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NYT on Paul Graham's YCombinator Bootcamp
prostoalex writes "The New York Times tells the story of Paul Graham's YCombinator - a venture firm that specializes in funding early stage startups that's famour for startup bootcamps conducted twice a year in Silicon Valley and over on the East Coast. YCombinator's boot camps apparently attract a lot of employees out of major software companies, who are still young and want to run a software startup."
....Keith Casey, blogged about his trip to Startup School here. There's an interesting note in his post about one of the speakers talking about how nervous CFOs feel about Sarbanes-Oxley.
Incidentally, Keith also reviewed my book.
The Army reading list
Talk about getting a bargain - if you can't figure out a way of raising that sort of money on your own you really shouldn't be in business.
Remember, folks, venture capital is like heroin; easy to get hooked on and bloody hard to get off.
--- Nick, hard at work
Reminds me a bit about the "college" Phil Greenspun started a few years back. It was going to be an "accelerated" version of M.I.T. bypassing the stuff irrelevant to startup computer businesses. It also sound a bit elitest and blowhard.
Anything that can channel the energy and creativity of smart young men and women into constructive pursuits has my vote. Sometimes people are turned off by formal channels like universities and low level entry jobs and dont realize their potential.
Y_combinator is focused mostrly on software and web services. That's cool, but is a sign of a trend that I don't like. This kind of focus on IT sometimes lead people and some media too to equate technology with software and web services. I think this leads the masses to think that's all there is for technology.
Why? Their boot camps require everyone involved to move to either Silicon Valley or Cambridge, MA, find their own office and living space (in two of the most expensive markets in the US for both!) and then code up a prototype in some number of weeks. After that, if you don't get funded, you're done and you go back home... assuming you have a home and a job left to go back to. Yes, they offer assistance with all this, but the whole idea isn't really practical on its face for the people they purport to be trying to serve: small-timers with big ideas trying to work on a shoestring. I can't afford to just drop my middle-income tech job, leave my wife behind while I go haring off hundreds or thousands of miles away, on a chance that my team may successfully code a prototype and get funded. Neither could any of the other people I'm thinking of going in with... except one guy. (And he already lives in Brighton, ironically enough.)
Y Combinator works if you're a single, highly employable geek with no obligations, but most of the people I know with the skill to accomplish things worth investing in are either married, have broad skills but relatively specialized job experience (= smaller market with correspondingly smaller proportion of available jobs), or have things like family and financial obligations they can't just drop and leave behind on a whim. So where's financing that's friendly to our situation?
-- Old Man Kensey
Wow! Keep it up and maybe someday you too can be famour!
That's insane, 6% stock for only $20k investment AND they won't sign an NDA so they're free to take your idea and pass it off to one off to whoever they want. If you're a budding entrepreneur and you can't raise $20K for seed funding you really should stick to being a wage slave.
Hmmm, but isn't this Y_combinator rather... Paradoxical? - I like curry, tastes good with french fries
"I can't hear you!"
"SIR, YES SIR!"
"Are you ready to convince angel investors that your fooseball table is an integral part of your creative environment?"
"SIR, YES SIR!"
"Are you ready to convince gullible members of the public that your particular URL is worth several million dollars?"
"SIR, YES SIR!"
"You, maggot! Front and center! What's you're name?"
"Smith, sir!"
"And what do you do, Smith?"
"Program, sir!"
"Well goddamn, a white boy who thinks he can program! Are you half-Asian, boy?"
"No, sir!"
"And what do you think your non-Asian ass is going to be programming in?"
".NET, sir!"
".NET?!?!? .NET!?!? What sort of goddamn candyass faggot shit is that??? No VC is going to give no sucking-his-momma's tit .NET programmer jack! You will program in JAVA, and you will LIKE IT!"
"Sir, yes sir! Java, sir!"
"Now drop into that Aeron chair and give me 20 lines of code!"
Crow T. Trollbot
I enjoy reading Paul Graham's essays, but I'm bothered by the logic "climbing the corporate ladder" verus starting your own company.
