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Comment by michaelochurch | Hacker News Reader

I never applied to YC because of the small amounts. First of all, if I'm going to ask for money, I only want to do it once. Which means I'd prefer to ask for enough to get to profitability, not just enough to get to another round. (Granted, you'll raise that A on better terms with YC social proof.) Second, if we assume a 4-year vesting cycle (which, I think, should apply to founders as well) then my being there already puts the valuation at $1.5-2M (because, while I wouldn't get $375-500k on the normal wage-labor market, I'm working 2+ times as hard and taking lots of risk). Scale that up based on how many other founders there are. So for me, it's not a good deal. If you're 22, I think it's probably a great deal.

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Having been an alum before, I feel confident in saying, as hooande mentions in another thread, that the program itself is unlike getting invested in by any other investor. If you get funded by other angels or VC's, you have little real relationship built beyond that of you with the partner or angel.

On the other hand, at YC, when we needed help with our Series A, we got to talk to James Lindenbaum of Heroku, who taught us the ins-and-outs. When we needed to launch, we could talk to Alexis Ohanian who created Reddit (and interviewed us) and knows a thing or two about launching consumer sites. YC batchmates help each other and pay it forward when we become alums.

Few people do it these days for the money itself. One trend we see of late is companies who have already raised seed rounds, often from already prominent angel investors, opt to go through YC because it's a multiplier on their ability to execute -- they're more motivated, they focus more on the right things, have access to a hugely powerful network of alums, make deep lasting connections with batchmates, and then get a multiplier on their valuation at Demo Day.

I don't see age as the determining factor. Even for people who already have networks (I was an early engineer at Palantir, Stanford grad) it was useful to greatly increase the number of smart people I knew and trusted. (See Metcalfe's law.)

I've joined a YC company as a founder after the actual YC sprint and I would definitely echo much of what garry is saying here even for myself. Our other investors are good people, but none of them offer the accessibility and information even now, versus what we get from the YC partners and especially our fellow YC companies.

That's an excellent set of points. Thank you for adding some real experience to counterbalance my speculations.

When it's viewed that way-- as not a fundraiser but a high-power incubator-- YC isn't a bad deal if you can capitalize on those synergies.

I have a lot of respect for Paul Graham and his Lisp advocacy in the mid-2000s can't be underestimated for its positive effect on programming. It was his essays that got me interested in Python, then Lisp and Ocaml, then Clojure and Scala. I'd certainly consider YC if I was sure I'd get a lot of personal attention from people like him.

Fair; it's not for everyone - but that's really not the point.

The point is that no one really thought "22 year olds" were capable of making an economic impact before YC came along. Hence, someone with the simple idea to say "Hey, we should give 22 year olds this deal" created an employment impact on the economy as big as Facebook. The more people that come up with new funding models like YC that actually work, the better we'll all be.

Some 22-year-olds are pretty badass, so I wouldn't underestimate them as a group. You're right, though. VC, except in certain bubble chambers (e.g. Stanford's CS department in the '90s) has this a weird paradox where you're either too old to raise money or too young to get an introduction. YC solved that, which is commendable.

It is better to start with small amounts, demonstrate viability of the concept and team, then work up to larger amounts. Even if someone would bet a large amount on you up front, you'll retain more of the company by raising most of the money after demonstrating traction.

I personally see YC's equity stake as a "fee" companies with young or un-networked founders will pay to gain law/financial/sales-lead networks to leverage.

In a vacuum, the trade works best for young founding teams and the value decreases as the team gets older (age typically does correlate with your leveragable network size).

If you don't mind me asking, what's your job and where do you live?

New York. Between jobs, have offers, still looking for a little while. Strongly considering a move outside of NYC (sick of having an impressive city on my resume be my savings; would like actual savings savings). Boston, SF, and Austin are main candidates. SF is still expensive but my pay would go up.

Also, doing a talent scan for a startup concept. Possibly a Hail Mary pass because I don't know if anyone can meet the standards for the business co-founder, but worth a shot. http://michaelochurch.wordpress.com/2013/04/23/seeking-co-fo...

Tried mining AngelList for contacts? I suspect you're going to have trouble recruiting people blind if you can't even say what the opportunity is.

(NB. On the NLP for code quality analysis front: there's a startup {well, going a couple of years now, so now exactly startup} in Oxford that's been doing something related: http://semmle.com/ code quality analysis is supposed to be one of the selling points of their product.)

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