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Why you should not apply to YC
- eightturn 3y agoI sell onions on the internet, and I approve this message.
- Krientine 2y ago[dead]
- orangesite 3y agoThis is the nub of the matter. I could have saved myself a decade. The only thing from YC that survived our relationship was the incorporation of the company. I still think there's a massive gap in the market for an ergodic startup community where the young ambitious people tell the Gen-X's to go fuck themselves with a police baton and instead enjoy the benefits of pooling the risks & sharing the rewards.
- deleted 3y ago[deleted]
- MattGaiser 3y agoI imagine the problem is how do you pool the risk without being able to assess with confidence who will succeed and who will fail? And how do you prevent freeloaders who don't expect to succeed wanting a share? And if you could make that determination accurately, why wouldn't you use it to avoid pooling risk among all but an extremely small pool?
- orangesite 3y agoThe point you're missing entirely is that risk is an independent variable which is not related to any factor under control of the participants.
- senkora 3y agoWhatever else, it is to YC’s credit that they don’t censor criticism of themselves on their own platform.
- verticalscaler 3y ago[flagged]
- wg0 3y agoNo doubt but I additionally see it as a pretty American cultural trait as well.
- Uehreka 3y agoNah, they don’t get points for not censoring criticism of themselves. It would just be negative points if they did.
- mizzao 3y ago"There's no such thing as bad publicity."
- whiterknight 3y agoJust because you see some doesn’t mean they don’t.
- loceng 3y agoAnd don't mention a dislike for "that one thing" too many times.
- dang 3y agoI don't know what one thing you're referring to, but a core principle of HN is to avoid repetition, and especially the repetition+indignation combo, which is the commonest and most tedious thing on the internet. So to me it sounds like you're referring to HN working as intended, regardless of what the thing is. https://hn.algolia.com/?dateRange=all&page=0&prefix=false&sort=byDate&type=comment&query=curiosity%20repetition%20by:dang https://hn.algolia.com/?dateRange=all&page=0&prefix=false&so...
- lelanthran 3y agoTBH, if you're already holding a product in your hands, that you created, it's really hard to tell if you're holding an anchor or lightning in a bottle. Using VC money to make that determination is kinda a no-brainer. OTOH, if you're still in the exploratory phase (I am), is it wise to tie yourself to the mast of a ship that is already sinking? In the latter scenario the smallbets.com proposition looks better.
- islewis 3y agoIt feels to me like YC's name-drop doesn't have a purpose beyond just attention/view grabbing, despite there being a few nuggets of solid reasoning sprinkled throughout the post. > That’s 1.25%. To be fair, that’s actually quite impressive, but let’s say you have the stamina and willpower to go through YC three times in your lifetime. You’d need approximately 26 lifetimes to hit the jackpot! This isn't the least bit unique to YC, it's just the cold reality of any high-growth startup. If OP had framed this as "Moonshot Startup vs Lifestyle Business" it would have felt more like a good faith argument. Even "Do you have the risk tolerance to be a founder" would have worked. But basing a thread titled "Why you shouldn't apply to YC" off an illformed assumption of the readers risk tolerance is naive at best (and likely malicious given OP is selling competing services).
- Pedro_Ribeiro 3y agoAlso that sentence on "you need to go through YC three times in your lifetime, so you need 26 lifetimes" is absurd. I got a migraine trying to understand his line of reasoning.
- romafirst3 3y agoThe reasoning is a bit reductive, it makes sense if you think of success as binary (you become a billionaire or you don’t, which in fairness is what yc and many VC firms push). Obviously you can fail to become a billionaire and make some non life changing amount of money and even make what to a lot of people is life changing, but for this outcome (which is still uncommon) you would be better off not trying to become a billionaire.
- gamerDude 3y agoTo me, this tweet seemed much more anti startup trying to grow big than anything anti-YC. Only using the tweet for marketing as mentioned at the bottom. At first, it's against dedicating your life to your startup (which presumably you are already doing or at least want to do) and then states that YC actually has a good success rate for unicorns. Then he talks about doing some brainstorming to find ideas and product market fit, but at least from my perspective YC doesn't advocate for this at all, but rather talking to customers, getting their buy in and then making something that solves customer problems. Aka, not brainstorming at all. And then goes on to say that YC has lots of young people rather than older (more likely to be successful founders). But doesn't do any of the data diligence on percent of founders by age by industry and by YC vs. not. And finally he focuses on saying that only the unicorns were success stories and no one else, while advocating that you should aim for a smaller goal. But doesn't acknowledge any data of companies from YC that aren't unicorns but are still operating, sold for less than a billion, etc. I personally think that looking from the outside that YC is not for everyone and is geared towards the VC route. But if you want those things, then these arguments aren't valid for why you wouldn't apply.
- pclmulqdq 3y agoThis sort of became an anti-VC rant, definitely, and also a little unfair to the product YC offers. It's a legitimate product in the market, not a scam, and the 22-year-olds who do it are not getting duped. My biggest issue with YC is that the deal isn't very good. Giving up 7-10% for $500k is pretty crappy for any company that has a decent shot at becoming anything good. That is why I have only ever applied to YC when my company ideas were very speculative. If you already have a network and a decent platform to communicate with people, as well as the motivation to go at it for yourself, you're giving up a huge chunk of the company for a pittance. If you already have the ability to go talk to a VC and an idea/product/company that is good enough to make it into YC, you don't need YC for your company. If you can sell YC on investing in you, you can sell your product. However, it does make sense to do YC right out of college to get the networking benefits and the credibility signal. That's why so many 22 year olds do it. It sacrifices your stake in your first company in exchange for helping you as an individual later in your career.
- jumploops 3y ago> One of the bad learnings you get from YC is that there’s a formula for success, and it looks like this: First you do some brainstorming. This isn’t how YC works at all… If this guy had gone through YC, maybe he wouldn’t be trying to sell an online course.
