7 ms·

Investors have won? What? Founders have never had more power relative to investors than they do now.

by pg 13y ago

alanthonyc 13y ago
“politically charged statements like this can do a good deal of damage, so I’ve been wary about sharing my views more publicly” It’s not that the statement is politically charged, it’s just wrong.
venomsnake 13y ago
Only if they have read all and not just some of your essays and groked them. In the country where I live the startup scene is terrible - only buzzwords thrown from all sides and no substance at all. Engineers in startups expecting salaries and benefits of a big company but with nothing from the downsides. In this situation the guys with the hard cash hold a lot of influence.
sillysaurus 13y ago
Founders have never had more power relative to investors than they do now. Do investors need any power over founders? Yuri Milner's philosophy seems to suggest they don't.
- InclinedPlane 13y ago
  They need to have the power to compel founders to believe that they need outside investment, and they need to trade significant amounts of equity for that. Today, with everything available it's become easy for small companies to bootstrap their way through all stages of growth without any conventional investment. Begin with personal savings and maxing out credit cards to allow a tiny handful of founders to build an MVP that gains credibility and perhaps even generates some revenue. Then use things like crowd funding to scale up to bigger projects, mitigating the risk of burning through savings during development and of failing to get market traction at the same time. Then hit the ground running with a product that's already built and already known to be valued by the market and simply rake in revenue. Or go back and hit another cycle of crowd funding. You don't even need a merchant account to charge people money for things. Compared to the way things were even 10 years ago the scales have shifted a great deal in favor of founder autonomy.
  - sillysaurus 13y ago
    Today, with everything available it's become easy for small companies to bootstrap their way through all stages of growth without any conventional investment. Can you name a large startup that hasn't taken investment? Oculus, maybe. Begin with personal savings and maxing out credit cards to allow a tiny handful of founders to build an MVP that gains credibility and perhaps even generates some revenue. That's incredibly risky. If it doesn't work, then you won't be able to make another attempt for years while you try to recover. The value of VC investment is that it insulates you from those risks. I've seen firsthand just how ravenous the effects can be when the "avoid investment" philosophy is taken to its extreme. So the question becomes, why not take VC investment from VCs who aren't interested in company control?
    - EGreg 13y ago
      Can you name a large startup that hasn't taken investment? Oculus, maybe. 37signals? Craigslist? Fog Creek? Many app companies?
    - yk 13y ago
      Actually Schumpeter argues, that it is precisely the risk associated with entrepreneurship which separates 'entrepreneurs' from 'bureaucrats.'
    - mindcrime 13y ago
      I'm not sure how large your definition of "large" includes, but Bronto Software[1] were / are bootstrapped and are doing pretty well. [1]: http://en.wikipedia.org/wiki/Bronto_Software http://en.wikipedia.org/wiki/Bronto_Software
    - tbrownaw 13y ago
      Can you name a large startup that hasn't taken investment? I thought that's how "startup" is defined, and if you don't take outside investment your business is called something else.
  - tonyedgecombe 13y ago
    "Today, with everything available it's become easy for small companies to bootstrap their way through all stages of growth without any conventional investment." Try building a bridge or an opera house or a car factory without outside investment. There is a whole world outside our small bubble.
orangethirty 13y ago
Good, smart founders do. Technology and open source have reduced the power of investors. Though I know more good founders that don't take investor money, than those who do.
7Figures2Commas 13y ago
Even if you assume that this is generally true, it doesn't mean that increased founder "power" has really come at the expense of investors. The coordinated money printing by central banks around the world has injected trillions of dollars into the global economy, and the greatest beneficiaries of that have been a) firms in the financial sector and b) individuals who have significant exposure to financial markets. This, of course, has a direct and indirect impact on Silicon Valley: 1. It's easier to raise a venture fund when LPs are doing well. Fed action has incentivized investment in riskier asset classes. Appetite for risk is broad-based and not concentrated in venture capital, but venture capital has certainly benefited. 2. Thanks to QE Infinity, the fortunes of many publicly-traded Silicon Valley companies have risen with the stock market and the IPO window is open. A handful of tech companies even sport 1999-like PE ratios. This has created enormous wealth in the Valley, much of it liquid, which has produced an angel (and super angel) boom. Founders, particularly those with a track record and/or traction, may be able to negotiate better terms today than they could have even a few years ago, but that's largely because the dollars being invested in their companies are so cheap. Who would you rather be: an entrepreneur who thinks he's getting a good deal because he got a higher valuation and retained more control, or the investor who gets to invest with Monopoly money?
