If YC could reliably pick the winners from a given set of applications they would be a complete outlier in the venture capital market.
I assume they're excellent judges of character, that they try to stack the odds as good as they can in their favour in the choices that they make.
Sure the selection process is better than random sampling, after all, you first get to discard the obviously bad stuff, I took it as read that we would not include those in any meaningful sample.
But the tremendous amount of applications means that YCs capacity to accept, mentor and nurture will probably be vastly outnumbered by the flood of people applying.
Let's say we reduce it to an extreme situation, two companies apply, there is only room for one. Both are 'pretty good', but there is a better personal click between one of them and YC. So, that company gets selected.
In the longer term that is not a way to predict success, the other company has just as good a shot at being successful as the one that got chose, in spite of the 'goodies' that YC brings to the table.
In the end it is mostly up to the market and the founders.
The very best time when it helps to have an experienced investor on board is in times of trouble, that is when it really pays off, after all, if the investment is large enough then it is their worry as well and they may have more experience.
At the level of investment that YC does I doubt that there is such a commitment that the problems of the startup are synonymous with a problem for the investors.
A second big benefit is that it may help to get further funding because of contacts etc. once a moderate stage of success is reached.
Of course the plain dumb ideas get taken off the top, but every now and then even a plain dumb idea gets to make it big.
There are plenty of well documented examples of VCs that said 'no' to a winning team.
If there ever will be a VC that manages to correctly identify only the winners then that would amaze me completely, as far as I can see they're as fallible as any other process to select 'winners'.
They do their best but in the end nobody gets to beat the 'industry average' by any considerable margin. Especially not in the seed stage investors.
VCs routinely hold the speech to say what it is that 'they bring to the table' and that their involvement makes a difference.
Maybe. For the most part the companies that I know of that were successful with an investment were only more successful, they would have succeeded anyway, regardless of whether they found a backer or not. The success factors that counts most are team and market, not the investors.
I'm sure investors would like to think otherwise, but that's the way I see it.
Any investor that wants to make the case that the company that they invested in would not have made it if they had not invested are discounting the biggest factors and overselling themselves.
I assume they're excellent judges of character, that they try to stack the odds as good as they can in their favour in the choices that they make.
Sure the selection process is better than random sampling, after all, you first get to discard the obviously bad stuff, I took it as read that we would not include those in any meaningful sample.
But the tremendous amount of applications means that YCs capacity to accept, mentor and nurture will probably be vastly outnumbered by the flood of people applying.
Let's say we reduce it to an extreme situation, two companies apply, there is only room for one. Both are 'pretty good', but there is a better personal click between one of them and YC. So, that company gets selected.
In the longer term that is not a way to predict success, the other company has just as good a shot at being successful as the one that got chose, in spite of the 'goodies' that YC brings to the table.
In the end it is mostly up to the market and the founders.
The very best time when it helps to have an experienced investor on board is in times of trouble, that is when it really pays off, after all, if the investment is large enough then it is their worry as well and they may have more experience.
At the level of investment that YC does I doubt that there is such a commitment that the problems of the startup are synonymous with a problem for the investors.
A second big benefit is that it may help to get further funding because of contacts etc. once a moderate stage of success is reached.
Of course the plain dumb ideas get taken off the top, but every now and then even a plain dumb idea gets to make it big.
There are plenty of well documented examples of VCs that said 'no' to a winning team.
If there ever will be a VC that manages to correctly identify only the winners then that would amaze me completely, as far as I can see they're as fallible as any other process to select 'winners'.
They do their best but in the end nobody gets to beat the 'industry average' by any considerable margin. Especially not in the seed stage investors.
VCs routinely hold the speech to say what it is that 'they bring to the table' and that their involvement makes a difference.
Maybe. For the most part the companies that I know of that were successful with an investment were only more successful, they would have succeeded anyway, regardless of whether they found a backer or not. The success factors that counts most are team and market, not the investors.
I'm sure investors would like to think otherwise, but that's the way I see it.
Any investor that wants to make the case that the company that they invested in would not have made it if they had not invested are discounting the biggest factors and overselling themselves.