Y Combinator and Power in Silicon Valley

Re:Y Combinator and Power in Silicon Valley by light_triad on Tuesday December 03, 2024 @11:26AM (#42307936)

The need to scale is inevitable if you consider 2 trends: startups have become mainstream and the internet is orders of magnitude bigger. When YC applications consisted mostly of PG essay readers the chance of success per company was higher. Also some niche ideas can now work because of a more developed communications infrastructure, easy payments, better targeting, etc.

And knowing which companies are high quality is almost impossible at the early stages.

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Re:Y Combinator and Power in Silicon Valley by llamaimperative on Tuesday December 03, 2024 @12:31PM (#42308722)

Neither of those lead to a need to scale. Those are enabling factors, at best.

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Re:Y Combinator and Power in Silicon Valley by fragmede on Tuesday December 03, 2024 @12:51PM (#42308960)

There needs to be an ROI, YC isn't funding companies out of the goodness of their hearts. So the additional size means they have to bet on Uber and Lyft and Flywheel and every other competitor in that space in order to guarantee a return, because they only win if they bet on every horse. You can't do that if you keep small since the number of entrants got bigger. Hence scaling is necessary for them.

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Re:Y Combinator and Power in Silicon Valley by llamaimperative on Tuesday December 03, 2024 @01:44PM (#42309655)

Sure, but that's not the argument that was being made. This is just generically: VC works by power laws so larger portfolios are generally preferable to smaller ones.

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