vinceguidry 13y ago
There are three parts to this essay, He doesn't explain this point adequately until the end of the second. But you still won't get what he's saying unless you're already a follower and have digested the ideas in his blog. Venkat trades in big, hairy concepts. The one he's using here is legibility. It's when information is structured in rigorous ways, defined by those using it as an instrument of power. It is the primary tool governments use against the people. An example is making every person have a current address listed on their driver's license. Governments stack these legibility requirements up so as to control commerce and extract rents. (taxes) Venkat's argument is that investors won the game by forcing founders to be legible, reducing the information advantage they enjoyed historically. While it may look like founders have never had more power, in reality they've lost a crucial ability, to hoard critical inside information. It's really the only advantage they have, without it, they're at the mercy of investors. The ability to dictate terms is really inconsequential, more a function of fashion than actual power. Who cares if you get 2x the money you should have gotten? With information asymmetry, founders could easily wrangle 100x.
- ajju 13y ago
  Are there historical (in the last 20 years) examples of founders who wrangled 100x investment from investors, who would now not be able to do this because this supposed information asymetry no longer exists.
  - vinceguidry 13y ago
    His main example was Facebook. But really, you should read the essay in its entirety and get his arguments directly. Looking further back, Bill Gates managed to steal the future right out from underneath IBM through information asymmetry. Venkat is drawing large arcs here, and he would consider IBM an "investor" for the purposes of the discussion.
    - ajju 13y ago
      Facebook's leverage was growth, not information asymmetry. Zuckerberg's personal strengths are that he is savvy, and he had knowledge gleaned from Sean Parker et al. If anything YCombinator and others help make acquiring that knowledge easier. YCombinator's strengths are as much in its alumni sharing information within the network, much the same as Sean Parker shared information with Zuck, as in anything else that happens physically at YCombinator. And, if you want to see a post-Facebook example of how hypergrowth can enable favorable fundraising, just see Github: http://www.crunchbase.com/company/github http://www.crunchbase.com/company/github I have no idea how YCombinator, the lean startup movement or any of the other miscellaneous "villains" Venkatesh identifies would prevent a new Zuckerberg from raising money at the such favorable terms again. Re: IBM/Microsoft - As Jobs did with Xerox, as Jack Dorsey may do with Visa one day. Savvy players beating non savvy players is a trend that has happened throughout history. I do not see how any recent developments preclude that. Venkat is framing this into an elegy for the savvy entrepreneur when there is no necessity for that. I did read the essay - all 3 parts of it. There are some interesting points about return to city states and an understanding of politics being a huge strength for entrepreneurs towards the end, and several valid points about acqui-hires becoming more and more mainstream towards the beginning. I wish he had stuck to making those points instead of trying to weave a grand theory of entrepreneurs as the new labor which does not hold.
georgetwohands 13y ago
As the investor tells entrepreneurs from the site he runs -- owning their attention. Investors out-built builders. And with minimal effort. It's another thing investors own: what developers read. Pwnd developers. You're pwnd.
- cinquemb 13y ago
  Well from the context of the subject of the article, YC serves as the university (this site can be seen as serving like the social environment of such to discuss things relating) to feed the "New Bankers" or the Google/Apple/Facebook's. However what this author fails to talk about in his haste of this new order to shape up because of the fracturing social order in developed world (note not developing world because most people in the developing world have nothing to lose because they did not gain much of the fruits the developing world has), is the war that usually happens during these periods (look at what is shaping up in Spain, Greece and spreading through europe). I expect 3-d printed weapons (Hat tip to Defence Distributed and the pollitically aware hacker-culture that very much includes the so called "Pwnd" developers) to shape some role. Developers are the "new engineers" aren't "Pwnd". The "new system" relies on them for the new working class: the Robots. And the "old system" relies on them for pretty much making technology practical to use for their whims. The people that are "Pwnd" are going to be the people who aren't shaping the new system at all: most people in the societies of the developed world. "If you don't become an actor, you'll never be a factor." http://rapgenius.com/Lupe-fiasco-words-i-never-said-lyrics http://rapgenius.com/Lupe-fiasco-words-i-never-said-lyrics
