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"Access to venture capitalists: Raising money is incredibly hard and incredibly distracting. The faster you can get it done, the faster you can get back to buil

"Access to venture capitalists: Raising money is incredibly hard and incredibly distracting. The faster you can get it done, the faster you can get back to building something people want. YC is the perfect forcing function to help you raise capital. Network: Being an entrepreneur is a lonely path. There are few people who truly understand what you’re going through and even if your friends (or parents) are well meaning, they still don’t get it. YC is the ultimate network and you will be surrounding by people who do get it." These two points from her essay reveal more about the true nature of YC than perhaps the author intended. In theory, when you join YC, you and your cofounders give Paul & Co. a sizable chunk of equity in your budding startup in exchange for advice dispensed over dinner--advice and dinners which, given the valuations of certain YC-backed startups and the percentage of equity surrendered, cannot possibly, no matter how enlightening the advice or delicious the dinners, be worth the price paid in shares. Why then are so many founders eager to make what on the surface seems like a terrible deal? Because what they actually get in exchange for their equity is not mere mentoring, but the access to top VCs like Andreeson Horowitz and Sequoia. Those VCs can in turn, using their money and media connections, hype-up your startup and work to get you bought out/acquihired. We like to pretend that the startup game is a meritocracy and not all like the cronyism that goes on in corporate boardrooms where CEOs doubling as board members vote on each other's lavish compensation packages, but it is not difficult to recall examples that suggest it is all too similar. Take Loopt. It was a dying product with a dwindling userbase that while novel in concept for 2004, was clearly too early to market and soon found itself in a market awash with location-aware competitors like Foursqaure and Gowalla. But because Loopt had gone through YC and took investment from board members of Sequoia, strings were pulled to get Greendot to acquire Loopt and reward Sam with a life-changing exit and provide him and his investors with a justification for branding Loopt a success. From there, he went on to succeed PG as YC's president, and using that platform, he's written--without any hint of irony--polemics decrying the lack of innovation[1] and calling for startups to work on "breakthrough technologies"[2] despite having as his major accomplishment a failed feature phone version of Grindr.[3] I'm happy for Susan and hope her startup is successful, but her experiences has only reinforced my view that success in the Valley startup game is much more about luck and connections than skill and execution. She was suspiciously vague about her financial situation, but one can infer from the essay (buying the domain, flying back and forth, hiring a "full stack" dev), that it's probably much better than most mothers of two, married or otherwise. The requirement that you "move to the bay area"[4] (which she technically violated) all but ensures mothers who aren't rich won't apply, which completely negates her message of "I'm a mom and I did it and so can you!" [1] http://blog.samaltman.com/what-happened-to-innovation-1 http://blog.samaltman.com/what-happened-to-innovation-1 [2] http://blog.samaltman.com/new-rfs-breakthrough-technologies http://blog.samaltman.com/new-rfs-breakthrough-technologies [3] https://news.ycombinator.com/item?id=385178 https://news.ycombinator.com/item?id=385178 [4] http://www.ycombinator.com/apply/ http://www.ycombinator.com/apply/

mqsiuser 12y ago
Facebook made me rich and now I can do anything If you were made rich by some (recent) lucky coincidence, then you can also do whatever you want. Great message, a bit hidden. Unveiled by hacker news, thank you!
trhway 12y ago
>We like to pretend that the startup game is a meritocracy It is not "we like", is it just a rule of the game - to pretend that it is about meritocracy, to wear a hoodie. >decrying the lack of innovation being formally pro-innovation is just a rule like the "meritocracy" rule. The game is a well-oiled money making machine and like any such machine it is very risk-averse, and with any innovation (or, God forbid, "breakthrough technology") being a risk, it is thus in particular innovation-averse.
dkarapetyan 12y ago
And YC is one of the good guys. Imagine what it's like in regular VC land.
seanccox 12y ago
YC really has succeeded in building a recognized brand in the tech startup space, such that they can really define that space. I'd compare YC to Harvard or Davos (the World Economic Forum), where the challenge is to get accepted. Once you have passed the gateway, the wealthy/powerful recognize this by extending opportunities to new members. This is true of almost any club (the Free Masons, your local BPOE, Boy Scouts, etc.). You join, you get to know people, those people help you with your interests, and in return you help them with their interests. It isn't particularly difficult to see why this success might backfire and reduce/limit actual innovation, because it creates a powerful echo chamber – in part by design, to achieve specific goals, and in part by accident, because the people accepted by the club tend to meet predefined expectations. The problem is, as I see it, that escaping that kind of feedback loop is very difficult, once an organization is in it, because the momentum making the loop bigger is difficult to redirect into an energy to make the loop different. Harvard could announce that it will no longer accept children from powerful/wealthy families, Davos could release a statement that this year it will be hosted in conjunction with the Communist International, and YC could relocate to Uganda for a season – but that's not what these organizations do, so after a point, they aren't able to innovate outside of very specific boundaries. The answer to that, of course, is create new organizations with different boundaries/priorities, but Christ, that reeks of effort.

mqsiuser 12y ago

Facebook made me rich and now I can do anything If you were made rich by some (recent) lucky coincidence, then you can also do whatever you want. Great message, a bit hidden. Unveiled by hacker news, thank you!

trhway 12y ago

>We like to pretend that the startup game is a meritocracy It is not "we like", is it just a rule of the game - to pretend that it is about meritocracy, to wear a hoodie. >decrying the lack of innovation being formally pro-innovation is just a rule like the "meritocracy" rule. The game is a well-oiled money making machine and like any such machine it is very risk-averse, and with any innovation (or, God forbid, "breakthrough technology") being a risk, it is thus in particular innovation-averse.

dkarapetyan 12y ago

And YC is one of the good guys. Imagine what it's like in regular VC land.

seanccox 12y ago

YC really has succeeded in building a recognized brand in the tech startup space, such that they can really define that space. I'd compare YC to Harvard or Davos (the World Economic Forum), where the challenge is to get accepted. Once you have passed the gateway, the wealthy/powerful recognize this by extending opportunities to new members. This is true of almost any club (the Free Masons, your local BPOE, Boy Scouts, etc.). You join, you get to know people, those people help you with your interests, and in return you help them with their interests. It isn't particularly difficult to see why this success might backfire and reduce/limit actual innovation, because it creates a powerful echo chamber – in part by design, to achieve specific goals, and in part by accident, because the people accepted by the club tend to meet predefined expectations. The problem is, as I see it, that escaping that kind of feedback loop is very difficult, once an organization is in it, because the momentum making the loop bigger is difficult to redirect into an energy to make the loop different. Harvard could announce that it will no longer accept children from powerful/wealthy families, Davos could release a statement that this year it will be hosted in conjunction with the Communist International, and YC could relocate to Uganda for a season – but that's not what these organizations do, so after a point, they aren't able to innovate outside of very specific boundaries. The answer to that, of course, is create new organizations with different boundaries/priorities, but Christ, that reeks of effort.