- deleted 3y ago[deleted]
- llamaimperative 3y agoYeah this thing is rife with “I have no clue what YC actually advocates”
- brigadier132 3y agoLet me give the other side of this because I used to believe this too I'll start with the most important first 1. When you take YC money you get to pay yourself. You wont be paying yourself FAANG money (if that's still achievable nowadays who knows) but you are paying yourself to build a company you own the majority of. So yes, they want you to dig to the center of the earth to find gold but you are being paid to do so. 2. I don't think starting a niche startup is meaningfully easier than starting a startup seeking uber growth. While a tech startup might require more up front knowledge I don't think startup ceos are working harder than the baker that's waking up at 4 am every day. 3. YC has a very good success rate and I think it's related to services they provide founders and the network. I think if your business falls into the category of hyperscale startup and you are a first time founder I really think YC is worth it. They seem to have a system that works.
- bruce511 3y agoI concur that the system works. The point of the article is who does it work for? Personally, I agree with you. If you're just coming out of college this is a great way to get a couple years of salary and a chance to work on whatever you like. Give it a few years, if it doesn't work out it hasn't really cost anymore than a post-grad course in terms of time. Basically you can view the whole program as a simple "job" with pay, with a 1% chance of going big. That's probably worth taking a punt on. 99% will fail, so frankly I wouldn't spend more than 5 years on this path, but if you're young you can afford that time. Honestly this approach seems a lot more attractive than putting up my own life savings to start a business. Or working without income for a year or whatever.
- computerdork 3y agoAnd a startup doesn't need to make 1 billion per year to be a success. How about one that makes 100 million? or even 10 million? If the company is sold, the founders will be rich (not ultra rich, but have a million or more). And, for ycombinator, the number of "startup exits" is: 351 (according to this page: https://explodingtopics.com/blog/startup-stats https://explodingtopics.com/blog/startup-stats). Am no expert at startups, but this may mean that out of the 4000 that when through ycombinator, ~9% where valuable enough for investors to take profit. That sound pretty good to me.
- thwydewy 3y agoOverly zealous opinions of any form are, to me, often eyebrow raising. Yes the acknowledgement of self-promotion gives the guise of candor, but does make clear the attempt to gain by standing on the shoulders of giants to reach the stars. To YC or not to YC is a personal decision that one should make on their own assessment of cost/benefit of doing business - and not be based on the emphasis of talking heads, no matter how they attempt to appeal to the emotions.
- yinser 3y agoFrom the man who said MKBHD was irresponsibly criticizing a “nascent” tech project that has hundreds of millions in funding and built a dud
- DVassallo 3y agoI said MKBHD was irresponsible for using a highly sensational headline (worst product ever reviewed) when he has such as large influence. I never said what you're implying.
- sneak 3y agoYou’re going to need to substantiate “irresponsible” a lot more than “he said an opinion that he actually factually holds to a lot of people”. Who was harmed? What was the source of that harm? What was the moral or ethical failing that caused the harm? I think you have cause and effect mixed up.
- pb7 3y agoSometimes the truth is sensational. I hope you know you lost at least one long time follower after your recent stretch of engagement farming. You’ve fallen off. Good time to lay off the tweets and look inward.
- mslt 3y agoPlease explain how someone whose job is to share their opinion is being irresponsible for sharing their opinion.
- fizx 3y agoEhhh, there's pros & cons, just like anything else. Maybe some VCs want you to dig to the bedrock, but not all, and everything in life is a negotiation. I look at YC as grad school for entrepeneurs. You'll learn a ton, build a network, and have a good time for a while. Unlike grad school, there's direct upside, and you won't have to take out loans or live off the lab stipend. Now would I go to grad school at 40? Maybe, but the calculus is certainly different than at 20. YC is clearly good for something. You really have to figure out how to make it work for you.
- ttul 3y agoJoin a CEO group and set up a cross-holding of stock between the companies in the group. Now you’re all digging for gold at the same time. You don’t have to be a VC and you also don’t have to be that person with 26 lifetimes to spare.
- StressedDev 3y agoThe problem with this is VCs give you money, and some (like YCombinator) also give you advice. The CEO group gives you no money. Also, how do you prevent parasites from entering your CEO group?
- ttul 3y agoI’m not saying a CEO group is a replacement for venture capital. You can join a group of CEOs whose companies are all venture backed. As for ensuring parasites don’t join your group… that can’t be guaranteed.
- hahahacorn 3y agoIn each section I got maybe 1/3rd of the way through before reading something that was just so wrong and exposed his lack of knowledge and skipped to the next section. Which is a bummer! I got excited by the title but disappointed by the content. I’d love opinions from people who have actually gone through YC and their arguments against applying to YC.
- flappyeagle 3y agoThis dude is posting for clout or something. In one thread he gets into histrionics about an overfunded VC hardware startup getting a bad review and in another thread he criticizes the existence of such companies.
- andrewmcwatters 3y agoThis post is an ad.
- kumarm 3y agoThis is the same guy who went viral criticizing MKBHD last week right? Here is a good information on what is happening: https://news.ycombinator.com/item?id=40060554 https://news.ycombinator.com/item?id=40060554 from that discussion. There is incentive to take a public view that is anti current (or trend or popular or right) thing to do that makes you go viral.
- alangibson 3y agoI came here to point this out. I'm automatically skeptical when this came from the author of one of the dumbest tweets I've ever read.
- loceng 3y agoPointing this out seems to popular in comments, and doesn't seem to add anything to the conversation.
- sneak 3y agoPart of being an interesting contrarian is that you have to actually be right about stuff. Simply espousing the opposing view to the popular view is going to be wrong more often than not.
- deleted 3y ago[deleted]
- _akhe 3y agoHahah he's like "YC is a big scam" but when you keep scrolling... > I charge you a one-time payment of $375, and you get access to my community It basically invalidates the entire post. Maybe some good points were made about investing in general but they should be delivered by someone who doesn't run an Andrew Tate style self-help scheme, and shouldn't be advertised in the very post criticizing YC of being inauthentic. YC is infinitely more prestigious and well-connected than this guy's $375 program - and how dare he talk about YC coming after my "personal economy" when he's charging $375 for "access to a community". Last I checked HN is free and I bet there's a lot more valuable info here than that self-help nightmare forum. Furthermore, we know YC is exclusive. But the fact that YC is so Ivy League and startup focused is also why HN is not just a random subreddit, or some Twitter hatefluencer pyramid scheme.
- DVassallo 3y agoHN is free because it’s a top of funnel for YC. They’re not doing out of the goodness of their hearts.
