Good luck in your endeavours, regardless!
Read something recently that many serial entrepreneurs seek VC funding rather than fund the effort themselves (even when they have the cash to do so). Often the connections provided by a VC are just as important.
Geoff from YC and Patrick from Stripe did a chat with an Irish audience late last week. One thing that resonated with me was the fact YC provided encouragement along the way when the Stripe founders were unsure the venture would work.
I'm sure many of these companies will be successful, but I'm underwhelmed by most companies on the list. The AI and biology-based companies seem the most interesting in that they're attempting to push the envelope forward. The rest seem to be some combination of:
1) Do X slightly better
2) Do X in new region Y
3) Do X using NFTs
4) Be a bank to those underserved by existing banks
Obviously the point of these companies is to make money, not necessarily to push the technological boundary of human progress, but I miss being inspired by what YC was encouraging people to build.
This is actually the main reason I haven't applied to YC. I can think of things that would be awesome if they were 10x better, but I feel they are either too ambitious (drone delivery), already being done (ai robot that packs boxes arbitrarily), or too difficult (general AI, jetpacks)
YC is one of the best ways to get funding and access to the highest tiers of investor and advisers. It's startup funding on easy mode, if you can get in. The rest of your batch doesn't really matter.
YC has funded a company building supersonic passenger jets (https://boomsupersonic.com/) and underwater mining robots (https://impossiblemining.com/), I don't think “too ambitious” is a problem for them if you can convince them that you're capable of delivering.
Serious question, let's say that I have delivered or proven some prototype to users, but I am not already famous or rich or powerful.
How would I convince YC that though I am technically gifted and people like my prototype, there is probably a founder out there elsewhere who has the ability to make the legal/manufacturing side of things work?
Airbnb and Uber essentially disregarded local regulations and let things fall as they may. If you do that with the FCC or DOE I imagine things are a bit more serious?
Most of the problems out there that need solving are not data ones anymore, they're physical/manufacturing related in my opinion.
FROM THE ARTICLE: > We strive to be a bridge for everyone – no matter who they are, where they live, or what demographic they belong to – to enter the startup world.
That was the situation for me and many other I know. YC explicitly looks for overlooked founders and companies. They'll take risks other won't. They discount credentialism more than any other S-tier VC I know.
FROM THE ABOVE: > let's say that I have delivered or proven some prototype to users, but I am not already famous or rich or powerful. How would I convince YC that though I am technically gifted and people like my prototype, there is probably a founder out there elsewhere who has the ability to make the legal/manufacturing side of things work?
Keep demonstrating traction, and find that founder out there who can make it work.
FROM THE ABOVE: > Airbnb and Uber essentially disregarded local regulations and let things fall as they may. If you do that with the FCC or DOE I imagine things are a bit more serious?
That's after they had initial traction. YC accepted ABNB off of literal airbeds on people's floors.
> Airbnb and Uber essentially disregarded local regulations
Not really. There were almost no AirBnB regulations before AirBnB because no one was doing anything like that at scale.
Uber/lyft got started as a "town car" service, which is legally very different from a taxi. The essential difference is that "town cars" can't do "street hail" - they can only do rides when they're specifically called (or messaged). "Street hail" is where you flag down a ride.
Confusing this is that most taxi companies also offer town-car services, but even pre-Uber/Lyft, most town car providers were not taxis.
No one thought that town car services could compete with taxis before Uber/Lyft. Plus, all previous town car services were "call us for our cars", not two-sided market places/aggregators.
That's why there were very few town-car regulations.
> You mean unlike the piles of settled law governing the hospitality industry?
Short-term rentals are/were not part of the hospitality industry.
>>> Uber/lyft got started as a "town car" service, which is legally very different from a taxi.
> Which is exactly like a taxi. It is a vehicle that you do not own that some else is driving to take you places, where you will pay per ride.
You mean buses? Trains? Airlines?
Taxi services are services that can legally accept riders via "street hail". There are "rides for rent" that are not done via street hail and they are regulated differently. This LEGAL distinction predates Uber/Lyft by decades.
It's a bit confusing because most taxi companies provide both street hail and arranged-ride services. However, most "rides for rent" companies do not have street hail privileges.
Uber/Lyft did "call for a ride" on a scale that no one had imagined and via a two-sided marketplace. Previous companies didn't work that way.
> Short-term rentals are/were not part of the hospitality industry.
Tricks with words won't work. AirBNB competes with hotels who are very much in the 'short term rental' business: you can rent their rooms for a short period.
> You mean buses? Trains? Airlines?
If you want to stretch the definition to those cases where the vehicle does not drive you door-to-door that's fine by me but it looks as if you are just - again - playing word games.
AirBNB competes with hotels by using private property as hotels, Uber competes with taxis by breaking the law. Whether you want to see it like that or not isn't really my problem but redefinition of terms does not change the law.
I don't care if the scale is different, though them operating at scale is part of what makes them problematic.
So what? So does staying with friends/family. So does using an RV. As does camping.
Lots of things "compete with hotels" but that doesn't mean that they're subject to hotel regulations.
Hint: the law is words that have meaning.
> Uber competes with taxis by breaking the law.
No. Uber/Lyft competes with taxis by offering transportation with the "town car" model, which is legally distinct from the "street hail" model.
Prior to Uber/Lyft, no one thought that the town car model could scale. Street hail obviously scaled and there were tons of regulations/laws around it. There are different regulations for town car.
Uber/Lyft doesn't do street hail so it isn't subject to regulations specific to street hail.
The fact that Uber/Lyft figured out how to scale town car does not "redefine" them into the street hail business.
If your 'prototype' does something materially useful wherein there's some kind of clear revenue opportunity, then it doesn't hurt to apply. And you can always apply again.
YC has funded multiple companies drone delivery companies - Volansi, Pyka, Flirtey, etc., and they've also funded a jetpack company (Jetpack Aviation). Being too ambitious or too difficult is not an issue, and if you want to apply to YC you should
Thanks so much for the reply, could you check out my message to the other user? Genuinely curious as I feel like I have good ideas, have delivered in the past, and can apply with working prototypes for my ideas.
My main concerns are applying without solutions for legal/physical scalability.