A common theme in many of those essays, and one of the primary reasons for starting Y Combinator, is for young hackers to create their own companies to sell (so they don't have to about climbing any corporate ladders) -- briefly, control your own destiny. So how is "flipping" your start-up any different from the corporate culture?
When you "flip" your start-up, you'll be put right back into the corporate ladder, albeit a little higher, but you're still working for the "man". Why not make your start-up into a viable, self-sustaining business? Or is that not Web 2.0?
Synchronize your calendar and mobile phone via text messaging.
I find the credentials of this group of people pretty weak when it comes to startups; making a lucky sale during the early Internet boom years is not the same as having sustained startup or business experience.
I don't know how intentionnal it is, I assume it is intentionnal : in computer science a Y combinator is, basically, a function that takes a function as an argument and returns a fixpoint to the function. so for any function f, f(Y(f))=Y(f). Oh, what's the hell : just check out the wikipedia.
Basically, middle-aged successful people are trying to re-live their "gee, what if *I* had a million bucks when I was 22" youth. Well, that's great, but really, not that many great--and complete--ideas really do come from fresh college [under]grads. It takes experience, whether in advanced degrees or out working in "the real world" to get the combination of [K]nowledge [S]kills and [A]bility to make a business work. I mean, at the point when you're barely qualified to be a decent employ-EE, how the hell can you reasonably expect to be a decent employ-ER?
It would be far more realistic to design something like this around the assumption that you *will* be over 30, married, with kids and solid decent paying job (that you can hopefully self-fund with) and teach people how to start a business in THAT scenario. Chances are, by the time most of the attendees in these things actually get their collective sh*t together, they WILL be in that situation. But, by the time their in that situation, they're no longer sexy wunderkinder that make Daddy Warbucks stiff and proud...and part owner.
Y Combinator isn't targetting people like you. Or me, for that matter. They're quite up-front about this.
Does that mean that Paul Graham is a bad person or Y Combinator is a bad choice for the people they _are_ targetting? Not at all.
But also a lot harder for paul & co: instead of people willing to move to where you can coach them and live on $2k/month or so, you've got someone who is less able to relocate AND has significantly higher fixed expenses.
:)
Business 101: if your costs are higher, your return needs to be higher too, or it's not worth it.
I suspect that paul simply doesn't know how to get 3x the output from 30-somethings that he can get from 20-somethings in return for the higher costs. This is amplified by the relocation issue; _you_ might not think paul's advice is worth relocating for, but _he_ clearly does. And he's doing the investing.
None of them. This is SOP for early-stage investors of all sorts. Grandparent is simply ignorant.
Ok, start by handing over 6+% of your company.
...
If you're good you'll get you business-skill-lacking-self in front of investors. Don't worry, if they like your idea, they'll take care of the legal work for you. Kiss a whole bunch more of your ownership goodbye. Oh wait, you need more money to keep developing, that's where our funding comes in with so many strings attached you'll get dizzy if your patient enough to read the contracts. Don't worry about reading them, however, because the lawyers the VC's set you up with will take care of that. They'll look out for your best interests. Trust them.
Cookie-cutter contracts and business formation legal work can be purchased from numerous places over the 'net for anywhere between $100 and $1000.
Sorry for the cynicism, but if you can "make something people want", you can probably attract enough attention on your own. Isn't that what the Internet enables? As others have pointed out, you won't have to move and if you can't get $6k on your own
And if you're not young you're not interested in running your own software startup?
Ideas for Start ups -- An entertaining talk by Paul Graham on how entrepreneurs get ideas for start ups.
Hackers and Painters -- Another entertaining and informative talk by Paul Graham. Unlike architects (who figure out what to build) and engineers (who figure out how), great hackers and painters do both. Who makes a good hacker and how can you identify a good hacker/programmer in a job interview? Why is empathy an important skill for programmers? As a hacker who also studied painting in Europe, Paul may be uniquely qualified to write a book entitled Hackers and Painters. If you leave your day programming job only to get home and write more code, this is a great book for you.
