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Y Combinator, the X Factor of Tech (economist.com)
universe520 writes: Since 2005 YC has taken on batches of promising founders, and this month will celebrate the funding of its 1,000th startup. Though about half of its startups have failed, which is typical of early-stage investing, it has had a head-turning record of success. In addition to Airbnb, YC has had a hand in Dropbox, a cloud-storage firm, and Stripe, a payments company. Eight of its firms have become what Valley folk call 'unicorns', valued at $1 billion or more. Combined, the companies it has invested in are worth around $65 billion (based on their most recent funding round), although YC's share is only a small fraction of that total—perhaps $1 billion-$2 billion. It is because of this record that YC has become a juggernaut in Silicon Valley.
Is Airbnb really worth 25 billion? Really??? Dropbox at 10 billion?? And that's just somewhat successful YC stuff; Twitter, a company that is only good at losing investor money, is somehow valued at 19 billion.
The real story here is the silly amount of "value" in companies that produce no tangible products. When this bubble pops, it's going to be really messy.
Its nothing about the 90's dot com bubble really .. Where there are investment bankers , there is bound to be a bubble. Anywhere and everywhere .. It's like where there are programmers there's bound to be code ..
1. Build a non-tangible online company.
2. Trick investors about a profitable future. If not possible, GOTO 6
3. Everyone knows about your product and uses it.
4. Success!
5. GOTO 2
6. Company has failed, never made any money.
The success story is their ability to present something that has no value as something revolutionary and valuable.
Everything is in the pitch.