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Updates from YC
- akozak 8y agoI'm curious why more bay area startups haven't come to Oakland. (maybe it's happening and it's just not obvious?) Always felt like there was plenty of potential office space relatively close to BART but maybe that's wrong.
- alexk 8y agoWe moved from SF to Oakland more than a year ago and could not be happier! Here's the view from our Gravitational's Oakland office right now: https://imgur.com/2p9BX1b https://imgur.com/2p9BX1b
- infecto 8y agoI think its slowly happening. Square just took the building Uber was building out, all 356,000 sqft. This is going to make them the largest tech company in Oakland. And some company named Marqeta just put their name on a building...no idea how long they have been here but they now have enough money to have their name on both sides. Its slow but its definitely changing.
- akozak 8y agoHot tip for startups: A lot of ppl who work for the big co.s (me included) live or have migrated to the east bay for housing over the years but hate the commute.
- fourstar 8y agoHot tip? How does this solve anything? People who work at big tech companies migrate to Oakland pushing those who have been there out by driving rents higher. And you think those companies will forfeit their offices in the city/SV? Maybe you can kindly migrate back to where you came from?
- woah 8y agoBuild the wall?
- fourstar 8y agoHousing would be more appropriate.
- umeshunni 8y agoObligatory liberal hypocrisy link: http://marketurbanism.com/2017/01/27/the-disconnect-between-liberal-aspirations-and-liberal-housing-policy-is-killing-coastal-u-s-cities/ http://marketurbanism.com/2017/01/27/the-disconnect-between-...
- shmooth 8y agooh those poor flailing and flailing liberal coastal cities! maybe Republicans can teach them something, by, for example, the coastal city of......Knoxville, TN. :-D
- akozak 8y agoI've been here for 15 years?
- oids98d98s 8y agoStartups with office space have VC money, and can afford SF (in theory). Tons of small shops, including consulting, freelancing, etc, in Oakland. Companies with people who need to go to SF on a semi-regular basis and who work best in person but don't need to be in SF.
- nickelcitymario 8y agoTake this with a grain of salt, because I'm from Canada and have only been to SF once, but: If I had to guess, I'd say race and class conflict. I wasn't used to how heavily divided a culture could geographically be, and it seemed to me that Oakland was far more heavily multi-ethnic and financially poorer than the rest of the area. Before the hate poors in: - Yes, Canada still has a racism problem. But I don't know of any areas around me that are strongly of one ethnicity versus another. The major exception being "Indian" reserves, which is a whole other topic. - Yes, it's ridiculous for me to comment after only one visit. But that's how strong the difference seemed to be. Every cab and uber driver I had was from Oakland. - SF was beautiful and I don't mean any disparagement. You're all wonderful people and I love you.
- tyre 8y agoOakland is starting to become more attractive to people in SF precisely because of its diversity. "Really starting to enjoy Oakland—have you been to Drake's?" is the new climbing, hiking, etc.
- deleted 8y ago[deleted]
- nostrademons 8y agoMulti-ethnic is not a problem in the Bay Area. Most of the people with money & skills are also immigrants, and many of them are various shades of brown or yellow. Poor is. The Bay Area is one of the least racist places I've lived in in my life, but it's also one of the most classist. There's still a big class stigma based on where you live. (Though sometimes gentrification flips this on its head - the Mission and EPA used to be poor, crime-ridden areas, but now they're rich, crime-ridden areas.) It's very strange - I think that people who are used to the race & class social systems of much of the rest of North America don't really know what to make about the Bay Area, because in some ways we've busted out of those social systems and just replaced them with other ones which are...weird.
- dragonwriter 8y ago
- tyre 8y agoIt's possible but has it's own challenges. If the benefit of moving to Oakland is lower costs, than that has to be made up for partially by lower salaries (most of a startup's costs are in people.) Being near BART is fine, but not if your employees are coming from SF. Then they still need to pay SF salaries to make up for cost of living. Living in Oakland can be less compelling due to the housing stock. Oakland has many single family homes, which I personally feel is a good thing, but less compelling for many workers. (We can, of course, debate whether the kinds of workers who aren't in the life-stage to want/need a single family home are the right kinds of workers to go after, but that's a separate conversation.)
