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Yea, I’ve found it interesting reading about YC companies from this batch that include: - A scam MMO - Terminal autocomplete as a service - A Splitwise clone

Yea, I’ve found it interesting reading about YC companies from this batch that include: - A scam MMO - Terminal autocomplete as a service - A Splitwise clone - An app that puts your next meeting in your menu bar (for $10/month!) YC gets 5K+ applications/cycle, accepts 1-3%, so they rejected 4500+ companies for these?

new299 5y ago
I have some sympathy for the difficulty evaluating tech plays when "an RSS search engine" turns into twitter. These ideas are the starting point, but it's difficult to tell what they might turn into. Quite possibly they evaluate the ability of the founders to shape the company into something interesting during the program. But more than that, they're probability are trying to figure out how well the founders will perform at demo day, after they've helped them polish the play.
- wearywanderer 5y ago
  "Invest in the team" makes some sense when you're talking about bright people with a lame idea (RSS search engine, or whatever.) But in this case the idea isn't merely lame; it's a scam, and the team being invested in are a team of con-artists. What might they pivot to, if not another scam?
  - aidenn0 5y ago
    A key skill of con-artists is being able to make yourself resemble someone competent. If you go back to 5 years ago, YC probably wasn't on the radar for con artists yet, but starting about then, it was becoming clear that VCs had more money than there were good companies to fund. We are now seeing the results.
    - api 5y ago
      Unfortunately the con artists make funding harder for people who are not con artists. A con artist can spend 100% of their time and effort on polish and marketing, while someone trying to actually do something often has to make those things an afterthought. I’m sure the con artists have much better decks and web sites.
  - deleted 5y ago
    [deleted]
  - RapidFire 5y ago
    "Invest in the team" gets you Juicero. Great ambition; they raised a bunch of money. Great production; watch a tear down of the Juicero product itself, it is a mechanical work of art. Great potential; a SaaS for a fruit drink? Lots of people love fruit drinks! They can buy our packets of delicious pre-made juice, people drinking juice is a huge Billion Dollar Market™! Stupid Idea! You can just squeeze the juice out of the bag by hand, no fancy device needed. It is less convenient than pouring from a bottle! Does it really taste better than the delicious organic juice you can buy at any grocery store in every city for a lower price? Lets put one hundred and twenty million dollars behind it and find out. Hahahahahahahahaha big swing and miss! Survey said? No. You can of course have a great team with the smartest best credentialed people working on the idea motivated by tons of money. If the idea is bad they still fail, maybe they can pivot, but probably not.
    - ALittleLight 5y ago
      YCombinator doesn't put in that much money though. I'm sure they don't intentionally fund scams or juiceros, but if they do, that's not the end of the world. It's a bigger deal to miss the dumb thing that turns out to be good then to accidentally fund a few dumb things.
      - RapidFire 5y ago
        Totally agree not trying to be critical of YC. Situations like Juicero, Theranos, this topic, et al scams, are interesting to observe.
    - wearywanderer 5y ago
      The Juicero was very overbuilt, I know because I watched the AvE video, but isn't that a sign of amateur engineering? I'm thinking of the old saying that anybody can make a bridge that stands, but it takes an engineer to make one that barely stands.
      - RapidFire 5y ago
        Hah! It's totality overbuilt for a product that squeezes a bag of Juice! That being said the idea did work for Coffee: e.g Keurig; just not juice. >it takes an engineer to make one that barely stands. Engineers do not build bridges that barely stand. They build bridges that they reason will stand for an amount of time in the conditions they predict the bridge will be subject to versus the cost required to build said bridge. They build realizing that no bridge will stand forever but it must stand for a specified amount of time. They build to "Correct", Not "Perfect"
debarshri 5y ago
We have been following YC's devops companies. It seems like they are basically investing in pretty much similar companies, which we found a little bit weird. I would assume as fund or incubator you would diversify your investments.
- sokoloff 5y ago
