Re: "won't get in"
How do I balance this encouraging advice with everything I've heard online about YC basically being a post-Ivy League thing? Seems like there's basically a 0% chance a random person would get into YC. And often those who did get in went to Stanford, Harvard, etc. and don't even have a product - sometimes they don't even know what they're going to build yet.
I wrote the idea of VC stuff off long ago. My wife and I have a profitable business here in SF that would be perfect as a startup, but the concept of raising funds to expand literally hasn't even crossed our minds because it seems so geared toward post-grads - like something only Stanford and Harvard people get access to after they graduate.
Not only that, we're profitable, and can even articulate a realistic vision about how it becomes the next $100M household name, but the numbers I've read online that most VCs want to see are not realistic - or if we were hitting those numbers I wouldn't even need a VC, we would be able to fund our own expansion.
So we're just doing it on our own.
The LinkedIn page for a lot of these companies showing you "Where they studied" can be a bit intimidating. Chockablock with Stanford and Ivy League.
I was filling out the Co-Founder matching service application and it has a required text area for education. The placeholder text examples? Standford MS in Comp Sci, NYU BS in Physics.
As a college dropout with "some college" but a 14+ year career in systems/software engineering roles, that was quite discouraging.
I'm with you and wish that we were more careful with this sort of signaling risk. However, there are tons of college dropouts and uncredentialed software people who make it in to YC.
What I'm basically trying to tell everyone, and hoping to convince a few, is: don't listen to any of this, just do it.
I'm also with you! Just wanted to share my experience in case it helps as a data point.
Gates, Jobs, and Zuck all famously dropped out of college of course.
It's an interesting and tricky social dynamic matching within and between these somewhat distinct groups.
Harvard, Reed, Harvard.
Any drop out from any of those has hurdled more than 98% of the general college corps. Or at least that would be a rational assumption by the VC cadre that is probably in the top 0.1% and an Ivy League grad.
People are commenting on this but failing to stake out a real point.
Is the point that just having been accepted to those schools is a strong signal? I would concede that it could be, sure.
But a lot of people drop out of Ivy league schools and simply flame out. Many would consider dropping out of those schools after a few semesters as failure. And many companies still require degrees; a few semesters at Harvard won't cut it.
I guess my point is that college dropouts are also successful at creating startups. Two have started the two most valuable companies in the world.
I'd argue getting accepted is almost the entire signal.
These people dropped out to chase extremely lucrative business opportunities - that they created as a student, likely aided by structural/networking support inside that institution - due to timing risk.
One could argue they not only got into a highly prestigious institution, but they quickly leapfrogged everyone there. That's the opposite of flaming out.
Didn't they ask drop out from Harvard or something? It's a bit disingenuous to say that.
Steve Jobs went to an obscure private school called Reed which seems to be something he became obsessed with due to LSD.
Zuck and Gates both dropped out of Harvard after founding their companies.
Reed is a great liberal arts college. Very intense and quirky academic culture, and being in Portland OR lends to an amazing college town vibe.
Sometimes I wish I went there instead of my Alma mater.
So did Elizabeth Holmes.
They were arguing success is possible without a college degree, not that lacking a college degree guarantees success.
Does it have to be US citizens, living in the US?
How about a native South African, born in SA?
Anyone can apply - you needn't be a US citizen (I'm not, for example) and you are most welcome to be South African.
Just curious, I was filling out my profile and it says Education History required. Normally that means college experience. I only did one year at a local community college. Should I just put that? My cofounder is attending a well respected school though.
Sure why not? If I were you I'd try not to worry too much about what will/won't seem good—what YC is pattern-matching for is usually quite different than what people assume.
There is likely some level of selection bias to it as well. If I think it's unlikely to get in without that ivy/engineering school background I might not bother to apply.
I don't personally believe that -- I'm confident in my 23 years of experience. It's unlikely I'll apply this weekend, but I did find a cofounder through the YC dating app. Maybe next batch.
Just finished W24 batch with no Ivy/FAANG background.
Everyone I met in our batch was very friendly, curious, and razor-sharp. Many people have credentialed backgrounds, many people do not.
I generally buy YC’s justification that many of the smartest people happen to go to Stanford/Ivy which is why they are over-represented.
There's no way this is even possible, let alone true.
This might be a hot take but if you're under the age of 25, it's likely that you know very few things total. And the things you do know, you're just not going to have a master level of understanding of in your 20s yet nor the drive to focus on it the way it needs, especially with other social pressures at play. What is extremely high in your 20s is your ambition - your loftiness of ideas and goals and your expectations of yourself - these can land you exceptional jobs, opportunities, and get you to a great starting point, but that's not the same as intelligence and ability.
For manual labor work, there's a definite peak - college age and the years just after. But for knowledge work, math, programming, business, politics, etc. being older is almost always an asset - you get better at things, you get smarter, your networks grow, you become an adult among the children and are far more aware of timing and can predict and speak on things with more accuracy. You simply know more.
