If you are scrappy, $20k can get you extremely far at a cost that is "basically" zero (1.5% stake that only converts upon a liquidity event of $100M+ or IPO).
Remember, PG "...started Viaweb with $10k..."[0] in 1995 and "Julian got 10% of Viaweb" for that investment. Viaweb sold to Yahoo! for $49M[1]. The whole reason why YC exists is because PG got a $10k investment!
Back in 2005, pre YC, PG started the Summer Founders Program and invested $20k in each group. "Another of our hypotheses was that you can start a startup on less money than most people think. Other investors were surprised to hear the most we gave any group was $20,000. But we knew it was possible to start on that little because we started Viaweb on $10,000."[2]
The first version of Viaweb.[3]
I keep finding examples of the seeds of YC and they get me really excited. You can see a photo from 2005 from the SFP and YC's roots here[4]
Consulting on the side isn't bootstrapping. Bootstrapping is funding your business development with revenue from that business. Bootstrapping a startup, keep in mind that a startup is a business designed to grow very fast, is very, very difficult, requiring a certain kind of consumer-facing business model.
Consulting on the side is a time sink that takes resources away from your enterprise. That's all but incompatible with growing fast.
There are plenty of other kinds of businesses you can bootstrap. But startups are particularly hard, which is why so many of them rely on venture funding.
It's quite common among self-funded companies in our industry to start out providing professional services, and immediately plow that money back into developing their first product. When the product starts bringing in revenue, the consulting side of the business can be safely closed.
So I'd argue that consulting on the side is bootstrapping for many founders; it's just one of the many ways to weather those first few months of product development and sales. Another way is to be independently wealthy enough to keep the lights on until the product starts selling.
Others - like YC applicants - spend time looking for outside money. There is no universally right answer for every business.
As a lifelong bootstrapper, bootstrapping seems to be generally self-funded. Which involves seeding some money yourself, often from another source, because it involves going from 0 to 1 with as little resources as possible and using income to grow the business.
In the early stages of bootstrapping the only goal is to nail down what customers will pay for. Spending as little as possible to reach such a lightbulb is bootstrapping in my experience.
It's easy to get distracted with too much free time and funding on one's hands, especially in the hands of an inexperienced founder with little to no business experience.
Bootstrapping also necessarily doesn't need to grow fast. YC itself also says to start small and get the business down before focusing on growth.
Lots of businesses are self-funded and start as a freelance -> part time -> full time.
Here's an article about how 98% of Canadians fund their startups. It's pretty funny considering how we think it's 98% not this way based on the marketing of the 2%.
Who said anything about consulting on the side? You invented this. I merely said that coming up with 20k was pretty trivial as a developer, often can be done in a few months (which the YC application process probably would take longer tbh).
> In the end, the pair remarkably sold more than $30,000 worth of themed cereal, nearly pulling themselves entirely out of debt. Chesky had to convince his mom at the time that he was still in the short-term rental business, and not running a cereal startup.
Many businesses will sell consulting services and a product, transitioning away from consulting if the product supplies regular income and is more time-effective to invest in.
That's still consulting on the side. It's just that now you have the whole business doing it. It brings in income but is ultimately just a distraction, because you don't want to be doing it for years.
I'm not sure if you've consulted on the side with a team that generates income. You get a team that can build and work together.
While helping customers solve problems in their industry, you are effectively paid to do market research to find the gaps and find a product need that the existing customers are willing to start paying for immediately.
The challenge can be is maintaining some sort of balance, but there is plenty to learn from in terms of market and product needs from consulting. I am a better product developer because of it.
?? Why not? If you can make money and help good people, what's the X-factor? Obviously I like investing in products, but I see it more as a way to keep utilization high without busywork.
Given, YC might not like it, but I bet they like the business going under a lot less.
I mean, if that's what you want to do, by all means. I'm not going to tell you how to live your life.
But it's not a startup.
> I bet they like the business going under a lot less.
You would be wrong. They would much rather see you shut down a company that fails to find traction and come up with a new idea and new team and get fresh funding than they would you tying yourself up for 10+ years in what they would term a lifestyle business. They didn't give you that money to sit on, they gave it to you to change the world.
What if you are not the consultant? Find a consultant, place him/her on a gig and charge the client a 20% markup. Place 5 consultants and you make 100% of a consultant salary with no time sink.
Unless you have some source of deal flow that they don't, why would a consultant work for you and take a 20% haircut to help you fund a company that they won't even get part of the upside for?
