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by tatsuke95 5183 days ago
>"...they are essentially saying that the YC company is twice as likely to succeed"

In my opinion, this is precisely what makes the business so frothy. I don't really believe that YC backed companies are significantly (certainly not twice) more likely to succeed.

The whole incubator thing could be the best or worst thing to happen to to Valley; we just don't know yet.
2 comments
il 5183 days ago
Well, YC only takes the top 3% of startups. If you believe that they have any skill at all at judging startups, that number should be a lot more than twice.

Investors are not just counting on the fact that YC makes a company more successful- they also know YC filters for startups that are already more likely to succeed.

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larrys 5183 days ago
"YC only takes the top 3% of startups."

This is exactly how legends are built in the media. YC takes 3% of startups that apply, not "3% of startups". This is the same as when they say it is harder to get into Techstars then to get into Harvard.

See this:

http://www.forbes.com/sites/nicoleperlroth/2011/08/24/the-mo...

Figures like that ultimately don't mean much anyway other than creating a appearance of scarcity. It is well know for example that colleges try to increase the application rate to game the acceptance %. Nobody has access to all the companies applying to YC in the 97%, (do they?).

Edit: To judge the quality (if possible) of the applicant pool.

Edit2: I don't mean to imply that YC tries to game applications. Only that numbers get thrown around without any vetting.

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cperciva 5183 days ago
YC only takes the top 3% of startups.

s/the top//

Obviously they try to select the top startups, but as smart as they are, it's hard to believe that there is zero error in their selections.

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dasil003 5183 days ago
Incubators were around before YC though, and pg et al seemed to want to avoid being identified as an incubator. At any rate though, YC certainly redefined what an incubator is, and my impression is that the track record already shows better returns than any previous incubator. But as with any good idea, the cargo cults are quick to follow, and I think it's inevitable that a froth would be raised following this kind of success.
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