Besides that, I don't think raw intelligence is selection criteria for a good founder anyway. It has a lot more to do with your particular situation - how well you're situated to pull it off, which can mean many things. In terms of personal qualities it probably has more to do with determination and obsession (work ethic) than intelligence, especially these days where information is so cheap and available.
There is a lot of variance in how words are used, so I'm not going to say you're wrong here.
However, my usage of the following words deviate from yours:
* intelligence - raw intellect, having absolutely nothing to do with anything ever learned
* smarts - synonym for raw intellect, but often more on the 'crafty' side of raw intellect
* ability - short for 'capabilities', and is a merge of 'intelligence' and 'learned information'. Information is useless without intellect, and intellect is vastly reduced in capability without learned information. Ability is a metric for these two conjoined. 'Skilled' fits here too.
So from where I sit, you never get "smarter" as you age. You do however grow your abilities, you may become "wise", and skilled.
By the way, agree 100% with the context of what you're saying. And just passing on term usage from another geolocation.
That's fine, but then measuring 'raw intellect' is like measuring 'raw strength' when you're selecting members of a soccer team. It will help, no doubt, but it's one of many factors.
Ah sorry for clarity I didn't mean "currently attend", and agree "smartest" here was probably excessively casual.
I think there's different benefits at different ages, and agree on importance of determination and obsession. A good market is the only thing that might be more useful.
I don’t think you can make that argument in good faith: “many of the smartest people happen to go to Stanford/Ivy”.
I think you _can_ say that many smart people go to Stanford/Ivy.
In the usage above “many of” I read to mean “smart people are significantly over-represented” at those places rather than anything stronger.
I dropped out of the University of Wollongong in ~2001 (points if you know where that is without looking it up), I've had a great 23 year career so far.
I agree that the cofounder dating was intimidating, and even some of the people fit into that category. Far more didn't though, and I've found an exceptional cofounder through it, which is one of the most exciting things in a very long career.
(I'll get around to doing YC at some point)
i was hanging around the Gong around then; I'm in Rads and was attempting to make a game with some friends from there at the time.
Those were some fun times.
Discouraging, sure, but now the real question: did you apply anyway? :) I hope you did!
I had ambitions of cranking out an MVP and pitching it to VCs in my late 20s. After a year of solid rejection ( including YC not even responding), I gave up.
You end up spending alot of time trying to pitch your work. I've had a few idea guys expect me to build MVPs for free with an offer of like 1% or something silly like that. Never any pay, poorly thought out concepts.
I've accepted I'm never going to be rich, it's easier this way.
The filters are self-fulfilling.
For twenty-somethings ideas are easy and all opportunity is in front. Might as well swing for the fences and yes people do hit home runs. At this stage, debating the actual statistics is misguided use of energy. Because justifying a reason not to play still means you're not playing.
And the older you get the more gray this calculus is. There's more reasons not to do something. We put the filters on ourselves.
This isn't a moral argument. No one really knows how the statistics will land, we can only back analyze them. Yes it's statistically very unlikely you're going to get funded. So you stopped trying. Maybe your ideas really weren't very good. That's ok, you've got a lifetime.
edit: fwwiw I've always wanted to be an entrepreneur and now decades later when I'm more financially secure and the reality is here, I really really really question if I am cut out to be an entrepreneur. I don't think I care all that much. Not really.
It's more like I don't think cold calling ( tweeting) VCs yields results.
It's the equivalent of singing with a guitar outside of Columbia records. It's not like Paul McCartney is going to just tell you to step into his office and record a demo.
I do plan on taking some time off to work on my side projects though. Maybe I'll try again...
I’m in the same boat, except now actively planning to take off to work on a side project. Rather than spend another year building a prototype for a potential $100M idea (last two landed me really nice jobs) I have my eyes set on ideas that will generate $3-6M/year that I can realize on my own with minimal/no outside funding.
I may apply to this YC round for giggles, but totally get the same feeling as you that I’m probably not good enough in their eyes. As Paul Graham said, if you are out chasing VC funding, you are not building your product. So just going to focus on making my life comfortable and launching another successful product or service.
Good luck!
What market are you targeting 3 to 6 mil a year is amazing for a solo startup.
I'm basically a hobbyist game dev outside of work and games are just so risky as a business.
- AI (sell them shovels)
- Hospice
Games should be developed for fun. I would totally fund game development with profits from another venture.
I figured solo game devs were more in it for passion rather than anything else. The Choo Choo Charles guy has an interesting YT video on his dev/launch procedure. He basically spent 4 months full time advertising his game after he finished developing it.
Cold emailing or tweeting investors only works if you have eye-popping results to point to or credentials that stand out.
Otherwise the way to get to them is via accelerators like YC. And the way to get into accelerators with no credentials is to launch something and get some traction. It doesn’t even need to be a lot of traction. Just having users who use your product regularly puts you near the top of the pile.