- you are only as good as the people you find. Or, you are as weak as your weakest person.
- hiring in any specialized field, including consulting can be difficult to scale into a large product, because 10x consultants seem to know what they're worth (and make it) a lot more than 10x developers.
- the overhead in managing 5 other people to do things also can add up.
The positive? If you do find a few of these people, all at the same time in life, and all available and interested, you can have some pretty remarkable progress and profit, where part time consultants get more done than full time folks.
Sure, but the 20K is there probably just to ensure you can work a couple weeks on developing a very early prototype with some friends without having to work during that time, specially if you are fresh out of college. The real reason to do a program like this is probably still the advise and the connections with potential early stage investors in case you do decide to keep the company running for longer than a quarter (and you are not the rare company that can be profitable in a few months). Essentially, if you don't need much money right this moment but already know you want to go the traditional VC-funded company route and want access to that sort of environment and business/legal/etc advise, this program is lightweight/flexible way to do that.
Also, I don't know if there are any geographic restrictions to this program, but 20K could keep a 3-4 people company alive for a year or more in many parts of the world. And saving that much would be non-trivial in those places.
There is also great talent everywhere who isn't always able to relocate. Not to mention locations where 20k can go extremely far, combined with great local talent. Looking forward to seeing if this program takes on more of an international flavor than perhaps originally anticipated.
Interesting choice on the equity side. If I'm reading this correctly, and YC gets 1.5% when the company IPOs or has a $100M or more funding event then, functionally, it's as if YC is taking much more than 1.5% now, because they're not taking on the dilution they would otherwise be as the company went through successive rounds of financing.
Right. All equity sold until this triggers takes a haircut.
This is especially weird if the 1.5% is taken post-money: companies will want to trigger the conversion as soon as they can reach the $100M valuation (or IPO in Canada even sooner).
Given the number of companies exit at 100m vs exit 1-99m is huge. They're taking a bet at the earliest possible time and are only making money in the case of extreme success.
It's a 75:1 return on investment for those that make it to a 100M exit. They just need to make sure that they can pick better than 1 in 75 to break even. If they can get 1 in 25 they'll get a 300% ROI. If they can get an exit within 5-10 years, then that's very competitive against other investments.
It is also just 1.5%. I doubt companies will try to game it, since the payoff simply wouldn't be great enough to warrant altering your fundraising schedule (not to mention the reputation risk).
If a company "graduates" from YC Fellowship to YC Core, will YC be taking the standard YC Core equity on top of the 1.5%, or will it be some different number?
That is a great question - my guess is that they will just revert to the standard YC Core terms, given that YC states in their Fellowship terms that they are hoping that Fellowship companies will then also go through the YC core program.
Put a different way, I am assuming that YC believes that a company that also goes through the core program would have a higher chance of success, so they would not want to provide a disincentive that would reduce the chance of a Fellowship company also going through YC core...
> Instead of taking our equity up front, we’re going to be issuing a convertible security that only converts into shares when the company 1) goes IPO or 2) has a funding event or acquisition that values the company at $100M or higher. [...] it’s both founder friendly [...]
Is it (founder friendly)? It places YC (even more) firmly on the VC side of the classic VC/founder conflict: VCs want founders to go big or go home, or as pg puts it "VCs want to blow you up, in one sense of the phrase or the other." [1] Not that I don't think YC can handle it, but still.
The money is effectively free for founders unless their company does incredibly well.
Also, at 1.5% equity and no effective shares till that valuation threshold, we don't have enough equity to force companies to do anything they don't want. That's also part of our philosophy anyway.
My wild speculation is that taking equity in exchange for the money simplifies legal and tax status for both parties by framing the relationship between the company and YC in a well precedented way. But I am neither lawyer nor accountant.
Anyway, my gut suggests that pressure cooking a company to go public or raise a big round for the sake of a possibility of $1.5 million probably isn't highly ranked among the ways YC can direct effort for return on capital. That YC won't have a stake in a $50 million dollar acquisition may indicate how pennies and nickels are seen by YC.
It strikes me more as just a protection against the case of a massive company being born in the fellowship.
If they just put the cash up for people to work on interesting things and it helps grow the YC network and feed some interesting companies into the YC Core program, then it's probably worth it without any equity compensation.
But that model wouldn't look so great if the next Google comes out of the program but doesn't do the YC Core program, resulting in a massive outcome that YC doesn't get to participate in.
