Comment by _1tem | Hacker News Reader

Comment by _1tem | Hacker News Reader

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Since when is YC about innovation? YC (and all VCs) are about maximizing returns for investors. That is NOT innovation, that is mostly rent-seeking. Hence most YC startups are boring B2B SaaS products designed to milk the oceans of freely printed money floating around the American economy.

The trickle-down wealth transfer goes like this: Federal Reserve -> Banks -> Traditional Businesses (who do the hard work of actually providing goods and services people need) -> B2B SaaS that sells them software to replace spreadsheets.

True inventors and innovators tend to be eccentric and purpose-driven rather than money-driven. That is actually a negative signal for YC. They want the slick grifters, popular kids, who can wine and dine clueless execs at "enterprises" to sell them chat apps like Slack at $100/seat. Much easier and faster way to get investor ROI than pie-in-the-sky "innovation".

To expand on this, and maybe this point is obvious, but accelerators and VCs purposefully fund a lot of companies they assume will not succeed. Something like 10% success is an acceptable target.

I wonder if all this focus on AI companies is actually denying opportunity to founders who have better ideas? Every AI agent company in YC and other accelerators is one that could have been taken by someone else.

But that’s the thing, AI is the highest risk highest reward opportunity, which fits the VC model. A boring CRUD app that solves an actual problem might be more likely to succeed but less likely to explode into a unicorn.

> … purpose-driven rather than money-driven […] is actually a negative signal for YC.

You can even find that in PG's “essays”, although he doesn't say it that directly.

It is a sensible position. YC and VCs are backing businesses, not charitable causes or research initiatives. It is the founders' responsibility to liaise the two sides in order to signal that the pursuit of their particular purpose is an undeniably attractive and fast-growing investment. Which obviously entails more work and has fewer market opportunities compared to the case "money is the purpose".

After getting backed and receiving adequate funding, all that matters is maintaining a good growth rate to remain a purpose-driven business.

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