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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.
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
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.
"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.
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.
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
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.
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.