Ask HN: YC misses that went on to do well (like veed.io)
Its quite possible that even YC would miss a few good founders. One that I came across recently was veed.io. They have raised 35 million in funding from Sequoia. What other startups that YC rejected went on to do well?
85 comments
[ 3.8 ms ] story [ 155 ms ] threadJust think about this. Every successful startup was rejected by some VC. It is par for the course and not really a big deal if you are winning.
In my founder "generation" at least, many of us got excited and felt heard reading PG's old blog posts. A YC rejection can feel more personal when you've lionized them for years.
Separately: I'm not saying this to denigrate YC or anything; they get thousands of (at least moderately) serious applications and probably 10x that that are nonsense, but the interview we got had interviewers that seemed pretty unfamiliar with the sales processes of b2b companies that sell to midmarket or enterprise. I assume the people who did the 10 minutes with us were luck of the draw. And major props for promptly responding and saying no thanks; lots of vcs we talked to fucked around with responses and/or two even ghosted us.
So, YC for dev tools or b2c stuff? Probably great. YC for sales enablement or tooling for midmarket or enterprise sales teams? It may be very hit or miss. (Just like any vc.)
The parent company became Thesis, a venture studio where we raised a $21M Series A, and have incubated a few more projects (Keep, tBTC, Saddle, Tally).
A friend's company, Wyre, was rejected. They ended up being acquired for 1.5B [1].
It would've been nice to do YC in 2013/14. From what I've heard from other founders, I'm not sure the value today is nearly so high.
[0] - https://foldapp.com [1] - https://www.wsj.com/articles/crypto-startup-wyre-being-acqui...
Good job on fold by the way - I am a user and it’s great!
They did great with Coinbase, but by and large missed crypto due to that attitude. Maybe they'll reflect on that now that Garry is back.
Genuine question (based on what my perception has been, it’s mostly been FOMO investing, but maybe I’m just missing something?)
How much of that 1.5B was real money, and how much was soon-to-be worthless stock?
Also according to CrunchBase Bolt has raised about $970 million in total. Their revenue is at somewhere around $20-50 million, so they wouldn't even had the cash. Also seems unlikely they would have taken or gotten a massive loan to do an all-cash acquisition like that
In the age of cheap capital, this might have been an attainable goal: Raise money, pump valuation and dump on retail. If not, get acquired by another startup unicorn. That is no longer the case. Many startups are going to run out of capital and not only is IPO out of the picture in 2023 and beyond, the "failacquired" is just going to be straight up "shut down" when they can't find buyers.
I saw this happening heading towards 2018 briefly and I am seeing even more number of desperate startup founders who turned their cash positive business into a cash negative by raising money.
It always puzzled me why startups were being told to lose money to grow quickly and its made me uneasy knowing that when the tide goes out, it does so rapidly.
Founders at least are offloading so much equity in every round that every raise essentially becomes an “exit”.
I’m very surprised by this change. When I first started in this world, it wad drilled into my head that founder equity must be controlled at all costs. But now, the prevailing wisdom seems to be to sell off as much as you can with every round.
It will take some time but there's a side of this coin that nobody with money likes to talk about, its the slow realization that your material attainment creates a cycle of apathy and that you have an impact on the world that you've squandered ultimately in the vain chase of exuberance. You try to get over this feeling of emptiness by doing a variety of things but because you are so comfortable you can't find a way to undo it. Many fall into addictions, sex, drugs, purchases but its fleeting and you hit a wall. With all the money and comforts in the world an outsider would be puzzled but this is the burden of haves. While it isn't quite the same as have nots, its of the same pedigree.
Everybody chases what everybody else is chasing without realizing what it is they are chasing. This is the type of conversations we avoid. We don't stop, pause, and collective question what we do is correct. No there's no trickle down effect either. It's the other way around and I've seen many successful people destroy their lives once they let wealth get to their heads.
YC is also very public that a significant number of every batch have been rejected a couple of times. So basically being rejected by YC is not even a strong indicator that you won't be a YC success.
I found a bunch of “first check” VCs but out of the ~30 I contacted, only 4 responded with some level of, “Ahh, that market hasn’t been proven but keep in touch!”
With YC it’s, “You didn’t get selected but keep trying!”
The only need I have for VC money is freedom to work on my ideas full-time and continue to feed my family. I guess I’ll keep bootstrapping.
A close friend once told me, “Rejection is protection and redirection.” (:
- https://797capital.com/
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As an example, let's say you owned the Handshake TLD .testmasterflex…you'd be able to create SLDs (domains) and manage everything quite easily with my software. Currently, Handshake is in its second year and the ecosystem is quite barren so it's not friendly for non-devs. I have ~1k TLDs and setup websites secured with DANE and DNSSEC for ~900 of them. It was tedious, to say the least.
