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Ask YC: Do consulting companies get funded? Why or why not?
I suspect the answer is no, and I can think of some obvious disadvantages, but I would like to gain some perspective on this. Also, hybrid companies that are working on product, but aim to be somewhat self-funded by consulting at the same time.
(This doesn't have to be specifically for YC - anyone involved in angel or VC funding is welcome to share their perspective.)
- wavephorm 15y agoYou can see a list of companies YC has funded at http://yclist.com http://yclist.com There's an awful lot of consumer facing web "product" companies (most of them clones like "Twitter for Teachers") and very few, if any all-purpose software/consulting companies. My only guess is they prefer companies that can be condensed into a laser-focused story in the form of a well-oiled slide-deck and elevator pitch for the YC Demo Day. Meanwhile, software/consulting companies like Fog Creek or 37 Signals can do very well for themselves.
- ig1 15y agoGenerally no, to get investment you need to be able to offer a 10x return in a short time frame (3-5 years). Very few consultancy firms can offer that because it's hard to rapidly scale businesses where growth is restricted by number of employees. Scaling a people based business is hard (both because hiring is hard and also you can't stop people leaving to compete with you).
- petervandijck 15y agoNo, unless you've found a way to make consulting companies scale.