This is cool, are there any other programs like this out there except Y Combinator and Capital Factory? I would have thought that the success of Y Combinator would launch a lot of copycats
"If we don’t understand the idea or the space, Cummings said, we’re not going to [invest in it.]"
Look forward to a lot of mediocre ideas, then. I'm glad early investors didn't say this about things like the gasoline engine. But of course that effort was probably bootstrapped.
YC has always had the brand image of turning out good, well trained, companies. I remember a post about it a while back, on how YC was like the "Harvard or Stanford" of the seed stage incubators.
I agree that YC being the first to try out this format may give them more experience credit than anyone else. But YC do not control the brand, It does not guarantee success more than it does with let’s say TechStars, if that was the case Google would not be ahead of Yahoo.
A) Attracts the best startups. If you're going to gun for one of these, YC is at the top of your list.
B) Attracts the best investors. It's in the Valley and historically has actually made some investors a pile of money already.
C) Attracts acquisitions.
Past performance doesn't not guarantee future returns, however. It'll be a slow change in brand perception, much like an elite school slowly falling out of favor in favor of a newer school.
I disagree. I don't know how you can say that YC attracts the best startups. All these micro-funding companies are so new to the game that none of them have enough of a track record to make any difference in the real world.
Not only that, but these companies are becoming regionally specific, which means you'll go to the one in your city first before you apply somewhere else, or that's what I would do anyways.
Well, if you're going to argue the case of proximity... then you should consider the relative strengths and weakness of those geographic areas too.
pg has an active role in the local universities (which are world class btw), and is more philanthropical in his approach with nurturing talent and intelligence. lots of people admire him because of he's genuine. and imo, a lot of these other incubators popping up have alternative intentions. i'm not saying that it's wrong for there to be capital motives, but I think pg's approach is what separates him from a lot of the others.
my suggestion is if you're considering any of these programs, then study their boards, compare the application process, and pick the one that fits you best.
I'm certainly guessing here, but it seems pretty common sense. Ask 100 embryonic startups who are considering this path which investment entity would be their first choice and what do you think you'd learn? I think you'd learn that (if they'd done their homework) they'd pick the one with the longest track record, the best PR, the biggest demo day, the most competitive program (as measured by application-to-acceptance) and the most founders who got rich. YC wins on all of those fronts.
Even if your regional theory holds (it probably does for a meaningful percentage of startup, but plenty are willing to relocate), wouldn't you assume that the bay area has WAY more qualifying software startups who'd be interest in such things and thus (mathematically) would attract more good ones?
One data point is not enough to dismiss the idea that YC has a better brand name. I would have to agree. Having a better brand name does not mean no other company will ever out do you, it simply means you tend to have a head start out of the gates. Personally, if I had a choice, I'd ally with YC. And I think my perception of them is 90% about the Brand image they present and their track record. That is branding is it not?
One of the big advantages of YC is the notoriety associated with being a YC company. Easier introductions to press, investors, and partners. Notice how much coverage YC companies got on TechCrunch this last round? There's a reason, it's because YC does a great job pre-selecting good companies to showcase to press/investors and they've built up a good reputation on that.
Which in-turn, is now an idea magnet that pulls the best deal flow from around the world. I don't think they are the only ones that are capable of doing this tho.
ycom also seems to be more consumer focused, which is what most of the techblogs cover because it brings eyeballs. consumer exits are often big pay days, but more importantly to me at least — the most fun to work on. B2B is often a drab. lol
i think some of these incubators should not forget the enterprise play either. Austin Ventures had A/V Labs awhile back, but I don't recall much about its success.
I'd wager that YC companies are statistically more fund-able or exit-able than other similar stage startups out there. They've been through a round of screening, chosen and mentored by successful entrepreneurs who do it for a living--it's certainly a leg up.
"They've been through a round of screening, chosen and mentored by successful entrepreneurs who do it for a living", so do TechStars companies and others.
Correct. I think we're comparing two different things. I was talking about YC-style seed-stage funding vs other startups. You were talking about YC vs TechStars. Apples and oranges. No disrespect to TechStars, that's just not what I was talking about.
“You were talking about YC vs TechStars. Apples and oranges.” Ah, That is disrespectful to TechStars they are in the same business and it is exactly what we have been talking about, read the thread again.
I’m one founder who has great admiration for YC, but I just don’t think they have the key to startup success. I think this should be clear in all HN readers mind despite the hype around here. Ultimately it will serve the startup world very well that YC get competitors, because no matter their commitment they will not spot all future success.