I turned 50 this year and have one moderately successful startup experience as a co-founder about 8-10 years ago, but if I do another (which I'm considering) it will either be bootstrapped or I'll look for funding out of my personal network vs. the VC path. This is probably aligned with YC as well; far more than the education expectations in their signalling is (generous interpretation) that they'll trade experience for youthful ambition.
I'm seeing a few "founding engineer" roles that pay pretty well and offer up to 1% equity for highly experienced candidates. Honestly some pretty unique opportunities.
But yeah, I'm not building out and MVP without pay for 1%.
1% at seed stage also become 0.1% after a few rounds of funding, plus you are way down the preference stack and have no liquidity power.
Startup equity is pretty much objectively a terrible deal except for founders. Be a founder or get paid market comp in cash.
If you actually get 1% at seed stage and the company goes through a "few rounds" of funding (and subsequently exits), you're doing great. You've basically won a small lottery and have an excellent chance of being a millionaire.
The problem with startup equity is that this is a very rare scenario, and most of the other scenarios aren't so good. If the company doesn't exit, your equity is worthless. If they exit at a value below your strike price, and you exercised your options, you could end up in debt. Lots of ways for this to end badly.
That’s my point. Even in massive outlier upside cases getting a 1% equity deal at seed is not really worth more than just being a standard FAANG worker. And that requires many rounds of funding an and dilution and an exit. It’s worth remembering exits are very hard right now and founders have far more liquidity options. There have been multiple unicorns I’m aware of in the past 5 years with founders taking 8 figures in secondary and employees getting nothing. Now those unicorns have worthless equity for employees and the founders are on the beach.
I assume you are referring to employees who have an equity stake in the company. Can you explain how the scenario you describe happens?
It can certainly be worth more; I know engineers personally who became wildly wealthy, tens of millions of dollars from their equity—— but you’re right that most of the good outcomes are comparable to working in big tech over the last few years. (Worth noting that big tech itself has had some remarkable stock gains, which plays into this as well.)
A factor 10 dilution is huge and I'd like to see the math on that.
There are different roles founders hire for under the "founding engineer" umbrella.
There is your fresh out of bootcamp "founding engineer" brought on during pre-seed or seed stages to help bash out POCs and mocks used to sell the vision.
Then there is the "founding engineer" they bring in post money and customer commitments to actually deliver the MVP and help build out a professional engineering program.
I'm in the later category and those roles can pay very well for early stage startups.
You can still be rich. Tech culture, or rather modern capitalism, tells us that businesses need to raise a bunch of money, capture a bunch of users, and then squeeze them for all they'll take.
It fails us in two very distinct ways. It encourages us to think that is the only viable option and it's unethical. Primarily because it requires the perception of customers (and often employees) as a means to an end (not humans).
However, the possibility for ethical, sustainable business models is still very real. I tend to believe we're going to see another wave of those soon as people figure out that it's actually easier to make a living that way.
Those exist everywhere in the trades. Every major city has dozens of small businesses doing plumbing, electrical, roofs, etc., with the goal of sustainable, loyal customers based on doing a good job at a fair price.
Well put. The difficult part for us software folk is learning to apply that model to software. Customers in the world of software generally don’t know what they want. I think the low hanging fruit here is to copy products from the unethical companies and beat them at caring for the customers.
The real value is probably in new product models that can only exist given an ethical perspective. Perhaps reviving the mostly dead pay once use forever model of software would work well.
That model requires abandoning DRM which the unethical companies will never do.
Customers for other trades similarly "don't know what they want", unless it's "fix this for me".
The main difference in the software world is that you can potentially build things "once" (or rather, keep building it forever) for a huge global market, which means that it's hard to know when something is good enough. With roofing or coffee, you do good enough work (differs between companies, sure) and move on to the next customer.
But you don't think about adding continuously running rainfall test for the roofs you do to ensure no regressions (leaks) appear.
The only way that would happen is a bug. YC always responds to applicants. Rejections usually aren't personalized because that can't scale - but not hearing back at all should never happen.
If you want me to look into what might have happened there, I'd be willing to try if you email hn@ycombinator.com.
Correction, I got a response, but no specific feedback.
I double checked my emails.
Anyway, I'm realistic in knowing my ideas aren't going to garner investment.
I would love if you had a YC Junior for just getting help on ideas vs capital.
No investor is going to give you specific feedback.
Your best bet is to go to onto Reddit, Discord etc, find the startup communities and ask for advice there. There are a lot of people who want to support other founders. Or even better go on Linkedin, find some prospective customers and ask them for advice. I've had about 10% of people reply back some with page long answers.
If you are willing to spend money there are plenty of services like Kintell, Intro.co which will allow you to book an hour with investors or successful founders. But there are plenty of free options that I would start with first.
That depends on what you mean by "specific."
Several Sand Hill Angels members, who are investors, provide feedback almost every month. (It's in the context of a pitch, but...)
See https://www.sandhillangels.com/raw
("pitch practice" is somewhat misleading.)
[edited to add some detail]
The typical angel-group pitch has three parts, the pitch, the Q&A, and then the "with the entrepreneur out of the room" discussion.
