This person has no understanding of what a Monopoly is.<p>A high value service realizing it delivers more value than it initially thought, and raising prices... is not a monopoly. That's just business, life, etc.<p>A monopoly would be if:<p>1) You can only effectively start a startup through YC (Not true)<p>2) YC actively did things to subvert competition (Not true, at all, from what I can see)<p>3) YC owned a significant majority portion of some market, and used its position to arbitrarily set prices (A la Apple for taking cuts of apps written by people other than them, to be installed on devices you own), or otherwise damage the market's competitive viability in some way. (Clearly not true)
> They are so confident in their power that they have recently instituted new funding terms that crowd out seed investors (their partners of yesteryear).<p>This quote is hilarious and actually proves that YC is moving farther from a monopoly than to one. YC had to make their funding terms much more competitive (better for founders) because of the insanely increasing competition and the flood of capital into VC.
This seems... odd to me. I don't understand the industry well, but if you're sugesting that YC benefits from having stakes in lots of competing companies that therefore co-operate, that's a cartel, not a monopoly.<p>I do think the new terms are YC trying to capture more of their advantage though.
One insight into YC leverage is that they are working in larger and larger batches instead of moving to a continuous process or many smaller batches. I believe that a significant source of leverage is their ability to create two "Demo Day" auctions a year. This leverage might be considerably diluted by spreading the 400 startups in the most recent cohort into, for example, 13 fortnightly events with 30 startups spread over the same six months.<p>From cohort sizes in the teens in the first few years to several dozen in the next decade to now hundreds, the only constant has been two events a year.<p>I believe the logistics and support models for a 400 firm cohort are very different from one of 40 (in the same way 40 is distinct from a dozen). They cannot be analyzed in isolation as there have been many other changes in the venture funding and incubator models over the last 15 years.<p>I never did get an answer to this question from ten years ago (<a href="https://news.ycombinator.com/item?id=3711131" rel="nofollow">https://news.ycombinator.com/item?id=3711131</a>)<p>"Initially we didn't have what turned out to be the most important idea: funding startups synchronously, instead of asynchronously as it had always been done before. Or rather we had the idea, but we didn't realize its significance. We decided very early that the first thing we'd do would be to fund a bunch of startups over the coming summer."<p>I wonder what the best batch size is: each cohort seems to be larger than the last. When does it makes sense to do three, four, or six a year as smaller batches.
PG realized something really early on: that the most valued commodity in the tech economy is the attention of the customer; The most valued skill is therefore to grab attention. That may be the reason, why he made this site: if one can grab every hackers attention, then that attention can be directed towards the goal of making money. And he managed to do just that. This ability to turn insight into a tangible result does deserve a lot of respect, imho.
First off, being a "monopoly" (dominant market share) does not make one a "despot blinded by hubris" as the OP suggests. Anti-trust laws target "abuse" of monopoly.<p>Secondly, YC may very well be a "new age monopoly" much like Google or Amazon or Facebook i.e. the customers of those companies (in YC's case - founders) gravitate to them not because there is no choice but the value that they offer is so far above and beyond any competition that exists today. The point to note is - traditional definitions of monopoly abuse don't apply, unlike for example: Apple extorting 30% from app devs, which is a blindingly obvious case of abuse.<p>YC just put out a superior product for their customers who'd otherwise have to pitch to 20 other angels. If you consider YC like the Amazon marketplace, this new deal can be considered a new private label (like AmazonBasics). It is quite likely that this hurts the economics of some angels. But YC is still makings it primary customers happy.<p>And talking about superior products, by virtue of its early stage and program design, YC does in fact add substantial value when your company is most vulnerable and needs the most help. A16Z/Sequoia/etc founders, are happy with the money and the short lived legitimacy the branded money confers.<p>But most YC founders seem to owe their existence to YC i.e. they love YC like an alma mater, which is exactly how YC positions itself. No angel/fund can compete with that emotional connect with checkbooks. Soon YCG will be giving later stage VCs a run for their money.<p>Disclaimer: I am a yc alum. YC is far from a guarantee of success as my dying company can testify. And they are quick to remind that the Harvard analogy doesn't go very far because the median YC company is still a dead one.
I want to see their returns 5-8 years from now based on this new model. I've always thought of YC as the ultimate "throw spaghetti on the wall and see what sticks" type of program. Should be interesting to see how other programs respond. If nothing else, it's a GREAT time to be a founder.