One of the things YC gets you is access to lawyers. And if their lawyers don't have the expertise you need, they can send you to one who does and you can use the money you get to pay said lawyers.
The fact that you know you need lawyers you can't currently afford is a good start because it shows you're at least thinking about the problem.
I disagree here. I think this batch is actually extremely interesting for a few reasons.
The B2B companies all seem to be providing non-incremental changes to industries.
Seeing CX prioritized is something that makes me happy -- a large number of B2B companies have to build out undifferentiated CX tooling to help support large business teams that need to interact with their APIs.
Cloud architecture management is also something that seems to have gotten some love. Existing tooling works on IAC to try to derive insights, but often these are artifacts created after a visual representation of the infrastructure. Skipping this hop and avoiding disconnects here is very interesting, and there are a lot of ways to extend the functionality of this tech.
Further, there's some real-estate tech that has a chance to eat away at a large and unmodernized industry.
Beyond B2B, expanding YC's footprint in Africa is something that has the potential to bring a lot of customer impact in an area that often functions differently than the rest of the world. Africa has been siloed off and developed tech in a radically different direction than the rest of the world. Just looking at the payments infrastructure in places like Nigeria, you can see why a barrage of companies would come out that seem similar but require completely different tech solutions. I'm excited to see how this moves forward, and happy that YC is going to help foster the tech ecosystem in places like Lagos.
I do agree with you on Web3 investment though. I think it's mainly a waste.
This one was always puzzling to me, and maybe I'm underestimating the lift to move into new regions, but why is this a thing? Why doesn't the main big player move into Africa, or India, or LatAm? Why can't Stripe be the Stripe for Africa as an example? Why does there need to be another company that's specific to that geo.
Understand that and you understand a lot about how the world works.
'Everything is Different'.
Imagine in Spain 25 years ago people didn't use debit/credit for much at all, that buying a car with consumer credit was a big deal, and home ownership is new. Getting credit scores is hard. Opening bank accounts might be difficult. In Indonesia perhaps most people are 'unbanked' in the way we understand it. Maybe there were/are few proper internet connections to do transactions. The major local banks are controlled by a cabal that you need to bribe. Or it's an oligarchy that will not let you in. Or there's a custom 'national system' i.e. 'Carte Bleue' in France that everyone uses and it's pointless to do anything around that. Privacy regulations, localized data, risk, banking regulations, ambiguity, lawyers, fiduciary requirements, reporting requirements.
Or literally 'employees don't show up' or 'electricity is not constant' or 'the Local Magistrate takes 10% cut' or 'The local warlord wants a cut' or 'nobody is qualified to do anything' or 'the employees got upset and shot/beat a manager' or 'sanctions shut down a key component'.
Not really a new idea... a group called kPoint was doing something like this years ago but I am sure it is easier today.
> kPoint scans every frame of every video so well that users can search through every spoken word or important text on screen to find precise points where a phrase was said or shown
414 companies invested = ~25 companies per YC group partner (including visiting partners), assuming 40hrs/wk + no prior batches also competing for time.
Seems like a phenomenal resource for those who are new to tech mindset/hyper growth/tech culture.
That said, it seems largely not possible for a startup to get more than ~2 hours per partner per week. That's a lot from the perspective of an semi-experienced founder, but perhaps not a lot for someone with minimal experience, seeking more coaching.
For other founders on HN, how much time do you take/get with your investors and advisors? Is their time undersupplied, oversupplied, or just right for you?
This is where it helps to have a diversified cap table. In our case, we have a set of angels -- each with their own expertise.
All of them lead busy lives, but we can get many hours of feedback by picking a subset to talk to on a particular subject. E.g. we have a "former CTO of large SaaS company"-angel who we specifically call with regards to tech stack; an "ex Head of Product" we ask for feedback on product etc.
As an added advantage, it almost automatically leads to strong mentor-mentee relationships on a personal level.
What a disappointment, so many NFT/crypto companies. Given current blockchain technology, this is something that straight up makes the world a worse place by making existing processes significantly more carbon intensive.
I would consider working in crypto to be the equivalent of working for Juul or a tobacco company. Not quite as evil as working for a company that provides spyware that's used against human rights activists, but, the rung above that.
What is the crypto killer? I still don't understand what the value proposition of crypto is (well at least one that can be said with a straight face or without magical thinking)
doing just a quick search in the public directory, I found 24 out of 394 companies are in crypto. That's a lot lower fraction than you'd expect given how much mindshare, hype, and attention crypto has now vs. other sectors.
I am a crypto-skeptic, and consciously chose not to work on it myself, but I still wouldn't want any investor, especially one as early stage as YC, to categorically rule out a sector based on the impact of its current technology, the state of the technology will be different when these companies have grown.
Eg with respect to the carbon impact of crypto specifically, the current chains are very unscalable for the exact same reason that they consume lots of carbon; while the per-user stats look bad now, any world in which these companies are used at the scale of web 2.0 platforms is necessarily a world where the carbon footprint per user is many orders of magnitude lower.
I agree with your first point: 24 out of 394 is too many for my taste, but, given how hyped the sector is, it’s not a huge amount.
Per the second point, I actually completely disagree. I think there’s huge social dynamics in play that make it harder to move away from proof of work because miners have massive amounts invested into mining equipment. We might see Ethereum move to PoS eventually (maybe) - but - that will be in spite of social dynamics and because some of the leaders are stubbornly trying to do the right thing.
I think in the scenario where miners block the move to PoS (or any other much-more-scalable technology) is a scenario where nobody ever actually uses crypto for anything, and almost all coins go to $0 after the speculative bubble pops. To be clear, I think that's certainly a possible world, maybe even the modal outcome.
The alternative world, where we're using crypto to pay for everything, and we're no longer logging into twitter, but instead using our keys to log into a client for a globally distributed twitter where we own all our data on a blockchain - that's impossible without not just Eth2 but a several orders of magnitude of improvements beyond that.
Basically, I think taking the current per-transaction carbon impacts, multiplying it by eg. Visa's transaction volume, and forecasting a world where crypto is burning 1,000X as much carbon as the whole transportation sector or whatever - is a fallacy. Crypto will either solve the scalability problem (and therefore consume a much more moderate amount of energy), or it won't be used at all.