This event lets participants listen to that discussion, as well as those three parts for the other folks pitching the same night.
Then there's an "ask investors anything" session at the end.
I think there are things that need doing that can't be done profitably, so giving up on being rich had a really nice focusing effect on my dreams.
I mean, I didn't even graduate college :P
IMO if you can become a $100M household name without VC, that's absolutely the way to do it.
Even if you do take the VC path, YC for me was a massive boost in network, knowledge, and resources that I didn't have before, but it's also not the only way to acquire those things. You can even find that YC knowledge online, e.g. https://www.startupschool.org/.
That said, if anyone's even considering applying to YC, I'd recommend it, at a minimum it's a forcing function to think more deeply about your idea or business when assembling the application.
Yes, but did you go to one of those colleges where dropping out is even better than graduating? Because most of us didn't even get the chance to drop out of one of those.
This is a really good point because the vast majority of YC members (97-99%) either graduated or dropped out from Ivy League level schools, or really highly rated state schools. (Dropouts are also a very small minority.) There are YC members who didn’t come from prestigious schools, but they are outliers. Maybe it’s changed the last 4 years? That’s when I stopped tracking it.
That's definitely not true. Where did you get these numbers?
I had a side project that was meant to be an “IMDB of everything”. For my initial focus, I targeted YC, its companies and members. This involved looking at a lot of LinkedIn profiles and recording their alma mater because I wanted to give credit to organizations as well and not just individuals. That’s how I came to that conclusion.
The result surprised me as well but it also makes sense. Investors would be more eager to invest if the founders were already part of some of their networks. People from these schools also tend to be more inclined to be higher achievers than other places on average.
The only time where there was more educational diversity was probably only during the 1st two years of YC.
Has it changed in recent years? I would rather be wrong on this one.
Assuming it's true/accurate it seems like the kind of research you should share (for free or otherwise) with YC, because it seems like the kind of bias that they would be interested in correcting for.
Not just from an equality perspective, but also that good ideas and founders can come from anywhere. Top Schools are going to produce one type of founder and idea. People that have walked different paths, another.
I’ll see if I can scrounge up the data. For some years, I had the entire batch covered, but most had holes since not everyone had a LinkedIn account. Unfortunately, the more recent the years the less the data.
Personally, I don’t see anything wrong with what YC is doing. Startups are hard enough as is, and they found a formula that works consistently.
Dang going around saying, "no no apply anyway" says to me that even if it is in that state, that's not what they want.
As a unknown university dropout (2001) I wouldn't feel intimidated to apply, and may well go after the next batch (have just found a cofounder). I have to trust that they'll evaluate me on merits rather than prestige.
I'm a YC founder and I dropped out of not-one-of-those colleges (RPI). My cofounder dropped out of high school.
Why not just give it a shot? Find the powerful parts of your story (I'm sure they exist) and share them!
We applied, as GP advocates for, mostly to sharpen our thinking. Just the application process would've been worth the time, even if we had gotten declined immediately. The interview 10x'd that value, then the YC batch itself was another multiple on top of that.
I would definitely count RPI as one of "those" colleges! I guess everyone has a different list, but for me, RPI is in the same category as Rose-Hulman, Olin, Harvey Mudd, etc. Perhaps not Ivy League level in the sense of being a household name, but still known among people in the field.
The "Ivy League" consists of precisely these eight schools: Brown, Columbia, Cornell, Dartmouth, Harvard, Princeton, University of Pennsylvania, and Yale.
Honestly I feel like some of these are negative indicators when it comes to engineering cred.
Meanwhile, stellar engineering schools like Caltech, Stanford, and MIT are in a league of their own.
This comment is mostly to complain that using "Ivy League" as a shorthand for prestigious engineering schools is inaccurate.
Silicon League?
It’s definitely a great, high caliber school. But it’s not one of the dropout-porn inspiring ones like Stanford/Harvard.
For example, a lot of people drop out of RPI because it’s actually difficult to get good grades there (not why I did it FWIW). That’s not why anyone drops out of Harvard.
Not that I'm aware of, no, just the local state school.
My impression of the YC application process was that it was way more holistic than just educational background.
YC approval process is pretty much this:
- Do I even understand your idea.
- Have you talked to customers.
- Am I impressed in your use of time.
- Do I believe that your team is capable of delivering.
- Is it a good idea.
Most people can't get past the first two but obsess over the last two.
This is the process. They want people with high agency, a bias to action, and who make progress in the face of uncertainty.
Unfortunately this is too low for a VC/YC. The min valuation they are looking for is around $1B
That's not so. At the last YC talk I attended, founders of $100M startups were cited as successes (anything else would be pretty weird, no?) That's incredibly successful, even though startup investing is a power-law game.
Here is the YC rejection letter for my startup
If that's an accurate quote then I owe you an apology and I'm sorry!
That's a verbatim quote copied from the rejection email.
You don't owe an apology because you are not the one rejecting it. However keep in mind that what your beliefs are, they are not the same held by colleagues/friends/families.
