Some of us don't live inside the Bay Area startup bubble. I've never worked for a place that has offered equity, I've worked for publicly traded companies and the government. For the vast majority of Americans (and the world) this is a situation where we will never see ourselves in, so some of us see this as a weird business idea given the incredibly limited market that relies on a booming economy resulting in VC money funding startups to survive.
As someone else in this thread said, this is a startup for startups.
I can see why YC funded it "we exist to fund startups, startups offer equity when they can't afford to pay employees fairly, of course we'll fund a startup that helps employees of startups!".
However the problem here is, YC has never existed with their current model during a recession. Y Combinator was founded in March of 2005 with what like 8 companies and a much smaller contribution, the recession started a few years later.
Fast forward to last year and they had 273 companies present at demo days between winter and summer batch, at what 150k a pop? What happens when we enter the next inevitable recession? Will accelerators like YC have 50 million dollars (given the events they put on, I imagine you can at least round up to 50 million) to fund startups at these levels? Or will they have to drastically dial back and fund considerably less companies and focus more on the continuity fund and additionally funding companies that are seeing growth?
Then enter Compound, relying entirely on startups popping up offering equity. Enter a recession and a lot of startups are likely to fail during tha tperiod because VCs will be less inclined to take on risky investments, companies and consumers will be less likely to take on buy new goods or pay for new services, and then Compound is suddenly like "whoa, if there's no startups offering equity we have no customers, we don't have any other product ideas!!!" Press Release: Company Compound has shuttered, in a noble gesture Compound posted all employee resumes on the website and urge companies to consider interviewing these now unemployed persons.
This is a problem I consistently see with YC companies and VC in general the Bay Area exists in a alternate reality, or fantasy, bubble that does not resemble the rest of the country or how most Americans lives are. That isn't sustainable. I mean you have all these SaaS companies -most Americans have no idea what software as a service is and doesn't need to have their toaster tweet that it is toasting the 17th piece of toast this week so that D0ughb0x can ship more artisanal gluten free free trade gmo free bread and notify the Ca$#p@y app that the subscriber's digital life companion Phriendly should request authorization for payment-.
Ok, maybe that example is a bit ridiculous but seriously, look at a list of the companies for the past few YC batches... there are some absolutely ridiculous ideas, most of these companies will fail miserably and would NEVER have been seeded during a recession, what happens to Compound when startup numbers plummet and they can't find customers to educate about equity?