- deleted 3y ago[deleted]
- keepamovin 3y agoHaha my thoughts exactly. Overall I doubt his characterization. It's an okay model but I think the way that YC probably actually works is more like: a network of secret back-channelers with inside info and connections, read a bunch of crazy old treasure maps, pay off landowners, form search cliques, hire people with good shovel-arms, develop tunneling methodologies, and end up swiss cheesing the entire field until the subsurface is a honeycomb of search paths, and maybe they come away with some gold, after agreeing beforehand how it would be divided if it were found. YC is more like ants, but he makes it sound like robots. But even that doesn't really cover it, as the whole idea of a zero-sum game where you are searching for something that already exists is broken and wrong. It's false. What you're actually doing (YC be damned, in anything!) is creating something new! You're not finding the gold that's there, you're making it. Out of nothing. And then profiting from it!!! :)
- nostrebored 3y agoThere are few people I think are as consistently wrong as Daniel Vassallo. His writings on cloud are an exercise in fanaticism, and it looks like he’s turned that failed venture into yet another course. People selling you courses and community are mostly grifters. The content here has nothing to do with YC in particular, and makes a few interesting claims: 1. YC founders are all young, impressionable 20yos 2. YC encourages you to make up problems to solve 3. That an exit less than a billion dollars is a failure All of which are easily dismissed by watching actual content from YC. 4. That a 1.25% chance of creating a company worth more than a billion is a bad outcome Honestly what an opportunity!
- mlhpdx 3y agoHas YC published age demographics for batches somewhere I’ve missed? They’ve talked a bit about it, but I haven’t seen hard numbers.
- ec109685 3y ago5. Saying YC doesn’t encourage businesses to pivot or explore until they find product market fit.
- doctor_eval 3y agoYeah this one got me. I have nothing to do with YC but I was hired to consult to a couple of really nice young guys who were YC alumni. They worked their asses off doing All The Right Things - talking to customers, reaching out to people with deep experience :) - and when they realised it wasn’t going to work out, they pivoted right away. This is the exact opposite of digging in one place for the rest of your life, and as someone who has done a few startups, I was super impressed by their attitude and their ability to let go (even though I was out of a gig!) I think they’re going to do great whatever they do, and at least some of that will be because of what they learned at YC.
- fuzztester 3y ago>4. That a 1.25% chance of creating a company worth more than a billion is a bad outcome Slight logical problem, or unclear or poor wording here: A chance is quite different from an outcome. The first is in the future (chance), while the second is in the past (outcome). A (1.25% or other) chance means something may happen. An outcome means something did happen. Also, a 1.25% chance in the past does not in the least imply the same chance in the future. See stock trading, for example.
- the_real_cher 3y ago7% of your company for 500 Grand startup money a Network on a moonshot idea? that's unbelievably good! If he finds this bad... then he finds venture capital and bank lending bad in general.
- holoduke 3y agoGood? My two startups were 2m for 5% shares. Pretty standard.
- the_real_cher 3y agoThe fact that you can get such large amounts of money for such a small amount of equity in general is good. what were your startups?
- jameslevy 3y agoFirst money in at a 40M valuation? Assuming this is pre-seed, that seems like the investor is taking on a lot of risk based on the distribution of outcomes.
- dazh 3y agoMy understanding is that the standard deal is more like $2MM at 20%. Raising that at 5% is an insanely good ideal.
- abeppu 3y agoHmm, I think this criticism maybe has a kernel of truth, but - I think the "ergodicity" concept is kind of being abused. As I understand the term, ergodicity describes systems whose dynamics cause them to eventually visit all states in a way that lines up with some probability distribution. In MCMC one uses this to argue that a chain that runs long enough can be used to generate samples from a distribution. - But the response to his actual concern I think should be something more like income pooling. E.g. my understanding was there was some movement towards this for minor league baseball players, who have a modest chance of really large incomes. I think poker players also make similar arrangements. But critically, pools make sense when all the participants in each pool have pretty equivalent odds of making getting a large payout. With very early founders of course smart, reasonable people could have wildly different ideas of who is in equivalent tiers. - You could try to ask a bunch of informed investors to rate or rank, and hope that average estimates are good -- but if those investors don't also have the opportunity to invest in a way commensurate with their ratings, they have no incentive to be accurate. https://www.npr.org/2019/10/25/773532516/some-baseball-players-are-entering-income-pooling-agreements-to-fix-imbalance https://www.npr.org/2019/10/25/773532516/some-baseball-playe...
- deleted 3y ago[deleted]
- kyleyeats 3y agoConfusingly, this tweet is about why you should join YC. History is full of young men on boats, in the wilderness and in formation to have a small chance at glory. All of those guys were giving up a lot more than a 7% stake, and eating worse than ramen, and living worse than a cramped apartment. The reason you shouldn't do YC is simpler. It commits you to the VC track. Whatever you build is eventually going to suck because of enshittification. YC = VC If the VC thing doesn't bother you then try for YC for sure. It is overwhelmingly the best way to do that unless you're a rich kid who can leverage his connections. And even if you are that rich kid it's still the best way.
- dang 3y ago> It commits you to the VC track. That's not true. YC always supports what founders want to do. If founders don't want to raise VC, YC supports them in that choice.
- kyleyeats 3y agoI didn't mean it as a top-down thing but as an aligned goals thing. If you do this you're basically paying a 7-10% tax on everything you do, forever, without the hyper-growth to justify/offset it. It's like selling out to Hollywood and then only doing bit roles. If you do YC, you should take VC. You would be stupid not to. I mean, YC is VC, right? It's a consistency thing. No-YC and no-VC makes sense. Yes-YC and yes-VC makes sense. Yes-YC and no-VC does not make sense.
- robocat 2y agoPaying 7-10% tax is a fabulous expense for founders if that leads to company growth >10% (ignoring smallprint). Certainly that's a reasonably likely outcome. "Hyper growth" is irrelevant. Do the benefits exceed the costs? That's a harder thing to judge. Worthwhile reading https://paulgraham.com/articles.html https://paulgraham.com/articles.html which has many articles expounding the benefits (understandably biased and unfortunately mostly pro VC). There are unfortunately very few decent articles or good data on the costs. Here's one good article against the YC SAFE: https://siliconhillslawyer.com/2019/05/01/startups-shouldnt-use-yc-post-money-safe/ https://siliconhillslawyer.com/2019/05/01/startups-shouldnt-... Sometimes compromises are needed! Not many businesses can find $500k another easier way.