That’s totally true, though there’s a difference between “founders of $100M startups” that already have that valuation, and working on a company in a market where $100M is the max you could expect.
If you aim for $10B and hit $100M that’s great, you aimed for the Sun and landed on the Moon! But if the max you can hit is $100M, then everything needs to go right to reach the Moon, and the Sun is fully out of reach — and it will be much harder to raise money.
I meant $100M in annual revenues :) Your point is taken though, I think a lot of VCs would scoff at our present-day numbers despite our growth and outlook. It's very much still a small business, yet by far the most impressive thing either of us have ever done and the hardest we've ever worked. Been at it since July of last year pretty much non-stop.
$100M from only July last year is far far impressive. We have been on this for 3 years and barely reaching $1M revenue (Although I wasted two years of my life applying for YC/VC/Pitching)
Also understand the VC industry is inherent with learning from the ideas submitted to them as part of curating deal flow; and it's common for them to justify it with a mantra that ideas are supposedly not worth anything, and it's all about execution.
When and who to share ideas with - and any market traction you may have as proof points there's an opportunity - is possibly the most important part of executing, and where you may be shooting yourself in the foot if sharing that with people in the business of funding ideas.
If ideas are worth nothing then a great team executing well should be able to create a billion dollar company selling dog droppings.
Anyone who says ideas are worth nothing is flat out wrong.
I think the claim is rather that idea is not the high-order bit in an early-stage startup funding decision; founders are.
There's no success without eventually finding a good idea, especially since 'successful in the end' is practically the definition of 'good idea', or close enough to be inseparable.
So it's not so much "ideas don't matter" as "starting ideas don't matter", as long as you're the type of founder who can excecute on an idea, change it as needed, and drop it when necessary.
Good ideas are arguably emergent from "time spent on problem" - where time spent on problem is also considered a key metric.
If people do want to play the VC industrial complex game - then at least understand the pros and cons of it; otherwise it's good to understand it so you know how to better position yourself.
A great idea is incredibly valuable. In fact the idea is the key to great success.
However, it is true that without great execution, timing and luck, a great idea will go nowhere.
Trouble is there are many people who have heard "ideas are worth nothing" and failed to understand that the full sentence is "ideas are worth nothing without execution" - that is certainly true, but it is a totally different statement to "ideas are worth nothing".
I mean, there are shit (literal?) businesses our there with stellar marketing and therefore stellar revenues. It's famous that a charming person can sell you almost anything, even your own things.
Well said, and you reminded me to be more careful about what I share haha
All I can tell you is it's not true and that's why I posted this!
(and if it's true that everything you hear about YC is telling you otherwise, then YC has a serious messaging problem)
One of the reasons I like this site is that it feels slightly academic in a way that a competing site like Reddit does not.
And being a somewhat exclusive post-academic institution is not a bad image or message IMO. Maybe there are more pros than cons in terms of curation (of content, of founders).
Really didn't see it as a "everyone should apply!" kinda place, thought the messaging was intentionally "here's the latest out of Stanford" which I'm fine with.
You're right about HN - pg always used to say he wanted it to look 'bookish'. But not for academic reasons. He's just a bibliophile and a massive reader.
When it comes to YC, however, I'm way closer to the "everyone should apply" end of the spectrum. Or rather: everyone who thinks they might like to start a high-growth startup.
One of YC's biggest impacts has been in growing the number of startups that get created in the first place. It's not so much about picking founders out of a limited pool, it's about the much larger set of potential founders who can maybe get bumped out of the "I could never do that track" into the adjacent "maybe give it a try track"...which can lead to life-changing places.
pg's essays have been one of the biggest such bumping devices. I would like HN to be that too. (While remaining interesting in all the other ways it can be.)
Bookish, yeah, the look has aged well.
My intuition was that there are more overly-confident types who think they want to be a founder rather than those not confident enough to do it, but after reading some comments here maybe my intuition was off. Then there's people like me who became a founder out of survival lol I'm a founder whether or not I want to be, need a cohort for that! xD
Thanks for sharing the motivating insights!
I see YC as doing what every successful mature business does, which is come to rely on its experience and market position (it’s hard to disrupt yourself), which for better or worse creates habits, which in YC’s case means very coarse investment heuristics. As an outsider they seem very obvious. I’ll omit how that relates to my own experiences and biases (I’ve only ever made one half-baked on-the-deadline application so I don’t think they are relevant). Just my 2c as a long-time follower.
I think it would be awesome to see YC break at least some of itself off into some more elite and disruptive units (where elite refers to the quality of the intake and YC expertise, not the founder education history).
"then YC has a serious messaging problem"
People have been signaling this for quite some time.
Throughout this thread you attempt to dispel this perception, but I can't help but wonder why this isn't being addressed on a higher level at YC. Whether misperception or not, this view is certainly not contained to just HN, and is even shared by those who have no idea that this forum exists.
