Y Combinator Winter 2023 Application

 

Automated Transcription

Hello Hello, Tyler Bryden here. Hope everything’s going well. It’s interesting time of the year. If you’re a tech founder, you’re a startup YC is opening their winter 2023 batch and that means that there are a lot of people currently finishing up submitting, maybe have already submitted applications for this funding cycle. So it takes place January to March 2023 and will be remote with optional in person component. So we’re moving back to a hybrid model for. I see sounds like still slightly optional, but really you know a shift after many seems like many years of having lots of these accelerated programs having to go fully remote because of the pandemic. So first of all, that’s one thing to consider that I think some of the advantages that come through these programs actually are very transparent when there are in person gatherings. That’s where a lot of value creation relationships are created where you can sense one another more and a lot of obviously the early versions of.

I see which some people still consider more of the golden years now that the volume and stuff has been considered. The focus was on in person get togethers and has created an incredible network that has spawned, you know, incredible companies from NYC as well as companies that came out of it. You know, talented people who maybe that company didn’t work. But then they went on to do XYZ blah blah blah. So overall that’s an exciting piece of this. September 12th is the deadline so it’s coming up. It’s coming up hot.

8:00 PM Pacific Time. I always you know, for us it was Eastern Standard Time so give you a little bit more, a little bit more life at it’s and it felt like anyways and then a couple other notes just quickly here and these have been pretty general through YC’s sort of batches as a whole. If for you to be considered a founder you need to have 10% equity so if anyone has more than 10% equity on your you know on your CAP table now outside of investors who have invested previously then. Then that means that it would be considered a founder and. And this is the part that’s sort of is the requisite for you to attend events and everything there. So why comment has moved much more to a rolling basis, so you will know by November 18th if you apply by the deadline and then they’ve sort of extended this application. Where you can apply late, probably maybe not recommended, but if you have the metrics, if you have the growth, if you have the product.

And maybe some of those things became transparent after the deadline. That it seems that you’re at the right stage. Then go ahead, you know. I think they have empathy for founders. Empathy for the fact that we have so much going on our lives, and if you miss a deadline by a little bit, I don’t think that’s going to be the deal breaker, especially if you’re doing a lot of other things right, so?

There are a couple things that are sort of interesting to me that I stick out so interviews and I guess I’ll just talk for a second here we did. I have applied for white commenters several times in the past. Other sometimes we have gotten, you know, good interest. Sometimes we have gotten little interest. Still not exactly sure you know what delineates those two. From my own experience, one thing I will say is that as you go, you know longer on and then they start to gather.

Data from applications about sort of your growth rate and users and all this things, all this stuff. Then they can start to sort of build this I think profile of. You know, what are you prioritizing as a company? What is your growth trajectory? And with that becomes a lot of sort of insights and sort of pattern recognition from all the experience they’ve had and just so many companies applying over the years. And you know, I remember specifically 1 batch and I should know this exact one, but I don’t. We were invited to then interview a jump down to call Michael Seibel. Seibel was right, right there and that was a super interesting experience we felt that we had prepared.

Really great, we had done a bunch of mock interviews with why Combinator alumni? Who said we were doing a good job and that we had one who I would say give us the exact opposite is sort of a, but most of them overall had a consensus that you’re pretty solid. better than I was when I was accepted into Y Combinator, which was good feedback. We had this very divisive plan as we. Got into that interview where, you know, basically a quick intro, hit hard with a sort of tagline. And then what we wanted to do was then dive into a demo of the platform. Because, you know, generally the understanding is that they like to see that you’re already building something, something already built. That’s something that customers can use and shows that you’re willing to work and you’re making this investment and you’re, you know, making progress. And there was this moment where we said, hey, we’d love to show you a demo. And Michael then sort of said, you know, before we do that, I want to ask X.

And I think that’s where the moment that I would just recommend is. You might have this very rigid sort of strict. Uh, pattern of where you might think this is going to go and then that can be deviated very quickly. And I think this my idea is this idea of like a pattern interrupt. But I think that they’re purposely sort of plant printing on founders to make them deviate from the course that they hope. Because you know, as soon as you start sort of after your intro is done, you start to lose a little bit of control as they start to ask questions. And there are some, maybe I’ll link it as a resource here. If you get to that stage with the application, you know, there are some really good ones of like questions that have been asked and was like some cue card.

Why? Combinator preparation. And really the goal is to, you know, answer those questions succinctly. One of the things that we’ve got feedback on is just general. I mean, you hear me talking here all the time. It’s like generally try to answer questions succinctly and as quickly as possible so that you can get through a number of questions instead of, you know, going too deep into depth into a specific question and then not getting to navigate through to other important parts of the business and.

