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We have no idea what our performance will be. It could take 10 years to know something like that, and the median YC startup is about 18 months old. If you add

by pg 18y ago

We have no idea what our performance will be. It could take 10 years to know something like that, and the median YC startup is about 18 months old. If you add up all the valuations of the companies we've invested in so far, I'm pretty sure we're doing well on paper. But I don't even know how well, because I've never done it. It would be so misleading; I'd rather just wait till I have real data. In the meantime we're operating on a hunch that YC is a good idea. The evidence so far does tend to confirm that hunch, or we wouldn't be so eager to expand.

davidw 18y ago
This is what, to me, is inspiring about your work: YC is first and foremost a 'cool hack'. It's not a finance guy thing or an 'entrepreneur' thing in the sense of a calculated attempt to make a big bunch of money, it's taking some existing pieces and putting them together in a novel way, and creating something new and valuable, and hopefully, in the process, also making a good return on the risk. I think that, ultimately, this attitude is what I've always liked in your essays - hackers can do business stuff and do a good job of it. Sorry if that seems a bit fawning... let's balance it out a bit: a skeptic might wonder if the YC bunch's investments are not panning out enough to continue investing at the current pace and think that therefore, they're seeking outside funding.
numair 18y ago
Thanks for the guidance, Paul. In thinking more about this, I came to the conclusion that this is probably a "taster" for what may become a closer relationship between YC and Sequoia. For example... Could you see a future where YC was part of Sequoia? It seems to be a good fit, as they are not currently targeting deals of the size you pursue, and you'd gain access to their resources and infrastructure.
- pg 18y ago
  I don't think of it that way and I'm sure they don't either. You can't have the same company doing both seed and series A investments.
  - numair 18y ago
    A very good, and important, point. Several VCs have told me that they hate the pain the comes with dealing with many seed/angel investors out there; YCombinator has sort of established itself as the premier seed brand, and one that eliminates the old problems with seed/angel while adding a ton of new benefits. I suppose this could be a great symbiotic relationship, rather than a "potential future synergy" (in corporate speak). I'm still unsure why Sequoia was brought in if they really aren't getting any preferential treatment, as I think this would be off-putting to other VCs out there -- especially with such a small funding round, which I am sure could have been raised without creating any conflict of interest, be it real or perceived. You're a smart guy, so I am sure you had your reasons (access to their administrative infrastructure / easier pipeline for having YC startups acqu-hired by larger Sequoia-backed companies, perhaps?); you may not want to disclose them, however, and I respect that.

by pg 18y ago

davidw 18y ago

This is what, to me, is inspiring about your work: YC is first and foremost a 'cool hack'. It's not a finance guy thing or an 'entrepreneur' thing in the sense of a calculated attempt to make a big bunch of money, it's taking some existing pieces and putting them together in a novel way, and creating something new and valuable, and hopefully, in the process, also making a good return on the risk. I think that, ultimately, this attitude is what I've always liked in your essays - hackers can do business stuff and do a good job of it. Sorry if that seems a bit fawning... let's balance it out a bit: a skeptic might wonder if the YC bunch's investments are not panning out enough to continue investing at the current pace and think that therefore, they're seeking outside funding.

numair 18y ago

Thanks for the guidance, Paul. In thinking more about this, I came to the conclusion that this is probably a "taster" for what may become a closer relationship between YC and Sequoia. For example... Could you see a future where YC was part of Sequoia? It seems to be a good fit, as they are not currently targeting deals of the size you pursue, and you'd gain access to their resources and infrastructure.

pg 18y ago
I don't think of it that way and I'm sure they don't either. You can't have the same company doing both seed and series A investments.
- numair 18y ago
  A very good, and important, point. Several VCs have told me that they hate the pain the comes with dealing with many seed/angel investors out there; YCombinator has sort of established itself as the premier seed brand, and one that eliminates the old problems with seed/angel while adding a ton of new benefits. I suppose this could be a great symbiotic relationship, rather than a "potential future synergy" (in corporate speak). I'm still unsure why Sequoia was brought in if they really aren't getting any preferential treatment, as I think this would be off-putting to other VCs out there -- especially with such a small funding round, which I am sure could have been raised without creating any conflict of interest, be it real or perceived. You're a smart guy, so I am sure you had your reasons (access to their administrative infrastructure / easier pipeline for having YC startups acqu-hired by larger Sequoia-backed companies, perhaps?); you may not want to disclose them, however, and I respect that.