- nostrademons 8y agoA lot of really-early-stage startup activity (eg. solo engineer working on a project, or 3 guys working out of an apartment) seems to be happening in Oakland and the East Bay generally. It's the last place rents are affordable, so it's naturally attractive to people who need to go without income for a while. The commute over the bridges is terrible, so with the bulk of investment capital and experienced engineers living on the peninsula (and oftentimes more down by Palo Alto & Menlo Park than in SF), it remains difficult to scale East Bay companies. Unless you're someone like Elon Musk where you can just invest $100M of your own capital and need more semi-skilled manufacturing workers than skilled software engineers. Fremont/Milpitas is coming up as a bedroom community for mid-career engineers though (because if you work at Facebook it's just across the Dumbarton, while if you work at Google/Apple you can take 237 and avoid the bridges), so that may increase the engineering supply along the East Bay BART corridor. The East Bay really hurts from BART & Caltrain being two separate systems; it's easily BART accessible, but much of the peninsula's population only has Caltrain access, so you need a very time-consuming transfer to get there without dealing with the bridge traffic.
- djakjxnanjak 8y agoI think tech employment in downtown San Jose is going to blow up for this reason, once the BART tunnel goes in. Combined access from electrictrified Caltrain/BART/ACE/VTA/Amtrak is going to be killer for bringing in people from all over who don’t like being stuck in traffic. Google sees this coming and is building the new campus there. And that will push up prices for homes near any of those rail systems. It will also be possible to commute from SJ or Santa Clara to Oakland via BART, which may marginally improve recruiting there. It would be fantastic if Caltrain or somebody rebuilt the burnt-out rail bridge next to the Dumbarton, but that’s wishful thinking. It would be useful to integrate ACE, Caltrain, and Amtrak.
- kenneth 8y agoI put almost zero faith in Bay Area governments fixing the mess that is Bart/Caltrain/etc.
- paxy 8y agoI feel like if a company decides it doesn't want to be in SF proper it's more worth it to go south rather than north.
- jakelarkin 8y agoagree with most of the other comments in this thread, but would add - BART is an extremely filthy and dangerous transit system by any 1st world standard, and I say this as a lifelong transit rider. - Oakland, Berkeley, & Richmond govs/regs are business unfriendly & tech hostile. It's a traditionally poor working class area undergoing massive housing displacement & the political class is all old money or non-profit types.
- e40 8y ago- BART is an extremely filthy and dangerous transit system by any 1st world standard, and I say this as a lifelong transit rider. This is hysteria. I have many coworkers who ride BART on a daily basis for 15+ years and not a single reported incident from any of them, other than stinky homeless people that very rarely ride during peak hours.
- praneshp 8y ago> I have many coworkers who ride BART Have you personally taken BART on a consistent enough basis? I took it two days a week for a significant length of time and calling it filthy is not hysteria at all.
- jakelarkin 8y agohttp://www.ktvu.com/news/bart-investigating-3-violent-deaths-in-the-past-week http://www.ktvu.com/news/bart-investigating-3-violent-deaths... https://www.sfchronicle.com/bayarea/article/BART-s-approval-rating-plummets-as-riders-13550578.php https://www.sfchronicle.com/bayarea/article/BART-s-approval-... slightly depends on your entry/exit stations but I would regularly see crack/heroin use, defecation, deranged meth heads screaming and/or picking fights. I doubt I am alone in this.
- i_am_nomad 8y agoSeconding a couple of other replies here: it is not hysteria. In the 20 years I've lived in the Bay Area, BART has gone from tolerable to completely revolting.
- enahs-sf 8y ago
- zavi 8y agoBecause Oakland is sketchy (way more so than gentrified parts of SF) - people want to live in SF, that's what the blog post alludes to also. Some parts look post-apocalyptic with dozens of tents in a single encampment. I bet you if city manages to clean up the homeless and finish the bike line across the Bay Bridge there will be an explosion of startups because it's a perfect place to be in otherwise.
