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I think it's a reasonable question. The answer is almost entirely dependent on how many founders/employees you have and if you're drawing salaries or not. Sal
by Patrick_Devine 12y ago
I think it's a reasonable question. The answer is almost entirely dependent on how many founders/employees you have and if you're drawing salaries or not. Salaries are by a country mile your most expensive cost.
It should be roughly enough for around 4 people to be pulling $90K/year salaries for 3 months with a bit left over for other stuff. So not a ton, but enough to do something interesting. The expectation is you'll be raising another round right after YC.
- ac2u 12y agoThanks for your answer. I find the more figures I have in general about how money moves in and out of the company over time, the more I feel I understand. It's really more of a question to get my head around the burn rate for early stage valley companies that are living and working together and your answer helped. It was a little annoying to see some folk answer back with an invalidation of the question.
- Patrick_Devine 12y agoOne caveat is that I haven't gone through YC, however I am running my own startup right now in Los Altos/Palo Alto. Our next biggest expenses after salaries are legal bills and IT stuff. I believe YC really helps keeping the legal bills down (we're not so lucky), and many cloud services companies will offer you free cloud servers (including my own; do you need any instances?). Oh, also, office space costs an arm and a leg here, but presumably you can just work out of someone's house in the true start-up spirit. Other than that there's not much to worry about at first unless you need a foosball table. You're not going to have much time to play it though.