This is like arguing circuit switching is more efficient than packet switching for voice. There’s an account in the book, The Master Switch, where an AT&T exec shrugged off a demo of the internet in the 70’s because packet switching was woefully inefficient. While true, it misses a much bigger picture that we now understand today.
There’s definitely lots of problems with NFT/crypto, but I’m pleased people are risking time and capital to explore if these ideas work. Hopefully the energy usage issues are addressed and the world emerges with an environmentally friendly blockchain that we can use for global consensus.
I don’t understand why people outright dismiss crypto/NFTs by comparing them to tobacco companies or outright banning it from conferences like Rails Conf. Yes, some crypto/NFT companies are scams, but so are many other non-crypto/NFT companies.
What we should focus on are highlighting the crypto projects that are actually good so we can become smarter and more educated about the ways we might deploy this technology.
Given we're heading into environmental crisis, I don't think it's morally defensible to promote a system which actively attempts to maximise energy consumed to the point of restarting coal power plants, in order to explore industries that have primarily been used for greater-fool and pump-and-dump wealth transfer. I haven't seen any examples where NFTs actually have use that isn't just "collectibles + massive energy waste", and the only uses I've seen for crypto outside scamming are avoiding legal barriers ie transferring money over borders, selling drugs, that type of thing.
You'd need to put forward an argument for specific NFT or crypto tech that hinge on blockchains as a necessary component of the innovation, and I've literally never seen that. I've seen plenty of "thing X but on the blockchain", which is not innovation, it's branding.
The fact of the matter, as far as I can see, is that NFTs and crypto are popular because they enable you to make tons of money grifting, without having to go through the inconvenience of providing any actually-useful innovation, while contributing to environmental destruction. It's like boiler-room penny stocks, if they were fuelled by coal-rolling.
There's quite a big elephant underneath this argument, which is the "zero utility in crypto" assumption. If utility exists then the question of energy use and externality is simply a matter of cost/benefit like everything else society does with resources.
And then you go back to why the stuff was invented, and it was for exactly the thing that you're dismissing, which is to evade authorities and enhance privacy through cryptography. That is the utility Satoshi identified, and it drove initial adoption, and continues to be pursued through privacy coins. A zero utility stance amounts to "Satoshi had no justifications". The rest is negotiation of the price.
Everything after that - copycat coins, distributed computation on Ethereum, NFTs and so on - is "what else can we do with this stuff", which is actually a much more challenging problem because it suggests no particular specification, hence the entire space is in the midst of a random walk in which features are developed with few concepts grounding our ability to determine whether they do the things we're imagining they do. The scams have a playground, but that's not actually different from capitalism in other times and places.
I'm aware that there is utility in crypto in being ungovernable (though ideologically I only partially agree with that utility - I think tax evasion is immoral under the current system, for instance) but I'm saying the cost/benefit weighs massively in the cost side: not only the positive feedback loop of energy consumption, but the fraud, the wasting of skilled engineers' time building ever more elaborate scams, the empowerment of ancap types like Buterin, the enabling of actual immoral crime like ransome ward, just so so many negative utilities. Proponents don't even invest what I consider the actual upsides like remittance or harm reduction in buying drugs - they invest in get rich quick schemes. That should tell you where their priorities lie.
> There's quite a big elephant underneath this argument, which is the "zero utility in crypto" assumption. If utility exists then the question of energy use and externality is simply a matter of cost/benefit like everything else society does with resources. And then you go back to why the stuff was invented, and it was for exactly the thing that you're dismissing, which is to evade authorities and enhance privacy through cryptography.
Passing laws and then prosecuting offenders is a major way that society codifies what costs are acceptable and what’s unacceptable.
If you believe that offering an bypass around that control has utility (corrupt regimes, whatever), I don’t think it’s fair to handwave the really sticky part: how does society add controls so that we don’t destroy the planet through runaway energy consumption, or end up with the smartest, most ruthless, and least ethical folks controlling all the resources.
This is completely my opinion, but I believe people are risking time and capital because they are motivated to get their money laundered cleanly, and at a stable exchange rate.
The Cutest YC Startup in the world can't wipe out the swaths of: illegitimate casinos, drugs dealers, and content for sale so awful I cannot describe it here. The foundational transactions the whole system stands on.
That depends if they choose a proof-of-work or proof-of-stake blockchain. Proof-of-stake isn't all that energy intensive.
And do you complain about the energy of credit cards vs cash? Technically cash is carbon negative since the cash itself is a carbon sink. So should we be pushing against credit cards because of all the servers it takes to process them and all the oil it takes to make the plastic?
Or do the benefits perhaps outweigh the costs and provide other second order opportunities for energy savings?
Ycombinator was an unfair advantage back in the day 10ish years ago:
- Incredible mentorship
- Incredible network of angels / alumni
- Incredible location to start a company - almost like a requirement
Today:
- Ok mentorship but most content can be found online
- You literally can connect with anyone through LinkedIn and everyone's email/social is super simple to find - also people are way more eager to meet you than 5-10 years ago
- Literally not a requirement anymore to work from SV to launch something successful!
The pro's of YC are staggeringly overweight in comparison to the cons. You trade 7% of your mostly-worthless startup for $500k and the YC network? That's such an easy decision.
You cannot literally connect with anyone through Linkedin or social media. It just doesn't work like that.
My company did YC in 2017. Raised $5M. Disconnected mentorship. Agreeable coaches with no industry insight.
Since then, we folded, and started a new company. We didnt go for YC, but StartX and directly connect with funds such as First Round and others. We raised $12M, and not having YC in the cap table really helped our investors to dive in.
What makes you say that you can connect to anyone on LinkedIn? You can purchase a premium LinkedIn account and craft a nice message and if you're actually a match for the expectation you can connect. Source: everyone I know receive messages from LinkedIn Premium users - they read at least the first sentence before discarding or accepting.
Huh? All the good engineers I know send anything from LinkedIn straight to /dev/null, because of exactly the phenomenon you describe: anyone can pay Microsoft money to send them spam.
What would it take to rebalance the allocation ? more than 50% is for economic/finance sector. healthcare, climate is tiny. Is it a lack of ideas ? or problems too hard to solve ?
