Scribd is another Loopt | Hacker News Reader

Scribd is another Loopt

2 pointsMenaMena1237 comments

I have wondered about these companies and always thought they were hyped up, but at the end of the day...are they really that good? I don't think soooo :) YC companies seem cool at the start, but are they really doing anything, besides looking cool? It seems the same type of companies and same type of founders are in YC, not to say many won't continue to be successful, but if I was in the room at the YC office with everyone, the only thing in common would be technology, but it lacks diversity in many ways...many will argue that one and say they have people from all kinds of places, but really same old Ivy league, computer or engineering degrees, started or finished. Got jobs at big names etc etc etc. Boring!!! :) Thats why you see the same style of companies and no big winners cause its only selected by a few people, that probably look for the same traits of people. Is YC a bunch of Paul Grahams? lol

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You say that in YC you "see the same style of companies and no big winners cause its only selected by a few people" and that they "probably look for the same traits of people"

As well as these points, I will also be addressing some of your earlier points including the fact that you claim YC lacks diversity.

First of all regarding Ivy league schools, computing/engineering degrees and the fact it lacks diversity proves that you are not aware of Y Combinator or its investments. Y Combinator have funded people from 17 years of age upwards and have funded people from the likes of Spain, Netherlands, England, Canada, India and teams with mixed nationalities etc. The founders come from different backgrounds and schools including both Ivy Leagues and State schools. Y Combinator have also funded MBA's who have taught themselves to code.

Secondly, now we have addressed the parts regarding schools and diversity we will cover "probably look for the same traits of people" well they do. Y Combinator look for founders who are relentlessly resourceful[1] I'd advise you to read the essay by PG linked below so you can see what YC actually looks for.

Now regarding, "see the same style of companies and no big winners cause its only selected by a few people" I think you are also completely wrong here as well. For instance, you are forgetting that YC's investment is around ~$17k for around 6% of the companies they invest in and this is extremely important when considering some of the exits they have already had, and will have in the future.

By exits they've already had, I'm referring to the likes of:

Heroku which was acquired by Salesforce for $212M which gave Y Combinator a 400x return! [2] WooFu to SurveyMonkey for $35M CloudKick was acquired for $30-50M by Rackspace BackType for $50M by Twitter 280 North (Motorola, $20 million) Omnisio (YouTube, $15 million) Reddit (Conde Naste, $12 million) AppJet (Google, $10 million) Rapportive by LinkedIn for $15M Project Wedding for $4M Movity by Truila for $15M AdGrok - Twitter $8M

Even as recent as today, Posterous just sold to Twitter!

To be honest I could go on for a while, there has been a lot of acquistions in the several million range for YC Companies and this is excluding other companies which haven't had an exit.

For instance; AirBnB, DropBox, Stripe, SongKick, Bump, Disqus, Webly, Wepay, Justin.tv, Heyzap, rethinkdb, DailyBooth, wakemate, carwoo, 1000memories, Hipmunk, GoCardless

Again I could go on here but these companies are all different and are becoming huge companies in their own right.

Sure, Y Combinator might look for a particular type of founder/founders but to say they're all the same and aren't successful is completely wrong.

[1] http://paulgraham.com/relres.html [2] http://www.businessinsider.com/y-combinator-exits-heroku-mov...

Buddy, you just described all these companies that were aquired, many are hyped and dont last sometimes thats the only option or move forward. Loopt was aquired doesnt mean it was a success. Look at the details, if a company gets aquired for 20 mil, but needs to pay the vcs and staff and themselves alot of times its a loss, not in every case. But yc hasnt had any facebooks or googles, maybe later but I dont see it yet. And I never said they wouldnt have success, many will, but I dont care if they get people from each continent, they can still be the same style and type from what I see.

I think you missed my point and sure companies fail every day but, Y Combinator doesn't actually need a Facebook or a Google to succeed.

Sure, a $XX Billion IPO would be awesome for them but they're investing $17k for 6% of the company at those levels, they can survive on small acquisitions etc.

Plus, your point of if a company gets acquired for $20M then it still can actually be considered a successful exit. You need to go and look how much they have raised etc most of those I listed had raised only a couple of million or less prior to acquisition.

Also I agreed with you regards to style and type they do look for a particular type of founder (as I highlighted earlier) one that is relentlessly resourceful http://paulgraham.com/relres.html

The buyout prices you described are baby buys, those happen everyday, trust me investors arent thr those low ball buys. Yes people make money, but its not one for the history books, if success is maki million, then I guess thats your success.

Heroku was acquired for $212MM with a 400x return to YC. I wouldn't exactly call that a baby buy with a small return from a $20k investment.

With regards to the other acquisitions I was highlighting that YC is actually successful without the need for the huge IPO with billion dollar exits. It doesn't need them in order to survive in can happily have $XX Million exits and be hugely successful.

However, they will have those billion dollar etc exits soon as you can see from the likes of some of those companies I listed such as DropBox, AirBnB, Stripe etc.

Yes heroku did a great job, but what about the rest, they may just end up like Loopt, it was hyped and came down to alot of money raised and sold for nothing. And trust me YC isnt in this for the baby buyouts, its looking for that facebook.

Scribd is next, alot of hype and money, but just sucks.

I agree with you that YC are looking for billion dollar companies but, what I am saying is that they can still be hugely successful with even those "baby buyouts" $X-XX MM exits are they still provide huge returns from their investment.

Also with regards to Loopt, I actually think they were a great company but were too early to market - which whilst it gave them some advantages it also hindered them. For example, they successfully were able to do deals with the carriers (when they were the only way to get onto phones) but this also hindered them.

Likewise, they have several patents which are extremely valuable as well as the team they built. Sure, their exit wasn't as amazing at it was hoped but thats the risk with all businesses... many fail whether they are in YC or not.

However, it will be interesting to see what will happen to Loopt but, sure that wasn't the home run they hoped it would be, that is irrelevant to the whole of YC.

I say this because, they have 60 or so companies every batch now, eventually and more likely with the improving companies every batch they will have the home run - aka the Google/Facebook that would give them they huge roi with a billion dollar plus exit.

Lets not forget, YC is still young, it was founded in 2005 and has been pretty successful so far in terms of its returns achieved already and we haven't even started to see the full returns from its investments yet.

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