You may be thinking, “Okay, but hasn’t this been tried before? What makes Handshake so different?”
What I’ve gathered is, while alt‑roots have come and gone over time, Handshake came along at a great time; with a bunch of investment and an incentivized rollout to get developers interested in building upon it…and it’s working.
We’ve got ICANN‑accredited registrars like Porkbun, Encirca, and Namecheap selling Handshake domains. Namecheap even owns a handful of Handshake TLDs! The parent company of Porkbun, Top Level Design, operates .gay and .wiki on the ICANN side and claimed those names on Handshake. On top of that, we’ve got plenty of Handshake resolvers for your OS/platform of choice: macOS, Linux, Windows, iOS, Android, whatever. If that’s not support, I don’t know what is.
Anyhoo, lemme get off my soapbox to share some links.
- https://blog.neuenet.com/post/why-get-a-tld
- https://neuenet.com/
- https://blog.neuenet.com/
- https://twitter.com/neuenet
- https://twitter.com/beachfront_
I'd suggest really dumbing it down.
People don't care about blockchains for the sake of decentralization or whatever, they'll care if they can build cool shit on it easily though. It'll be easier to show when I'm ready to launch.
Initially, I expect volume to modest. The Handshake community will be the early adopters/speculators. Once the registrar gains features like a website builder and one-click install integrations (Wordpress, Gatsby, whatever), I'm going to reach out to creatives I admire to see what they can do.
I don't expect to set the world on fire or make millions within some short timeframe. My main goal is to empower people to build dope shit they wouldn't otherwise be able to build on traditional domains.
Slow and steady focus/growth.
Everytime I watch dragons den I get the same feeling. You have $1m in orders this year, which should be a profit of 200k, sure I will give you 100k for 20% of your company.
From this Quora answer [2]:
> Apparently, only one partner, Robert Morris, reviewed the SendGrid application, and he gave it a highly negative score, calling it a "spam company." That pushed it so far down the application queue that no other partner reviewed it. Paul talks about how they changed the application process after that so that any applications negatively scored by Robert would also get reviewed by Paul.
(Interestingly, venture returns skew so highly to big winners that SendGrid's objectively huge outcome would not even have had a material impact on YC's current portfolio value of nearly $1T [3]. I'm not aware of any current $10B+ companies that were rejected by YC, though there may be some.)
[1] https://www.zdnet.com/article/twilio-to-acquire-email-api-pl...
[2] https://www.quora.com/Why-was-SendGrid-rejected-from-YCombin...
[3] https://www.ycombinator.com/
I don't think you mean portfolio value. That would mean YC actually owns $1T in the companies they funded, at their current valuation. The following on YC front page is more meaningful: "Our companies have a combined valuation nearing $1T."
Was he wrong? Honest question. Looking at their homepage I'm guessing a good portion of unsolicited emails in my inbox went through SendGrid.
Any modern paid email protection service will also work nicely with sendgrid and the like.
You worked at orgs that didn't have the best decision making if they are blocking sendgrid. Talk about throwing the baby with the bathwater. Lazy mitigations made bad security. This is especially true here since sendgrid is hardly the only one of their kind so you will play whackamole blocking all kinds of legit services because... you don't have toolimg that can follow 301's??
I'm going to guess Sendgrid themselves also look for high ratios of spam reports and do the same.
https://en.m.wikipedia.org/wiki/Morris_worm
[1] https://davidgcohen.com/2020/09/19/a-review-of-the-first-ele...
And I would take a guess Bolt probably got rejected.
YC is mentioned at timestamp https://youtu.be/pYS3QKJHUDM?t=715
I attended the talk. The founder said they'll grow organically and won't need any VC money. I can't find the sections are not in the youtube video (missing minutes?). So I'm interested why the founder changed his opinion.
The way they broke down the traditional venture path with YC was eye-opening. Lots of divvying up the pie.
Was told the business required a degree of enterprise sales that my skills weren't suited for. It's now worth $350m (on paper at least).
That said, no hard feelings. They see so many applications - they're bound to make the wrong decision time to time.
10mins isn't enough time and their judgement is likely to be off (it is also mostly also down to the interviewee / founders to sell themselves in whatever time they have). I've heard this similar "no skill" story before from another start-up (which isn't doing as good... yet).
> It's now worth $350m (on paper at least).
YC's bar is $10b exits. I hope you get there!
(I don't think there's anything wrong with clearbit just to be clear)