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High risk in the sense that companies founded by Y-Combinator are focused on raising a lot of capital to feed extremely fast growth. This is not slow healthy g
by nightski 11y ago
High risk in the sense that companies founded by Y-Combinator are focused on raising a lot of capital to feed extremely fast growth. This is not slow healthy growth. From Y-combinator's perspective they are fine since a.) initial investment is low and b.) extreme diversification. But the companies themselves can be very volatile and risky.
- braythwayt 11y agoHowever, although their are obviously exceptions, YCombinator typically invests in founders who don’t have a ton of financial skin in the game. Which founders have kids that won’t eat if the company fails? If you aren’t looking at being thrown out of the family home, you aren’t really taking on a huge amount of risk. The typical thing at stake for most founders is opportunity cost: “With my grades and experience, I could have been making $200,000 - $300,000 consulting or at BigCo, but I chose to found a startup instead."