I think I’ll ask you know why question would be like why did you not get accepted into why commentator. I think a very templated can response came from Michael through e-mail but I still think it was a nice one which was I actually like you personally as founders we think you have made a ton of progress and you’re doing something super you know you you 2 individuals myself and that’s will seem really hard working and ambitious and valuable. We are struggling with the business model and the product because you’re maybe not as reined in on a specific customer segment. We’ve continued to define that, but still I think with the application of speech recognition and natural language processing that. You know that can create complexity and you start to get inbound inquiries from different kinds of customers, so I think.

One of my recommendations would be really closely clearly defined who your customer is and have a very simple stated reason for why you are why you’re doing what you’re doing, what the mission is, and what you actually do. Where does the value be created? Because we got lost. I think in the complexity of that in several different use cases from the customers that we had at the time, which then created risk created complexity, and the story that they’re then weaving in their head became less clear. I think overall good experience with that interview. We did a decent job, but not.

Good enough obviously, and and then the recommendation is just to continue to apply at that standpoint, so I’m not going to go too deep into. The structure of sort of YC, I think there are, you know, lots of resources on that and I’m not an expert in that because I haven’t done YC. What I just wanted to sort of pop about, talk about was the actual sort of application itself and just highlight and amplify that if you are interested in this deadline is coming in. There’s one other note that I want to talk about. I’ll jump on in a SEC. A couple other things, all, all will be links in, in resources here, but they’re investing 500, you know, now a new deal has sort of emerged.

500K You don’t have to take that. You’ve got a 125, and then there’s a 375 on an uncapped, safe meaning you know you can really, depending on what that next investment is that can put you in a pretty good spot, and there are sort of continuing to buy their sort of equity in the business as you grow and raise more money and and get more investment and continue to hit, you know, hopefully your traction and ideal milestones and everything that now. The other part that I wanted to touch on that I thought was super interesting is I actually shared some videos on this in the past, which was first of all, why combinative reduces the cohort size to 40% due to economic downturn. And I showed a whole video about this link. This is the profile, just 10 minutes, but I have some resources around there as well too and starting to get some comments and really nice engagement from people in that regards. And I think it’s a super interesting time because even in this Instagram post what you can see is they’re reviewing 20,000 startups, so.

Put that in your mind is. That’s a lot of companies. How do they filter out very quickly which ones are good? Which ones are not? And I think there is a lot of qualitative analysis that can be done, but not at a huge level of scale like that. And then you’ve got quantitative analysis of metrics and revenue and things like that, and especially in a time of downturn. You know what those things are probably being used to filter and focus down on companies and continue to grow so Stephanie’s here Y he’s head of admissions, she’s reviewing 20,000 stars for the next court, even in the middle of downtown.

Turn and then. Here’s what she’s looking for, so there are a couple of sort of example companies that then they’re sort of using as sort of examples for how you can then do a solid application. This one you know it looks like 5,000,000 bookings, so there’s a metric of adoption and usage and growth, so making sure you can highlight that there is tractions and that this one looks like maybe possibly a little bit more of a moon shot and moon shots are good. I think that was one of the other reasons why our application, our sort of our interview sort of struggled. Come from a little bit more of a conservative risk averse background where I don’t have access to a bunch of investors and you know generally I come from this sort of this agency service background. It’s like if you don’t have enough money, guess what, you can’t really have a business. And so that’s sometimes deviates from the norm especially when we interviewed which was this frothy market where you are like the expectations, you just continually raise money and you don’t have to worry about profitability in the short term because they’re you’re optimizing for hyper growth and then trying to achieve profitability.

Later, so here’s a couple other sort of examples, not exactly 2. You know, sure exactly all the points of it, but just a couple sort of examples here. I’ll link this post and you know, just anything in general. YC is constantly sort of putting out content. They’ve always done a really good job with that and you can learn a lot just from following that. Also linked somewhere Hacker News, which you can see not. Not only can you see content that’s being posted on there, this is ran by Y Combinator, sort of separately, but still very involved. You can also contribute and be part of it, and I believe there is some belief.

Love for people who are contributing on Hacker News, so that’s another thing to to look at. You’ve also got the Twitter here and then. The other thing that I thought was so funny is, you know, this was their warning letters to founders, their role and startup correction and invite. So this was a little bit of my commentary beyond just the actual note itself, but included a link about that. And so. With this in mind, that should have some impact. I think on your application you can see here.

It opened it up just so I could show you what you’re actually in dealing with. You’ve got basically a bunch of fields. My recommendation is put this in a Google doc and do these answers and then paste them in as you sort of, you know, finalize the answers, get some feedback, get some people to take a look at it, especially on your team. Maybe some outside perspective if if if you have it and maybe even some people who have YC experience who have successfully gone through the other piece, you know. So again, a couple of things obviously should have a website just if you’re not, then you’re in a tough spot to be honest.