Notice that the people complaining seem to be other funds, not founders or startups.<p>The reason YC is so popular is that they cater for founders and startups.<p>YC terms are well-laid out, fairly easy to understand, and reasonable.<p>They also are huge for networking.
If seed VCs are upset about YC's terms, they could always start sourcing deals themselves instead of depending on YC and the like to derisk their investment decisions.
I don’t think it’s a monopoly as there are scads of other accelerators.<p>YC is neither the first nor the last, but as far as I can see it’s the only one have had any significant success (and I think it can quite reasonably claim to be successful).<p>They were always quite expensive, and, as the article says, now even more so. But I think for a lot of people it’s worth it. Not everyone, but many.
Why is it that we can freely swap what a consumer and producer are in this context? To say YC is a monopoly would be suggesting the capital to be a ‘product’ and the startup to be a ‘currency.’ While one could make an argument that they are similar to something more hotly debated as an actual monopoly (e.g. Facebook, Apple) in that they are a consumer of startup ownership (and even then, only partial as opposed to full acquisitions), they do not then use that purchase to potentially restrict _actual_ consumer choice down the line with their primary product.<p>Also, why does the author examine YC’s interactions with its own competitors in a vacuum? Isn’t the litmus test for an abusive monopoly to examine if its decisions and negatively effect its target consumer’s behavior? Of course a company may make decisions which harms its competitors, but does that decision then increase overall cost or reduce the potential choices a consumer can make, or does the decision benefit the consumer (as most business competition should)?
We keep hearing about YC network effect, but are we sure it is significant?<p>In France, there is a fund which is also doing seed index investing [1] they invest in 100 companies a year. But they are not an accelerator, just a fund, and they consistently get good IRR [2]. And they are as much known in the French ecosystem than YC is known in the American ecosystem.<p>Does anyone have an example of a seed index investing fund that failed ?<p>[1] <a href="https://www.kimaventures.com/" rel="nofollow">https://www.kimaventures.com/</a><p>[2] <a href="https://twitter.com/2lr/status/1479042875019173889" rel="nofollow">https://twitter.com/2lr/status/1479042875019173889</a>
> Their portfolio boasts over $400B in value<p>I don't understand - YC doesn't own these companies does it? They just have a minor 7% investment? So YC isn't worth $400B. What is it worth?
As much as I think Monopoly law needs to be expanded, there is no definition of anti trust law, that would apply to YC.<p>Anti trust law, requires pretty significant market power. And even in places like the EU, "significant" means at <i>least</i> above something like 20-30% of a market.<p>And there is no way that YC has anywhere close to that, in basically any market.
The problem is that founders without funding have very little support. I'm trying to change that at <a href="https://cxo.industries" rel="nofollow">https://cxo.industries</a>.
YC is a monopoly in the same way that Coca Cola is a Monopoly. And if you’ve ever been to a Taco Bell, Pizza Hut or KFC you’ll know exactly how much they are not.
nah. it's more like a new type of technology conglomerate where knowledge share and mutual support between projects still exists, but innovation murdering enterprise scale corporate bureaucracy problems have been minimized by reducing the depth and influence of the top-level holding company to an absolute minimum.<p>the only potential trust concerns would involve exclusive dealings between portfolio companies, but even that is a stretch.
Like Twitter redefined "disingenuous" to mean "disagrees with me", now "monopoly" is redefined to "successful thing I don't like".
> Betteridge's law of headlines is an adage that states: "Any headline that ends in a question mark can be answered by the word no."<p><a href="https://en.m.wikipedia.org/wiki/Betteridge%27s_law_of_headlines" rel="nofollow">https://en.m.wikipedia.org/wiki/Betteridge%27s_law_of_headli...</a>
> Any headline that ends in a question mark can be answered by the word no. [0]<p>I wonder if the author chose this headline on purpose. I doubt it.<p>[0] <a href="https://en.wikipedia.org/wiki/Betteridge%27s_law_of_headlines" rel="nofollow">https://en.wikipedia.org/wiki/Betteridge%27s_law_of_headline...</a>
According to 'Betteridge's Law of Headlines' any headline that ends with a question mark can be answered definitively with:<p><pre><code> No.</code></pre>