  In an area that might be hot, VCS are wise to diversify by investing in multiple companies in the space rather than trying to pick the winner themselves way ahead of time. VC is about funding the massive winner and much, much less about avoiding funding the runners-up.
treelovinhippie 5y ago
The VC game these days is no different to flipping houses. They're primarily funding boring, inconsequential and incremental startups which can be acquired in <5 years. Or chasing the <1 year money-on-money return of crypto projects. It's Peter Thiel's "Great Stagnation" decline accelerated by the capital allocation of short-sighted VCs.
zumu 5y ago
Definitely damaging to the YC brand. I'd like to see a postmortem on how these _blatant_ con artists got through.
- sombremesa 5y ago
  Italics on HN are made using asterisks. They should really make underscores do the same...not like those do anything else.
- lvs 5y ago
  Maybe the brand is a little bit hyped to begin with? I suspect there are only two companies these VCs have ever funded that are known to turn a profit. It seems like they've trained a generation of young smart people on how to get rich by losing money.
  - dang 5y ago
    What a strange thing to hear. Even I can tell you that many more than "two" YC companies have become profitable, and I'm pretty removed from the business side of YC.
    - lvs 5y ago
      Which ones? There are only two public companies that currently make a profit that I'm aware of: dropbox and coinbase. I don't really pay much attention, but that's all I can think of at the moment.
      - dang 5y ago
        Well, here's one: https://www.forbes.com/sites/alexkonrad/2021/03/08/zapier-bootstraps-to-5-billion-valuation/ https://www.forbes.com/sites/alexkonrad/2021/03/08/zapier-bo.... Sorry I don't have a list for you, but HN seems to have warped my memory in strange ways. I'm sure that YC has funded at least dozens, probably hundreds of profitable companies, including many that people wouldn't remember, because they found a lucrative niche for the founders and a small team (or maybe even just the one or two founders), and opted out of the fundraising track and are happily making a good living. That's not the preferred outcome from a venture investor's point of view, of course, but YC has always supported what founders want to do. Also, Zapier's an outlier - there are others that have followed a more conventional fundraising path.
chaostheory 5y ago
I've been following YC companies closely for about 6-8 years of data. Before the last big transition, I noticed virtually every founder came from an Ivy League school or something comparable. Their work experience was equally impressive before YC. Other people noticed this too and brought up the lack of diversity and complained. They felt that this strayed from pg's initial goal for YC, which was helping the little guy against the VCs instead of being yet another launch pad for Ivy League alum. Is this the result of YC wanting more diversity (not just gender and race, but for background too like education and experience)? EDIT: The technical founder came from Apple and Cruise, and he graduated from the Univ of Michigan. He has the same cred as most YC founders. They probably didn't vet them as much since he came from a successful YC company, and I'm sure they talked to his former bosses. YC's system just had a public failure after using what seems like the same process for 15 years. EDIT: If YC was too careful, Stripe and AirBnB wouldn't have happened. Those guys didn't have any experience in their respective industries either.
tmilard 5y ago
Yes, it is funny. Sometimes fools with big mouth get more attention than they clearly deserve. By the way, I wouldn't like to be those three YC interviewers who valitaded this idiotic project into ycombinator ! "Le bonnet d'âne pour tous les trois ! "
Aeolun 5y ago
Didn’t Oculus sound just as crazy when it was conceived? As far as I know the founder had barely any experience with hardware. Just a glorified gamer.
- husainhz7 5y ago
  His wikipedia[1] page states that he was a VR enthusiast for quite a while, building several prototypes before launching the kickstarter [1] https://en.wikipedia.org/wiki/Palmer_Luckey https://en.wikipedia.org/wiki/Palmer_Luckey
- rasz 5y ago
  First Oculus was pretty much linear continuation of where VR died in the nineties with VFX1 and Virtuality. Merely a hardware upgrade of LCD and IMU technology.
nowherebeen 5y ago
I lost a lot of respect for YC when I realized they invested in a startup that sold laundry detergent with a manly scent. The founders I think were from Stanford. So yeah, I don't think they are nearly as good as they say at judging startups. I believe a lot of it is based on signaling from founders and already successful startups applying.

