

Ask HN: What % of Y Comb startups either become profitable or successfully exit? - combinatrix

Long time HN'er using a throwaway account.<p>Basically, I want to know: What are the chances of a startup's chances of making it big after going through the program?<p>I realize it's vague but any facts or figures would be very helpful.
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pg
We don't know ourselves yet, because it takes so long for startups to exit.
But we have a decent idea how many are successful at the next stage after YC--
the number who are either able to raise more after YC, or don't need to
because they're profitable (or in very rare cases acquired). I think for the
winter 2010 batch the percentage was in the low to mid 80s.

Incidentally, I wouldn't want it to be much higher. If it was 100%, it would
mean we were picking too conservatively.

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tptacek
Isn't 80% already a warning signal? Do you think you turn teams down because
their ideas are too ambitious? Or that you tend to talk them down from crazily
ambitious concepts?

(Don't get me wrong, the number of business you get on their feet is one of
the things I admire about YC.)

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Bitmobrich
80% is a really high rate. About 51% of new business started will make if five
years or more. <http://web.sba.gov/faqs/faqIndexAll.cfm?areaid=24>

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byoung2
Tech startups are a special breed of company in that they are very inexpensive
to start (sometimes all you need is a laptop, a server, and an internet
connection), they can run leaner than other types of businesses (ramen,
hosting, and lots of Mountain Dew), and they can scale very easily from a
handful to hundreds of thousands or millions of customers (open source and
Amazon AWS).

Contrast that with other business types included in those SBA figures, like
restaurants and liquor stores. Those businesses start out in debt because of
leasing costs, equipment purchase, payroll, licensing, insurance, etc. It is
also much harder to scale a restaurant than a website or app (because of
geography).

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_delirium
The ready availability of funding plays a role as well. The 80% figure isn't
for startups that actually achieved profitability, but for startups that
achieved more funding. VCs aren't as willing to fund unprofitable restaurants.

Whether that's due to real promise of future profitability, versus a funding
bubble, is something to judge in hindsight. ;-)

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webwright
One thing that isn't often mention is this: the average time to liquidity for
a venture backed startup is just north of 7 years [edit: make that 8.7 years].

The first "class" was 6/2005: Reddit (made it pretty big) Infogami (joined
reddit, "made it big") Kiko (sold for ~$250k, started Justin.tv - likely to
make it big) Loopt (well-funded, great traction, seems likely to make it
pretty big) ClickFacts Firecrawl (one founder joined TextPayMe, another YC
company that sold to Amazon) Simmery (one founder joined Reddit and presumably
made it sorta big) Memamp

\--> That's 50-75% seeming to have a pretty good shot at making it somewhat
big.

You can head to:
[http://spreadsheets.google.com/ccc?key=0AkkhSN3vaY4jdF90b1l1...](http://spreadsheets.google.com/ccc?key=0AkkhSN3vaY4jdF90b1l1Vnl5NmZjaTBNQWlJYVozMEE&hl=en#)

and do your own math, but it's pretty premature for most of the classes.

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points
Surely that first class will have a disproportionate amount of success
compared with further years though.

It's like the first season of American Idol produces the most successful
winner...

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mlinsey
I would expect the exact opposite. In 2005 many were skeptical of the whole YC
model, and consequently would have had a much more difficult time attracting
investors and already-successful startups. The first demo day was twelve
investors, mostly PG's friends; the S10 demo day was a three-day affair with
over 350 investors and members of the press. The current batch also was able
to attract some startups which already had launched and had good traction
before YC even started; these startups probably would not have applied to the
first couple YC batches because it was not yet clear just how advantageous YC
was even for startups which could raise at higher valuations.

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sgk284
Not sure about YCombinator, but TechStars is very open with their results.

You can read up on them here: <http://www.techstars.org/results/>

I suspect YCombinator's are similar to those.

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byoung2
It's too soon to say for most startups in the recent classes. From earlier
rounds, there have been successful exits like AppJet, ReMail, Reddit, Omnisio,
Zenter, as well as startups that appear to be thriving like Loopt, Justin.tv,
Weebly, Scribd, AirBnb, Xobni...too many to count. YC started in 2005, and it
can take 5 years sometimes to see if a startup is successful, so we'll have to
wait and see who makes it big over the next few years.

Judging by the success we've seen so far, it looks like YC is getting better
and better each year. We'll see a few solid exits per class in the years to
come, and I'll bet it won't be long before we see a massive acquisition on the
scale of YouTube which will really catapult YC into the spotlight (what's 6%
of $1.65 billion?)

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dtby
_We'll see a few solid exits per class in the years to come_

It's patently impossible to know this.

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byoung2
True, hence the qualification "judging by the success we've seen so far" at
the beginning of the paragraph. Based on what we've been seeing so far, and
since the classes appear to be getting both stronger and larger, it's
reasonable to expect this success to continue in the future. Even more so as
the economy gets better.

Do you really think that out of 25-35 per class we won't see at least 2-3 who
successfully exit or become profitable within 5+ years? If the YC team didn't
expect as much, they wouldn't doing this anymore.

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dzlobin
[https://spreadsheets.google.com/ccc?key=0AkkhSN3vaY4jdF90b1l...](https://spreadsheets.google.com/ccc?key=0AkkhSN3vaY4jdF90b1l1Vnl5NmZjaTBNQWlJYVozMEE&hl=en#gid=20)

Here is a spreadsheet someone put together with most (all?) of the incubators
and the status of their companies.

edit: someone beat me to it :-(

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darwinGod
I think about 90/140 startups are still alive, read this on some thread at HN.

Dont know about exits though

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sabj
I'd be interested to know stats about the impact of Y Combinator on companies
with a nice control setup. Revealed preference: people who get in, but choose
not to go to Y Combinator, vs. those who do... or something like that.

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paolomaffei
Why a throwaway?

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jacquesm
Throwaways are the HN equivalent of an AC. The difference with 'elsewhere' is
that they usually contribute and are only used for that one article rather
than to hide in a sea of anonymous users all wearing the same identity.

