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Y Combinator's Young Startups Tout Revenue Over Users - Bloomberg

Stashed in: YCombinator, @paulg, Greylock

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The emphasis on business models stands in contrast to dot-com companies as well as more recent Web 2.0 startups such as Twitter and Foursquare, which raised money from VCs while having little or no revenue by emphasizing their adoption by users, said Josh Elman, principal at venture capital firm Greylock Partners.

“We’re seeing a new focus on people thinking about how they’re going to make money and build these big sustainable businesses,” Elman said in an interview at the event, held at the Computer History Museum in Mountain View, California. “It’s not just about how quickly you can attract a ton of users.”

Entrepreneurs in Y Combinator may be taking a cue from the program’s co-founder, Paul Graham, who in June penned an open letter urging young startups to focus on making money as a hedge against a potential downturn in Silicon Valley brought on by Facebook’s IPO. If venture capitalists see public investors sour on Facebook and other Internet stocks, they may be more cautious about pouring money into the next new things, he said at the time.

I disagree with the framing of this article.

Foursquare made a deal with American Express that brought in a bunch of money.

And Twitter has been trying to monetize at least since Elman worked for them.

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