
Ask PG: Will the Yuri Milner deal affect which startups YC accepts? - il
One thing that hasn't been mentioned much is that, after making such a significant financial commitment, Yuri Milner/DST will probably have some say in who gets picked for YC. Does this mean that the next batch of YC startups will be more closely aligned with those investors' goals? For example, DST has pledged to invest heavily in social media. Does that lead to more social startups in the next batch? Would YC still fund, say, a hardware or enterprise software startup?
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pg
No, of course not.

I don't know if people realize this, but there is no actual deal between
Ron/Yuri and YC. The deals are between them and the startups. We liked their
plan of investing in all the startups, so we called a meeting for them to
present it. But we don't have any control over which investments the startups
accept. Anyone who wanted to do what Ron and Yuri have done could have done it
at any time, whether YC liked the idea or not, simply by making the offer
publicly.

While we're on the subject, Sequoia, which we do have a deal with (they're our
biggest LP), also doesn't have any effect on the startups we pick.

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HackrNwsDesignr
What does "LP" mean? Does that mean an investment deal or advising deal?

How do you guys manage 40 startups in one batch? I am quite excited to read
about them when they launch.

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davidu
LP == Limited Partner (<http://en.wikipedia.org/wiki/Limited_partnership>)

LPs are basically the investors in YC who remain mostly silent as to the
operations of the firm. They participate in the proceeds and receive limited
liability from the affairs of the business. Sequoia invested in YC, just as YC
invests in startups.

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lacker
It will probably change who _applies_ more than it will change who gets
accepted. A lot of people reason that YCombinator is 6% of your company for
~$20k, are discouraged by the implicit valuation, assume (incorrectly) that
the other parts of it probably aren't worth very much, and discard the idea of
applying to YCombinator. This deal makes it obvious there's more value than
the initial investment and makes application more compelling.

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redthrowaway
pg, you've mentioned that you're happy with the development and think it's a
boon for YC companies. Did Milner/DST approach you before hand to gauge your
interest, or did they essentially do this independently?