michaelochurch 13y ago
Founders with breakout successes get the best terms ever now; that is true. On the other hand, investors have more power to fuck with founders' careers (even years after the venture dissolves), and founders who fail are more desperate to get back into conventional careers due to the disgustingly high housing prices that exist now. Venkat talks about the old-school serial entrepreneur: the 10x hustler who learned a little bit from each failure and finally had a huge hit on his 5th attempt (usually around age 40, at which point he'd be unfundable by contemporary VC-istan standards). That person is gone now. In contemporary VC-istan, no one gets a 3rd startup, thanks to the collusive and almost certainly illegal reputation economy that exists there. You might get a second shot if you come back to your VC bosses with your tail between your legs. That's because VCs have set themselves up as the executives of the first post-modern company: VC-istan. "Entrepreneurs" are hustling project managers. The investor/founder separation exists to hide the Effort Thermocline (the level at which jobs become easier with increasing rank, not harder) because it exists between two companies, with a distinct power relationship of one over the other. Hell, most VCs won't even talk to you if you were lack-of-fit for a regular corporate job. They want to fund banker kids who did Analyst -> Private Equity. (This is the MBA stereotype, but it's the 2nd tier of those who do MBAs. The top tier skip MBA school and become parasitic PEtards two years early.) True hustlers and technologists are second-class citizens; they work too hard and don't have the social polish to exploit "just like me" chickenhawking of their backers.
- Retric 13y ago
  VC's are a tiny slice of the economy and have little impact on the vast majority of companies. In the wider world there is a near surplus of capital that has been driving down investment returns for hundreds of years. Not that long ago 15% ROI was considered a poor investment now your doing good to make half that. So, if anything capital is losing most of it's power. PS: Also, VC's are managerial not capital. You don't need any mony to start one just convince a other managers that are investing still other people's money that you know what your doing.
  - michaelochurch 13y ago
    Sure, but that's all there is left for a lot of people, once they're trapped in high-COL areas and unable to properly bootstrap. Bank loans want personal liability, which rules out anything that has more than a ~5% chance of failure. Even the mid-risk/mid-growth tech companies (derided as "lifestyle businesses" by VC-istan) have 10-30% 5-year failure rates. So they're out. There really isn't anything to fund these mid-risk/mid-growth companies. VCs don't like them, because the company's goal is to be independent, not an overwhelming corporate megalith. Savings/bootstrapping work if you have them, but I challenge you to find a 30-year-old in SV who (a) has appreciable savings, and (b) wasn't lifted by a connection ("acqui-hire" welfare checks count as "lifted"). Such people are fairly common outside of SV and NYC, which might surprise you. I know a few programmers out in PA who, even though they make (just slightly) less than I do in salary, they're my age and worth half a million. They were able to actually fucking save money. Perhaps I am a moron for chasing the prestige of the VC-istan and Wall Street jobs, throwing me into a city where landlords win and talent struggles. My "savings" is the career benefit of having spent my 20s in NYC, but it's questionable how much that matters. I'd rather have the autonomy that comes with money and the credibility that comes with having higher-quality work experience. VC-istan (and, to a lesser degree, Wall Street with its bonus system) are economies where, instead of savings, you put everything you have (time, money, energy) into this weird system that distributed outsized rewards, intermittently, to a lucky few. Wall Street is more decent than VC-istan, I feel like. Wall Street is some part meritocracy (esp. prop trading) and some part connections, but it's honest about what it is. VC-istan is a who-you-know economy that pretends to be a meritocracy, and if you call the lie by it's name, people fuck with your career in the worst kind of way.
delinka 13y ago
I agree. And I believe the author does and just doesn't realize it. "Those who are attracted to true entrepreneurship are figuring out new ways to work around the traditional investor class." Seems to me if the investors had won, this wouldn't even be possible. But as long as innovation (in any industry, not only tech) exists, people will find a way to work around any obstacle.
will_brown 13y ago
>Founders have never had more power relative to investors than they do now. Easy to say coming from the new middleman getting between start-ups and funding. If you really believe this prove it. Accept me into YC (or anyone who was not invited into YC but has a launched product), I/they will not receive YC funding but be a "mole" and go through YC and present at demo day - I promise I/they can secure funding - which means the power is not relative to Founders but shifted to YC.