I beg to differ partially. Having technological interest can also promote the topic in the eye of the public, which can influence political decisions. People vote for things they believe to be near-possible, not invisible.
At this point, it seems like YC is just optimizing on execution risk, and only care about those startups where market risk is eliminated (more or less). If someone has already invested in more than half the batch, YC's already has a pointer about a big well defined market (or expected to be), just needs a team which can execute well.
People used to apply to YC because they would be able to get support without a network. If a startup has to raise funds before getting into YC, I don't know, just does not sound right.
This may also be the reasoning behind accepting many startups on just basis of an idea(29%) provided they worked in big-tech or hot startups previously[1], and working on problems in Dev Tools and B2B Saas space (similar to problems they solved already, or seen). Market is defined, they are just looking for good executioners. (In dev tools and Startup related Saas tools, market is other companies of the batch on occasions.)
[1]: YC indexes heavily on anyone from an Ivy League college, or who has worked at FAANG, or unicorn startups like Uber. Going through their companies list, ex-FAANG/Ivy leaguers building a dev tools (or planning to) is the most repeated pattern.
With a sample that large you have to be careful not to draw conclusions too quickly. Just looking at the recent Launch HNs I see a bunch of startups that go way beyond just "execution risk":
These all happen to be climate-related but I'm pretty sure that's just a coincidence. One thing's for sure, YC is just as interested in funding high-risk-high-potential-value startups as it ever was.
You may be right. I was drawing the conclusion from the stat about 55% prefunded startups, but that still leaves 45% w YC as first investor (45% of 414 is a sizeable 186). If you add 29% as only idea based, still leaves 66 at least which had product and YC as the first cheque. A couple of years ago that was close to the batch size. Probably in the absolute numbers, they are still funding those moonshots.
Thanks for the list. Many seems very promising. So are some of the others like Andy which had a post yesterday.
Isn't this theory contradicted by the next bullet?
> 29% of the batch were accepted with only an idea
Perhaps the proportion that had already raised is because YC are writing more and bigger checks, which gets them access to "later-stage" (still early) companies.
> 10% had more than $50k of monthly revenue when accepted
If I had started a company that was bringing in 50k a month (600k a year), I would feel weird about being part of a group where 29% of the cohort is there on just an idea. Especially considering everyone gets the same deal. Surely 50k in monthly revenue is a better signal than someone that just has an idea and worked at some company before. I may be over stating its significance. Maybe those companies are movie pass business models, selling $10 bills for $5 so the revenue doesn't really mean anything
Seems like YC has simply become a credential for future fund-raising, like "Harvard" or something else on your resume. No sour grapes at all, full credit to pg, Jessica, and the rest for building it to be wildly successful like that, but yes founders should think hard about why they would do something like YC and if the trade-off is worth it.
While "YCXX" has always seemed like an interesting signal especially around these parts, personally my own radar is that anything post YC15 is less likely to grab my attention, because the original YC founders were less/no longer involved. Nothing wrong with the new generation of folks running it, but having followed this space since their early days, there is still a certain cachet that comes with the "OG" batches of YC, which were small and seemed more impactful, compared to the later ones.
In many places outside Silicon Valley, you'll find that local investors are reluctant to deviate from 1x revenue or 10x EBITDA for "venture investing" valuations -- which are really more akin to mature company / PE-style worldviews. For companies working in those environments, you could easily justify YCombinator as a conduit to Silicon Valley investor networks with loftier valuations & hypergrowth mindsets.
Certainly makes sense - though the piper needs to be paid eventually though - loftier valuations eventually need to be justified, else companies eventually suffer a down-round or worse, founders get kicked out or the entire company gets shut down. Seems like a Russian-Roulette way of playing business - hope you can exit with strong wealth before you find the chamber with the bullet in it.
Yes, it's a different risk profile that doesn't suit all businesses. VCs are in the business of power-law returns: They're looking for homeruns, not base hits. It's really important for founders to select the right sources of capital for their business. The good news: YC itself is a pretty good actor on that front -- the new $500k uncapped SAFE helps founders retain optionality without fully committing them to hypergrowth trajectories.
To be fair, it’s ridiculously cheap to start something right now. Even 8-9 years ago, you only needed low six figures to jumpstart something. Now? I am pretty sure the biggest hurdle is opportunity cost for founders not the actual funding needs. This is referring to mostly SaaS of course.
The only real cost is time for building a SaaS company. You can pretty much get by without paying for anything. Granted, buying the premium versions of certain products makes life a lot easier, but it's by no means required. Of course, as you launch, you'll likely have to pay for some server cost, but even then, you'll most likely be covered by credits for the first year.
For B2B SaaS, your first big costs are going to be advertising. Even just running ads against your own company name is a few hundred per month with Google. At that point though hopefully you're generating enough revenue from a few customers to cover the cost.
> At this point, it seems like YC is just optimizing on execution risk
From YC's side the cash outlay is the same either way so why not put a lot of it into something lower risk?
But what's more interesting to me is from the team's side: clearly they are spending a large amount of equity (<7%) in exchange for some networking and the opportunity to be on the stage on demo day. Seems very expensive, but if you have built a SaaS business away from the deep investor and customer pools, it could really be worth it.
We're in the current W22 batch with Andi. We raised a small amount of funding after getting accepted to YC but before the batch started. I would guess that is a non-trivial percent of the "raised money before YC".
I think it's the other way around really. You're much more interesting to investors once you're in YC, not more interesting to YC once you have investors.
We're not from Ivy League colleges (drop-outs). Never worked at FAANGs or unicorns. Not a dev tool. Definitely huge risk (new search engine taking on Google).
I think YC cares about what they say they care about - making something people want. That's it. That's the secret. Having a small number (even 10s) of people who really love what you're making matters more than all the other signals you list.
You mean you got accepted into YC, then a few investors heard about you, and decided to fund you before you start the batch or take the YC deal? I did not think of it like that. Any insights as to why you would accept money just before entering YC, given there is a high probability you would get more money at higher floor through YC.
