What I got from reading Paul Graham's own writing on the genesis of YC, was that his key insight was that VC's should be funding more companies, and earlier, and giving founder's much more control.

The other key innovation was funding in batches, in classes. This created a close-knit ad hoc community with shared goals, and one in which teams whose ideas were not finding traction could join teams whose ideas were.

I'd say this is pretty awesome: https://blog.ycombinator.com/research

I don't think it's common for a VC to hand out free money. The best part is that with the data they get from these experiments, combined with the vast experience of starting and growing companies, they'll likely be able to find business models that are successful financially while simultaneously achieving the goals of what they are researching.

I'm no rocket surgeon, but off the top of my head, they could determine the personal financial implications of not having to worry about keeping a head over your kids' head and food on the table. If you give someone a basic income, what do they do with it? does someone use time to become more marketable and be able to earn more in the long-run instead of have to focus on a minimum wage job to feed their kids? Maybe there's a business model in using yourself as collateral. I've seen personal examples of this happening - high net worth individuals that meet exceptional people and give them a basic income so that they can focus on big ideas, not affording rent. Maybe through the data YC is collecting, they'll be able to find a scalable form of that.

The application process, number of deals they do and the community across YC companies which is not so great in the typical VC firms.

Maximizing return to investors.