Sam Altman for President. I'm delighted to announce that Sam Altman has agreed to become president of Y Combinator starting next batch. I'll continue to do office hours with startups, but Sam is going to lead YC. Why the change? Because YC needs to grow, and I'm not the best person to grow it. Sam is what YC needs at this stage in its evolution. I'm convinced there's a fundamental change happening in the way work gets done. Of all the people we've met in the 9 years we've been working on YC, Jessica and I both feel Sam is the best suited for that task. So when Sam became available in 2012, I started trying to recruit him. YC should feel the same to the startups we fund. Who Needs Y Combinator, Anyway? Not These Two Dropouts. The words “entrepreneur” and “dropout” are often associated; think Mark Zuckerberg, leaving Harvard for bigger things, or the young people goaded and funded by Peter Thiel. It’s easy to imagine a college student planning to drop out of school to join Y Combinator; rarer, though, is the person who has gotten his startup into that famous accelerator, only to abandon it.
Yet that’s what Noah Ready-Campbell did. He and his business partner, Calvin Young, both ex-Googlers, joined the Y Combinator program in the summer of 2011. Within a week or two, they dropped out--becoming, so far as they’re aware, only the second team to ever do so. Not long after withdrawing their micropayments company from Y Combinator, the team decided to further pivot into a completely different business, a secondhand clothing marketplace for women called Twice. There was something else that irked them a little about Y Combinator. “No one dropped out,” Ready-Campbell says of their investors.
In fact, yes. The YC VC Program. Really interesting change. Not sure what metrics YC collects on each of its cohorts, but if "Cycle Length" and "Total Cycles" are two of them (i.e. end-to-end time through build-measure-learn loop), then it would be valuable to see if January's teams deviate, in a meaningful way, from the established average and mean. Hypothetically, you'd think that "Cycle Length" would decrease as less cash in hand forces teams without product-market fit to tap into higher gear (or sustain that same high level of output), rather than spend valuable attention wondering about how to get a piece of the "carcass" should things crash and burn.
Total cycles would then move up and to the right, as teams get a few more in near the end of their runway. That said, there are at least two additional potentialities. 1. "Cycle Length" and "Total Cycles" are already running along their respective natural asymptotes. Consequence(s): A. 2. Consequence(s): A. The YC VC Program. The YC VC Program 26 November 2012 Two years ago Yuri Milner and Ron Conway formed an informal coalition to invest $150k in every startup we funded. Although we didn't organize this program, over the years we ended up de facto managing it, and it was awkward to manage something we hadn't started. So we decided to take control of the situation and replace it with something of our own design. The new version involves less money and more engagement. We're decreasing the amount invested because experience showed $150k was too much.
We're still not sure what the optimal amount is, but $80k is probably close. While we're asking VCs for less money, we're asking for more time. We're partnering with 4 investors who are each going to invest $20k per startup: Yuri Milner, Andreessen Horowitz, General Catalyst, and Maverick Capital. Startup = Growth. September 2012 A startup is a company designed to grow fast. Being newly founded does not in itself make a company a startup. Nor is it necessary for a startup to work on technology, or take venture funding, or have some sort of "exit. " The only essential thing is growth. Everything else we associate with startups follows from growth. If you want to start one it's important to understand that. Startups are so hard that you can't be pointed off to the side and hope to succeed. Redwoods Let's start with a distinction that should be obvious but is often overlooked: not every newly founded company is a startup.
When I say startups are designed to grow fast, I mean it in two senses. That difference is why there's a distinct word, "startup," for companies designed to grow fast. To grow rapidly, you need to make something you can sell to a big market. For a company to grow really big, it must (a) make something lots of people want, and (b) reach and serve all those people. Ideas Rate Compass Value. Black Swan Farming. September 2012 I've done several types of work over the years but I don't know another as counterintuitive as startup investing. The two most important things to understand about startup investing, as a business, are (1) that effectively all the returns are concentrated in a few big winners, and (2) that the best ideas look initially like bad ideas.
