Y Combinator accepting applications for Winter 2008

Y Combinator accepting applications for Winter 2008

Ycombinator_3 Y Combinator is now accepting applications for their winter start up boot camp in San Francisco which runs from January through March 2008. I attended the Summer 2007 Y Combinator Investor Day recently.

Y Combinator is a seed stage investor
with a large network of entrepreneurs, VCs, and all the people you need
to start a company. It is hard to explain but it is a cross between a
startup boot camp and a traditional startup incubator. The best
description of Y Combinator is on its application page.

Here it is in its entirety;

  1. If you want to apply, please submit your application
    online by 10 pm EST on October 11, 2007. Groups that submit early have
    a slight advantage because we have more time to read their
    applications.
  2. We’ll review applications by October
    18 and invite the groups that seem most promising to meet us in
    Cambridge on the weekend of November 3-4. We’ll reimburse up to $600
    per group for travel expenses.
  3. We’ll decide who to fund that weekend, and tell you by phone on Sunday evening.
  4. Yes decisions will include the amount
    we’ll invest and the percent of the company we’d want for it. We
    usually invest $5000 + $5000n, where n is the number of participating
    founders (i.e. 2 founders get $15,000, 3 get $20,000), in return for
    between 2% and 10% of the company. The median is 6%.
  1. If you accept our offer, we’ll write you a check immediately for as much as you need to cover your initial expenses.
  2. If we invest in you, your group is
    expected to move to the Bay Area for January through March 2008. (You
    can of course leave afterward if you want, but it’s a good place for a
    startup to be.)
  3. After you’re accepted, we’ll set up all your paperwork for you, including getting you incorporated.
  4. Once your company exists, we’ll write a check to it for the rest of the money. You can spend the money however you want.
  5. Y Combinator is not an incubator. We
    have space you can use if you need to, but we expect you to work out of
    wherever you find to live. It is no coincidence that so many successful
    startups have started this way; it’s the ideal setup for the initial
    phase.
  6. From January through March we’ll have dinners every Tuesday for all the founders. At each dinner we’ll invite an expert in some aspect of startups to speak.
  7. On Wednesday afternoons we’ll have an
    open house at YC for founders who want to demo their latest work or
    talk about strategy. You can arrange to meet with us any time during
    the week, but the open houses ensure no one has to wait more than a
    week.
  8. You’re encouraged to ask the founders
    of other YC-funded companies for help. There are now almost 150 of
    them, and they’re usually very willing to give advice or make
    introductions.
  9. About 10 weeks in, we’ll organize an
    investor day at which startups that want additional funding can present
    to investors. You can of course seek additional funding from any
    investor whenever you want.
  10. YC doesn’t really end after three
    months; only the dinners do. We continue to give advice and make
    introductions as long as founders need—and so does the informal network
    of YC-funded companies.

How
do we choose who to fund? The people in your group are what matter most
to us. We look for brains, motivation, and a sense of design.
Experience is helpful but not critical.

Your idea is important too, but mainly
as evidence that you can have good ideas. Most successful startups
change their idea substantially.

We’re more likely to fund people we know are smart from their submissions and comments on Hacker News. In fact, that was one of the main reasons we wrote it: so that we could get to know people before they applied.

The ideal company would have two or
three founders. We’ll consider those with four or five. We’re very
reluctant to accept one-person companies, though we have funded a
couple.

We don’t expect you to have a formal business plan yet. All you have to do is fill out our application.

$5000 + $5000n is not a lot, but it
turns out to be enough. It will cover at least 4 months’ living
expenses, and that is enough time to build something nontrivial. It’s
in your interest to take little money in the earliest stages, because
you give up less control for it.

The original motivation for Y
Combinator was benevolent, but this is not a charity. If our
investments pay off, we can invest in more startups, and if they don’t,
we can’t keep doing this indefinitely. So we’re looking for startups we
think will succeed.

My next post
will be an interview with Paul Graham, founder of Y Combinator. I ask
Paul lots of questions about how the program works and his philosophy
on building startups.

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