new299 5y ago

I have some sympathy for the difficulty evaluating tech plays when "an RSS search engine" turns into twitter. These ideas are the starting point, but it's difficult to tell what they might turn into. Quite possibly they evaluate the ability of the founders to shape the company into something interesting during the program. But more than that, they're probability are trying to figure out how well the founders will perform at demo day, after they've helped them polish the play.

wearywanderer 5y ago
"Invest in the team" makes some sense when you're talking about bright people with a lame idea (RSS search engine, or whatever.) But in this case the idea isn't merely lame; it's a scam, and the team being invested in are a team of con-artists. What might they pivot to, if not another scam?
- aidenn0 5y ago
  A key skill of con-artists is being able to make yourself resemble someone competent. If you go back to 5 years ago, YC probably wasn't on the radar for con artists yet, but starting about then, it was becoming clear that VCs had more money than there were good companies to fund. We are now seeing the results.
  - api 5y ago
    Unfortunately the con artists make funding harder for people who are not con artists. A con artist can spend 100% of their time and effort on polish and marketing, while someone trying to actually do something often has to make those things an afterthought. I’m sure the con artists have much better decks and web sites.
- deleted 5y ago
  [deleted]
- RapidFire 5y ago
  "Invest in the team" gets you Juicero. Great ambition; they raised a bunch of money. Great production; watch a tear down of the Juicero product itself, it is a mechanical work of art. Great potential; a SaaS for a fruit drink? Lots of people love fruit drinks! They can buy our packets of delicious pre-made juice, people drinking juice is a huge Billion Dollar Market™! Stupid Idea! You can just squeeze the juice out of the bag by hand, no fancy device needed. It is less convenient than pouring from a bottle! Does it really taste better than the delicious organic juice you can buy at any grocery store in every city for a lower price? Lets put one hundred and twenty million dollars behind it and find out. Hahahahahahahahaha big swing and miss! Survey said? No. You can of course have a great team with the smartest best credentialed people working on the idea motivated by tons of money. If the idea is bad they still fail, maybe they can pivot, but probably not.
  - ALittleLight 5y ago
    YCombinator doesn't put in that much money though. I'm sure they don't intentionally fund scams or juiceros, but if they do, that's not the end of the world. It's a bigger deal to miss the dumb thing that turns out to be good then to accidentally fund a few dumb things.
    - RapidFire 5y ago
      Totally agree not trying to be critical of YC. Situations like Juicero, Theranos, this topic, et al scams, are interesting to observe.
  - wearywanderer 5y ago
    The Juicero was very overbuilt, I know because I watched the AvE video, but isn't that a sign of amateur engineering? I'm thinking of the old saying that anybody can make a bridge that stands, but it takes an engineer to make one that barely stands.
    - RapidFire 5y ago
      Hah! It's totality overbuilt for a product that squeezes a bag of Juice! That being said the idea did work for Coffee: e.g Keurig; just not juice. >it takes an engineer to make one that barely stands. Engineers do not build bridges that barely stand. They build bridges that they reason will stand for an amount of time in the conditions they predict the bridge will be subject to versus the cost required to build said bridge. They build realizing that no bridge will stand forever but it must stand for a specified amount of time. They build to "Correct", Not "Perfect"

debarshri 5y ago

We have been following YC's devops companies. It seems like they are basically investing in pretty much similar companies, which we found a little bit weird. I would assume as fund or incubator you would diversify your investments.

sokoloff 5y ago
In an area that might be hot, VCS are wise to diversify by investing in multiple companies in the space rather than trying to pick the winner themselves way ahead of time. VC is about funding the massive winner and much, much less about avoiding funding the runners-up.