- lettergram 3y agoWe applied to YC and were rejected, which was probably good for us (less dilution, etc.). That said, you get some pretty unfair advantages being a YC company. My cofounder has 20 years in the industry and I have a solid tech background with a track record of success. We had leads at the time; a demo product, etc. We raised without YC and have been doing well. One of competitors (little experience, no product, no customer leads) got into YC. Immediately they were considered credible. They are getting effectively the same interest with nothing and that’s what YC offers. They are good at branding and offer you their brand, advice and network. All of which is well worth the cost if you have nothing to start with. Now ultimately the best product will win and I’m confident in ours. That said, for someone starting out with little network or connections it’s worth YC.
- smallerfish 3y ago> Now ultimately the best product will win and I’m confident in ours. That's unfortunately not true. The better funded company has an advantage because they can get ahead in GTM. The further ahead they get, the harder it will be to catch up. If you find yourself in this situation and they offer you a merger, strongly consider it.
- rgbrenner 3y agoThis is a repost from the authors blog before the W24 deadline: https://news.ycombinator.com/item?id=37869760 https://news.ycombinator.com/item?id=37869760
- dang 3y agoThanks! Macroexpanded: Why you shouldn't join Y Combinator - https://news.ycombinator.com/item?id=37869760 https://news.ycombinator.com/item?id=37869760 - Oct 2023 (320 comments) The fact that this was reposted only 6 months later makes this a dupe by HN's standard (see https://news.ycombinator.com/newsfaq.html https://news.ycombinator.com/newsfaq.html). Normally we would mark it as such, which removes a thread from HN's front page. I'm not going to do that, though, because the principle described here is more important: https://hn.algolia.com/?dateRange=all&page=0&prefix=false&query=by%3Adang%20moderate%20%22less%2C%20not%20more%22&sort=byDate&type=comment https://hn.algolia.com/?dateRange=all&page=0&prefix=false&qu.... "We moderate less, not more, when YC or a YC startup is the story" is the first rule of HN moderation. That does not mean we don't moderate at all—that would be too big a loophole. But we always moderate less than we otherwise would. A related principle is that we trust readers to be smart enough to make up their own minds. Between this thread and the one I posted yesterday (https://news.ycombinator.com/item?id=40091622 https://news.ycombinator.com/item?id=40091622) I think HN commenters are doing a good job of that. Edit: although it follows from the above, I should probably say explicitly that the [flagged] marker on the post is because of flags that came from users, not moderators.
- redbell 3y agoSurprisingly, the OP of this twitter thread is the same as the link above!
- georgehill 3y agoYes, you noticed. Although I very much disagree with Daniel's post, it is always good to have two different perspectives. Respect to Dang for not taking it down.
- ec109685 3y ago
- elwell 3y agoThis tempted me to apply. I feel like all the arguments came to the opposite conclusion that the facts should lead one to.
- llamaimperative 3y agoThat’s what motivated reasoning (for clout, in this particularly sad case) will do to ya! You should apply. Worst case scenario you’ll have spent a few hours tightening your thinking about what you’re trying to achieve.
- loceng 3y agoCare to share examples? Accelerators can be a great fit for some people at a certain stage of their life, development, or understanding of these systems; it really depends on what your end goal is too.
- whiterknight 3y agoHis comparison to the military is weird. It’s well known that from a strict money to time exchange it’s not a great deal. But the target market is also 19 year olds who don’t have social capital, not Harvard undergrads. So yes, improving your future options and skills is a greater value than cash. That’s true of YC too.
- deleted 3y ago[deleted]
- levocardia 3y ago"You shouldn't take a ~5% chance of getting $500,000; you should take a 100% chance of losing $375!"
- dzogchen 3y agoIf your YC startup fails you can possibly still pivot or try again. I don’t understand his thesis at all.
- bearjaws 3y agoSo I bit on this guys ad. First red flag? Using GumRoad. Which is basically course grift central. Immediately you have the option to buy other courses from his recommendations (with a coupon of course!) What a joke. He has only made 16 videos out of the hundreds listed in the "Course". It's hilarious how EVERYONE is trying to sell courses, and none of them are good.
- redbell 3y ago> It's hilarious how EVERYONE is trying to sell courses, and none of them are good. This is, unfortunately, a real business for many.. Creator Courses: Selling Dreams as Products: https://youtu.be/ZmixszMNFgM https://youtu.be/ZmixszMNFgM The Rise of Fake Gurus: https://youtu.be/L9Gpr7PEnbs https://youtu.be/L9Gpr7PEnbs
- robocat 3y agoI think this “tweet” is totally unbalanced. And I think he misses some of the significant downsides. He is moaning about Venture Capital, not YC. You can use the YC money and bootstrap. Although obviously YC is pushing the Venture Capital drug and will filter for Venture Capital seeking founders/opportunities. My experience of an incubator showed me that incubators disable founders. Incubators put back into school where the teachers tell you they know everything. Many mentor relationships are dangerous too. It damages your psyche and is hard to escape the desire to get the best advice/mentoring. Learning to be a founder is all about making your own good and bad decision. The right attitude is hard to maintain, and hopefully YC builds it (no idea if it does). Get advice but learn how to ignore most of it (even geniuses get most things wrong). 7% for $500k is a great deal if you use it carefully: use the network and experience to your advantage and you should get more than an extra 7% growth. Take care that other flashier startups don’t steal your star employees. YC gets preferential shares, but founders get common shares: so alignment is wrong. YC has the financial incentive to team up with Venture Capitalists against founders. Not saying they do, but it is a bad signal that YC gives. You need to watch YCs behaviour with the few winners to learn the outcomes for YC versus founders - on average only the few winners matter financially. The final results for the reddit.com IPO are really weird given reddit was in the first YC batch: https://archive.is/https://www.businessinsider.com/who-got-rich-reddit-ipo-2024-3 https://archive.is/https://www.businessinsider.com/who-got-r... (Sam Altman had 9% ownership). Finally, PG has written multiple essays about how startups need to shoot for the moon. I have seen zero information come out from YC about median returns for founders, or an analysis of the $ earned against the time invested for the vast majority of founders (the ones that do not successfully start unicorns). Some light on this subject from YC would be welcome. Too much of the external YC writing is clearly self-serving while saying they help founders (the whole VC industry is like this though). I am in New Zealand so I have little experience with YC (watched one guy from here accept and flame out - but I had a bad signal about him anyway).