This model supports the former and protects against the latter, in a way that seems really founder-friendly to me. Founders could take the money and build a small business, go to YC Core, give up altogether, or leave the YC ecosystem and build a massive company – and regardless which path they take, this capital won't cost them anything unless they build something massive.
At 1.5% ownership, YC has no say over the direction of the company (other than through the influence they have from being well-known and respected in the startup space). The conflict arises when your VCs sit on, or even control, your board. Then you, as the Founder/CEO, can be forced by your board in directions that you don't want to go. That situation simply does not exist here, with YC taking such a low ownership stake. Nor does it exist in the normal YC program, since again, they do not take board seats with their 7% stake.
> Then you, as the Founder/CEO, can be forced by your board in directions that you don't want to go.
In my experience that happens very rarely. If the board votes at all, and especially if in a direction that the CEO doesn't want to go, then it's usually a vote to dismiss the CEO.
But the people you surround yourself with (and their incentives) do matter. "Control" is a lot more subtle and social than you might expect.
Sure, the board may rarely actually hold a vote on a given direction, but their ability to vote to remove the CEO is a huge threat hanging over the CEO. If a majority of the board favors a certain direction, even if they don't hold a vote on it, that exerts enormous pressure on the CEO to follow that direction.
In that sense, we are saying the same thing. I agree that "control" does not require voting by the board. I do assert that investors with board seats exert far more control that those without, and investors with higher equity positions exert more control than those with less. I also assert that an equity stake of 1.5% exerts very little control. Again, YC exerts _influence_ (call it control if you want) simply because of their reputation for being good at what they do, but 1.5% ownership barely changes that equation.
I wonder if YC will see accept any companies/ideas that have a low probability of of reaching IPO / acquisition at >= $100M. Plenty of good companies aren't going to reach this scale but could certainly use their expertise and cash.
This is not something we actively try to predict, even with the Core program. Airbnb, for instance, would have been missed if we thought like this. As ever, we primarily optimize for funding great founders.
Really like this. If a great founder switches ideas while in their fellowship based on advice and market conversations, it seems like there would be no issue with doing so.
They are giving the companies 20k for 1.5% stake so they would make 1.5 mil when their investment pays off. 1.5 mill /20k = 1.3%. They only need 1.3% of the companies they invest in to pay off to make money so I think they will be fine investing in low probability companies. 1.3% is 1 out of 75.
So can we itemize the exact benefits of this type of deal versus taking a somewhat bigger stake up front? I can think of a couple:
1. In the case of a sub-$100M exit, where perhaps founders are getting squeezed, every little bit of extra equity counts. YC graciously forgoes their stake in the company. That's unquestionably good.
2. In the case of a big exit, YC essentially bypasses dilution and targets a fixed post-dilution equity stake, regardless of how much subsequent investment the company took on.
That lets founders retain more equity early on and thus be that much less diluted, while still getting YC ballpark what they'd like to get in the end. So that's nice.
But how might subsequent investors feel about YC getting the same fixed percentage of a IPO'ing Series B vs. Series E stage company? Could this possibly complicate funding down the line? Is it "too good" of a deal for YC in the Series E case?
(I admit the absolute amount here is fairly low, and YC is "special" in the industry. But I'd want to sketch out the consequences in detail before taking the deal.. someone "pays" for these founder and YC benefits.)
Another (scary?) thought: might more investors demand this sort of deal down the line? Would a seed or Series A or Series B investor ask for fixed percentages of IPO/acquisitions? I can't even fathom how that would scale or complicate taking on investors.. Does this only work of it's a special one-time thing?
As an occasional investor 1.5% dilution is nothing. I'd much rather invest in a company where YC gets 1.5% than one in which they are not involved. YC not being involved increases your chances of dumb stuff causing a 100% loss rather than 1.5%.
> But how might subsequent investors feel about YC getting the same fixed percentage of a IPO'ing Series B vs. Series E stage company? Could this possibly complicate funding down the line? Is it "too good" of a deal for YC in the Series E case?
They won't care. Basically all later investors have anti-dilution provisions, to they get exactly the same deal (though they have to pay for it, while YC gets it "for free") - put a different way, if the company is doing well (and they would have to be for potential $100M+ exits), all they care about is that they have a certain % of the company to make their economics work, so YC getting 1.5% of proceeds won't matter to them.