treelovinhippie 5y ago

The VC game these days is no different to flipping houses. They're primarily funding boring, inconsequential and incremental startups which can be acquired in <5 years. Or chasing the <1 year money-on-money return of crypto projects. It's Peter Thiel's "Great Stagnation" decline accelerated by the capital allocation of short-sighted VCs.

zumu 5y ago

Definitely damaging to the YC brand. I'd like to see a postmortem on how these _blatant_ con artists got through.

sombremesa 5y ago
Italics on HN are made using asterisks. They should really make underscores do the same...not like those do anything else.
lvs 5y ago
Maybe the brand is a little bit hyped to begin with? I suspect there are only two companies these VCs have ever funded that are known to turn a profit. It seems like they've trained a generation of young smart people on how to get rich by losing money.
- dang 5y ago
  What a strange thing to hear. Even I can tell you that many more than "two" YC companies have become profitable, and I'm pretty removed from the business side of YC.
  - lvs 5y ago
    Which ones? There are only two public companies that currently make a profit that I'm aware of: dropbox and coinbase. I don't really pay much attention, but that's all I can think of at the moment.
    - dang 5y ago
      Well, here's one: https://www.forbes.com/sites/alexkonrad/2021/03/08/zapier-bootstraps-to-5-billion-valuation/ https://www.forbes.com/sites/alexkonrad/2021/03/08/zapier-bo.... Sorry I don't have a list for you, but HN seems to have warped my memory in strange ways. I'm sure that YC has funded at least dozens, probably hundreds of profitable companies, including many that people wouldn't remember, because they found a lucrative niche for the founders and a small team (or maybe even just the one or two founders), and opted out of the fundraising track and are happily making a good living. That's not the preferred outcome from a venture investor's point of view, of course, but YC has always supported what founders want to do. Also, Zapier's an outlier - there are others that have followed a more conventional fundraising path.

chaostheory 5y ago

I've been following YC companies closely for about 6-8 years of data. Before the last big transition, I noticed virtually every founder came from an Ivy League school or something comparable. Their work experience was equally impressive before YC. Other people noticed this too and brought up the lack of diversity and complained. They felt that this strayed from pg's initial goal for YC, which was helping the little guy against the VCs instead of being yet another launch pad for Ivy League alum. Is this the result of YC wanting more diversity (not just gender and race, but for background too like education and experience)? EDIT: The technical founder came from Apple and Cruise, and he graduated from the Univ of Michigan. He has the same cred as most YC founders. They probably didn't vet them as much since he came from a successful YC company, and I'm sure they talked to his former bosses. YC's system just had a public failure after using what seems like the same process for 15 years. EDIT: If YC was too careful, Stripe and AirBnB wouldn't have happened. Those guys didn't have any experience in their respective industries either.

tmilard 5y ago

Yes, it is funny. Sometimes fools with big mouth get more attention than they clearly deserve. By the way, I wouldn't like to be those three YC interviewers who valitaded this idiotic project into ycombinator ! "Le bonnet d'âne pour tous les trois ! "

Aeolun 5y ago

Didn’t Oculus sound just as crazy when it was conceived? As far as I know the founder had barely any experience with hardware. Just a glorified gamer.

husainhz7 5y ago
His wikipedia[1] page states that he was a VR enthusiast for quite a while, building several prototypes before launching the kickstarter [1] https://en.wikipedia.org/wiki/Palmer_Luckey https://en.wikipedia.org/wiki/Palmer_Luckey
rasz 5y ago
First Oculus was pretty much linear continuation of where VR died in the nineties with VFX1 and Virtuality. Merely a hardware upgrade of LCD and IMU technology.

nowherebeen 5y ago

I lost a lot of respect for YC when I realized they invested in a startup that sold laundry detergent with a manly scent. The founders I think were from Stanford. So yeah, I don't think they are nearly as good as they say at judging startups. I believe a lot of it is based on signaling from founders and already successful startups applying.