- ec109685 3y agoPrevious discussion (coincidently 6 months ago): https://news.ycombinator.com/item?id=37869760 https://news.ycombinator.com/item?id=37869760
- SeattleAltruist 3y agoTL/DR: Don't bother trying to go big, even if you believe in your idea, because difficulty. Instead, pay me $375 for performatted business platitudes and chat with a bunch of randos.
- SeattleAltruist 3y agoTL/DR: Don't try to go big, even if you believe in your idea, because its hard. Instead, cough up $375 for templated business platitudes and chat rooms with randos.
- hyperliner 3y ago[dead]
- extr 3y agoI think all the disagreement is just a matter of demographics. If you are 22 and time is on your side, go nuts. The intangible benefits of YC (networking, etc) have time to pay off. It’s not like you would have been making insane money at BigCorp anyway that early in your career. You can afford some income instability. No real downside, just be realistic about your chances of a huge exit/unicorn status. But for “everyone else”, it makes zero sense. You have kids? You’re mid/late career? Forget about YC/VC funding. Much better ways to spend your time and effort.
- dnissley 3y agoWhat are those better ways to spend time and effort?
- extr 3y agoIt depends on your goals, but this is David’s core point. If your goal is an independent income stream or building a business, at many (most?) life stages, shooting for the moon is not practical - too risky to put all your eggs in one basket. Too many ways to fail and waste years. You’re better off diversifying your bets, not dissimilar to VCs themselves. Try small ideas and scale them up if they work/seem promising. And of course if your goal is just building wealth and having security, maybe working for a BigCorp is indeed the better choice of time/effort. You can make a lot of money in FAANG and get a dynamite family healthcare plan + retirement contributions to boot.
- andrewfromx 3y agoMy first thought looking at https://smallbets.com/ https://smallbets.com/ is to clone it and populate it with AI bots pretending to be the other members. In fact, if my little AI clones are good, it's not even that unethical. Long as they provide the same $375 worth of value and the customer doesn't want a refund?
- primitivesuave 3y agoThis is a very strange use of "ergodicity", which would be more suitable for an essay titled "How every possible startup idea will be tried at least once". Using a probabilistic term to describe deterministic activity (i.e. choosing where to dig, checking the soil, giving up if no treasure is found) indicates to me that the author is reaching for some high-minded mathematical justification for his perspective. The native ad for a $375 course further erodes credibility, and his recent statement that Youtube product reviewers like MKBHD should feel compelled to protect the fortunes of a VC funded company appears quite hypocritical [1]. 1. https://twitter.com/dvassallo/status/1779928354118111278 https://twitter.com/dvassallo/status/1779928354118111278
- DVassallo 3y agoI never said or implied in any way MKBHD or other reviewers should feel compelled to protect the companies they review.
- primitivesuave 2y agoI went back to the Twitter thread to understand your perspective better - agree that the title could be worded differently. I think the immense amount of contention on that thread was from you making a statement on what should be the responsibility of such reviewers - i.e. that they have some responsibility to protect entrepreneurship. As much as we'd like to believe, most entrepreneurship is not in the form of AI pins and apps and gadgets, it's people starting small businesses and handling some existing facet of commerce. If MKBHD started making videos titled "The worst mom and pop store I've ever reviewed" then there might be a more compelling debate about ethical behavior by reviewers. In this case, it is a heavily funded product experiment by wealthy venture capitalists, so people are a lot less sympathetic when they hear "give them a chance, v2 will be better". Also, this is by no means a new phenomenon - here's a TechCrunch review of the iPhone from 2007 titled "We Predict the iPhone Will Bomb": https://techcrunch.com/2007/06/07/the-futurist-we-predict-the-iphone-will-bomb/ https://techcrunch.com/2007/06/07/the-futurist-we-predict-th...
- a_wild_dandan 3y ago> YC will proudly tell you that you are more likely to end up with a billion dollar business if you join them. That may be true. What they’re more reluctant to tell you is that only about 50 companies met that expectation out of the 4,000 or so that went through their program. That’s 1.25%. To be fair, that’s actually quite impressive, but let’s say you have the stamina and willpower to go through YC three times in your lifetime. You’d need approximately 26 lifetimes to hit the jackpot! See the problem now? No. Those are frankly astonishing odds, and success exists on a spectrum between the extrema of abject failure and a billion-dollar business. Framing outcomes as one of two, mutually exclusive states feels disingenuous. (Also, minor nit: that's not how probability works.) I'm ignorant of the startup space, so the author's conclusions might be generally accurate. I don't know. But the piece sets off red flags for me, so I'm distrustful of it. Kudos for introducing me to the concept of ergodicity, though!
- Retric 3y agoBeing nominally a billion dollar VC backed company isn’t success until you’ve got a 7 figure exit, it’s just a number someone made up. So sure, you can have a “successful” exist without becoming a unicorn, but that doesn’t mean the odds end up very good or you wouldn’t have been better off financially working for Google.
- mattmaroon 3y agoSurely someone must have the statistic on how many YC companies had an exit/are still running, right? I bet it beats the industry average by a long shot.
- themanmaran 3y agoIt varies by cohort and age of companies. But the 10 year average is: - 58% alive - 8% acquired - 34% dead
- hcks 3y agoPretty sure 7 figures would be a massive failure in that case
- jmduke 3y agoOP has a history of railing against YC, largely for engagement's sake: https://twitter.com/search?q=from%3Advassallo%20YC&src=typed_query https://twitter.com/search?q=from%3Advassallo%20YC&src=typed... (I have never applied to YC — my closest affiliation is that I reviewed YC applications for prospective applicants while at Stripe — but I do find engagement farming really annoying.)
- paganel 3y agoSo you're more connected to YC than 99% of the people commenting in here, I don't think that your viewpoint can be seen as objective.
- jmduke 3y agoTo be clear, I reviewed applications _on behalf of Stripe Atlas customers applying to YC_, not on behalf of YC. (I have never chatted with anyone in YC, besides presumably on Hacker News.)
- StressedDev 3y agoWhat is engagement farming?