Investors have won? What? Founders have never had more power relative to investors than they do now.

by pg 13y ago

Investors have won? What? Founders have never had more power relative to investors than they do now.

“politically charged statements like this can do a good deal of damage, so I’ve been wary about sharing my views more publicly” It’s not that the statement is politically charged, it’s just wrong.

venomsnake 13y ago

Only if they have read all and not just some of your essays and groked them. In the country where I live the startup scene is terrible - only buzzwords thrown from all sides and no substance at all. Engineers in startups expecting salaries and benefits of a big company but with nothing from the downsides. In this situation the guys with the hard cash hold a lot of influence.

sillysaurus 13y ago

Founders have never had more power relative to investors than they do now. Do investors need any power over founders? Yuri Milner's philosophy seems to suggest they don't.

InclinedPlane 13y ago
They need to have the power to compel founders to believe that they need outside investment, and they need to trade significant amounts of equity for that. Today, with everything available it's become easy for small companies to bootstrap their way through all stages of growth without any conventional investment. Begin with personal savings and maxing out credit cards to allow a tiny handful of founders to build an MVP that gains credibility and perhaps even generates some revenue. Then use things like crowd funding to scale up to bigger projects, mitigating the risk of burning through savings during development and of failing to get market traction at the same time. Then hit the ground running with a product that's already built and already known to be valued by the market and simply rake in revenue. Or go back and hit another cycle of crowd funding. You don't even need a merchant account to charge people money for things. Compared to the way things were even 10 years ago the scales have shifted a great deal in favor of founder autonomy.
- sillysaurus 13y ago
  Today, with everything available it's become easy for small companies to bootstrap their way through all stages of growth without any conventional investment. Can you name a large startup that hasn't taken investment? Oculus, maybe. Begin with personal savings and maxing out credit cards to allow a tiny handful of founders to build an MVP that gains credibility and perhaps even generates some revenue. That's incredibly risky. If it doesn't work, then you won't be able to make another attempt for years while you try to recover. The value of VC investment is that it insulates you from those risks. I've seen firsthand just how ravenous the effects can be when the "avoid investment" philosophy is taken to its extreme. So the question becomes, why not take VC investment from VCs who aren't interested in company control?
  - EGreg 13y ago
    Can you name a large startup that hasn't taken investment? Oculus, maybe. 37signals? Craigslist? Fog Creek? Many app companies?
  - yk 13y ago
    Actually Schumpeter argues, that it is precisely the risk associated with entrepreneurship which separates 'entrepreneurs' from 'bureaucrats.'
  - mindcrime 13y ago
    I'm not sure how large your definition of "large" includes, but Bronto Software[1] were / are bootstrapped and are doing pretty well. [1]: http://en.wikipedia.org/wiki/Bronto_Software http://en.wikipedia.org/wiki/Bronto_Software
  - tbrownaw 13y ago
    Can you name a large startup that hasn't taken investment? I thought that's how "startup" is defined, and if you don't take outside investment your business is called something else.
- tonyedgecombe 13y ago
  "Today, with everything available it's become easy for small companies to bootstrap their way through all stages of growth without any conventional investment." Try building a bridge or an opera house or a car factory without outside investment. There is a whole world outside our small bubble.

orangethirty 13y ago

Good, smart founders do. Technology and open source have reduced the power of investors. Though I know more good founders that don't take investor money, than those who do.

7Figures2Commas 13y ago

Even if you assume that this is generally true, it doesn't mean that increased founder "power" has really come at the expense of investors. The coordinated money printing by central banks around the world has injected trillions of dollars into the global economy, and the greatest beneficiaries of that have been a) firms in the financial sector and b) individuals who have significant exposure to financial markets. This, of course, has a direct and indirect impact on Silicon Valley: 1. It's easier to raise a venture fund when LPs are doing well. Fed action has incentivized investment in riskier asset classes. Appetite for risk is broad-based and not concentrated in venture capital, but venture capital has certainly benefited. 2. Thanks to QE Infinity, the fortunes of many publicly-traded Silicon Valley companies have risen with the stock market and the IPO window is open. A handful of tech companies even sport 1999-like PE ratios. This has created enormous wealth in the Valley, much of it liquid, which has produced an angel (and super angel) boom. Founders, particularly those with a track record and/or traction, may be able to negotiate better terms today than they could have even a few years ago, but that's largely because the dollars being invested in their companies are so cheap. Who would you rather be: an entrepreneur who thinks he's getting a good deal because he got a higher valuation and retained more control, or the investor who gets to invest with Monopoly money?

