[colinsidoti]

This is interesting.

I wonder what you feel companies should do in the event of a strong pivot: reincorporate or retain their cap table?

Based solely on this post, it seems beneficial to reincorporate in order to retain an undiluted cap table.

However, that seems contradictory to YC's thesis of investing in teams instead of ideas. If a team's first idea isn't successful, I imagine YC would want to retain its stake in whatever their new venture is.

Also - is there any chance you've previously used pre-accelerators as a positive indication? "Letting up" on your standard assessment of a team simply because they had gone through a pre-accelerator could also explain this trend.

[sama]

My thinking has changed on this. I think investors shouldn't get a free option on every idea a founder ever has; after a few pivots and rounds I think a clean start is often a good idea.

[tomasien]

There's a lotta grumbles about Sam and YC taking this stance at VCs these days. FWIW I think it's about right but SO hard to judge.

[_sentient]

That's interesting. I'm guessing the investor complement to this would be the option to get your money back if a company chooses to go in a wildly different direction?

I've seen that sentiment around more of late, possibly as a result of the glut of seed-stage startups who are pivoting after failing to raise an A.

[jeffwass]

What if the investors were also mentors that helped guide the startup to a particular potentially-successful pivot?

[shostack]

What is the best way for founders to structure their pivots then in your opinion?