- grayhatter 3y agofancy clickbait
- dylan604 3y agoFor example, your comment
- deleted 3y ago[deleted]
- minimaxir 3y agoTwo common implementations of engagement farming are a) very contrarian/misinformed opinions to bait people to respond negatively and b) simple Q&A prompts like "What opinion about AI would get people mad at you?" which encourage people to respond. The organic discussion (positive or negative) is generally favored algorithmically so it gets boosted, and in the case of Twitter, there is a monetary incentive to do so, as Twitter Blue accounts can earn revenue from tweet views. The tweet author performed the former very recently and caused a news cycle by complaining about MKBHD's Humane Pin review with a bizarre take: https://daringfireball.net/linked/2024/04/16/vassallo https://daringfireball.net/linked/2024/04/16/vassallo
- alecco 3y agoWith all the retail investor mania of lately and so much money on tech people, perhaps we could do a sort of startup Olympics with bets. Founders and teams could publish their terms and what they offer in stock. It could be a decreasing function of price of shares with early birds getting cheaper shares. And open source due diligence. Make it a big show to get free promotion for the startups and opportunities. But the SV VCs would probably try to sabotage it and Wall St. would probably throw their SEC attack dogs. Perhaps it could thrive in a less compromised country like Singapore or Switzerland.
- deleted 3y ago[deleted]
- computerdork 3y agoThe tweet is saying that only 1.25% make it to a billion, but a startup doesn't need to make 1 billion to be a success. How about one that makes 100 million? or even 10 million? At these levels of revenue, if the company is sold, the founders will still be rich (not ultra rich, but have a million in the bank or more). And, for ycombinator, the number of "startup exits" is: 351 (according to this page: https://explodingtopics.com/blog/startup-stats https://explodingtopics.com/blog/startup-stats). Am no expert at startups, but this may mean that out of the 4000 that when through ycombinator, ~9% where valuable enough for investors to take profit. That sounds like a decent success rate for me (think I read that the success rate of ycombinator startups is similar to that of the rest of tech).
- wilde 3y agoSame engagement baiter who said product reviewers should all be shills. Nothing of value here.
- andrewstuart 3y agoSome of his point might be true, BUT: If you have a great idea, if you are onto something, then the best chance of success comes from having resources to execute, credibility and to share the endeavor with others who are literally invested in the outcome.
- gardenhedge 3y agoall you need to read: "I charge you a one-time payment of $375, and you get access to my community, which includes live workshops, recorded classes, a group chat, and a few other things."
- JaggerFoo 3y agoPoints for using the term "Non-Ergodic". I wish it were used more often. The post is well written, mostly cohesive, and with a willingness to express ideas counter to the status quo.
- paulcole 3y agoS-tier move by YC to promote this nonsense to the front page to make the pro-YC post from the other day look less sketchy.
- ChrisMarshallNY 3y agoI'm not really a fan of posting rants. Not because I don't have about 10,000 foaming-at-the-mouth rants in me, but because I don't feel it's professional, which is an indicator that I'm not very "new school," in my approach. It's actually pretty on the point, but I'm not sure that I'd get "Don't Apply to YC" as the result of reading it; just that I should calibrate my expectations and approaches. I probably would find other alternatives, if I was a "lots of small squares" digger, but that's me. I'm not a rich serial entrepreneur, so I guess my opinion isn't particularly relevant. This part stuck out to me: > The second bad lesson from YC is the focus on the upside. Because if there’s any formula for success in business, it’s to focus relentlessly on staying in the game rather than on hitting it big. Focus on the downside, and let the upside take care of itself. I think that's critical, but seldom actually practiced, these days. I have a friend that is a marvelously smart person, who has created a great product, that he is planning to market and sell for thousands of dollars. It's likely that he'll get it. But the real test is what happens after the sale. We need to determine things like service, support, parts, and reliability. Things shouldn't break easily, and if they do, we should be prepared to handle the calls. They may be irate calls, if the device costs a lot of money. That's where I have about 35 years of expertise. I've spent my entire adult life, making things that last, and can be serviced, if they break. 26 of those years, were at a top-shelf company, producing some of the world's finest optical equipment (expensive as hell, but worth it). A lot of the software we wrote, was to work around hardware deficiencies, or add service points. So I was giving him tips like "What happens if you get dirt in this fan?", or "How do you test the firmware?", or "I'm not sure that part should be printed with that kind of plastic," etc. I was politely told to fuck off, and stop being a "dream-killer." So I keep my mouth shut, and I won't say "I told you so," when things go south. Instead, I'll help him to clean up the mess, because that's what friends do.
- Animats 3y agoIf you just want to make money, one of the most successful strategies is to learn how to manage, via MBA or otherwise, find a company that's losing money primarily because of management problems, and take it over on some deal where you get a cut of the improvement. Turnarounds can be very profitable for all concerned, and the success rate is reasonably high, maybe 50%.
- siliconc0w 3y agoGetting into YC is probably one of the few cases where it does make sense to go the traditional VC route. It's like getting into an elite-level school. Most colleges are crazy expensive to the point that the value proposition of a degree starts to look tenuous even for STEM degrees. However a degree at an elite school still has some currency plus benefits like a network of equally hard working, smart, and likely well connected peers that is pretty valuable.
- kayo_20211030 3y agoNothing is more tedious that a po'd pedant. OP is a person who fell in love with the word "ergodic", and just both couldn't let it go; and even then uses it badly. If you want to say "unfair", or "inequitable", just say that. It's simpler and more honest and doesn't make you look like a jargon spouting smarty-pants. What on earth does "non-ergodic" even mean to a normal reader? Even after that, OP buries the lede. Put what you want to say in the first paragraph. Otherwise everyone is so bored by the time you get to it they just don't care. It's Twitter, not the New Yorker. Any New Yorker editor worth their salt would have reversed it. Apply or don't apply to YC, but don't base your decision on whether it's ergodic or not. Who on earth knows what that means?
- DVassallo 3y agoIt's entirely different than unfair. Communism would be a fully-ergodic system, but it's also very unfair and undesirable.
- hintymad 3y ago> But that’s not how you find business opportunities in the real world. You can’t just say I’m going to pivot, and suddenly a good opportunity lands on your lap from heaven. You get good ideas by embracing randomness for a long time, until something looks like it has a fighting chance of paying off. The pivot idea you were forced to come up with is extremely unlikely to be one. This is in general true, but I fail to see how that's against the idea of pivoting as advocated by YC. We find out interesting pivoting ideas by doing, and one of the most effective way is to get ideas by exploring adjacent areas while we invest deeply into an area the we are are interested in. That is, we discover by doing. Is that what the startups do?