It does. I've met some founders who went with Tribe8 (edit: Team8) or Sequoia Surge due to YC messaging issues and the (imo incorrect) perception that it's B2C or SMB B2B SaaS oriented.
The Open-Core RFS will probably help though, but maybe highlighting additional successes beyond B2C or Coinbase types would help.
This was not my experience. I have no degree, I'm not American, and I applied back in October 2021 about 3 hours before the dead line and filmed my application video from a coffee shop. I didn't have a good network. I didn't have a product yet. I was accepted first time.
As you say, a lot of YC founders don't have a real business yet, but they're not there because they're well connected. They're there because YC thinks they fit the profile of someone who really wants to build a big business and might pull it off. They're wrong most of the time but it's a numbers game.
I'm not sure you meant to communicate this VERY important point, this is a huge reason NOT to do YC.
You're right that I didn't mean to communicate that, but it's a good point. I agree with you entirely that this is the big downside of YC and frankly all VC backed entrepreneurship. It is not the path of highest expected return for a founder. If you want a high expected return then a FAANG job or a bootstrapped SaaS product you can build yourself are good options. Some days that's what I wish I was doing to be honest.
I think a lot of VC backed founders aren't just in it because they want to get rich though. Sure, we all want that, but we're also all predisposed to irrationally believe that we're the exception. That trait (for better or worse) comes with implications, and many founders I speak to are simply compelled to try because it's hard, and it's theirs, and they're impatient.
I also very much agree with the sibling though. Getting rejected does not carry that much signal, because YC are wrong more than they're right. So just keep trying.
This is not a reason not to do Yc, but to not take the if rejection seriously
or still do it, but know that YC's incentives and yours are pointing in different directions. Sometimes taking their advice is good for both of you, sometimes it is only good for them.
There are a lot of legitimate criticisms to be made of YC and of VCs in general (please do not take this as me going "there is nothing wrong in the VC world at all", because I absolutely do not believe that!), but I don't think excessive academic elitism is one of them. If anything, I think they're quite a bit better about avoiding that elitism than the average you'll find among organizations of comparable wealth and power (compare top law firms, leadership of more traditional companies, politicians, etc). This isn't my strongest opinion - I've never done any proper formal study of the question - but your impressions contradict my own experience living in that world.
I used to be part of the leadership team for a YC company. Here's where the four YC founders I know off the top of my head went to school: SUNY, Oxford, Epitech, Tufts. Only Oxford among those is truly elite, though the other three are good schools. The one who went to Oxford (Harj Taggar) is a bit of an odd one out here, since they were a partner with YC itself first before founding the company that I know them from. Granted, three of these were founders many years ago, so perhaps this has changed, but one (the Tufts alum) got funding only about a year ago.
I looked up a few other founders that are second- or third-degree connections and found the same: a handful of truly elite schools, a peak in A-tier-but-not-truly-elite schools, and a handful of no-name schools like my own alma mater. I expect that that's a reasonably representative distribution of where you find extremely smart people, and especially smart+motivated ones.
As for this bit:
YC is pretty explicit that they try to pick founders, not ideas, most of the time. That approach is all over the Startup School videos, for example; they don't exactly make a secret of it.
Growth demands, both realistic and unrealistic, are a much fairer criticism IMO. They're the primary reason I haven't sought VC funding personally (from YC or otherwise).
Out of curiosity, I'd love to know more about what you're doing - I checked your HN profile but it didn't have a link or anything.
If Y Combinator truly prioritizes founders over ideas, as indicated in their Startup School videos, repeated rejections might suggest a fundamental mismatch. If you haven't been accepted after one or two tries, it may be a signal that you're not the type of founder they're looking to fund. People do not change that much usually.
It's exactly the other way around.
You'd be right if YC were perfect at assessing founders every time, but of course they're not. Applying repeatedly gives you a chance to prove that they got you wrong the first time (and the second, and the third, and so on, if need be). Not only does this work, it's the majority case (I just double checked this). Most founders that YC funds are repeat applicants.
Applying repeatedly demonstrates persistence, which is one of the qualities YC looks for. Better still, if you can show continued progress since your previous application, that demonstrates resourcefulness, another core quality. Repeated applications can move the needle on what sort of founder YC thinks you are. Especially if you were a borderline call the last time—keeping going, and applying again, is a way to get on the other side of the line.
YC frequently heralds persistence as the most reliable indicator of future success. However, a closer look at their selection practices reveals a profound contradiction. Despite their public endorsement of this trait, YC often rejects applicants who demonstrate true persistence by reapplying after initial failures. In contrast, they appear to favor individuals with prestigious academic or corporate backgrounds—those who might be perceived as career opportunists lacking deep commitment to their ventures—over genuinely dedicated founders.
This pattern not only questions the sincerity of YC's stated values but also suggests a broader inconsistency. If such a discrepancy exists in their evaluation of persistence, one can reasonably doubt the authenticity of other virtues YC promotes. This insight casts a shadow over the overall integrity of their selection criteria, hinting that what YC publicizes may not always align with their actual priorities.