The first rule I knew intellectually, but didn't really grasp till it happened to us. The total value of the companies we've funded is around 10 billion, give or take a few. But just two companies, Dropbox and Airbnb, account for about three quarters of it. In startups, the big winners are big to a degree that violates our expectations about variation. I don't know whether these expectations are innate or learned, but whatever the cause, we are just not prepared for the 1000x variation in outcomes that one finds in startup investing. That yields all sorts of strange consequences. It's a constant battle for us. Harder Harder Still Notes. Screw the Black Swans: Ichiro is our role model, not Barry Bonds. | Dave McClure. There are probably better things for me to do today, however i feel compelled to respond to the Black Swan Farming post by Paul Graham, founding partner of Y Combinator.
Maybe you can call this post “Grooming for Ugly Ducklings”. While i respect YC & PG immensely – note that 500 Startups has invested in over 40+ YC startups, and we have generously borrowed (COUGH) many excellent & original ideas that YC developed – at the same time, it’s useful to grok the similarities vs. differences between 500 & YC. Put bluntly: we are both ambitious and we both play baseball, but YC is quite clearly the Yankees, while 500 is more like the Oakland A’s. Though i don’t profess to be Billy Beane (or Jerry Maguire), 500 is ideologically more focused on being an organization that teaches great hitting & fielding, rather than one that aims to find the best hitters & help them negotiate the best contracts. But before we describe our differences, let’s first review the similarities. But 500 Got Next. Kudos. Y Combinator Startups That Should've Made It. Y Combinator has invested in hundreds and hundreds of companies, and many of them have become quite successful.
Reddit, Dropbox, Airbnb, Wufoo, Hipmunk, Loopt, Posterous, Heroku, and Scribd are just a few of the companies that are doing well today. But there are, naturally, many startups who don’t make it. We looked through the archives and found startups based on good ideas that should’ve made it, but were hit with bad timing or were simply ahead of their time. Flagr One of the flagship (excuse the pun) companies of the second Y Combinator batch, Flagr, founded by Matt Colyer, David Wurtz and Cole Poelker, had everything going for it – it was location-based (a concept that people were really just starting to play with), it was ahead of the curve, and it even had a “verbable” name (like Google) in that you “flagged” places to share with your friends.
But what use is describing these places if your friends don’t know when you are there, so they can come join you? YouOS Memamp Thinkature. Y Combinator's First Batch: Where Are They Now? From small seeds grow mighty oaks. When a tree grows, at what point do you say it has achieved success? When it has reached its full height, and stopped growing? When it has dropped seeds of its own, to produce new shoots to hopefully grow into their own huge trees? Maybe success for a tree is measured every day, when it grows a little bit further, spreads its branches a little bit wider, when it survives another day and becomes slightly, ever-so-slightly, better. Eight little seeds Seven long years ago, in 2005, Paul Graham had dinner with a bunch of college kids. Over dinner, Graham realized he had been hasty in telling them not to come to him.
After giving the applicants just 10 days to submit, Graham received an amazing 227 applications, which just goes to show the unbelievable drive that the young would-be founders had. “Paul and Jessica, with no intent to slight Robert and Trevor, are awesome,” First Batch member Chris Slowe told me. It all depends on how you define that word. Success. The Easiest Way to Send Photo Prints to Friends and Family Automatically — Picplum. Y Combinator Alum Flutter Raises $1.4 Million For Gesture Recognition Tech.
Flutter, the startup that launched this past spring out of Y Combinator’s Winter 2012 class, has closed on $1.4 million in seed funding from Andreessen Horowitz, NEA, and Spring Ventures, along with Start Fund and a handful of individual angel investors. The cash will be put toward further scaling out Flutter’s team and its technology, which provides gesture detection and recognition from standard webcam devices. Flutter’s first app, which is currently available for the Mac, lets you control the play function on media apps such as iTunes, Spotify and Quicktime by simply waving your hand at your computer. Flutter has received a very warm reception from users since it made its official debut on the Mac App Store late last month.
Not bad for an app that was built by a company that now has just seven full-time employees. But Flutter’s co-founders Navneet Dalal and Mehul Nariyawala tell me that the company has lots more on the roadmap. “It’s a big ambition, but it makes a lot of sense. Paul Graham's Letter to YC Companies. Apps Aiming for Sharing Within Boundaries. Initially, I didn’t see the appeal of the app, which lets the two partners send messages and photos back and forth. The idea of adding another service to the daily routine of Twitter, Facebook and their ilk seemed exhausting. And wouldn’t it be just as easy to exchange e-mails, text messages or, better yet, just flirt face to face? Curious, I tried it — even though I’m single. I recruited a friend to help me test it. And, after a few hours, the app started to grow on me. Something was thrilling about the secret little notes that Shaun, my temporary beau, and I sent to each other throughout the day. The secrecy was welcome.