What business can learn from open source -- Paul Graham, popular author and Lisp programmer, discusses what business can learn from open source. According to him, it's not about Linux or Firefox, but the forces that produced them. He delves into the reasons why open source is able to produce better software, why traditional workplaces are actually harmful to productivity and the reason why professionalism is overrated.
The whole thing is for recent graduates, or even people still going to school doing this for the summer. He is convinced that people with jobs and families can't start companies.
Oh, I'm not devaluing his advice. What I question is the utility of the advice at the point in time when such relocation is possible. Sure, there will always be "winners" who will bang something out to make daddy proud, but there's kind of a sick S&M trip going on here when the "losers" go home as if "real" businesses are built in this sort of X-Treme sport mockery. It reminds me of the "Drawn Together" episode with the Louie Anderson-esque riff on Donald Trump where every ten seconds he, erm, "discharges" his sage advice all over his nubile contestants.
This is basically a game show where the real winner is the host and the contestants, winners and losers alike, are essentially arbitrary.
If it had said at the front page "Y Combinator funds shoestring technology startups run by recent grads -- click here to apply!" I wouldn't have looked past that and just gone blissfully on my way.
-- Old Man Kensey
You know, whether or not you think that the amount of the capital for the % of the company is good or bad, the cash isn't really the most enticing part of the YCombinator.
Yes, of course you have to be careful about giving away too much for too little, but YCombinator offers much more than just cash.
Paul Graham has a ton of experience and a ton of contacts. Having him, his team, his friends, and his firm on your side is a lot more important than the cash. Being able to take knowledge from these people, along with the other companies within YCombinator is a very important piece of the puzzle.
A lot of times, VC isn't about the cash, it's about the contacts and knowledge.
...about computer science but no, it's just a story about venture capitalists. The Y combinator is fun to play with.
"The White House is not an intelligence-gathering agency," -- Scott McClellan, Whitehouse spokesman.
For you or me, that might well be the case.
But for his target market, hey, here's a guy offering to pay kids to move to Cambridge for a few months. Maybe their company works out. Great! If not, well, a lot of young singles like Cambridge an awful lot, and there's plenty of more pedestrian tech jobs available.
Maybe it's not such a bad deal for the recent grad with no ties that he's looking for.
I think he just assumes that everyone has read his insane babblings, so they will already know they are worthless if they are older than 25. The obvious exception being PG himself of course, since getting lucky once, and then being a blowhard forever after makes you something akin to a god.
So when he was starting up this startup-bootcamp business, did he attend his own bootcamp to learn how to do it well?
--
The sentence was starting at the post title:
"One of the attendees, Keith Casey, blogged about his trip to Startup School."
You are just being an ass.
Most VC's have never been entrepreneurs themselves. Never started a company.
Maybe PG got lucky. But at least he's been there.
Been up and down Sand Hill road and other places. Have been pitching some neat ideas for a few years. VCs say ho-hum, and months later we see newly minted startups using some of our slides in their pitches. Our idea is now generating startup capital and VC blog-drool across the VC blogverse, with nary a cent from these people for the group that developed the product to begin with.
Most VCs are looking for the next MSFT or GOOG.
Most of them wouldn't know the next MSFT or GOOG if it came up to them and whalloped them in the ass. Which, coincidently enough, happens often enough that these folks lose lots of their investors money.
VC money is a drug. It is cheap, you don't have to work for it. You just need to find a sufficiently gullible VC who is foolish enough to believe you. There are far too many of those. Just look at the internet bubble these yahoos created. You could have a loose bowel movement, bring it in to a VC and get 10M$ funding for it.
Is combinator a real word? I mean even without the leading Y, which one can assume is because Apple would have sued if they'd used an i.
Confucius say, "Find worm in apple - bad. Find half a worm - worse."
Shouldn't that be 'Bootstrap Camp'?! ;-)
He who knows does not speak, he who speaks does not know...