Persistence is not "the most reliable indicator". It's possible to be persistent at something that isn't working and isn't going to work (I know; I've done it). That's not useful, so persistence is far from sufficient. It is necessary though.
If there's a most-reliable-indicator at all, it would be something like what pg called 'relentless resourcefulness'. The includes persistence and a lot of other things as well.
This inclination to "raise funds" is so foreign to me. VCs may tell you all the magic they can do for you, but at the end of the day you're trading ownership in your company for money (that you can't get elsewhere).
You are running a profitable business, why play that game?
My partner wants nothing to do with a VC or even a loan - basically because what you're saying here.
The other side to it, as rfrey said, is it would enable a hyper growth mode and let us make moves earlier.
But stable growth mode is working fine, and overall there's not a huge reason to take out a loan or raise money, it doesn't feel like we're racing against a clock on some trend or any other reason to rush things.
It's important to be aligned with your partners before you start because people rarely change what they want.
Many people are happy running a small business without much pressure.
To go faster. You trade part of your company (and your freedom) for time. Maybe as a profitable startup in one part of the US, for example, you could use reinvested earnings to spread into the rest of the US in 5 years, then Europe in another 5 years. Perhaps with VC funding you could do the same in 3 years rather than 10.
Not my first choice, but neither is it irrational.
Congratulations on having a successful business. There's nothing wrong with a business that grows slowly, pays you a salary, and remains profitable.
I've walked a similar path and, while I'll never be a multi-millionaire, I'm very comfortable and have more than I need. Small, stable, businesses that offer good secure jobs are the backbone of the economy.
All that said, there are investors out there who are interested in folk like you and me. A track record of success, coupled with potential, and immediate returns is attractive.
VC investors are ultimately investing in people, not businesses. The idea matters to some extent, but its more of a pitch in the person or team. This is partly why college is so predominately material. In the folk "starting out" there's little else to look at.
(Always have your first date on a famous college campus, then you can forever drop "we met at harvard" into the conversation.)
To be honest, VC investing isn't for me at this stage in my life, and it may or may not be a good fit for you. For many it's a great fit though, and in some ways their "first good job".
So I think the advice in thr post is fine - if you -want- to go this route then go for it. The worst they can say is "no".
That was hilarious. Do people really do that?
Probably not, but it sounds like an excellent strategy :)
Very good points, especially about timing / stage of life.
This is another factor - I didn't work at Facebook or Google and am not a member of the Bank of Mom & Dad, so if I got into investing I'd want to have enough extra time and money built up that I could participate in (or lead) the round and get a number of others involved, rather than being a candidate/applicant asking for funds and help - I'd want to be active in it.
Great points, thanks for sharing!
I have a lot of friends of mine who are decade+ YoE first time founders who have done very very well in YC.
Lots of Enterprise SaaS companies have went thru YC and done very well - you just don't hear about them as much because Direct Enterprise Sales doesn't require as much marketing.
There are similar B2C successes by older founders and non-Ivy/Ivy Tier founders.
You could easily pitch a Seed or Pre-Seed round depending on the numbers and location right now.
I guarantee you that you are a 2nd or 3rd degree connect with plenty of VCs.
Leverage that network you have and doors will open
The YC label does help to open doors if you don't know or don't have the network to do it.
(Note: this advice is US centric)
How many years do you have to go back to find 1 company that is on par with a dropbox or airbnb
i feel like if you went back 5 years it would be hard to even find more than 1-2 companies that has achieved a moderate level of mainstream success in the same way
Consumer != mainstream
It takes 10-15 years to successfully IPO an Enterprise/Infra/Cybersecurity SaaS (eg. ZS started in the mid-2000s, work on Rubrik started in the 2013 time period).
One notable mid-late state Enterprise firm I've been following is Vanta. Others have been very successful acquihires (eg. Squeen becoming a core part of the Security BU at Datadog). Salt Security is a good product as well, but will most likely be acquihired.
Usually, most enterprise companies choose to be acquired because even though the pot of gold at IPO is amazing, it is annoying to work on the same product for 10-15 years (though occasionally you do have startups just being stupid at strategy - looking at you Lacework smh, coulda acquihired Wiz or Orca 4-5 years ago).
Keep doing what you're doing.
Being VC funded shouldn't be the holy grail - the holy grail is having a business you enjoy doing, that's making you the life you want.
For some the life you want is pitching, raising, getting the kudos of the big numbers, onto the next raise etc.
For some the life you want is the complete opposite and bootstrapping it.
For some it's just all about the technical aspect, coding the next crazy thing.
There's no wrong or right answer in how you get to the 'happy place'.
You know in your heart of hearts what drives you, and what you'll be happy doing.
Me : I'd been with the money men for a period of years and it's super stressful, board reporting, projections, market analysis etc.
Now I've got my little B2B SaaS startup that's blended a life long passion with my software chops, and our clients love us, we get to work with the absolutely best people in our industry, we're making a difference in their lives, and they in turn pay us money.