My guess is, the brand of YC on your startup will more than offset the complications these terms create. Being a YC company is a strong qualifier in this magical world of unicorns and angelic investment.
I'm fairly certain that there will be investors mimicking this deal structure, but whether there will be founders willing to take it is another question. Just because YC can get away with it doesn't mean Joe IPO can.
Can someone explain what are the differences between a YC Fellowship and a YC Core company? Is it metrics, how far they are along, founders, etc.?
Are there different things that YC looks for when evaluating a company for one vs another? What constitutes as a company being ready for YC Core? Thanks!
Ideas remain a multiplier on execution. This illustrates a different phenomenon we encountered: Founders with no ideas at all often fail to come up with a compelling one when prompted.
Or the more likely possibility that if you could not come up with a good idea in the years before entering YC you are unlikely to come up with one in a couple of months during YC.
My limited observation is there is little correlation between the quality of the idea and how hard a startup team works.
So I take it then that working remote with founders was actually much more successful than the folks at YC originally thought it would be? Because I remember sama saying that he was very skeptical the remote thing would work.
> Many people say we don’t need immigration reform because people can work remotely. While remote working works well for a lot of companies, and I expect it to continue to work better as time goes on, it doesn’t work well for all companies (for example, it would not work for YC), and it shouldn’t be the only option. It also sends money and competency out of our economy. The common answer of “let the US companies open overseas offices” always sounds to me like “further slow US economic growth and long-term viability”.
Despite what some confused people say, there's actually not enough seed funding. Many thousands more teams would try their hand at creating something, given the kind of help that successful startups have all required. Most would fail and try again. A few of them would change the world.
A team of skilled and committed people should not have difficulty raising $50k to work on something important. When the same team can easily get paid $500k+/yr working for existing companies, but can't raise seed funding, there's a big opportunity being missed.
The big shift in Silicon Valley will come when a firm decides to fund every worthy startup on their merits alone, doing away with the "culture fit" based screening process that everyone uses today.
Any top investor could raise a large fund and back every single worthy startup.
I agree that there is a big opportunity here but suspect long term this will be solved in a different way: more great benevolent former founder seed investors will emerge and more startups will be funded.
This is fantastic! In particular I think the remote aspect is one of it's greatest selling points. While I agree there's a certain upside to being based close to your investors, the upside of reduced living/travel costs makes this greatly accessible. The equity structure also seems greatly in line with some of the inherently low cost startups that this will bring to the table.
I'm excited to see what comes out of these early batches.
Playing devils advocate - how is this program supposed to be considered in context of "don't join an accelerator to get into YC"? From 1000 feet away it reads as "don't join another accelerator except for YC".
We're working to make the Fellowship program one that can stand on its own. It is not designed to be a feeder into YC. Many teams may decide to apply and it may make sense, but I will always advise companies to work to make their company great, not good enough to look good on a form.
This is just outside speculation, but I think it's consistent. I fully expect that if you go through YC Fellowship and make no meaningful progress (e.g. you were not accelerated), that would make it less likely for you to get into YC Core. Of course, this time YC has a financial/reputational incentive to help you make progress.
At least the ostensible point was that an accelerator that tells you it can help you get into YC is not telling the truth.
FWIW there's an incubator in my hometown that takes 0 equity that has had an amazing track record of getting companies into other accelerators (including YC) so I'm not sure it's universally true.
I'm also a single founder, but apply anyway. Are you averse to finding co-founders? I haven't found any yet, and I might or might not. I'm open to the possibility, and I believe YC may be a great place to make connections to finding a co-founder.
I usually have strong opinions on how to run things, and one of the main reasons I've been investing time, money and effort into building a prototype is precisely to be able to put my own ideas to test.
I've been in great and poor working relationships.
I've had co-workers who either don't add anything, or who actually reduce the amount of work or direction a project can progress.
I've also had (far fewer) working relationships where the you 'leap-frog' each other, pushing the entire project forward in leaps and bounds.
It's the second thing that I'm looking for in a co-founder. This is why I think being a part of yc or a fellowship might help. YC is apparently expert at picking great people, so it is a pre-filter of amazing people,who likely have a further network of amazing people. (not that my network isn't great, but most of my people don't share my interests).
It is also far more family friendly. It is almost impossible for someone with a family to do YC Core without substantial savings and financial stability.
YC Fellowship adds an additional stepping stone.
No idea if this was intentional, but it is very welcome either way.