- wuj 3y agoI disagree with OP. Treat YC as a school where you learn and network. It is not a zero-sum game. If you made it big, you've hit the jackpot. If not, you still gained valuable experience and skills applicable to the industry and other areas of life. It's like going to a college. If you didn't find a job right out of college, it doesn't mean you've wasted four years of your life. The expected value of doing a startup is very high when your career is just starting. You are well-educated with very marketable skills. You don't have people depending on you. If you are building something and picking up transferable skills, all while being surrounded by the most driven people (and paid), I don't see why someone wouldn't try their luck with YC (or any other startup incubators).
- barfard 3y ago[dead]
- xpe 3y agoMy goal in this comment is to vet Daniel Vassallo's section on ergodicity. I follow and agree with the setup: > First, you have to understand a very important concept: in some systems, what’s best for a group is not necessarily what’s best for the individuals who make up the group. In other words, the total wealth of a group of people could be increasing, while almost everyone making up that group could be seeing their wealth diminish. But do the following sentences follow? Do they even make sense? > When this happens, we say we have a non-ergodic system. If the system was ergodic, what’s happening to the collective would also translate to all individuals. I'm pretty sure these sentences don't follow. I am struggling to think of even a charitable interpretation that would make such a connection. This is not out of a lack of interest -- I would like to see a connection. I think I'm more willing than many to find such connections; I have studied EE, physics, SwEng, CompSci, economics, and more. But, alas, I see no connection -- and not even a plausible path to explore to find one. So, after reading only this much of Mr. Vassallo's writing, my BS-detector alarm bells are ringing. I'm going to go read https://plato.stanford.edu/entries/ergodic-hierarchy/ https://plato.stanford.edu/entries/ergodic-hierarchy/ instead. Please let me know if I'm missing something. I am genuinely trying to be rational and open to good arguments. I admit that I'm developing a gut-level distaste for Daniel's writing, but I don't want this to unfairly bias me about a possible insight on ergodicity here. P.S. Maybe even though Mr. Vassallo's writing is a stretch, there is a reasonable point to be made? Could someone make it succinctly without the baggage of his larger claim?
- MichaelDickens 3y agoI recently spent some time looking into ergodicity and my conclusion was that people who write about "ergodicity" in a non-academic setting generally have no clue what they're talking about and they're just using the term to make it sound like their reasoning is more rigorous than it actually is.
- alphabet9000 3y agoyou shouldn't join that guy's $375 thing. whoa, that was easy, can you believe i just saved you $375? if you're feeling generous for my saving you a WHOPPING $375, i only ask for a small small tip request of $3. win win for both of us. i saved you some cash, and now you've got $372 in your pocket. :handshake:
- balls187 3y agoThe key issue I take away is the success rate: 1.25% and assuming that fact is accurate, I suggest the following: If the goal of your company is to be a billion dollar business, then I would say that just applying for and getting into YC is enough, and you should not join YC. YC apparently is very good at picking winners, but not necessarily making winners--being selected by YC means you have a higher chance of of succeeding, but attending YC does not. However, I would expect that there are tangible and non-tangible benefits for going through YC that are not readily apparent when looking solely at becoming a billion-dollar business, and those would be the reason to join YC should they matter to your startup.
- tlogan 3y agoThis post seems to hint at a larger conversation about the accessibility of opportunities like YC for people from different economic backgrounds. While it might be easier for those with financial safety nets to take entrepreneurial risks, perhaps there should be more discussion on how to make such opportunities more inclusive. How can organizations like YC ensure that everyone, not just the financially privileged, have the chance to innovate and succeed?
- Havoc 3y agoThe guy seems to like hot takes to get attention
- graycat 3y agoAfter reading the OP: (1) Business Is Okay: For the neighborhood I grew up in, a big fraction of the houses were owned and occupied by families of owners of businesses. (a) Drove into the country, met with farmers, evaluated and bought their cotton, and sold it to, say, companies making medical bandages. (b) Bought junked auto parts, renovated them, sold them to auto parts stores. Later bought, developed, sold real estate. (c) Had a warehouse next to a rail line, got big shipments of beer, sold smaller quantities to bars and convenience stores. (d) Sold, installed new tires to people with flat tires. (e) Ran a trade magazine for the trucking industry. For more, not in my neighborhood but not far away, (f) opened a sit-down seafood restaurant, built relatively modest houses, started a national motel chain. (g) Sold jewelry to jewelry stores. I dated the owner's daughter -- they lived in a nice house and neighborhood and helped a cousin -- prettiest human female I ever saw, still in love with her. (h) Bought medium trucks with no beds, installed tanks, custom, e.g., for water, fuel oil, gasoline, .... For this last, I tutored the owner's son in high school math -- their house was really, REALLY nice! It does appear that in the nicer neighborhoods, the fraction of house owners that were successful business owners was high. Conclusion: "The business of America is business". To get important things done, America wants and needs successful businesses. The successful businesses are not flukes. Necessarily there WILL be successful businesses. The business owners were ordinary Americans, not geniuses, not venture funded. (2) Key. To have a successful business, build something people want, like, need, and don't have (loose quote from some YCombinator source). (3) Opportunity. Exploit the sudden revolution in productivity in our civilization, i.e., computers and the Internet. IBM helped automate the routine work of the accounting departments of major businesses -- good PI (productivity increase). PCs killed off the typewriters -- big PI. Email, big PI. Web, huge PI; also great for information, knowledge, entertainment, maybe soon making dense cities less important. (4) Cheap. In both historical and even absolute terms, current computers, the Internet, and the digital phone network are cheap, really cheap, just dirt cheap. E.g., I got new 8 core processor with a standard clock speed of 4.0 GHz for $100 -- can spend more than that on a family restaurant dinner; can come close on flowers for Valentine's Day. What are the recent numbers, 18 trillion bytes in a standard 3.5" size??? Big, big, big, big, huge PI steps up from history back to punched cards, ledgers, quill pens, etc. Are the PI opportunities already fully exploited? What to do? Get a good computer with good software tools, a good Internet connection, write some software that will let some people get something they want, need, like, etc. faster, cheaper, better, easier, etc. and get users and/or customers (e.g., advertisers), and revenue. OWN the software. And, go ahead, own 100% of the business, as just an LLC (limited liability company): Soooo, "Look, Ma, no BoD meetings!!!". Can't be fired. Have minimal involvement with lawyers. VCs? Do they write the software for/with you? Nope. Do they really know what way to please a lot of people that will make a successful business? Nope. Do you need their $500 K to pay for your computer(s) and Internet connection? Likely not. Can a sole, solo founder be successful? Example 1: Plenty of Fish, one guy, sold out for $500+ million. Central Point: For better financial security, you need to own some/all of a successful business, AND the economy MUST have a lot of successful businesses. Every major US city has lots of such successes -- they are NOT rare.