Also, while I like what Andi is doing (some marketing terms aside), it's not a market risk (if you call yourself a search engine[1]). The market definitely exists, and is a Trillion $ one, with Google already dominating it. It depends on your execution ability as to how you capture it according to your strategy (which currently looks smart), but if you can't, the reason would be you could not outcompete Google, and not "the market is too small or does not exist". A typical market risk problem would be Airbnb for example.
Edit: All the best for the demo day
[1]: You can also be called a smart assistant. This way it has market risk, but carries negative connotation as the existing ones aren't as good. You know your strategy best, and I think it's a 10x better experience if I get the answer without having to open the link.
In our case it was friendly parties. But the YC validation made it straightforward, and I think would help anyone raising before the batch. We were an early admit so we're an unusual situation that way.
And thank you. You're right that execution is all that matters for us. Our most important thing is focusing 100% on what our users want, and iterating as quickly as we can toward product market fit based on feedback. So we are a classic case of "code and talk to users" as all that matters.
I think this is actually a feature not a bug. YC can mitigate risk for many companies who still get great value out of it, while also investing in moonshots knowing that they will get enough of their money back from the less risky ones.
That means YC and the world gets to see where the moonshots go by supporting the less risky!
I don't think there is anything wrong with it. They can do whatever they like, just that it felt weird given what YC promised earlier (not sure if they promise the same thing now).
The other aspect of this is their target market (Seed investors) is also very much market risk averse, and invest heavily in execution risk businesses. They like their Saas multiples and GM very much.
Some stats that jumped out at me:
- "we received 17,000 applications from founders around the world and funded 414." That's a 2% acceptance rate for this batch.
- "57% of the batch applied more than once."
Has YCom published stats on % of applicants coming from underrepresented groups? I'm especially curious about the gender split given the 10% female founders number in this batch.
In the past they have mentioned that the acceptance rate is pretty close to the application rate. That is why they focus a lot on recruiting underrepresented founders and getting them to apply.
Sincere question: Do people call ycombinator "YCom"? I've never heard this and have been living in SV since the mid-aughts. Mostly I hear "YC". Just did a quick google and I'm not seeing it there either.
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[ 0.18 ms ] story [ 204 ms ] threadDoes being in one of those groups give you an advantage when applying, a la affirmative action?
Does anyone of Hispanic ancestry actually use the term “LatinX”? The Spanish language is explicitly gendered and there’s no such thing.
https://www.pewresearch.org/hispanic/2020/08/11/about-one-in...
> However, for the population it is meant to describe, only 23% of U.S. adults who self-identify as Hispanic or Latino have heard of the term Latinx, and just 3% say they use it to describe themselves, according to a nationally representative, bilingual survey of U.S. Hispanic adults conducted in December 2019 by Pew Research Center.
I would be intrigued though has YC ever formally come out and said they are looking to increase diversity and thereby decrease the amount of Asian and White male founders they accept each batch?
Also why does YC not report on LGBTQ stats for their founders then? Surely they are also underrepresented in the Startup world as well.
And I find it wrong that I can't remove slurs from my music. It's basic--if I can get cancelled for using a word, I can't sing it, I don't want to listen to absolutely any music which includes it. So for instance there's a song by an African musician, I think he's from West Africa, his name is Akon. Quite famous I believe. He created a song that was played frequently at dance halls and has a lot of musical merit. The song's name is "Sexy Bitch." I hate that word though, I can't stare at that word, it's so disgusting on so many different levels, for so many different people, in particular in this case because it's talking about women. And the chorus is like...I just can't write it. Instead, I found a sanitized version that is not disgusting and has all the same musical merit, called "Sexy Chick."
Damn, she's a sexy chick, sexy chick, Damn, she's a sexy chick, damn girl!
Damn, she's a sexy chick, sexy chick, Damn, she's a sexy chick, damn girl!
But it's incredibly hard to find, only on iTunes, not on my Apple Music, not on my Youtube, super censored. Because Akon apparently has the right and obligation, because he's African, to be misogynistic, like that has more victim points than being a woman, and these media are so mysogynistic in actuality--regardless of their donations to nonprofits and shit--that they don't want people to have even an alternative to listening to this man calling every woman on the dancefloor a bitch. I have trouble figuring out to what degree his being African plays a role, I want to ignore it but the machine is pulling all the stops to make it blatant, but for sure it does, "Blurred Lines" was much milder and got into so much trouble. The song repeats the word "bitch" like thirty times, that word "bitch" is the payload of the beat, if you want to listen to the beat you are under strict orders from the machine to accept women being called bitches. It's disgusting.
I emailed YCombinator about tokenism I think ten years ago, maybe 12, that they needed to throw the machine a bone in a couple of ways--this was before they ever talked about over- or under-representation, percentages of each type of founder, all of that--because the machine is like a bulldozer with a wrecking ball and you can't face it directly, only get it to hit at an angle. And if you do that, it'll cross by you, saying, "you best watch yourself."
Probably not. What's really weird about it is that YC is international and they are applying US ethnic labels (and representation levels) to international companies. i.e. 54% of Latinx founded companies are in Latin America and 60% of Black-founded companies are in Africa. (per directory: https://www.ycombinator.com/companies?batch=w2020&batch=W22)
Which means the underrepresented/overrepresented doesn't even make sense (except for US-facing political reasons). If you use the world population as your benchmark:
* Latino founders are if anything slightly overrepresented (10% of world; 12% of founders)
* South Asian founders should be considered underrepresented (22% of world; 15% of founders)
* Assuming "Asian" means East or southeast Asia, such founders are also underrepresented (28% of world; 18% of founders)
Alternatively, YC should do what universities do and only report ethnic data for American companies.
i'm latino and i (along with all my friends) absolutely hate the term latinx. it's american colonization.
not only that but there's already a gender-neutral term for latinos in english: latin.
Same with folx.
I've been in the interview now 3-4 times and it's always fun (in the sense you will absolutely find out where you have weak points), but it's an absolute blitz that's over before you know it and you have to be absolutely on point. The amount of adrenaline you can work up for a 10minute conversation is surprisingly high.
My point, is that I imagine those 29% have both really great ideas and are also incredibly sharp people.
I'm seriously thinking of submitting my project: https://lxagi.com. I've written a lot of code, but I'm not quite sure of when/if to apply.
you should apply now!