vinceguidry 13y ago

There are three parts to this essay, He doesn't explain this point adequately until the end of the second. But you still won't get what he's saying unless you're already a follower and have digested the ideas in his blog. Venkat trades in big, hairy concepts. The one he's using here is legibility. It's when information is structured in rigorous ways, defined by those using it as an instrument of power. It is the primary tool governments use against the people. An example is making every person have a current address listed on their driver's license. Governments stack these legibility requirements up so as to control commerce and extract rents. (taxes) Venkat's argument is that investors won the game by forcing founders to be legible, reducing the information advantage they enjoyed historically. While it may look like founders have never had more power, in reality they've lost a crucial ability, to hoard critical inside information. It's really the only advantage they have, without it, they're at the mercy of investors. The ability to dictate terms is really inconsequential, more a function of fashion than actual power. Who cares if you get 2x the money you should have gotten? With information asymmetry, founders could easily wrangle 100x.

ajju 13y ago
Are there historical (in the last 20 years) examples of founders who wrangled 100x investment from investors, who would now not be able to do this because this supposed information asymetry no longer exists.
- vinceguidry 13y ago
  His main example was Facebook. But really, you should read the essay in its entirety and get his arguments directly. Looking further back, Bill Gates managed to steal the future right out from underneath IBM through information asymmetry. Venkat is drawing large arcs here, and he would consider IBM an "investor" for the purposes of the discussion.
  - ajju 13y ago
    Facebook's leverage was growth, not information asymmetry. Zuckerberg's personal strengths are that he is savvy, and he had knowledge gleaned from Sean Parker et al. If anything YCombinator and others help make acquiring that knowledge easier. YCombinator's strengths are as much in its alumni sharing information within the network, much the same as Sean Parker shared information with Zuck, as in anything else that happens physically at YCombinator. And, if you want to see a post-Facebook example of how hypergrowth can enable favorable fundraising, just see Github: http://www.crunchbase.com/company/github http://www.crunchbase.com/company/github I have no idea how YCombinator, the lean startup movement or any of the other miscellaneous "villains" Venkatesh identifies would prevent a new Zuckerberg from raising money at the such favorable terms again. Re: IBM/Microsoft - As Jobs did with Xerox, as Jack Dorsey may do with Visa one day. Savvy players beating non savvy players is a trend that has happened throughout history. I do not see how any recent developments preclude that. Venkat is framing this into an elegy for the savvy entrepreneur when there is no necessity for that. I did read the essay - all 3 parts of it. There are some interesting points about return to city states and an understanding of politics being a huge strength for entrepreneurs towards the end, and several valid points about acqui-hires becoming more and more mainstream towards the beginning. I wish he had stuck to making those points instead of trying to weave a grand theory of entrepreneurs as the new labor which does not hold.

georgetwohands 13y ago

As the investor tells entrepreneurs from the site he runs -- owning their attention. Investors out-built builders. And with minimal effort. It's another thing investors own: what developers read. Pwnd developers. You're pwnd.

cinquemb 13y ago
Well from the context of the subject of the article, YC serves as the university (this site can be seen as serving like the social environment of such to discuss things relating) to feed the "New Bankers" or the Google/Apple/Facebook's. However what this author fails to talk about in his haste of this new order to shape up because of the fracturing social order in developed world (note not developing world because most people in the developing world have nothing to lose because they did not gain much of the fruits the developing world has), is the war that usually happens during these periods (look at what is shaping up in Spain, Greece and spreading through europe). I expect 3-d printed weapons (Hat tip to Defence Distributed and the pollitically aware hacker-culture that very much includes the so called "Pwnd" developers) to shape some role. Developers are the "new engineers" aren't "Pwnd". The "new system" relies on them for the new working class: the Robots. And the "old system" relies on them for pretty much making technology practical to use for their whims. The people that are "Pwnd" are going to be the people who aren't shaping the new system at all: most people in the societies of the developed world. "If you don't become an actor, you'll never be a factor." http://rapgenius.com/Lupe-fiasco-words-i-never-said-lyrics http://rapgenius.com/Lupe-fiasco-words-i-never-said-lyrics

