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what I'd like to know is (yes I've been rejected again) is should I consider organizing now... or continue coding and again hope to get picked up by yc in the next round (yes I know I don't need yc). they say the don't like dealing with existing paperwork. I'd also like to know if anyone has seen YC fund something that wasn't a web application.

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As kyro said, being accepted or rejected by YC should not be a determining event when it comes to "should I continue". Yes, you should continue, in the same way you would have if YC had never existed.

the question is not one of 'should continue' it's one of should I go out and organize and start building the legal entity now, or should I code for 6 more months and try again.

Do you need to build a legal entity to go out and talk to people etc? A lot of people over here at least get warned against incorporating until they absolutely need to.

That I can't answer, since I'm not familiar with the legal kerfuffle surrounding incorporation in the US. In the UK, incorporating takes about an hour and costs £50, but I hear that it's a lot harder and more onerous in the US.

I don't know about incorporation, but an llc takes about as much in the US. it's not really an easy question generally. I'll probably end up waiting until closer to a 'production' release

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