

Ask YC/PG: Quantitative success of YC so far? - ryanwaggoner

The story on Fool.com about YC being a force to be reckoned with got me thinking about whether the data backs that up.  I'm not disagreeing, just curious.  YC has funded a lot of startups and it would be interesting to know roughly what percentage have failed, become profitable, exited, etc.  How does this compare to other venture portfolios?  If it's still too early to tell, at what point will you have enough data to know if you're earning an acceptable return?<p>Perhaps this data is already available somewhere?<p>PS - One of the things about the article that bugged me is that they seemed to equate $$ raised with success.  That's not really what I'm looking for.
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fallentimes
Obviously PG knows better than me, but I think it's still too early to tell
given that most funding cycles are 7-10 years.

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pg
Yes. We have no idea yet what the returns might be. Quite a lot of the
startups we've invested in are doing well, but I've never even tried to
estimate what our shares in them are worth.

We'll start to have some idea how we're doing financially in around 2012. I
feel optimistic we'll make money, but I never think about it. I just focus on
the individual startups.

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ivankirigin
I surprised you aren't using any monetary metrics to quantitatively track
investments. Wouldn't that be a good corrective tool to feed back into the
criteria you use to judge potential investments?

Or do you get enough qualitative information to integrate into better judgment
and intuition about startups?

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abossy
At Startup School in April 2008, PG cited a '50% success rate.' The full video
of his talk is located here: [http://omnisio.com/startupschool08/paul-graham-
at-startup-sc...](http://omnisio.com/startupschool08/paul-graham-at-startup-
school-08)

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knightinblue
What exactly constitutes 'success' tho?

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SwellJoe
He defined it during that talk as, "the founders are now 'rich', by some
definition of 'rich'". Meaning, I think, that 50% of those folks, once vested
in their respective acquiring companies, wouldn't actually have to work if
they didn't want to.

Note, though, that the first batch was an outlier. No other batch has produced
that many exits that fast. One could easily argue that ambition and dedication
to being in it for the long haul is higher amongst more recent founders,
however, and a low digit millions acquisition isn't as attractive.

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veemjeem
$$ raised is a success in a way. I'm sure most people think Facebook has
succeeded, but they're a long ways off from paying back their investors.

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frisco
Facebook is the 5th most populous country in the world. That's more of where
its "common knowledge success" comes from given where it is now, as opposed to
venture raised.

Reference: <http://en.wikipedia.org/wiki/List_of_countries_by_population>

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quizbiz
I think it's worth asking those that have went through the program as well.
Lessons learned go way beyond "$$".