- dmode 8y agoThere are huge portions of Berkeley and Oakland which are awesome and where houses are as expensive as the peninsula. Piedmont, Montclair, Rockridge, Claremont etc
- massivecali 8y agoOakland is dangerous and gross compared to SF, and that's saying something as I found heroin needles next to a bench eating lunch in a beautiful office courtyard. I was accosted outside of the Oakland station in broad daylight and local police couldn't have cared less. "The violent crime rate in Oakland, California, is 1,421 per 100,000 residents. Forty-nine people were murdered in the city in 2016." https://www.cbsnews.com/pictures/the-most-dangerous-cities-in-america/32/ https://www.cbsnews.com/pictures/the-most-dangerous-cities-i... Please let's make smarter choices about where to move businesses to, given numerous options. Oakland definitely should not be one of them.
- hk__2 8y agoWouldn’t moving some businesses there eventually lower the crime rates? Violent crime is twice higher in Oakland, but property crime is about the same: 5,983 per 100,000 in Oakland [1]; 5,715 in SF [2] (6,168 according to [3]). [1] https://www.areavibes.com/oakland-ca/crime/ https://www.areavibes.com/oakland-ca/crime/ [2] https://sfgov.org/scorecards/public-safety/violent-crime-rate-and-property-crime-rate https://sfgov.org/scorecards/public-safety/violent-crime-rat... [3] https://www.areavibes.com/san+francisco-ca/crime/ https://www.areavibes.com/san+francisco-ca/crime/
- massivecali 8y agoHow would moving more businesses there lower the crime rate? Poverty is always touted as the source of crime in communities, but businesses moving from SF to Oakland wouldn't be employing Joe/Jolene poor person. If anything, doing so would just rehash the standard complaint about gentrification and alienation of current residents.
- baby 8y agodidn't work at all for SF.
- deleted 8y ago[deleted]
- dmode 8y ago
- eldavido 8y agoI live in Oakland and I see more tech activity there every day. LaunchDarkly, VSCO, etc. It's an interesting discussion because the city is huge and has many good and bad parts. West Oakland along Broadway is basically SF west. Go east of Lake Merritt and things get bad pretty quickly.
- baby 8y agoIt's cheaper but way more dangerous imo. That puts away a lot of people. Having said that it's changing and a lot of start ups do move there.
- georgewfraser 8y agoWe (Fivetran) moved to Oakland over a year ago and it's been fantastic. Great office right next to BART, great restaurants, and it's a big recruiting advantage. SF sees itself as the center of the universe, but most of the people in the Bay area actually live over here.
- erikpukinskis 8y agoIn general, I have observed socially that East Bay people are willing to take BART to SF, but SF people mostly won't come to the East Bay for any reason. Because it's rare, when an SF person does come out here to visit, I feel really loved. :)
- N0RMAN 8y agoSam who?
- badfrog 8y agohttps://en.m.wikipedia.org/wiki/Sam_Altman https://en.m.wikipedia.org/wiki/Sam_Altman
- minimaxir 8y ago> Speaking of San Francisco, we are considering moving YC to the city and are currently looking for space. I thought YC had an office in the city?
- tyre 8y agoThey do but it's just offices for partners and employees. Nowhere near large enough to hold dinners, office hours, etc.
- ironchief 8y agoAltman (YC) leans into SF Thiel leans away Will be interesting to see the winning move
- tosh 8y agoI wonder when YC is forking to other cities. Staying in the Bay Area longer than other acceleration programs which decentralized (& often diluted their network and quality) earlier was wise. That said, from the outside it seems like sticking to the Bay Area is no longer optimal. Startup School and YC China are mentioned but I think by now there must be enough YC alumni all over the world to facilitate local communities/office hours and investment activity (while keeping the quality). For example I like how Lambda School is expanding globally much faster. I know the two are difficult to compare and it is not a straight forward decision to make. Would love to learn if you have some thoughts on this.
- cududa 8y agoI assume they’re testing the waters given that they’re doing interviews for the next class on the ground in NYC
- akharris 8y agoInterviewing in NYC has much less to do with testing the waters for a new location than simplifying the application process for a greater number of good founders.
- streulpita 8y agosuuuure
- nostrademons 8y agoThe model for YC startups is that most need to raise outside capital after YC. Part of their value proposition is being able to create a market of follow-on investors so their startups don't get totally shafted in those deals. That requires being in areas where there are enough investors to create a liquid market in fundraising rounds after YC. China is one such area, and places like NYC or Boston could also work (YC used to be in Boston before PG & JL had kids). Those don't help much with the cost-of-living issue, though.
