I'm a small time angel investor (I write 8-10 $100K checks a year), so YC is really important to me. Almost all my checks are in YC companies. I don't have the time nor skills to do proper due diligence, but with YC I don't have to. Investing in a YC company provides me with already vetted founders who I know will have an incredible support network and are already well connected. Yes, I give up some upside because of how much YC already owns, but to me it's worth every penny for the service that YC provides to me as an investor and to the startup.

That's the investor side of the equation, which if you believe this thread is his main complaint -- that it's too investor friendly.

But I also get to see the founder side of the equation. Since I'm writing such small checks, a lot of my value to the company is offering help at the early stage, often with architecture review or product reviews, and sometimes even interviewing engineering candidates for them. Because of the close relationship, sometimes I end up becoming friends with the founders I invest in. Which lets me see how YC helps them as founders.

Need help connecting with someone at company X? There's almost always another YC founder who can make the intro. Need more money? YC has got VCs on speed dial for you. Need media coverage? There are journalists from highly respected outlets asking YC for good stories every day. Even basic stuff, like, "I need an accountant" or "I need a lawyer who can handle this special type of law" can be much easier solved with a quick intro from YC.

Getting into YC just makes everything else about doing a startup so much easier. It doesn't make it easy, because startups are never easy. But it takes away a lot of the low level friction.