Exclusive: Inside the Startup-Generating Secrets of Y Combinator, by Vanity Fair
Eric Barker stashed this in Tech
1. 2000 teams applied, 170 got interviews, 60 got funding. "3% is normal," says pg.
2. Funding is 7% of the company for $20k.
3. Power Law of YCombinator: Excluding the most recently funded start-ups and looking only at the 208 start-ups funded from 2005 through 2010, he reported that five Y.C.-funded companies had been acquired for over $10 million each, and 20 more had been sold for less. Graham also added up the valuations of the 21 most valuable Y.C. companies that had not exited and came up with a total of $4.7 billion. Most of that came from two companies: Dropbox and Airbnb. Paul Buchheit, a Y.C. partner and an early employee of Google’s credited with creating Gmail, points out that in Y.C.’s portfolio “the number one company is worth more than [the] next 199 companies combined, while number two is worth more than [the] next 198 combined, and so on.”
4. "Y.C. is in the hits business, and uncertainty about which start-up will become the one monstrous hit benefits many founders who are funded. Graham and the other Y.C. partners tell the founders that start-ups fail only when founders give up."
5. The most successful start-ups, Graham says, are the ones that completely remove distractions: “They just sleep, eat, exercise, and program.”
Graham says he would be delighted if the percentage of start-ups that succeeded were as high as 50 percent. But it’s unlikely to happen.
Graham tells the Kalvins, “Here’s how to generate new ideas. Three things. One: founders are target users. Two: not many people could build it, but founders are among them. Three: few people realize it is a big deal.
“Ask yourself: ‘What do I wish someone would start a start-up to do for me?’ ” says Graham. “The next best thing: something for someone else that you know is a problem.”
Women: hiding under hood, shoved in back
I noticed that, too. It's disconcerting.
Oh, come on. Not everything is patriarchal gender-choreography.
The founders of a car-themed company are crowded around and inside the car. The YC founders are grouped to the right -- and it's extremely unlikely that gender bias, by either photographer or YC team, 'shoved' Livingston to the back.
If you're looking for offense with a gender-politics microscope, almost any other permutation could have generated suspicion, too. Women more in front? They're trying to distract from underrepresentation! Women in the silhouette positions? They're emphasizing the female form! Woman leaning-forward in chair? That come-hither look invites leering! Woman casually leaning-back in chair? They're portraying women as loungers! Woman in driver's seat? What is she, a chauffeur? Etc...
Actually my offense is more at an entire article wrapped up in the "secrets" of tricking people into giving you free money. I just noticed that.
There are two main things that sell magazines and get click throughs.
One is free money.
The other is women.
This was immortalized in the Dire Straits song "Money for Nothing".
It's more true now than it was in 1985.
Secrets to free money? Where can I buy???
What do men's magazines put on the cover? Sexy women.
What do women's magazines put on the cover? Sexy women.
And yes, scientific studies around the phenomena have been done.
Lester Wunderman, the father of direct mail marketing, said there were two words with magical powers:
Funny that FREE and NEW are more magical than VALUABLE and GREAT.
Free is black and white.
New isn't quite as polar but still less subjective than valuable and great.
Oh, I see. Free and New aren't opinions; they're facts.
A Vanity Fair article on YC is intriguing already.
Yes, although that article is 3 years old and there has not been a YC Vanity Fair article since.