It's hard, rewarding, graft. At the end of the week when the money lands in stripe (for me..) there's nothing artificial, there's no projections, there's no-one to pay back, it's a 100% value exchange of 'heres my(our) hardwork, here's a product and you're giving me money for it'.
Sure - could I potentially have gone the VC route (maybe!). Would it be different, hell yes. Would I (probably) earn more ultimately 5 years down the line (sure?). That 5 years would be very, very different...
I really appreciate this comment. Service offered / payment received is irreplaceably wholesome and satisfying :) especially when they come back as repeat customers or become regular clients. Repeat business and gradual growth gives us both an exciting feeling about the future that I never quite felt at a startup. I've found too often a venture-backed startup is really a lifestyle business in disguise for the founders, not really about serving customers, so it's hard to truly get excited about them anymore. Where running a business that solves a problem for paying customers feels more like changing the world:
We've felt this too in our community, it's the real meaning of "Make something people want" (and why we haven't had a day off in like 62 days or something lol). It's strange to refer to our business as a "startup", but it is one, moreso than most VC-funded ones and I bet we have more customers, higher revenues, and a better growth outlook than the average local seed-funded startup. For us, a loan or VC route would just let us expand nationally right now to other major cities, instead of focusing first on the Bay Area and expanding nationally over the next several years which feels inevitable.
The amount a VC might pressure us to go in the wrong direction is another worry, and because it's just capital we'd need (not advice), they might just get in the way and throw off timing or team structure.
Thanks for your comment! I needed the reminder of how rewarding it is compared to conventional employment as today has been exceptionally hectic!
You're welcome ! Best wishes for your business :)
You too!
That’s essentially how the whole world operates. Y Combinator isn’t an exception. Do you think a wealthy investor would prefer to fund an unknown individual, or someone whose father is a well-established law professor at Stanford?
However, I do believe that YC tends to be somewhat more egalitarian and merit-based compared to others, although it’s not by a significant margin.
What if regarding slavery or horses as transportation people were like "that's essentially how the world operates", not that investing has anything to do with those, but that this excuse doesn't add a ton of insight if you think about it.
There are a lot of ways the world has operated that are not fair or optimal. It would be a logical fallacy - an appeal to tradition - to use that as an argument against the way things could be, or according to OP the way things should be (are intended to be).
Investing is a regulated activity that affects the economy and individuals, so I think it's at least worth exploring things like nepotism and exclusivity when it comes to the flow of capital. And it's obviously important to notice when the same relatively tiny group of people keep receiving the majority of "acceptance" (investment) while the vast majority outside that circle are totally ignored and/or marginalized.
You mean like Sam Bankman Fried whose both parents are in academia?
When the startup I co-founders applied to Techstars, we had to fill in the lean canvas diagram and it makes you think and write down a whole bunch of stuff that we were lacking. channels in, user-acquisition strategies etc.
That process was super worth it. Ultimately we got rejected, but going forward I'll use that (well I try) to do that when joining/founding any startups.
Worst case scenario is they say no, best case scenario... :-)
I hope you applied to YC as well!
This is simply not true.
There are countless examples of people from outside the US or who went to non-Ivy league schools. Does it move the needle ? Probably. But it's easy to counteract it by having better answers to the other questions e.g. traction, team.
It’s not false, either. What were the stats on the last round? IIRC 20k applications and how many got there? It’s not zero, but it’s a small chance.
Congrats! These are great stories to hear.
Our team has build a business without venture capital in a space where it’s commonly sought after.
Instead we did find a strategic partner in the industry who invested earlier on but then later we established a venture banking relationship and credit facility.
I had almost no idea the options that existed so wanted to post some ideas here for anyone reading.
Venture Capital is one source of funding. So is Growth Equity or even private equity —- but different from “venture”. It sounds like you’re past the “venture” stage anyway.
We’re paying about ~9% interest on a multi-million credit facility now from a bank (several other banks will do this type of lending - not just SVB I also learned along the way recently). There is also minimal warrant coverage provided of 1-1.5% equity which we are happy with.
Some names of banks who are lending - just a few names but wanted to share some ideas as alternatives to venture capital, especially if you have revenue:
* Texas Capital Bank * Cambridge Trust * East West Bank * Bridge Bank
Thanks, and very cool, thanks for breaking it down! I appreciate you sharing numbers.
A bank seems like a much better option if you just need the capital but you don't want to give up too much (or any) equity. That's likely the route we'd go if we ever wanted to tap into funding.
Both private equity and venture funding seem more like you have to give up the company and go work for the investor. Investors bring some value sure, network and what-not, but I wonder how valuable their "advice" and network really is.
Sounds like cope. The downside of applying is like.. close to zero? It's obviously +EV
This... what you just said. I am creating a business with my kids, so it is both educational for them, develop creator habits and that we create future together.
I don't think we would be taken seriously by YC even though this would be perfect educational setting for them. BTW, kids are 17 and 15 and 11, not sure if I would fully include all of them.
Sounds like you are making a lot of progress. What’s the business?