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I wonder what this will mean for the 7% they take. Quite a few people reduce that 7% to the price of the stage on demo day which I’m sure is less valuable if s

I wonder what this will mean for the 7% they take. Quite a few people reduce that 7% to the price of the stage on demo day which I’m sure is less valuable if shared with many more people. I’m sure YC is happy with the same size chunk of more companies! For the founders, is the YC network going to stay worth 7% of every company that joins it? Will founders get as much value from the network as before with much less spotlight?

vram22 6y ago
>For the founders, is the YC network going to stay worth 7% of every company that joins it? That 7% is not at all a single number. Effectively, it is 7% of the valuation of each company in YC, which can vary from very low, zero or maybe even negative, to Dropbox-like highs.
- hctaw 6y ago
  GP is talking about the equity cost to join the YC network, not how much money YC is able to get for that equity way down the line. The question is whether increased participation will dilute the pool of VCs who come to demo day with their checkbooks, or if the network effects will scale. I don't think anyone knows the answer to that.
  - vram22 6y ago
    Yes, I was quite aware of, and was referring to, that (the first clause of your first sentence), but also something more. Maybe I did not make it clear. Will try to restate it better tomorrow.
    - vram22 6y ago
      Actually, now I think that your GP's question itself (to which I replied above) is not very clear or meaningful, or at least not clearly worded. Mea culpa, maybe. So won't add more.
lacker 6y ago
If the value of YC goes down, it should be clear soon, because the valuation of YC startups on demo day will go down. That hasn’t been the case at all though - since 2010 when I first went through YC the typical valuations have pretty clearly been trending up. I hope YC can keep scaling, because the number of startups is not fixed. I would like to live in a world where a startup is going public every day, where YC funds tens of thousands of startups every year. Maybe we can get there.
- parhamn 6y ago
  That would definitely be a misleading measure of this change’s success. Valuations have been rising steadily across VC, significantly so. I’m sure it would at YC regardless of this change as well. Founders will be speaking about how useful it is soon and we’ll most likely trust them. Hope they keep quality because it is awesome to have it be more inclusive!

vram22 6y ago

>For the founders, is the YC network going to stay worth 7% of every company that joins it? That 7% is not at all a single number. Effectively, it is 7% of the valuation of each company in YC, which can vary from very low, zero or maybe even negative, to Dropbox-like highs.

hctaw 6y ago
GP is talking about the equity cost to join the YC network, not how much money YC is able to get for that equity way down the line. The question is whether increased participation will dilute the pool of VCs who come to demo day with their checkbooks, or if the network effects will scale. I don't think anyone knows the answer to that.
- vram22 6y ago
  Yes, I was quite aware of, and was referring to, that (the first clause of your first sentence), but also something more. Maybe I did not make it clear. Will try to restate it better tomorrow.
  - vram22 6y ago
    Actually, now I think that your GP's question itself (to which I replied above) is not very clear or meaningful, or at least not clearly worded. Mea culpa, maybe. So won't add more.

lacker 6y ago

If the value of YC goes down, it should be clear soon, because the valuation of YC startups on demo day will go down. That hasn’t been the case at all though - since 2010 when I first went through YC the typical valuations have pretty clearly been trending up. I hope YC can keep scaling, because the number of startups is not fixed. I would like to live in a world where a startup is going public every day, where YC funds tens of thousands of startups every year. Maybe we can get there.

parhamn 6y ago
That would definitely be a misleading measure of this change’s success. Valuations have been rising steadily across VC, significantly so. I’m sure it would at YC regardless of this change as well. Founders will be speaking about how useful it is soon and we’ll most likely trust them. Hope they keep quality because it is awesome to have it be more inclusive!