- jdsully 8y agoI think it says something about our industry that I assumed they were about to discontinue something or make a change that negatively impacted people.
- seizethecheese 8y agoOr maybe it says something about you. I don't mean to say you personally, but perhaps cynicism is an easy trap that a lot of the industry falls into.
- jdsully 8y agoPerhaps. But when it’s good news it usually makes it into the headline.
- jonas21 8y agoWell, I mean they kinda are discontinuing Sam.
- oids98d98s 8y agoAll signs point to Thiel entering politics. >Writing in Cato Unbound, the organ of the Cato Institute, a libertarian think-tank, Thiel wrote, > > …I no longer believe that freedom and democracy are compatible… The 1920s were the last decade in American history during which one could be genuinely optimistic about politics. Since 1920, the vast increase in welfare beneficiaries and the extension of the franchise to women — two constituencies that are notoriously tough for libertarians — have rendered the notion of "capitalist democracy" into an oxymoron. What a pleasant fellow. I earnestly wish him the worst.
- dang 8y agoCould you please review the site guidelines and follow them when posting here? They include: "Eschew flamebait. Don't introduce flamewar topics unless you have something genuinely new to say. Avoid unrelated controversies and generic tangents." https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html We detached this comment from https://news.ycombinator.com/item?id=19342355 https://news.ycombinator.com/item?id=19342355 and marked it off-topic.
- deleted 8y ago[deleted]
- kaycebasques 8y ago> The current total market capitalization of YC companies is around $150 billion. The YC network now has over 4,000 alumni and 1,900 companies, and it has become a reliable source of advice, customers, friendship, and support for YC founders. A question for people more savvy about VC than me. What's your ballpark estimate on YC's bottom line? They put $150K at least into each company, right? So that's $285M right there? But some of those are non-profits, in which case they only put $100K into the company. And then they get 7% of each company, which would theoretically be $10.5B? $150B * 0.07 = $10.5B (just removing non-profits from the equation). But accounting for dilution, it would probably be less than 7% ownership? In other words, I guess we'd need an estimate of how much YC actually owns in its overall portfolio. Forgive me if my numbers are wildly off or naive. VC isn't my domain.
- tim333 8y agoI think its about 3% as the 7% gets diluted so approx $4.5bn for the assets. Of course a lot of that is illiquid and unrealised. The GAAP bottom line would be a lot less and not give a very accurate picture as it wouldn't include most of the gains.
- tyre 8y agoTheir 7% stake has pro-rata and YC publicly states that it will follow-on to maintain that ownership up to $300m valuation. The 7% ownership also allows YC Continuity to be more attractive to later stage companies. If YC already has a 7% stake, then it only needs to invest an additional post-money 13% in order to raise its ownership to 20%. A new firm coming to the cap table would want to invest 20% post-money. So, if the company doesn't need 20% capital, then YC Continuity has a significant advantage.
- deleted 8y ago[deleted]
- jdoliner 8y agoI think YC only fairly recently started exercising their pro-rata. IIRC there was a while before YC Continuity was started when they didn't have funds allocated for pro-rata. They've had it for a while now but I think they may have missed out on some of the earlier successes, like Dropbox, Airbnb and Stripe, which is where a lot of the gains have been realized at this point.
- tzhenghao 8y agoI definitely understand the point on moving to SF. I was there for a YC hackathon few months ago, and their current office wasn't logistically easy to get to without a car/Uber. It wasn't close to a Caltrain station either, so it's a much bigger pain point for those commuting down from the city too.
- shafyy 8y agoI'm a bit worried that we might be seeing "peak YC". Clearly, Sam Altman and Michael Seibel are the most influential and impactful people that drive YC forward. Sam's on the way out, and I wouldn't be surprised if Michael also leaves in 1-2 years. Is YC going to be able to innovate without them? Furthermore, I would suggest that YC is becoming more risk-averse as it grows (as any organization does). Will that mean worse decision making? Another point is that the average age of YC partners is growing. Will that hinder them to spot and understand new trends, and pick the right companies? Now, this is an outside-view analysis. I've spoken to a few YC partners (as part of office hours or at events), but never went through YC myself. I know quite a few people who did, and they seem always most impressed with Sam and Michael. Edit: Typos
- deleted 8y ago[deleted]
- mwseibel 8y agoDon't worry - I'm not going anywhere :)
- freehunter 8y agoThat's exactly what I've said about three days before handing in my two weeks notice in the past ;)
- sama 8y agoThe entire partnership is incredible and does a huge amount of valuable work, and startup advising, that they don't get nearly enough credit for. I'll still be involved (and will ensure we continue to take risks and grow!), and obviously Michael is amazing.