michaelochurch 13y ago

Founders with breakout successes get the best terms ever now; that is true. On the other hand, investors have more power to fuck with founders' careers (even years after the venture dissolves), and founders who fail are more desperate to get back into conventional careers due to the disgustingly high housing prices that exist now. Venkat talks about the old-school serial entrepreneur: the 10x hustler who learned a little bit from each failure and finally had a huge hit on his 5th attempt (usually around age 40, at which point he'd be unfundable by contemporary VC-istan standards). That person is gone now. In contemporary VC-istan, no one gets a 3rd startup, thanks to the collusive and almost certainly illegal reputation economy that exists there. You might get a second shot if you come back to your VC bosses with your tail between your legs. That's because VCs have set themselves up as the executives of the first post-modern company: VC-istan. "Entrepreneurs" are hustling project managers. The investor/founder separation exists to hide the Effort Thermocline (the level at which jobs become easier with increasing rank, not harder) because it exists between two companies, with a distinct power relationship of one over the other. Hell, most VCs won't even talk to you if you were lack-of-fit for a regular corporate job. They want to fund banker kids who did Analyst -> Private Equity. (This is the MBA stereotype, but it's the 2nd tier of those who do MBAs. The top tier skip MBA school and become parasitic PEtards two years early.) True hustlers and technologists are second-class citizens; they work too hard and don't have the social polish to exploit "just like me" chickenhawking of their backers.

Retric 13y ago
VC's are a tiny slice of the economy and have little impact on the vast majority of companies. In the wider world there is a near surplus of capital that has been driving down investment returns for hundreds of years. Not that long ago 15% ROI was considered a poor investment now your doing good to make half that. So, if anything capital is losing most of it's power. PS: Also, VC's are managerial not capital. You don't need any mony to start one just convince a other managers that are investing still other people's money that you know what your doing.
- michaelochurch 13y ago
  Sure, but that's all there is left for a lot of people, once they're trapped in high-COL areas and unable to properly bootstrap. Bank loans want personal liability, which rules out anything that has more than a ~5% chance of failure. Even the mid-risk/mid-growth tech companies (derided as "lifestyle businesses" by VC-istan) have 10-30% 5-year failure rates. So they're out. There really isn't anything to fund these mid-risk/mid-growth companies. VCs don't like them, because the company's goal is to be independent, not an overwhelming corporate megalith. Savings/bootstrapping work if you have them, but I challenge you to find a 30-year-old in SV who (a) has appreciable savings, and (b) wasn't lifted by a connection ("acqui-hire" welfare checks count as "lifted"). Such people are fairly common outside of SV and NYC, which might surprise you. I know a few programmers out in PA who, even though they make (just slightly) less than I do in salary, they're my age and worth half a million. They were able to actually fucking save money. Perhaps I am a moron for chasing the prestige of the VC-istan and Wall Street jobs, throwing me into a city where landlords win and talent struggles. My "savings" is the career benefit of having spent my 20s in NYC, but it's questionable how much that matters. I'd rather have the autonomy that comes with money and the credibility that comes with having higher-quality work experience. VC-istan (and, to a lesser degree, Wall Street with its bonus system) are economies where, instead of savings, you put everything you have (time, money, energy) into this weird system that distributed outsized rewards, intermittently, to a lucky few. Wall Street is more decent than VC-istan, I feel like. Wall Street is some part meritocracy (esp. prop trading) and some part connections, but it's honest about what it is. VC-istan is a who-you-know economy that pretends to be a meritocracy, and if you call the lie by it's name, people fuck with your career in the worst kind of way.

delinka 13y ago

I agree. And I believe the author does and just doesn't realize it. "Those who are attracted to true entrepreneurship are figuring out new ways to work around the traditional investor class." Seems to me if the investors had won, this wouldn't even be possible. But as long as innovation (in any industry, not only tech) exists, people will find a way to work around any obstacle.

will_brown 13y ago

>Founders have never had more power relative to investors than they do now. Easy to say coming from the new middleman getting between start-ups and funding. If you really believe this prove it. Accept me into YC (or anyone who was not invited into YC but has a launched product), I/they will not receive YC funding but be a "mole" and go through YC and present at demo day - I promise I/they can secure funding - which means the power is not relative to Founders but shifted to YC.