3 ms·

Doing some numbers: When you add the acquisitions together you get $56 mill. Assuming that YC has an average stake of 7% they've made $3.9 mill from the acquis

by mixmax 17y ago

Doing some numbers: When you add the acquisitions together you get $56 mill. Assuming that YC has an average stake of 7% they've made $3.9 mill from the acquisitions so far. If you assume the expenditures to be $10.000 per startup that's $1.74 mill, since there are 174 companies in the spreadsheet. Also, since the YC guys need to get paid there's probably an overhead of $500.000 a year for five years. That's $2.5 mill. Adding the two numbers give you $4.24. mill. So if you include a nice wage for the four YC founders they're not making a profit yet, actually they're down $340.000. Of course these numbers are wildly inaccurate, and don't include future acquisitions, etc.

jackowayed 17y ago
Some places you can improve your numbers: * They start with ~7%, but almost all funding deals mean they get diluted. The bigger the acquisition, the more funding the company has taken (in general), so the less equity YC has (which means figuring out the average, even if you could, wouldn't help you much because the bigger funding deals would get overrepresented when you multiplied average equity * big exit where they actually were down to <1%). * The average investment is more like $20k. It's $11k+$3k/founder, so $17k for a 2-person company and $20k for a 3-person. I think that changed fairly recently though. I remember it being all 5's and 10's when I first heard about YC. Maybe $10k+$5k/founder? So that'd be $20k for 2 founders, $25k for 3. There's also probably a decent amount of money spent to fly people out to the interviews. $600/startup, if you assume they interview 2-3x as many as they fund, that's ~$1200 more per funded startup, or an additional 5% or so. Plus there's the cost of the office and utilties and dinners and such. (Just wondering, how nice/expensive is the food at the dinners?) But I think they're operating with a trend that shows that they will be highly profitable when you consider all the startups that they've already funded that will exit.
rokhayakebe 17y ago
I assume Dropbox and Loopt will change these numbers drastically. It is almost certain YC will have one 100M + exit from its pool of startups.
- rms 17y ago
  And Justin.tv is a UFC pay-per-view deal away from validating an entire industry... it is probably going to take them a while though, the UFC guy acted really angry at the congressional hearings on the subject of online live streaming video.
  - jolan 17y ago
    They already do pay-per-view online. They use silverlight for the smoothhd capability. justin.tv/ustream are used to pirate UFC pay-per-views.
    - rms 17y ago
      I meant that justin.tv may in the future negotiate a deal for them to sell legitimate, non-pirated UFC pay-per-view.
faramarz 17y ago
Don't forget, this time last year Sequoia injected $2 million into YC's new fund. Ron Conway, Paul Buchheit and Aydin Senkut all included. That means the startups in Summer '09, Winter '09 and this summers are probably being seeded using that fund.
jedc 17y ago
I generally was VERY conservative in my acquisition numbers. (I could easily make the case for bumping all the non-public prices by 50+%) The way I've generally looked at it is that YC has generally broken even or had a small profit so far on the exits they've had. They'll likely generate their massive return once companies like Dropbox, Loopt, etc have their exits.

by mixmax 17y ago

jackowayed 17y ago

Some places you can improve your numbers: * They start with ~7%, but almost all funding deals mean they get diluted. The bigger the acquisition, the more funding the company has taken (in general), so the less equity YC has (which means figuring out the average, even if you could, wouldn't help you much because the bigger funding deals would get overrepresented when you multiplied average equity * big exit where they actually were down to <1%). * The average investment is more like $20k. It's $11k+$3k/founder, so $17k for a 2-person company and $20k for a 3-person. I think that changed fairly recently though. I remember it being all 5's and 10's when I first heard about YC. Maybe $10k+$5k/founder? So that'd be $20k for 2 founders, $25k for 3. There's also probably a decent amount of money spent to fly people out to the interviews. $600/startup, if you assume they interview 2-3x as many as they fund, that's ~$1200 more per funded startup, or an additional 5% or so. Plus there's the cost of the office and utilties and dinners and such. (Just wondering, how nice/expensive is the food at the dinners?) But I think they're operating with a trend that shows that they will be highly profitable when you consider all the startups that they've already funded that will exit.

rokhayakebe 17y ago

I assume Dropbox and Loopt will change these numbers drastically. It is almost certain YC will have one 100M + exit from its pool of startups.

rms 17y ago
And Justin.tv is a UFC pay-per-view deal away from validating an entire industry... it is probably going to take them a while though, the UFC guy acted really angry at the congressional hearings on the subject of online live streaming video.
- jolan 17y ago
  They already do pay-per-view online. They use silverlight for the smoothhd capability. justin.tv/ustream are used to pirate UFC pay-per-views.
  - rms 17y ago
    I meant that justin.tv may in the future negotiate a deal for them to sell legitimate, non-pirated UFC pay-per-view.

faramarz 17y ago

Don't forget, this time last year Sequoia injected $2 million into YC's new fund. Ron Conway, Paul Buchheit and Aydin Senkut all included. That means the startups in Summer '09, Winter '09 and this summers are probably being seeded using that fund.

jedc 17y ago

I generally was VERY conservative in my acquisition numbers. (I could easily make the case for bumping all the non-public prices by 50+%) The way I've generally looked at it is that YC has generally broken even or had a small profit so far on the exits they've had. They'll likely generate their massive return once companies like Dropbox, Loopt, etc have their exits.