- matthewwiese 8y agoBy damn, I just love when the big kahunas still involve themselves in the community they cultivated so long ago. Cheers, Sam; the best of luck to you and the team at YC.
- shmooth 8y agoSam finally too far off the deep end
- sethbannon 8y agoThis is really bittersweet news. On the one hand, this is a huge loss for YC. Sam's energy and vision helped herald in YC v2.0. His leadership will be sorely missed. On the other hand, I'll sleep better at night knowing he's dedicating himself fully to AI safety and the work of OpenAI. There's no one I'd rather have leading the effort to ensure AI development doesn't lead to a dark future.
- craigkerstiens 8y agoReally surprised by the consideration of moving to SF. For a long time now YC stated that the ability to focus down in the valley was key, though immediately founders moved to the city after. I knew of a few cases where founders were based in the city and would commute down on needed days. I'm a bit surprised as this shift now as it was positioned as thought out before, but the reality is the center of new tech startups is now very much SF.
- shmooth 8y agoYC in SF gonna be like Joakim Noah in NYC :-D
- pylus 8y agoMarket cap $150 billion is insane. Never thought it is that big.
- stevespang 8y agoSF is a non starter for most startups who don't have $3,600/month or more for even a one bedroom apartment (since YC requires all startups members to locate at their hub). Austin is the new shining star, way lower costs, lower taxes.
- rsweeney21 8y agoAm I the only one that feels like the YC brand is being diluted by the increasing size of their batches? 200 companies feels like too many.
- csbartus 8y agoNo, you are not alone. The current batch (W19) is disappointing so far: https://news.ycombinator.com/item?id=19333170 https://news.ycombinator.com/item?id=19333170
- appstorelottery 8y agoI didn’t hear anything about the 10k grants to startup school attendees. Did this happen?
- awaaz 8y agoYes, it did. AFAIK, they took in 15,000 companies, but gave the grant to about 100. I got the grant :-)
- randomsearch 8y agoRather than monetary valuation, what do you think have been the most innovative and significant startups from YC?
- denisvlr 8y agoI was in YC W16 batch. Coming from abroad, part of the YC experience was, besides the program itself, renting a house in a residential area of Palo Alto where our team of 4 lived and worked. We didn’t have a car and the nearest bars & restaurants were at a 20 minutes bike ride. This set up felt like a retreat, and really pushed us to 100% focus on our startup. Basically the only things I did for 4 months is working, exercising in the surrounding parks and eating homemade food. Had YC been located in SF it would have been a totally different experience. It’s a vibrant and exciting city specially for new comers. However, I understand YC’s rationale: most local founders live in SF and the 1h commute is painful, the current building is not easily accessible, and doesn’t scale to bigger and bigger batches, etc.
- lightedman 8y agoMy question, how many of those companies funded by YC have been caught doing things we don't like, such as dark patterns, data collection, and more? I can already think of two companies off the top of my head. It's pretty much a given fact on this planet you don't get huge valuations and money unless you're about to violate someone's privacy and sanctity. "Speaking of San Francisco, we are considering moving YC to the city and are currently looking for space. The center of gravity for new startups has clearly shifted over the past five years, and although we love our space in Mountain View, we are rethinking whether the logistical tradeoff is worth it, especially given how difficult the commute has become. We also want to be closer to our Bay Area alumni, who disproportionately live and work in San Francisco." Telecommuting works just fine for me when it comes to designing, prototyping, and testing actual physical products with companies around the world, from LEDs to solar panels to remotely-controlled hydroponics facilities - why can't you do the same with your primarily software and speaking stuff?
- dennisgorelik 8y agoWhat is "the current total market capitalization of YC companies" that were accepted into YC since Paul Graham and Jessica Livingston left YC (~February 2014)? That would be an interesting metric that evaluates Sam Altman's performance at YC.
- dennisgorelik 8y agoIt is weird that these "Updates from YC" do not list the name of the author of these updates...