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I had no idea the returns for investors was so low. There has to be more to the story other than a bunch of people chasing the next Google or Microsoft. If I
by imp 20y ago
I had no idea the returns for investors was so low. There has to be more to the story other than a bunch of people chasing the next Google or Microsoft. If I remember correctly, pg said they started yc because it was fun and sort of like a real-life hack. Maybe other investors feel the same way. Or maybe they enjoy getting involved with the latest and greatest technology companies. If I had tons of cash, this type of investing would be a lot more fun than watching my money slowly grow in an indexed mutual fund.
- pg 20y agoI think most people who invest in startups do it in the hope of actually making money. And while the average return may be negative, the best investors make a lot. You just have to be honest with yourself about whether you're a good investor. At YC what drives us to make money is not wanting to be bad at what we do. If all the startups we fund fail, then we look bad, and we are the kind of people who really hate to look bad. That's arguably one of the unseen benefits of YC: if someone takes funding from us, they put themselves in a position where if they fail, we fail. YC is so public that we work much harder to make sure companies succeed than we would if we cared only about the returns.