- neilv 3y ago> One of the bad learnings you get from YC is that there’s a formula for success, and it looks like this: First you do some brainstorming. Then you come up with a good idea that can scale to a billion dollars What if we have an unusual social media idea for which the reason it works also means it stops working once it's worth a billion dollars? (Specifically, once it's that valuable, it's too high visibility, and is hit with too much adversarial manipulation, destroying what was most valuable about it. Then it's just a generic property, little different than the competition.) (Obviously, HN itself has had better success and longevity than most, despite its rising visibility. OTOH, the Reddit front page seemed to get taken over ages ago, and then they still had to chill for more than a decade before IPO.)
- petersumskas 3y agoThis is from the “honest reviews are unethical” whinger.
- jjmarr 3y agoLet's just assume the facts are as he says in the most charitable interpretation. You either have a 1.25% chance of a $1 billion company and a 98.75% chance of a $0 billion company. The expected value of a 1.25% chance of $1 billion is $12.5 million, so treat that as an (unrealistic) lower bound on your company's valuation. There's no real explanation of why that isn't a good deal for an entrepreneur. You don't get to keep all that, but $500,000 dollars from YC for a 7-10% stake of companies (as others have said) with an expected value of $12.5 million is a deal that gives YC a maximum of $725,000 in value, given that 10% of $12.5 million is $1.25 million. The question to ask is whether being part of YC adds $725k in value to your company; i.e., is it the cause of those startups being worth that much? Based on what others are saying in the thread, this seems to be true, but I'd love to know if people who were a part of YC felt like the assistance was worth that much. My point is that it's difficult to believe that the average wealth of the entrepreneur is worse off by joining YCombinator even assuming all of the facts proposed in the thread are true.
- 7e 3y agoYC adds almost no value. They capture all of the startups that would have been founded anyway (and many that wouldn't, because they are idiotic ideas) and tax them. Then, inevitably, some of those hit it big and YC takes the credit. Does the doctor that delivered Steve Jobs at the hospital get to claim credit for Apple? They don't. But YC does. They're a doctor that has talked their way into delivering all the babies in the city, and taking a tax on their future income as adults. The average wealth of the entrepreneur is actually maximized by having them go into a career in FAANG and not launching a startup at all--or launching a startup from a stronger position with a real VC that values their company at more than $7M. A $7M valuation in today's tech world is an absolute joke. It's scandalous the exploitation that's going on here.
- worik 3y ago> YC adds almost no value For some definition of "almost" I am not in the market, but if I were 22 in San Fran doing what I was doing when I was 22 in Auckland, I can see tonnes of value Networking and mentoring mainly
- worik 3y agoI found that refreshing. Unfair, of course. They are flogging their own very different product I really take to the point of moderate success. If I am going to have huge billion dollar success it is going to have to find me because I seek satisfaction, and I am satisfied with much less I am a worker. I like working. I like working for other people, I like getting paid a nice big fat salary. I would like it bigger! But I like my job, i like my boss, I like my work, mostly, and that is a fabulous way to live. Satisfaction! Being a billionaire does not sound any better
- throwaway5959 3y agoWhy does this guy keep getting so much attention on Hacker News? Isn’t this the same guy that tried to shame MKBHD (an actual small business owner/founder)? He’s clearly just engagement farming, probably for his “course”.
- sour-taste 3y agoHe started by getting the deadline date wrong so not off to a strong start Actual: Apr 22 at 8pm PT Him: The deadline for YC S24 is tomorrow (tweet from 11:25 AM PT Apr 20, 2024) Probably because this is just a repost as mentioned in sibling comments.
- deleted 3y ago[deleted]
- 999900000999 3y agoThis is an ad. But the bigger thing is most of us don't actually have investment ready products. I'm echoing my comments tester, but if a VC offered me 2 million today I'd have no idea what I'm done.
- richrichie 3y agoPredictably, gets flagged!
- flurb 3y agoI don't quite understand the criticism of YC, but I'm nobody, and maybe little bit naive here, but they offer you $500K in exchange for 7% of a potential business (of course it's more complex than that, but bear with me). Looking at the application form, nothing stops a farmer from, say, rural North Korea from applying, notwithstanding other issues of a more, ah, political nature. While $500K maybe isn't much for some people, it sure is a heck of a lot of money for someone like me, not to mention all the other benefits, being able to explore your ideas and start a business without the immediate worry you'll either die of stress or become homeless next time rent is due, for instance. All that for a measly initial investment of maybe 10 minutes of your time?
- nojvek 3y agodvassello loves attention seeking posts. There is some truth to it but the message isn’t clear. Yeah VCs make money over spread, and economic argument makes sense of Pareto principle. However this assumes only 40 1B+ exits and the rest get zero. The Pareto curve means: - a long tail of startups that failed to make what people want. (YC looses money) - A decent chunk of startups that did make what people want but wasn’t a sustainable business. (YC loses money) - A bunch of sweet 10M+ exits (YC breaks even) - 1% 1B+ exits. (YC gains multiples). There is a reason why most of the software wealth is concentrated in west coast. And YC giving $500k isn’t a loan. If your company goes under they don’t ask for it back and bankrupt you. It’s essentially free money to try out an idea. You get paid to test the market. In what other country does this happen at the scale US does it? There is the reason why US is at the heart of software. You don’t even need to be a founder. Employees at a mildly successful startup get make multiples of median wealth in US, and orders of magnitude more compared to global wealth. Most of US economic growth is coming from tech. Play the game.
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- debrahofstader 2y ago[dead]