The app highlights the best elements of social networking — the warm, fuzzy feeling of being connected to people you care about when you’re physically nowhere near them. Apparently, venture capitalists also see the point: The company that developed Pair raised $4.2 million in seed funding from a group of early investors last month. Mr. Did everybody see what just happened? The pendulum has swung. - Find Office Space - 42Floors. The feeling was palpable. Y Combinator had sixty-five companies present (42Floors was one of them). And we saw 500 eager investors, frenzied almost, excited to invest in entrepreneurs. One investor emailed me four times, texted me three times, called me and sent me a message on LinkedIn — desperate to get a check in before the round closes. No business plans, not even pitch decks this time. One 2-1/2 minute pitch and a quick follow up meeting.
Let me take you back to Y Combinator demo day, summer of 2009. There had not yet been a Dropbox valuation. Well that time has passed. It’s easy to lose perspective. The Y Combinator partners have been really good about trying to teach everyone perspective. So a word to every other founder out there enjoying the current (and temporary) good times we all face. It should not, however, have an effect on the way in which we treat each other. How We Need to Conduct Ourselves in a Hot Market Mutual Respect Optimize on People, Not Price Slow It Down. Here Are The Women of Y Combinator And They Are Awesome. I would normally rather have a root canal instead of write about the issue of women in technology. I just find most essays on this really tedious and obvious. (Sorry Alexia.)
But I do want to point one thing out. When I went to my first Y Combinator Demo Day three years ago, there was one woman. I’m going to keep this post simple. And ladies, if you’re interested in joining the next class, the deadline just passed. Nikki Durkin, 99Dresses Durkin wrote her first business plan when she was eight years old. “Ever since then, I’ve been pretty good at figuring out how to get what I want,” she said. At 15, she and her thirteen-year-old brother started their first online business called KultKandy, where they designed T-shirts and drop shipped them from China. While in college, she came up with a concept around dress swapping. “It wasn’t really planned out to the nth degree, but it really resonated,” said Durkin, who is now 20 years old.
Tracy Young, PlanGrid Young started with what she knew best. S Picks: The 10 Best Startups From Y Combinator Demo Day. 65 startups showed off today at Y Combinator’s Demo Day, and we covered all 39 that were ready for the public. After talking to VCs and tech moguls, the TechCrunch teamed huddled up and picked these 10 companies as the best. They’re disrupting commerce, evolving how we communicate, and making our phones even more powerful. Check out our coverage of session one, two, three, four, and five to choose your own favorites, but here’s a cheat sheet to the startups we think are going to remodel big industries [change the world], or at least make a ton of money.
Carsabi: An evolved search engine for buying used cars. Carsabi aggressively crawls every online car sale listing it can find, from classifieds to dealers. It already surfaces more deals than industry leader AutoTrader, and has features that let you sort by the biggest savings, not just lowest price. Priceonomics: An online price guide for anything. Exec: Ever wish you had your own personal assistant? Y Combinator’s Start-up Funding Forecast: More Froth - Digits. Eeve Pivots into Popset, a Group Photo-Sharing App. Back in September, we reported on how Eeve was trying to do what Color couldn’t, and was seeking to throw mobile, social, photo-sharing and location together into a big melting pot to create collaborative photo experience around specific events.
Well, as is the case with many fledgling startups, Eeve has now turned on its heels and morphed into Popset. So we caught up with co-founder Jan Senderek to get the lowdown on this pivot and take a quick peek at what Popset is all about. The story so far Eeve’s founders applied to Y Combinator in September last year. It was actually the second time they had applied for the seed-stage funding programme, having been rejected first time around.
This time, however, they were invited to fly to Silicon Valley for a ten minute interview, entirely at their own cost. This was in November. “The interview was tough,” says Jan. Eeve becomes Popset Now, however, Eeve is no more. So…why the pivot? The story is a familiar one. Why the new name? What is Popset? SendHub Crosses Messaging Platforms To Get Real Stuff Done — And Starts To Take Off. Paul Graham: Why Y Combinator Replaces The Traditional Corporation. Andreessen Horowitz Joins The Start Fund To Seed YC Companies.