9 ms·

> "I feel like Ycombinator in particular takes too much ownership stake from such a low investment (10% of your company for $6k/founder of investment? That seem

by sumukh1 15y ago

> "I feel like Ycombinator in particular takes too much ownership stake from such a low investment (10% of your company for $6k/founder of investment? That seems insane)" I wonder if this is actually an issue. I don't see any founders complaining about YC's equity (perhaps due to self-selection). Have founders ever needed more money than what YC and Start Fund but not enough to justify raising a round?

matthaughey 15y ago
I mentioned that specifically because I've invested myself in a few startups and typically I only get 1% at most for sometimes much more money than what Ycombinator offers.
- japhyr 15y ago
  People get much more than just funding from yc; I think people are happy to give 10% of their company for $6k plus all the connections and expertise that yc offers. If yc only offered money, they wouldn't get a 10% stake for $6k.
- alexkearns 15y ago
  I for one specifically did not apply to Y Combinator this year because of the big stake/small amount of cash they offered, though would have loved the mentoring and publicity. Six per cent for $6,000 per founder might be okay if you are a couple of guys or gals with an idea but if you are already profitable, it just does not make sense. There almost needs to be a Y Combinator for small-but-already-profitable web businesses, offering much better terms. Great talk, btw, Matt. As a fellow bootstrapper, it resonated with me.
  - JamesPeterson 15y ago
    Commercial banks offer what you're seeking. In our local scene when one of our cash-flow+ portfolio companies is seeking further capital for expansion, often debt is a better (cheaper) option than taking on VC investment (if they're CF+ they shouldn't be seeking angel terms!). We've actually had a big bank actively trying to sell such debt. If you're CF+ and need capital, talk to your bank.

9 ms·

> "I feel like Ycombinator in particular takes too much ownership stake from such a low investment (10% of your company for $6k/founder of investment? That seem

by sumukh1 15y ago

matthaughey 15y ago
I mentioned that specifically because I've invested myself in a few startups and typically I only get 1% at most for sometimes much more money than what Ycombinator offers.
- japhyr 15y ago
  People get much more than just funding from yc; I think people are happy to give 10% of their company for $6k plus all the connections and expertise that yc offers. If yc only offered money, they wouldn't get a 10% stake for $6k.
- alexkearns 15y ago
  I for one specifically did not apply to Y Combinator this year because of the big stake/small amount of cash they offered, though would have loved the mentoring and publicity. Six per cent for $6,000 per founder might be okay if you are a couple of guys or gals with an idea but if you are already profitable, it just does not make sense. There almost needs to be a Y Combinator for small-but-already-profitable web businesses, offering much better terms. Great talk, btw, Matt. As a fellow bootstrapper, it resonated with me.
  - JamesPeterson 15y ago
    Commercial banks offer what you're seeking. In our local scene when one of our cash-flow+ portfolio companies is seeking further capital for expansion, often debt is a better (cheaper) option than taking on VC investment (if they're CF+ they shouldn't be seeking angel terms!). We've actually had a big bank actively trying to sell such debt. If you're CF+ and need capital, talk to your bank.