> Why doesn't Paul Graham start this mythical founders first VC firm? My question is why would he? I can only come up with two reasons: 1) more money 2) a sens

> Why doesn't Paul Graham start this mythical founders first VC firm? My question is why would he? I can only come up with two reasons: 1) more money 2) a sense of altruism (we have to help startups succeed even more!) In terms of the first, YC seems to be doing pretty darn well by the numbers, how much more money do you need? The second is nice in theory, but I wonder if it would actually have a negative effect. The value provided by an early investor and a later stage investor is different in the same way that young companies need very different things than they do later in life. In the beginning what companies need is largely the same, and so advice and such can scale relatively cleanly (as YC has shown). As you grow, though, what is needed more and more is specific, individual advice - the answer won't always be the simple "don't die". There's no question that YC (and PG himself) represents one of the most authoritative sources of information on early stage investments, but it's not clear if that will directly translate as companies progress. If not, he'd essentially have to start over, refiguring out what it means to succeed and who knows, maybe he wouldn't be any good at it. Either way, if you tried to master both, I think one of two things would happen: you'd either lose your grip and be good at neither, or you'll "succeed" with the end result being homogeny. You'll seed companies and direct them into being what you want them to be for the next fund. That kind of "vertical integration" easily leads to a rules oriented echo chamber - the exact kind of stagnation that lets some scrappy "startup" come in and eat your lunch. Could he do it and make it work? If anyone could, I'd bet on him, but I actually think there's value in having YC stay at the stage they are. It's better to have multiple forces at work, pushing and pulling against each other.