a few years ago, switching to android would have been unthinkable for me. preposterous.
now? I am so annoyed by my iphones persistent buggy problems performing normal phone-like operations (texting, typing) that I will probably switch. ugh.
few other anecdotal observations:
their genius bar reservation web page literally redirects to an error page half the time! and not like a "planned" error page with a cute whale or something, but one with weird server logs that obviously are not meant for the end user
half the time i try to use the app store or sync apple ID I get an inscrutable error
i'm not sure if I gave up on apple, or they gave up on me! end rant
as someone that does not live in SF, it is mind boggling that a city with such a high concentration of wealth, talent (both technical and non-technical) and visionaries supposedly (not trying to be trite) trying to make the world a better place have arguably failed miserably to make their own city a better place... Silicon Valley's PeaceFair parody seems to ring true here
i don't think i'm explaining this well. I apologize for that.
i looked at your company. you and your cofounder had deep technical expertise in an area that was white-hot at the time (obviously not a perfect comp, but that was the year zynga ipo'ed on the strength of mobile gaming). so i am not surprised at all that you got into YC without any connections. im sure there are many deeply technical founders in "hot" areas such as AI, robotics, etc that are currently getting into YC without connections.
note: again, not a perfect comp, but they probably looked at you and thought that this has dropbox-like potential. also, perhaps you will disagree that the space was "white hot" based on your own personal experiences -- my rebuttal to this would be YC was probably ahead of the curve, as it usually is, as that space definitely became white hot if not around that time period, then shortly thereafter.
my point is that there are thousands of founders that apply every year to YC, who do not have PMF, prior exits, or obviously industry/technical knowledge in "hot" areas -- out of these folks, the ones that get in, i am guessing, had really good connections.
i honestly don't think i'm saying anything that outlandish. VCs don't even try to hide that you need to be connected with a "warm" intro to get their attention -- they make that publicly known. while there are always exceptions such as you and your cofounder, i don't think YC (which is for intents and purposes a VC with a better business model, a 3 month founder bootcamp, and afaict no LPs) is any different.
i agree wholeheartedly that PMF, prior exit and deep industry/technical knowledge are pretty obvious things to look for when you're trying to make money as a venture investor.
let me try another way. let's say YC gets 20K applications. let's say 1K (using round numbers) fall into the above categories (PMF et al), and 19K do not.
of the 19k that do not, my guess is that of the ones (ie. the very, very lucky few of the 19K) that do actually get into YC, a high (statistically significant) proportion of those founders were very well connected. that's all i'm saying.
as for your last point, i think we can both agree that we're both just guessing, there's no real #s or transparency to prove or disprove, so maybe we can just agree to disagree.
edit: maybe "elitist" was the wrong word to use. OTOH, YC is widely considered the "harvard of accelerators". while that has many connotations, it would be silly to say that harvard and elitism are not associated
nwenzel: i actually thought about covering your case (see below), but decided it was too verbose.
edited: yc is elitist. with a few exceptions (you have PMF, second-time founder with exit under belt, obvious deep industry/technical knowledge), you have to know someone
in other words, there are a few types of founders (as listed above) that it's either a no-brainer, or a very good risk-reward/expected value proposition to fund under YC terms (ie. 2m pre-money). for everyone else, anecdotally, you have to know someone
also, i mean this respectfully, but one counterexample doesn't disprove my point. my belief is that we live in a world where connections matter, a lot (whether getting a job, into business school, VC funding, a coveted internship, etc), and that YC is no different. there are always exceptions, of course, but i'm saying this, as a generalization.
Kudos:
afaict, yc is a "good actor" in contrast to "bad actor" VCs that have received recent notoriety
yc does its part in putting out knowledge into the world re: how to build startups (cynically, this is to promote brand, PR)
yc funds non-profits
yc promotes diversity esp relative to its SV peers
Criticism:
yc is elitist. with a few exceptions (you have PMF), you have to know someone
yc is incredible for the 1% that get in, to the detriment (broadly) of the 99% that don't. they get a disproportionate amount of attention, capital and support
yc is a VC firm (+bootcamp), but with a vastly superior economic model, which is pretty incredible given how good VC economics are
the part about it not being about the money rings hollow. my guess is it's 90-95% about the money. YC partners have made hundreds of millions (in the future, YC will probably mint a few billionaires) of dollars. every batch, 7% of the equity of 100-150 "cream of the crop" startups goes to a handful of partners. if YC's primary goal was social impact, the batch would look a lot different -- not saying yc doesn't do good, but i think a typical VC is at least straightforward that their goal, and fiduciary responsibility is to make $. i think YC sugarcoats this for branding purposes when they de-emphasize this.
the narrative around SV has really taken a turn for the worse. income inequality is a real problem, and also getting worse. one could easily argue SV is exacerbating this, and YC is a factory of many of the startups causing this. the future is already here, it's just unevenly distributed
i don't have a dog in the fight, but I think the answer to this:
"Are we trying to put corner stores out of business?"
Was extremely unconvincing. The only thing I saw in your answer was that you're not competing head to head with bodegas (presumably due to the geographical location of your current machines).
I am willing to bet that in your pitchdeck to investors, in your TAM section, that you listed the size of the "bodega" market -- the obvious implication being that that is your ultimate target market. In fact, I will donate $50 to a charity of your choosing, all you have to do is comment that I am wrong and I will take it at face value.
However, even if I am wrong about the pitch deck assumption, the fact that you raised $2.5M, and will presumably raise more $ if you are successful, almost certainly dictates that you will eventually compete head to head with bodegas, and that if you are successful, you will put some of these people out of business (ie. not to state the obvious, but in order to generate a 10x return for your investors, you will have to expand and compete with the existing bodegas eventually).
I'm not someone that thinks you can put your head in the sand and technological progress will stop, and everything will be utopia. But I also think it does a disservice when you pretend like technological progress won't have winners and losers -- in your case, if you win, someone else will lose.
You saying your not competing with bodegas is like Airbnb saying it's not competing with hotels. Airbnb is obviously competing with hotels, the only difference is that its a lot more socially acceptable for them than for you, but it doesn't change the reality.
I'm not a fan of YC (I find it elitist, and imo they crowd out the 99.5% of startups that get rejected), but I can't find fault with the SAFE as an instrument.
To the extent that founders suffer too much dilution while raising via a SAFE, it's more likely the case that there was something not working with the business.
Sure, if the founders could have raised a priced equity round from the get-go, they probably should have done that over a SAFE, but more likely the legal expenses would have been too onerous for that to have been an option...
now? I am so annoyed by my iphones persistent buggy problems performing normal phone-like operations (texting, typing) that I will probably switch. ugh.
few other anecdotal observations: their genius bar reservation web page literally redirects to an error page half the time! and not like a "planned" error page with a cute whale or something, but one with weird server logs that obviously are not meant for the end user
half the time i try to use the app store or sync apple ID I get an inscrutable error
i'm not sure if I gave up on apple, or they gave up on me! end rant