[nojvek]

I would like to see a place where I can micro invest in YC startups. e.g $500 - 10k. If YC takes 7% for 120k. It seems 1k is worth about 0.05%. Its a bet a lot of us are willing to take. e.g I don't mind spending 6k on 6 startups on a year, which are YC vetted and are in the space I think is very lucrative.

Offering dev time is very hard, but as someone who has worked in industry for so long, we can definitely help with guidance and advice.

[chatmasta]

Startups shouldn't be handing out equity like candy. If you are asking for 0.05%, you better have a damn good reason to deserve it, because $1k is definitely not enough. Startups give 7% up to YC for way more than just 120k (network, brand name, etc). In fact if all you want is 120k, there are better ways to raise that money than giving up 7% to YC. So your calculation does not hold up, because the value of you as an investor is not the same as the value of YC as an investor. All cash is definitely not created equal.

[angersock]

If you are asking for 0.05%, you better have a damn good reason to deserve it, because $1k is definitely not enough.

To be clear, that's an easy 2mm valuation. That's also an incredibly tiny slice of the company, and that's also something that will get diluted to shit.

So, let's stop this meme that for an early-stage company that fractions of a point are somehow a big deal. That's how a lot of early employees--who do the hard work--get screwed.

[chatmasta]

The OP is not talking about employee shares. He's talking about advisory shares, and maybe some 1099 work. What does a startup get out of that? Unless you're seriously qualified with relevant knowledge, why would a startup give precious equity to you? Sure it's "only" 0.05%, but it's still one more name on the cap table. And this attitude of "it's only 0.05%" is exactly what leads to the dilution you're talking about.

If a startup is valued at $2mm, they don't need your measly $1k. To make that worthwhile they would need to get $1k investment from dozens of different investors. And at that point they're no longer giving up "only 0.05%." Also, if they need an advisor, they can find one. If they need a contractor, they're not going to pay via shares, because the whole point of issuing options/equity is to align the long term incentives of the startup and the investor/employee. A contractor does not work long term, so there is no need to give away shares.

Also, the suggestion of the OP -- a place for investors to get advisory shares in companies -- already exists. It's called Angellist.

[syedkarim]

> That's also an incredibly tiny slice of the company, and that's also something that will get diluted to shit

If you are truly investing in a company, dilution is irrelevant. The only two things that matter are share price and your ability to liquidate those shares. If I buy at 1-cent and sell at $1, I could care less about how much my original 0.05% has been diluted.

[sharemywin]

The way equity is handed out to employees is BS. Yes, getting an investor to invest is hard work. But, if you can get past the momentum phase, employees are what make it work. Now, it's set up like a lottery. Investors and Founders get 90%. The rest of you few hundred people get 10% with most of the founders friends and early hires get a lot of that. No wonder the 1% own everything.

[guillegette]

This response is also valid for the main thread. Initially looks like a good idea but probably company that is willing to do this is in a more "desperate" position.

[sharemywin]

I think you need to allow people to follow an idea until it kicks. and maybe at first their just experiments and projects that get funded that can be reused.

[SherlockeHolmes]

Correct. The YC valuation is a special case. An example valuation after totality of round A funding for a company can stand at around $1M for 1%. So that'd be $50,000 for .05% for an early-stage company.

[daave]

Not YC-specific, but this sounds a fair bit like OfferBoard: http://www.offerboard.com/

[S4M]

> If YC takes 7% for 120k. It seems 1k is worth about 0.05%.

What YC brings to a startup for their 7% is 120k + advice + connections + the YC brand itself, so just 1k will be worth only a fraction of 1/120*7% of the company (I'd say, about a half or a third, maybe even less).

[tarekskr]

This is also a really cool idea.