Demo. And then you’ve got personal information, a lot of questions you know, remain consistent, although there are some slight variations I think between sort of application, application may be just depending on the market or they’re figuring, hey, if I knew this answer compared to this answer, I would actually have a little bit better of an insight into the company overall. And it would be you know, easier to make these decisions so they think they, you know, make a couple of changes like for example, have you received any government grants? That was not a question that I had seen in the past. That’s a new question. Seeing right now, but there are a couple of very consistent one who writes code, what’s the does the technical work, very product, very technology focused and something that you should, you know consider as you move forward. And of course there’s deviations from any rule. But there are a couple things that I’m pretty, you know I’ve seen pretty consistently based on the companies that actually get into NYC and then my own experience sort of applying and then just you know talking to people who have again gone through it or similar programs with sort of the same thesis around here. So the other thing is there is.

I can’t exactly get to this for some reason right now, but there’s also a founder profile that you need to sit still fill out and then if you have other founders on the team, you’ve got to make sure that you link. Those. Have a nice bio I believe. Maybe some links to LinkedIn and everything there you should be taking care of that stuff. If you are interested in this journey anyways and and then you’ve got some really good answers. I think if you don’t have these answers off the top of your head, writing them out consistently and succinct is a clarifying exercise and a valuable exercise.

Anyways, I don’t have advice on whether you should be writing in sentences or bullet points, but generally you know if you can hit high level valuable metrics, milestones, progress, and that isn’t up to me in a bulleted point list that allows for easy scanning and the numbers and the percentages and the revenue sticks out. It seems that that would be an easier read, but then additionally there are sort of fundamental questions of do you have revenue, and if so then you’re plugging this in and this is where I believe a little bit more quantitative analysis would come into the. Actual application itself, so you know ton of other things that you can go in and take a look. Obviously competitive analysis is a big one and I think that was a bigger, higher level, more top level feedback for us as we went through the interview progress or process was like. Hey, again, we like you, but this is really competitive market, possibly saturated market.

We’ve actually invested in companies who are in this market already, so we have some. You know understanding of it on a deeper level than what we were seeing from other sort of investors that we were talking to at the time. And you know, we think that this is going to be a really tough time. We like you, but we’re not sure you’re the team that’s going to be able to pull that off. You’ve shown some proof that it is, but the feeling that I got is that we were, you know, a little bit of outsiders from maybe the Silicon Valley, you know, not necessarily. You know from a Fang or a big fight, you know, big company not located geographically in the same area. And you know, no history of.

Other sort of fundraising. Besides some, you know non dilutive capital for other businesses that I’ve done so. There were a couple other things I considered. If you are, you know, maybe not. The Stanford MIT graduate with experience at Meta or whatever? Then you are relatively possibly a slight disadvantage, although it seems that Y Combinator is.

You know, somewhat democratized in the way that they invest in. They’re continuing to try to diversify their investments, although some people would still critique the lack of diversity in that. But I think overall there’s a lot of great information that’s come out recently about from whether it is the letter to founders, whether it’s sort of some articles about how their cohort has decreased from I think 400, four, 114 companies to only 250 companies in the in the 222 summer cohort which is down 40%. So it’s still a huge they used to you know struggle with only 30 but you got to think if there’s 20,000 going applying over 20,000 as they say and then you are you know you’re you’re and you’re trying to they’re weaning that down to say 2:50 if they keep it consistent that’s a that’s a that’s a small percentage. Let’s see if I can pull this up on the spot of what that is 250.

Of 20,000. Mass 1.25% so 1.25% acceptance rate. So you have to differentiate you have to be above the median and the norm. The mean all those things and really make sure that you stick out and differentiate where you fit a theme or a trend or something that is valuable within the eyes of why Combinator. And of course, considering the sort of market downturn we’re in, they may even be less risk averse. They need to may need to be more diligent with the capital they’re spending, although they had some incredible exits in the last few years.

You know there are people who are giving them money to invest may have different priorities now and that may affect how you write this application. Again, focus you can see it right on their website. It’s a constantly been everywhere in my computer. Makes something people want. So show that this is something that people want. Show that it’s something that people need and show that you’ve worked on it already. You make the investments, you have progress, and if you don’t, you better have a pretty wild, awesome, incredible idea.

That can truly change the world and impact a lot of people and some sort of credibility that you are the right ones to do it. So I’ve already been going on for 17 minutes. That’s too long. But I hope you got some insights in this. I hope I covered a couple of things. The train is coming and this is my, I guess my send off here. I appreciate you checking this out. I’ve loved doing the videos on why Combinator. I’m glad to see some traction and some comments and engagement on it. If you like this stuff, I’ll continue to publish it. I’m going to be I think even maybe examining some of the companies that come through the cohorts to see if I can.

Identify anything there and give some insights along the way. And I appreciate anyone who watches these videos who you know, follows the stuff that that that we’re doing here. Personally speaking, Tyler, Brian. And then through the company software at speaking.com, I’ll link that also make my website as always and appreciate you checking this out very much. I hope you have a wonderful rest of your day. Bye. Bye.