

Are Y Combinator startups less Ambitious? - kuldeep_kap

I want to put a decent entrepreneurial argument. We have seen many Y Combinator startups up till now and I think many had great potential and could have expanded their business and user base to match with the titans.<p>Why we didn't see next facebook or Digg beaters(in terms of size)? I think only Scribd, Loopt and Reddit have gone so far and they had much more potential to go further considering their business models ... or I am being a jerk? Of course I don't know the complete picture and it's too early to tell this, but I would like you to give a different dimension to this argument and tell us your opinion.
======
pchristensen
Sounds like a reasonable question, with a perfectly logical explanation. A
reasonable (if misguided) question.

Huge companies with huge success are _very uncommon_ \- that's why we can list
them off the top of our heads. YC invests in a lot of companies, but not many
in terms of the total number of startups in the world. So lets say that out of
10,000 startups, 1 gets huge (Google, Facebook, etc), 9 get big (Digg-sized).
That's 1 in 1000. YC has invested in ~80 startups (call it 100 for easy math
sake), which is 1% of the "market". 100 tries at 1 in 10,000 isn't great. Even
if you say that YC companies are 10x more likely to succeed (not unreasonable
given the training, motivation, selection bias, etc), 100 shots at 1 in 1,000
still isn't that good.

Becoming huge requires a lot of things - including luck and timing. No matter
how much value YC adds, it can't add those two things. What it can do is
increase 1) the odds of success and 2) the expected value of that success
(0.1% chance of $1B, 99.9% chance of $0 isn't very appealing).

I think pg's goal isn't to create billionaires (although he wouldn't mind).
His goal is to help smart hackers solve "the money problem" so they can have
the freedom to pursue other productive pursuits they wish. Look at what he,
rtm, and tlb have done since they sold Viaweb (Arc, YC, HN, Harvard prof,
awesome homemade robots). None of that would have been done if they were
working at Google for $110K/yr.

Trying to solve "the money problem" in a couple years shows an _excess_ of
ambition, especially since programmers earn decent coin in the corporate
world.

~~~
dennykmiu
So basically YC is in the "micro-loan" business???

If so, then I think the original premise of the comment is valid and
interesting ... that "YC startups are less ambitious (perhaps by design)".

~~~
pchristensen
No, more like realistic. It's like how every kid wants to be an astronaut, but
there are only 100 in the world. Or how every actor wants to be the next Brad
Pitt but very few actors (dozens ever?) achieve that level of success.
Creating a billion dollar, public company from scratch is something very, very
few people have ever done. Getting rich (single or double digit millions) has
been done millions of times and so although difficult, is a reasonable goal to
pursue.

And the $$ is probably the least useful thing YC provides. If I had to guess,
I'd say the most useful things they provide are (in this order):

(actually turned into its own post:

<http://news.ycombinator.com/item?id=147984>

~~~
dennykmiu
By the way, I am very supportive of YC and I am in awe of what is being done
within this community. But I can't help but to make the connection. As it
turns out, money is also the least useful commodity that the Microloan
Foundation provides. The following is out of their mission statement ...

"We provide ... basic business training and continuing guidance ... enables
them to develop self-sustainable livelihoods ..."

<http://www.microloanfoundation.org.uk/about_us.asp>

~~~
pchristensen
Well, add connections to the right people and that's about right then.
Although the goal is a little higher than sustainable livelihoods.

~~~
dennykmiu
Thanks for tolerating my twisted sense of humor.

------
SwellJoe
It's early yet. There are many YC companies building their business, and right
on schedule for where they want to go. A large business takes several years to
build. Some YC founders opted to go the faster path and sell early. They're
not wrong for doing so. They're richer than the rest of us now, and have fat
jobs at Google, Facebook, Conde Nast, etc. In a couple of years, they'll all
be vested, and have a ton of cash. They can shoot for bigger success, or they
can lounge around eating bon bons all day.

I'd say the level of ambition and the level of success is quite high with
current YC companies. It's interesting how your assumption seems based on the
notion that having YC backing makes success automatic, and all these guys need
to do is be more ambitious and stick with it longer and they could all build
the next Google, or even Digg. As pchristensen pointed out, the math doesn't
back this idea at all. YC is a great benefit--it brings additional media, a
lot of great guidance, and a lot of peers that you can lean on and ask for
help from--but it's not going to make building a business magically easy, if
you just have enough ambition.

------
hooande
Saying that YC companies are less ambitious is like saying that an 18 yr old
lacks ambition because he wants to go to college instead of trying to get a
job as the CEO of IBM.

You go to YC to learn and to meet people. Generally our ideas aren't world
shaking, but there is a reason for that. We're generally young and still
trying to learn and gain experience. You wouldn't expect a YC startup to be a
magic AI that can solve the world's problems. If you can do that...why would
you need to go to YC? There is a different between a lack of ambition and a
desire to learn.

------
ambition
There's plenty of me to go around.

[Sorry!]

Today's billion-dollar markets are not tomorrow's billion-dollar markets.
Building a better Digg or Facebook today won't help you kill those companies.
First, it would need to be an order of magnitude better to convince anyone to
switch. Second, your innovation would need to be hard to duplicate. You might
stand a chance if you found some way of positioning a startup for people who
don't currently use the existing services, but that's a hard problem.

Predicting tomorrow's big markets is a harder problem. The existing big
companies go after the big predictable opportunities with vigour and vast
resources, leaving us to chase the unpredictable opportunities. Thus, we can't
consciously chase the billion-dollar opportunities because we can only guess
at their nature.