No 2 businesses were built the exact same way and I think a program like this does open the door wider to those who may not be able to make the YC Core door.
$20k for 1.5% if the company ever IPO's or becomes more valuable than $100MM. I wonder what YC's normal stake is in a company after a company is valued at more than $100MM.
Awesome. At the super-early stage, 20kUSD can be huge boost compared to the amount of time/work/pain trying to secure similar funding from traditional institutions that don't understand startups at all.
Maybe someone will have time to update the fellowship page[1] with these new details, since they're quite different?
[1] https://fellowship.ycombinator.com
Is there any specific reason that there're not much YC companies working on gaming? I can only assume that the gaming startups maybe seen as less predictable than the tech ones, but seeing all entreprenourship and indie gaming booming and they're not meeting, makes me wonder.
My opinion is that nobody yet able to crack the gaming funding as YC did for tech startups.
Isn't it a very competitive market with low margins? Lots of companies already make games. It's well established. Maybe you have better insight on the market? Where are the $100 million to $1 billion dollar companies? What can be done differently? I know we had one big ipo last year. Don't most end up like Zynga?
You put it in a much better way :) As you said it's about investing in games, but expecting to create a financially successful game on the first try is kinda unrealistic.
So I think the better plan is to invest in a team that has a methodolgy to build games that have chance to be financially successfull, and let them build and test at least 5-6 games.
This is like a startup pivoting and trying to find the product market fit.
In gaming business this confirmation is quite straightforward, you do limited play testing for a prototype, and decide if you'll continue develop the game according to test results. If you do continue to develop, you release the game for soft launch with limited features and limited marketing budget. If the game has enough retention, you have a game that can become financially successfull. The studio follows this procedure and iterare till finds a game market fit :)
I think Zynga might not be a good example, in my opinion it's a company that doesn't care about their customers enough. Any company takes that road will face the similar results.
I'm not exactly sure if it's a market with low margins also, with mobile phones, cheaper PCs and more accessable consoles the gaming business is getting bigger. In every business there're big players, but look at SuperCell, in 3 years they were valued more than 4 Billion, actually SoftBank bouth 51% of Supercell for 2.1B. Wargaming, Riot Games are the other examples.
I think we still couldn't figure out how to iterate quickly and find winning games, like we did in lean startup model.
As an example you can manage to develop a game and do a soft launch to see the retention values for under 50K USD, talking about mobile games. So with a very basic calculation a small studio can iterate through 8-9 games with 500K USD investment, and I think optimizing these iterations are also possible.
This is amazing news! I was really worried about how the first run was going, because this format is just so great! It just makes sense. Kudos to all the teams for their performance, I am sure that had something to do with YC considering to do this again. I am super excited, and I really hope to apply this time.
Assuming one hit in the entire fellowship program, at which point:
1.5e6/2e4 = 75 fellowships
So each 100MM 'hit' funds 75 fellows. Would be hard to imagine they expect to do much better than that in terms of hit rate, so naively, the program seems to mostly be revenue neutral.
I was fully expecting the fellowship to eventually go down the path of equity but these terms sound far better than I would have expected. Nice job.
I'm curious how the option to choose what you're applying for will work out. What if someone selects just YC Core and, while reviewing, a reviewer thinks they would be a really, really good fit for fellowship instead? Do those simply get tossed out? Seems like if you're reviewing all of them anyway you could ask the applicate for their preference (so a slight rewording) and still talk to them if they're willing to do a fellowship instead of core, etc.
Likely we would still ask the team if they're interested in doing Fellowship -- it would definitely be better if they indicated it upfront though; there's no cost to applying to both.
> Likely we would still ask the team if they're interested in doing Fellowship
Good to know. I'd hate for someone to miss out because they hit the wrong option in the drop down (though I certainly agree you might as well apply to both).
I guess this is also the announcement that YC applications are open. Is this earlier than normal? I was preparing to fill out the application toward mid-March for the Summer YC batch, but stoked to learn about the fellowship which is a better fit for me at this stage.
Also good to see the 'thing you hacked' question had been removed, I never liked that one when I had applied in the past (it's been a few years though, so maybe that was removed a while ago).
How would the fellowship apply to hardware startups? I am a in the basement hacker working on my idea. Even with 20k, I can't quite my 9-5 job. I would think after I have finished the Fellowship( in parallel with my job) the idea would be flushed out enough that I would be more comfortable of going all in, e.g. committing into YC core. What about a longer time frame for these types of ideas? especially considering hardware lead times, etc.
