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Unfortunately, student loans constrain the freedom of action of many recent graduates. They have to have that income to make the payments, which can be quite h

Unfortunately, student loans constrain the freedom of action of many recent graduates. They have to have that income to make the payments, which can be quite high. This of course favors upper middle class people as young company founders.

pg 19y ago
Yes, that is a real problem. I thought of mentioning this in the essay. The problem is the same as with visas: the government's definition of work is a job working for someone else. I hope eventually they'll wise up and change the rules about student loans, because the intent of the rules about repayment is not simply to get the money back as soon as possible, but to discourage people from merely slacking after college. And on that scale founders are actually doing better than regular employees.
- henning 19y ago
  I'm sure megacorp lobbyists in DC will get right on that, Paul.
- benmathes 19y ago
  > The problem is the same as with visas: the government's definition of work is a job working for someone else. It's not quite that. At least some governmental oratory states that entrepreneurship is what drives the American economy. Verification of 'work' is just a hell of a lot easier if it's for a known company.
- tim2 19y ago
  Yes, this is far, far more severe than any credit card debt that that a student could possibly get into. Related to this, I know several people who had to drop out of school recently because they hadn't built up credit and didn't have parents to co-sign on school loans. Perhaps you should write on this some time, but I don't see how that could actually solve anything.
- strey 19y ago
  Could YC somehow register as the corporation the founders work for? Then they'd have a "regular" job for loan repayment.
- LogicHoleFlaw 19y ago
  How much of a hindrance are student loans to founders? Or inversely, how much of an advantage is having no debt?
  - zinder 19y ago
    Well, in one sense, it's much easier having no debt. Imagine trying to found a company if you owned a house with no mortgage, had a vegetable garden out back, and owed nobody anything. Realistically, what are your living expenses... how much money do you really need to buy 3- 6- or even 48-months of your time? Now imagine that you own no property of any sort, and have large loan payments that you have to make every month. How much money do you really need to buy even 3- or 6- months of your time. The opportunity cost of starting the startup is roughly the same (adjustments for interest between the riskfree rate and your credit rating notwithstanding), but the actual number of dollars that have to come from somewhere is quite different indeed.

pg 19y ago

Yes, that is a real problem. I thought of mentioning this in the essay. The problem is the same as with visas: the government's definition of work is a job working for someone else. I hope eventually they'll wise up and change the rules about student loans, because the intent of the rules about repayment is not simply to get the money back as soon as possible, but to discourage people from merely slacking after college. And on that scale founders are actually doing better than regular employees.

henning 19y ago
I'm sure megacorp lobbyists in DC will get right on that, Paul.
benmathes 19y ago
> The problem is the same as with visas: the government's definition of work is a job working for someone else. It's not quite that. At least some governmental oratory states that entrepreneurship is what drives the American economy. Verification of 'work' is just a hell of a lot easier if it's for a known company.
tim2 19y ago
Yes, this is far, far more severe than any credit card debt that that a student could possibly get into. Related to this, I know several people who had to drop out of school recently because they hadn't built up credit and didn't have parents to co-sign on school loans. Perhaps you should write on this some time, but I don't see how that could actually solve anything.
strey 19y ago
Could YC somehow register as the corporation the founders work for? Then they'd have a "regular" job for loan repayment.
LogicHoleFlaw 19y ago
How much of a hindrance are student loans to founders? Or inversely, how much of an advantage is having no debt?
- zinder 19y ago
  Well, in one sense, it's much easier having no debt. Imagine trying to found a company if you owned a house with no mortgage, had a vegetable garden out back, and owed nobody anything. Realistically, what are your living expenses... how much money do you really need to buy 3- 6- or even 48-months of your time? Now imagine that you own no property of any sort, and have large loan payments that you have to make every month. How much money do you really need to buy even 3- or 6- months of your time. The opportunity cost of starting the startup is roughly the same (adjustments for interest between the riskfree rate and your credit rating notwithstanding), but the actual number of dollars that have to come from somewhere is quite different indeed.