Geoff from YC and Patrick from Stripe did a chat with an Irish audience late last week. One thing that resonated with me was the fact YC provided encouragement along the way when the Stripe founders were unsure the venture would work.
1) Do X slightly better
2) Do X in new region Y
3) Do X using NFTs
4) Be a bank to those underserved by existing banks
Obviously the point of these companies is to make money, not necessarily to push the technological boundary of human progress, but I miss being inspired by what YC was encouraging people to build.
How would I convince YC that though I am technically gifted and people like my prototype, there is probably a founder out there elsewhere who has the ability to make the legal/manufacturing side of things work?
Airbnb and Uber essentially disregarded local regulations and let things fall as they may. If you do that with the FCC or DOE I imagine things are a bit more serious?
Most of the problems out there that need solving are not data ones anymore, they're physical/manufacturing related in my opinion.
That was the situation for me and many other I know. YC explicitly looks for overlooked founders and companies. They'll take risks other won't. They discount credentialism more than any other S-tier VC I know.
FROM THE ABOVE: > let's say that I have delivered or proven some prototype to users, but I am not already famous or rich or powerful. How would I convince YC that though I am technically gifted and people like my prototype, there is probably a founder out there elsewhere who has the ability to make the legal/manufacturing side of things work?
Keep demonstrating traction, and find that founder out there who can make it work.
FROM THE ABOVE: > Airbnb and Uber essentially disregarded local regulations and let things fall as they may. If you do that with the FCC or DOE I imagine things are a bit more serious?
That's after they had initial traction. YC accepted ABNB off of literal airbeds on people's floors.
Not really. There were almost no AirBnB regulations before AirBnB because no one was doing anything like that at scale.
Uber/lyft got started as a "town car" service, which is legally very different from a taxi. The essential difference is that "town cars" can't do "street hail" - they can only do rides when they're specifically called (or messaged). "Street hail" is where you flag down a ride.
Confusing this is that most taxi companies also offer town-car services, but even pre-Uber/Lyft, most town car providers were not taxis.
No one thought that town car services could compete with taxis before Uber/Lyft. Plus, all previous town car services were "call us for our cars", not two-sided market places/aggregators.
That's why there were very few town-car regulations.
You mean unlike the piles of settled law governing the hospitality industry?
> Uber/lyft got started as a "town car" service, which is legally very different from a taxi.
Which is exactly like a taxi. It is a vehicle that you do not own that some else is driving to take you places, where you will pay per ride.
Short-term rentals are/were not part of the hospitality industry.
>>> Uber/lyft got started as a "town car" service, which is legally very different from a taxi.
> Which is exactly like a taxi. It is a vehicle that you do not own that some else is driving to take you places, where you will pay per ride.
You mean buses? Trains? Airlines?
Taxi services are services that can legally accept riders via "street hail". There are "rides for rent" that are not done via street hail and they are regulated differently. This LEGAL distinction predates Uber/Lyft by decades.
It's a bit confusing because most taxi companies provide both street hail and arranged-ride services. However, most "rides for rent" companies do not have street hail privileges.
Uber/Lyft did "call for a ride" on a scale that no one had imagined and via a two-sided marketplace. Previous companies didn't work that way.
Tricks with words won't work. AirBNB competes with hotels who are very much in the 'short term rental' business: you can rent their rooms for a short period.
> You mean buses? Trains? Airlines?
If you want to stretch the definition to those cases where the vehicle does not drive you door-to-door that's fine by me but it looks as if you are just - again - playing word games.
AirBNB competes with hotels by using private property as hotels, Uber competes with taxis by breaking the law. Whether you want to see it like that or not isn't really my problem but redefinition of terms does not change the law.
I don't care if the scale is different, though them operating at scale is part of what makes them problematic.
So what? So does staying with friends/family. So does using an RV. As does camping.
Lots of things "compete with hotels" but that doesn't mean that they're subject to hotel regulations.
Hint: the law is words that have meaning.
> Uber competes with taxis by breaking the law.
No. Uber/Lyft competes with taxis by offering transportation with the "town car" model, which is legally distinct from the "street hail" model.
Prior to Uber/Lyft, no one thought that the town car model could scale. Street hail obviously scaled and there were tons of regulations/laws around it. There are different regulations for town car.
Uber/Lyft doesn't do street hail so it isn't subject to regulations specific to street hail.
The fact that Uber/Lyft figured out how to scale town car does not "redefine" them into the street hail business.
My main concerns are applying without solutions for legal/physical scalability.
The fact that you know you need lawyers you can't currently afford is a good start because it shows you're at least thinking about the problem.
The B2B companies all seem to be providing non-incremental changes to industries.
Seeing CX prioritized is something that makes me happy -- a large number of B2B companies have to build out undifferentiated CX tooling to help support large business teams that need to interact with their APIs.
Cloud architecture management is also something that seems to have gotten some love. Existing tooling works on IAC to try to derive insights, but often these are artifacts created after a visual representation of the infrastructure. Skipping this hop and avoiding disconnects here is very interesting, and there are a lot of ways to extend the functionality of this tech.
Further, there's some real-estate tech that has a chance to eat away at a large and unmodernized industry.
Beyond B2B, expanding YC's footprint in Africa is something that has the potential to bring a lot of customer impact in an area that often functions differently than the rest of the world. Africa has been siloed off and developed tech in a radically different direction than the rest of the world. Just looking at the payments infrastructure in places like Nigeria, you can see why a barrage of companies would come out that seem similar but require completely different tech solutions. I'm excited to see how this moves forward, and happy that YC is going to help foster the tech ecosystem in places like Lagos.
I do agree with you on Web3 investment though. I think it's mainly a waste.
This one was always puzzling to me, and maybe I'm underestimating the lift to move into new regions, but why is this a thing? Why doesn't the main big player move into Africa, or India, or LatAm? Why can't Stripe be the Stripe for Africa as an example? Why does there need to be another company that's specific to that geo.
'Everything is Different'.