I'm 19 years old and have a brilliant idea for a company. I recognize that something like ycombinator is a rip-off for someone like me. They're not really offering anything and moving to Boston or San Jose is a bitch.
So, is there a better way to get investment besides personal networking?
Here is my personal experience on some of Graham's commonly touted suggestions for entrepreneurs:
I have no wife or kids, no mortgage, and sufficient savings to last for long enough to give entrepreneurism a shot. Paul suggests people do this young not because of any inherent bias, but because the young have very little to lose.
The tech startup market is booming. The amount of available funding and interest shown by VCs, and large companies is very attractive to a couple of small entrepreneurs. With several startups having been acquired in the last year, there are rewarding exit strategies on the table too. If you are skilled, and good at your job, why not let the market decide your value instead of your manager?
The cost of creating value on the Internet is very low. Our product is a web-based application (some may call it Web 2.0), built entirely using open source software. With an abundance of cheap machines, and the fact that most web-apps simply don't need much more than lots of memory and some big disks, our hardwares costs have been low. In fact, we have funded the entire thing ourselves from our savings. With such low startup costs, you don't need to give equity away to try out an idea.
What really happens if I fail? Well at worst I'll be nearly broke, and back in the job market. But even then, I will have ways to commoditize my failure. Though by no means a given, having entrepreneurism on your resume often suggests some traits that employers look for: self-motivation, willingness and ability to work hard, maturity, technical expertise, ability to prioritize etc. I conducted many interviews during my time at Amazon, and candidates who had tried something on their own and failed were nevertheless, generally more interesting.
Graham helped me assert to myself that the risk calculation I was doing was right enough. At the end of the day, the risk is mine, and the rewards too. We launched the site 5 weeks ago, already have over 3000 users, have been contacted by several VC firms, and have gotten some great press on blogs like TechCrunch, and the Scobelizer. If you're interested, check out what I've been up to at http://www.billmonk.com/, and decide for yourself.
One thing I can say for sure: this is the best job I've ever had.
I don't think this is true at all. I think the masses think primarily on gadgets such as digital cameras, mp3-players, computers, HDTV sets and the like when they hear the word technology. Not web services.
Same impression I got.
I really like reading Paul Graham's writings. When I first discovered them, I went straight through them, and while they get kind of redundant (and I think that he's way, way too defensive on Lisp -- sounds like a guy who has heard one too many "Why aren't you using C++ again?" questions), I think that they pretty consistently would get +5 Insightful mods were they Slashdot posts.
I also wondered the same thing -- PG talks about how great it is to be your own boss, to start up a new company, etc, etc...but the obvious question is....why not keep that going? Okay, sure, if he's just trying to draw attention to Y-Combinator, then it makes sense. Y-Combinator wants to sell off its startups and see return. However, he talks about how happy he was at ViaWeb, and how unhappy he was after he sold out to Yahoo.
Why not just keep doing ViaWeb? Because he chose to cash in his chips, and he thinks everyone else should do the same thing?
While I think that he gives great pep talks for doing startups, I'm not sure that I'd want to actually work with Y Combinator. What's impressive is PG's writings, not necessarily the firm he runs. I think that if I chose to do a startup, I'd rather avoid Y Combinator, self-fund, and grow slowly if necessary instead of trying to expand like crazy. How many people do you really need to have to run a successful Web-based business?
I do like the points he makes about the OS and language freedom offered by doing Web services.
Any program relying on (nontrivial) preemptive multithreading will be buggy.
Congratulations. Whether your *company* succeeds or fails, you've already won because you've put yourself out there. (I'm remembering a Rudyard Kipling poem right about now: something about risking it all on the toss of the dice -- Rudyard seemed to a proponent of putting yourself out there).
I started 10 years ago (and the company was profitable from the first year).
I think Pauls' advice is GREAT. I think ycominator makes sense for only a small # of folks, but it's another option. take it or leave it.
Clay Nichols
http://wwww.strokesoftware.com/
Speech & Language Therapy Software
corrected url: http://strokesoftware.com/