Very excited to hear that YC is continuing the fellowship program and the changes they have made continue to remain founder friendly.
It would be interesting to see how this model involving remotely located teams and small amounts of funding is implemented/replicated by the other early stage accelerators.
Hmm! Thinking about this from a UX perspective, does it make sense for applicants to apply for YC core, but not for the fellowship. Is there an upside to that that makes sense or wouldn't it be better to put startups into fellowship by default if they are more suitable to that at that stage.
So excited to see another round of YC Fellowship! Excited to get a chance to apply, but more excited that this likely means that the Round 1 experiment has worked to a degree.
Will YC be publishing a copy of the convertible equity instrument? If not, can you tell us if it expected to be a SAFE, or will it take the form of a convertible note?
We're accepting applications from international teams and do not require incorporation. In the second batch, we have teams participating from the UK, Kenya, India, Ghana and Malaysia.
Teams have to incorporate, though they don't have to be incorporated yet to apply. There are a couple instances with F2 where we've allowed international teams to keep their pre-existing co structure, but it's still strongly preferred that teams are Delaware C Corporations.
The working remote idea is really good, since rent becomes a lot cheaper (SV is overpriced). Because of that, the $20k will last way longer for the teams!
As a practical experiment in Inequality, I invite YC to expand your incredible program into a third group : invite some college graduates from the poorest and most violent neighborhoods in america, fund them to work in small teams on their startup.
True, but they're not marketing to them. They're marketing to rich people, by using HN, the tech sphere, etc. If YC was interested in poor people they wouldn't do marketing the way they do.
They also gear the application to rich people by making it just a form on the Internet. That's perfect for people who have enough privilege to figure out what an application should look like but it doesn't work for people who don't yet know what to say to someone like YC, or that YC even exists. That suggests YC only wants applicants who are already connected to their social network, or have close cultural ties to the YC community.
Of course a poor person could technically apply. YC just isn't doing the work to make that probable. It's the difference between mechanical possibility and psycho-social possibility.
Young poor people have access to the Internet, with that they also would have access to YC; even a lot of homeless people have Internet access.
The only poor people without Internet access are poor, older people, which is due to a combination of ignorance and indifference.
> YC just isn't doing the work to make that probable.
I could be wrong but regardless of background, YC is looking for people who overcome obstacles. Internet access in the 1st world is one of the easier obstacles to overcome.
I'm not talking about Internet access. You can get that for free at the library. I'm talking about cultural knowledge and norms required to become aware of, and then signal competency to, YC.
> cultural knowledge and norms required to become aware of, and then signal competency to, YC.
If the core problem is the poor's lack of skill in signally competency, how would it matter if the application was online or not (e.g. a mail in form)?
I feel that YC programs that target specific minorities also already try to account for this issue in an efficient way, though I may wrong.
I wonder that even if these (talented but poor) people have internet access, they just wouldn't be thinking of even looking for these kinds of opportunities - I assume they would be spending all their time hunting for more traditional jobs.
no, no I didnt mean they were excluding them - I just assume that those people are not spending their time on HN, and are unaware of YC [ and other funding / investment / scholarships generally ] due to their surrounding environment.
If you are scrappy, $20k can get you extremely far at a cost that is "basically" zero (1.5% stake that only converts upon a liquidity event of $100M+ or IPO).
Remember, PG "...started Viaweb with $10k..."[0] in 1995 and "Julian got 10% of Viaweb" for that investment. Viaweb sold to Yahoo! for $49M[1]. The whole reason why YC exists is because PG got a $10k investment!
Back in 2005, pre YC, PG started the Summer Founders Program and invested $20k in each group. "Another of our hypotheses was that you can start a startup on less money than most people think. Other investors were surprised to hear the most we gave any group was $20,000. But we knew it was possible to start on that little because we started Viaweb on $10,000."[2]
The first version of Viaweb.[3]
I keep finding examples of the seeds of YC and they get me really excited. You can see a photo from 2005 from the SFP and YC's roots here[4]
[0] http://old.ycombinator.com/start.html
[1] https://en.wikipedia.org/wiki/Viaweb
[2] http://paulgraham.com/sfp.html
[3] http://web.archive.org/web/19961120231442/http://www.viaweb....
[4] http://ep.yimg.com/ty/cdn/paulgraham/sfptable.jpg