Imagine in Spain 25 years ago people didn't use debit/credit for much at all, that buying a car with consumer credit was a big deal, and home ownership is new. Getting credit scores is hard. Opening bank accounts might be difficult. In Indonesia perhaps most people are 'unbanked' in the way we understand it. Maybe there were/are few proper internet connections to do transactions. The major local banks are controlled by a cabal that you need to bribe. Or it's an oligarchy that will not let you in. Or there's a custom 'national system' i.e. 'Carte Bleue' in France that everyone uses and it's pointless to do anything around that. Privacy regulations, localized data, risk, banking regulations, ambiguity, lawyers, fiduciary requirements, reporting requirements.
Or literally 'employees don't show up' or 'electricity is not constant' or 'the Local Magistrate takes 10% cut' or 'The local warlord wants a cut' or 'nobody is qualified to do anything' or 'the employees got upset and shot/beat a manager' or 'sanctions shut down a key component'.
And that's the short list.
I'd like the same for all my photos and videos: that would be so much easier to find specific pictures by keywords
> kPoint scans every frame of every video so well that users can search through every spoken word or important text on screen to find precise points where a phrase was said or shown
https://kpoint.com/blog/video-indexing-and-search-technology...
Seems like a phenomenal resource for those who are new to tech mindset/hyper growth/tech culture.
That said, it seems largely not possible for a startup to get more than ~2 hours per partner per week. That's a lot from the perspective of an semi-experienced founder, but perhaps not a lot for someone with minimal experience, seeking more coaching.
For other founders on HN, how much time do you take/get with your investors and advisors? Is their time undersupplied, oversupplied, or just right for you?
All of them lead busy lives, but we can get many hours of feedback by picking a subset to talk to on a particular subject. E.g. we have a "former CTO of large SaaS company"-angel who we specifically call with regards to tech stack; an "ex Head of Product" we ask for feedback on product etc.
As an added advantage, it almost automatically leads to strong mentor-mentee relationships on a personal level.
I would consider working in crypto to be the equivalent of working for Juul or a tobacco company. Not quite as evil as working for a company that provides spyware that's used against human rights activists, but, the rung above that.
I not only believe that's false, I'd like to actively contribute to falsifying it.
Time.
I am a crypto-skeptic, and consciously chose not to work on it myself, but I still wouldn't want any investor, especially one as early stage as YC, to categorically rule out a sector based on the impact of its current technology, the state of the technology will be different when these companies have grown.
Eg with respect to the carbon impact of crypto specifically, the current chains are very unscalable for the exact same reason that they consume lots of carbon; while the per-user stats look bad now, any world in which these companies are used at the scale of web 2.0 platforms is necessarily a world where the carbon footprint per user is many orders of magnitude lower.
Per the second point, I actually completely disagree. I think there’s huge social dynamics in play that make it harder to move away from proof of work because miners have massive amounts invested into mining equipment. We might see Ethereum move to PoS eventually (maybe) - but - that will be in spite of social dynamics and because some of the leaders are stubbornly trying to do the right thing.
The alternative world, where we're using crypto to pay for everything, and we're no longer logging into twitter, but instead using our keys to log into a client for a globally distributed twitter where we own all our data on a blockchain - that's impossible without not just Eth2 but a several orders of magnitude of improvements beyond that.
Basically, I think taking the current per-transaction carbon impacts, multiplying it by eg. Visa's transaction volume, and forecasting a world where crypto is burning 1,000X as much carbon as the whole transportation sector or whatever - is a fallacy. Crypto will either solve the scalability problem (and therefore consume a much more moderate amount of energy), or it won't be used at all.
There’s definitely lots of problems with NFT/crypto, but I’m pleased people are risking time and capital to explore if these ideas work. Hopefully the energy usage issues are addressed and the world emerges with an environmentally friendly blockchain that we can use for global consensus.
I don’t understand why people outright dismiss crypto/NFTs by comparing them to tobacco companies or outright banning it from conferences like Rails Conf. Yes, some crypto/NFT companies are scams, but so are many other non-crypto/NFT companies.
What we should focus on are highlighting the crypto projects that are actually good so we can become smarter and more educated about the ways we might deploy this technology.
You'd need to put forward an argument for specific NFT or crypto tech that hinge on blockchains as a necessary component of the innovation, and I've literally never seen that. I've seen plenty of "thing X but on the blockchain", which is not innovation, it's branding.
The fact of the matter, as far as I can see, is that NFTs and crypto are popular because they enable you to make tons of money grifting, without having to go through the inconvenience of providing any actually-useful innovation, while contributing to environmental destruction. It's like boiler-room penny stocks, if they were fuelled by coal-rolling.
And then you go back to why the stuff was invented, and it was for exactly the thing that you're dismissing, which is to evade authorities and enhance privacy through cryptography. That is the utility Satoshi identified, and it drove initial adoption, and continues to be pursued through privacy coins. A zero utility stance amounts to "Satoshi had no justifications". The rest is negotiation of the price.
Everything after that - copycat coins, distributed computation on Ethereum, NFTs and so on - is "what else can we do with this stuff", which is actually a much more challenging problem because it suggests no particular specification, hence the entire space is in the midst of a random walk in which features are developed with few concepts grounding our ability to determine whether they do the things we're imagining they do. The scams have a playground, but that's not actually different from capitalism in other times and places.
Passing laws and then prosecuting offenders is a major way that society codifies what costs are acceptable and what’s unacceptable.
If you believe that offering an bypass around that control has utility (corrupt regimes, whatever), I don’t think it’s fair to handwave the really sticky part: how does society add controls so that we don’t destroy the planet through runaway energy consumption, or end up with the smartest, most ruthless, and least ethical folks controlling all the resources.
The Cutest YC Startup in the world can't wipe out the swaths of: illegitimate casinos, drugs dealers, and content for sale so awful I cannot describe it here. The foundational transactions the whole system stands on.
And do you complain about the energy of credit cards vs cash? Technically cash is carbon negative since the cash itself is a carbon sink. So should we be pushing against credit cards because of all the servers it takes to process them and all the oil it takes to make the plastic?
Or do the benefits perhaps outweigh the costs and provide other second order opportunities for energy savings?
Wow!
Ycombinator was an unfair advantage back in the day 10ish years ago:
- Incredible mentorship
- Incredible network of angels / alumni
- Incredible location to start a company - almost like a requirement
Today:
- Ok mentorship but most content can be found online
- You literally can connect with anyone through LinkedIn and everyone's email/social is super simple to find - also people are way more eager to meet you than 5-10 years ago
- Literally not a requirement anymore to work from SV to launch something successful!