~~~
brentr
Why worry about predicting what the next major company will be? You are
focusing on the wrong issue.

The thing you should be trying to identify is what are the major companies of
today not doing quite right or not doing at all.

While there are a few examples of billion dollar companies being built upon
already existing ideas, the market awards billions of dollars to those who
destroy the reliance upon already existing technology.

A company that radically changes the way people do things for the better has a
much higher probability of attaining billions in market cap than a company
that comes along an provides perhaps a better user interface to an already
existing service.

------
raghus
I think you might be mistaking a lack of blockbuster success (so far) for a
lack of ambition. Sometimes success is what makes the company or person look
ambitious after the fact.

If Google had not succeeded, it would be easy to say that they lacked ambition
- they just tried a me-too search engine when Yahoo! and AltaVista were the
titans. But Google caught fire and now, we all think they were audacious and
ambitious to try what they did.

Ambition alone does not guarantee success: sort of a necessary-but-not-
sufficient ingredient.

------
edw519
So last month you had sex with your girlfriend 9 times. Where's the baby?

Same argument. No lack of ambition. Just give it time.

~~~
kirubakaran
I guess the poster is asking if the metaphorical boyfriend is wearing a
metaphorical condom.

~~~
Shooter
Bravo!

------
startingup
Ambition can and does expand with time, so you have to give it time. Microsoft
is a classic example. It started off with an interpreter for BASIC. No one
could have said within 20 years later that company would reach the very top of
the IT industry.

When I started out, my first objective was to put food on the table, be self-
sufficient. I have grown a _bit_ more ambitious since ... :-)

------
rokhayakebe
YC startups are like Moroccan restaurants. it is a four course meal and i
takes 4 hours to eat diner. they start small, but by the time they serve the
entree you have been prepared enough to know how to eat it right. (EDIT: plus
throw in the belly dancers) If you have been following the YC startups you
will surely get that what you see at launch is not what you get 9 months
later. Just take a look at justin.tv. certainly when it launched you could be
like wtf is them dudes thinking. why would i want to watch his life live when
i got my own to worry about. off course a few months later you when they
launch the live video streaming platform, you say "oops, i did not see that
one coming" then they assault you every week with new features including
mobile streaming then you are like "ok these guys saw something n months ago
that i am just seeing now".

~~~
kuldeep_kap
yeah, I almost forgot justin.tv, they too had quite a success.

------
ivankirigin
YouTube is the only company in recent memory that got huge in the lifespan of
the oldest YC companies. Many companies can grow beyond what you initially
see, so I would call your estimate of 3 potential huge companies a lowball.

------
ideas101
i won't say the startup are less ambitious because i think almost all of them
wants to reach the level of success of google/facebook , but then it is all
about your idea/product, team, execution, timing, funding, luck, mentoring,
etc.

Also YCombinator is a king-maker but not every king can have huge empire and
not everyone can become Alexander, though everyone would like to become one,
but then they all have some kind of limitations which is sometimes is out of
your control.

------
jsjenkins168
This is a rather unfounded claim without any data. Seems like a troll post.

------
tej
Yeah, certainly this is a troll post. I have been analyzing certain posts on
various sites ever since I read that article by Paul. This one certainly
doesn't have any base or any analytical data to question Y Combinator
startups. This guy surely looks forward to pull unnecessary attention to his
post.

~~~
e1ven
I certainly wouldn't go so far as to label it a troll post at all- Keep in
mind, PG et all encourage apps that are intentionally small in scope, such
that they have a reasonable change of being finished in a 3 month cruch-and-
run marathon.

There are a lot of great apps which fit this model, but they DO tend to be
smaller in scope- The constraints of the model force uses to focus on their
core feature offering, rather than adding everything under the sun, to appeal
to as many users as humanly possible.

~~~
attack
The examples, facebook and digg, had a much smaller scope when they started
than many YC startups have...

~~~
sujaymahajan
Yes, I think initial scope is less of a concern, the way it evolves with time
and adapt to user need is very much important for the success.

