3 ms·

Seems like a deeply tedious topic, but it sounds like the argument is that the small number of (claimed) profitable companies have basically ignored whatever it

by lvs 5y ago

Seems like a deeply tedious topic, but it sounds like the argument is that the small number of (claimed) profitable companies have basically ignored whatever it is you tell them to do. That's a great pitch.

deleted 5y ago
[deleted]
tomhoward 5y ago
In my YC batch (I was in the same one as dang and Airbnb), the issue of revenue/profit was what the partners talked about the most. Growth too, but profitable growth. Like, it was talked about all the time in the batch. That was particularly important in our 2009 batch due to the financial crisis, but it remained important later in the good times - see PG’s post “Default Alive or Default Dead?”. Though it took us a while due to engineering challenges, our company survived and became profitable by minimizing spend and focusing on revenue/profit, just as YC advised. This notion that YC backs/encourages companies to flush money down the drain is a mistakenly applied stereotype spawned from a combination of different eras, different companies and different investors. Notably, YC has never been involved with companies like Uber, WeWork or Theranos, or any other company that SoftBank has tried to artificially pump up by pouring billions of dollars into.
- mercer 5y ago
  And yet here they are investing in something that is so obviously a scam that possibly even my grandmother would notice. It reminds me of the "but you fuck ONE goat" story: one misstep like this surely can and should have more impact than all the good steps.
  - tomhoward 5y ago
    > "investing in something that is so obviously a scam" None of us has any idea what was presented in the application form and interviews, but given YC prizes its reputation above anything else, we can reasonably presume it wasn't obviously a scam.
    - lvs 5y ago
      Most of these companies are obviously a scam in one way or another. It just depends on your definition of what a scam is. Is it a scam to insert a middle-man to profit off a transaction that already occurs, or is it a brilliant hack? Is it a scam to use huge amounts of veture funding to undercut prices in an existing market to grab market share and claim "disruption?" These are called business models, but some of us call them scams. They seem particularly scammy when they never ultimately turn a profit and begin to look suspiciously pyramid shaped.
      - tomhoward 5y ago
        > It just depends on your definition of This is the moment in an online discussion where we all lose 50 IQ points, so thanks for that. "Scam" has a well understood meaning in modern legal and economic systems, and that's obviously what I'm addressing, not some other ideologically-charged alternative definition that you're now invoking as a debating move that amounts to little more than trolling. (As for middlemen - for as long as commerce has existed, middlemen have been derided for inserting themselves into transactions that were already happening, by people blithely handwaving away the fact that those transactions were not, in fact, already happening.) Your insinuation was that YC trains the founders it invests in to deliberately build long-term money-losing companies, which is demonstrably false and also highly implausible. Philosophical discussions about the deeper nature of things are also of great interest to me, but not like this.
        lvs 5y ago
        I'll set aside your ad hominem and let you go on your merry way. Enjoy.

by lvs 5y ago

deleted 5y ago

[deleted]

tomhoward 5y ago

In my YC batch (I was in the same one as dang and Airbnb), the issue of revenue/profit was what the partners talked about the most. Growth too, but profitable growth. Like, it was talked about all the time in the batch. That was particularly important in our 2009 batch due to the financial crisis, but it remained important later in the good times - see PG’s post “Default Alive or Default Dead?”. Though it took us a while due to engineering challenges, our company survived and became profitable by minimizing spend and focusing on revenue/profit, just as YC advised. This notion that YC backs/encourages companies to flush money down the drain is a mistakenly applied stereotype spawned from a combination of different eras, different companies and different investors. Notably, YC has never been involved with companies like Uber, WeWork or Theranos, or any other company that SoftBank has tried to artificially pump up by pouring billions of dollars into.

mercer 5y ago
And yet here they are investing in something that is so obviously a scam that possibly even my grandmother would notice. It reminds me of the "but you fuck ONE goat" story: one misstep like this surely can and should have more impact than all the good steps.
- tomhoward 5y ago
  > "investing in something that is so obviously a scam" None of us has any idea what was presented in the application form and interviews, but given YC prizes its reputation above anything else, we can reasonably presume it wasn't obviously a scam.
  - lvs 5y ago
    Most of these companies are obviously a scam in one way or another. It just depends on your definition of what a scam is. Is it a scam to insert a middle-man to profit off a transaction that already occurs, or is it a brilliant hack? Is it a scam to use huge amounts of veture funding to undercut prices in an existing market to grab market share and claim "disruption?" These are called business models, but some of us call them scams. They seem particularly scammy when they never ultimately turn a profit and begin to look suspiciously pyramid shaped.
    - tomhoward 5y ago
      > It just depends on your definition of This is the moment in an online discussion where we all lose 50 IQ points, so thanks for that. "Scam" has a well understood meaning in modern legal and economic systems, and that's obviously what I'm addressing, not some other ideologically-charged alternative definition that you're now invoking as a debating move that amounts to little more than trolling. (As for middlemen - for as long as commerce has existed, middlemen have been derided for inserting themselves into transactions that were already happening, by people blithely handwaving away the fact that those transactions were not, in fact, already happening.) Your insinuation was that YC trains the founders it invests in to deliberately build long-term money-losing companies, which is demonstrably false and also highly implausible. Philosophical discussions about the deeper nature of things are also of great interest to me, but not like this.
      - lvs 5y ago
        I'll set aside your ad hominem and let you go on your merry way. Enjoy.