Is Ycombinator still an unfair advantage in 2022?
You cannot literally connect with anyone through Linkedin or social media. It just doesn't work like that.
Since then, we folded, and started a new company. We didnt go for YC, but StartX and directly connect with funds such as First Round and others. We raised $12M, and not having YC in the cap table really helped our investors to dive in.
"Plaid for..."[0] is a new one to me, but six companies have it in their one-line pitch.
[0] The line, not Plaid.
This seems neat: https://www.ycombinator.com/companies/impossible-mining
"Underwater robotic vehicles that collect battery metals responsibly"
At this point, it seems like YC is just optimizing on execution risk, and only care about those startups where market risk is eliminated (more or less). If someone has already invested in more than half the batch, YC's already has a pointer about a big well defined market (or expected to be), just needs a team which can execute well.
People used to apply to YC because they would be able to get support without a network. If a startup has to raise funds before getting into YC, I don't know, just does not sound right.
This may also be the reasoning behind accepting many startups on just basis of an idea(29%) provided they worked in big-tech or hot startups previously[1], and working on problems in Dev Tools and B2B Saas space (similar to problems they solved already, or seen). Market is defined, they are just looking for good executioners. (In dev tools and Startup related Saas tools, market is other companies of the batch on occasions.)
[1]: YC indexes heavily on anyone from an Ivy League college, or who has worked at FAANG, or unicorn startups like Uber. Going through their companies list, ex-FAANG/Ivy leaguers building a dev tools (or planning to) is the most repeated pattern.
Launch HN: Carbon Crusher (YC W22) – Carbon Negative Roads - https://news.ycombinator.com/item?id=30793076 - March 2022 (93 comments)
Launch HN: Charge Robotics (YC S21) - Robots that build solar farms - https://news.ycombinator.com/item?id=30780455 - March 2022 (79 comments)
Launch HN: AirMyne (YC W22) – Capturing CO2 from air at industrial scale - https://news.ycombinator.com/item?id=30712229 - March 2022 (192 comments)
Launch HN: Living Carbon (YC W20) – Trees that capture and store more carbon - https://news.ycombinator.com/item?id=30672841 - March 2022 (256 comments)
Launch HN: Micro Meat (YC S21) – Technology for scaling cultivated meat - https://news.ycombinator.com/item?id=30627418 - March 2022 (194 comments)
Launch HN: Phase Biolabs (YC W22) – Converting CO2 to Carbon-Neutral Chemicals - https://news.ycombinator.com/item?id=30557288 - March 2022 (88 comments)
These all happen to be climate-related but I'm pretty sure that's just a coincidence. One thing's for sure, YC is just as interested in funding high-risk-high-potential-value startups as it ever was.
Thanks for the list. Many seems very promising. So are some of the others like Andy which had a post yesterday.
Edit: There is! https://news.ycombinator.com/lists
> 29% of the batch were accepted with only an idea
Perhaps the proportion that had already raised is because YC are writing more and bigger checks, which gets them access to "later-stage" (still early) companies.
> 10% had more than $50k of monthly revenue when accepted
If I had started a company that was bringing in 50k a month (600k a year), I would feel weird about being part of a group where 29% of the cohort is there on just an idea. Especially considering everyone gets the same deal. Surely 50k in monthly revenue is a better signal than someone that just has an idea and worked at some company before. I may be over stating its significance. Maybe those companies are movie pass business models, selling $10 bills for $5 so the revenue doesn't really mean anything
While "YCXX" has always seemed like an interesting signal especially around these parts, personally my own radar is that anything post YC15 is less likely to grab my attention, because the original YC founders were less/no longer involved. Nothing wrong with the new generation of folks running it, but having followed this space since their early days, there is still a certain cachet that comes with the "OG" batches of YC, which were small and seemed more impactful, compared to the later ones.
with 50k/month in revenues, you could easily get a loan from several banks near 0.25~2% interest.
not sure exactly how much leverage you can get but at the extreme end you might get 6:1
For B2B SaaS, your first big costs are going to be advertising. Even just running ads against your own company name is a few hundred per month with Google. At that point though hopefully you're generating enough revenue from a few customers to cover the cost.
From YC's side the cash outlay is the same either way so why not put a lot of it into something lower risk?
But what's more interesting to me is from the team's side: clearly they are spending a large amount of equity (<7%) in exchange for some networking and the opportunity to be on the stage on demo day. Seems very expensive, but if you have built a SaaS business away from the deep investor and customer pools, it could really be worth it.
I think it's the other way around really. You're much more interesting to investors once you're in YC, not more interesting to YC once you have investors.
We're not from Ivy League colleges (drop-outs). Never worked at FAANGs or unicorns. Not a dev tool. Definitely huge risk (new search engine taking on Google).
I think YC cares about what they say they care about - making something people want. That's it. That's the secret. Having a small number (even 10s) of people who really love what you're making matters more than all the other signals you list.
Also, while I like what Andi is doing (some marketing terms aside), it's not a market risk (if you call yourself a search engine[1]). The market definitely exists, and is a Trillion $ one, with Google already dominating it. It depends on your execution ability as to how you capture it according to your strategy (which currently looks smart), but if you can't, the reason would be you could not outcompete Google, and not "the market is too small or does not exist". A typical market risk problem would be Airbnb for example.
Edit: All the best for the demo day
[1]: You can also be called a smart assistant. This way it has market risk, but carries negative connotation as the existing ones aren't as good. You know your strategy best, and I think it's a 10x better experience if I get the answer without having to open the link.
And thank you. You're right that execution is all that matters for us. Our most important thing is focusing 100% on what our users want, and iterating as quickly as we can toward product market fit based on feedback. So we are a classic case of "code and talk to users" as all that matters.
That means YC and the world gets to see where the moonshots go by supporting the less risky!
The other aspect of this is their target market (Seed investors) is also very much market risk averse, and invest heavily in execution risk businesses. They like their Saas multiples and GM very much.
Looks like they're going for a better, AI-assisted Google.