

Y Combinator Startups Now Have A Combined Valuation Of $13.7 Billion - rdin
http://techcrunch.com/2013/10/25/y-combinator-13-7b-valuation/

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codex
And Sequoia backed startups now have a combined valuation of almost a
trillion. These statistics are a bit meaningless. I'll wager that the median
YC company has a negative opportunity cost for the founders.

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reitzensteinm
You complain about meaningless statistics and in the next breath introduce one
of your own.

The median outcome of asking someone out, applying for a job, learning an
instrument, starting a side project, writing a novel, picking up a sport,
learning a language and any other of the thousands of things that make life
interesting are all negative.

You fail, yielding zero value, and you could have done something safer with
your time instead. But that's not a reason to not take chances.

If your startup fails, you can always go back to that cushy job at Microsoft.
You're out 6-12 months - who cares?

Do you believe that the median YC graduate regrets their decision to enter the
program?

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replicatorblog
It's a great headline for TC, but looking at the numbers from a slightly
different perspective it wouldn't be hard to make a negative case either.
Airbnb+Dropbox probably account for at least $8 billion, perhaps more. Figure
that another 10 companies probably have Heroku-sized valuations and you're
close to $11 billion. Now you're down to $2.7 billion spread among 500 or so
companies. In any case, YC is in great shape, but don't be surprised if you
see headlines equating YC founders to share croppers if YC is ever perceived
to stumble.

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ajiang
Holy negativity. Why is the overall sentiment of the comment pool so cranky
and skeptical?

1) YC startups have a combined valuation of $13.7B. Fact - groups of investors
have valued YC startups individually, and in aggregate the current known
valuation of the collective is $13.7B.

Does that number mean that much by itself? Perhaps not. Let's see what else we
know.

2) That valuation has grown by $2B since June. Also fact. And pretty
incredible, that's a 17% growth on valuation in 4-5 months.

Without making any comments on whether or not YC's success rate is
higher/lower than average and whether or not YC is a benefit to the
entrepreneurs it invests in (there's no data presented here to make that
assessment, but I'm sure it wouldn't be hard to do), what YC has done in a
short amount of time in helping build a tremendous amount of value in its
companies is noteworthy - and that's what I take away from this article.

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will_brown
These statistics are very meaningful because of YC's transparency. The math is
simple: YC has invested in 511 companies, this calculation uses an investment
of $18,000 (the max YC investment) per company, equaling $9,198,000 total YC
investment. YC investment results in an average of 6% ownership, 6% of $13.7B
is $822,000,000. That ROI is phenomenal.

I personally believe YC is in a more enviable than Sequoia. Further, YC or at
least the partners are in a position to participate in future rounds of
funding for the YC companies, of course they will likely be paying a lot more
for a lot less at that point...just like Sequoia.

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mariozivic
"YC investment results in an average of 6% ownership, 6% of $13.7B is
$822,000,000." \- this statement is not actually correct. YC ownership
averages 6% at the time when YC enters but that doesn't mean that YC gets 6%
of $13.7B. Companies contributing most of these $13.7B have probably gone
through additional financing rounds diluting YC's stake. But even if YC is
diluted 10x, it's still remarkable ROI.

~~~
will_brown
Confirmed YC ownership is subject to dilution. I appreciate your tact in
pointing out my error.

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markm248
And combined revenues of???

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icedchai
better yet, combined profit?

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ximeng
See
[https://news.ycombinator.com/item?id=5798512](https://news.ycombinator.com/item?id=5798512)
for previous discussion on a related article.

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confluence
The real question is how much of that is actually real?

Any VC can buy 10% of a company for $10 million. Doesn't mean that it's worth
$100 million.

Valuations are usually complete bullshit. I wouldn't rely on their proxy.
They're just another example of the anchoring bias.

~~~
terryjsmith
I would argue that they're definitely made up, but not completely bullshit.
It's a yardstick for a sale price: if the investors need to get out at least
X, then that's a good starting place to start shopping the company around. If
the entrepreneur is forward thinking it also means they know they need to find
a way to get annual revenues up to $Y to justify the investment and give back
any semblance of a return. So not a great judge of a company's "worth", but
outside of revenue, probably the best thing we have.

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ck2
There should be a YC startup stock exchange, even if it was with virtual
money, just to see what happens.

~~~
orenbarzilai
Not only YC, but still: secondmarket.com

