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You get the full $500k upfront. In exchange, YC gets 7% equity upfront (for the first $125k), plus a proportional share of equity in your next funding round (fo
by tfehring 3y ago
You get the full $500k upfront. In exchange, YC gets 7% equity upfront (for the first $125k), plus a proportional share of equity in your next funding round (for the next $375k).
- Joel_Mckay 3y agoThat is around 5 months operating capital in a small company. Most would laugh you out their office asking for 7% of equity. I often wonder if people understand why 1:23 companies survive the startup cycle. Best regards =)
- scrollaway 3y agoIt … depends on the company. Some “small” companies have a burn rate of 20k, some 200k, some 2M. YC isn’t about the money. The equity you give away is also for the seal of excellence it carries, and the network it brings. I would gladly give 7% of my small company today for YC’s network and seal alone, and 10% of the money they give.
- Joel_Mckay 3y agoTo me... business is about the market sector size, product/service viability, and profit model. The fact is liabilities come in many forms, and small mistakes may cast a long shadow if you are a startup. Best of luck =)