[pclmulqdq]

As startup valuations have gone up quickly and the YC offer largely remains the same, YC has naturally moved downmarket. They have gone from being an exclusive, premium product aimed at people who have a serious chance of building a unicorn to a finishing school for venture-backed entrepreneurs. In my opinion, this is a great thing for YC because it's a more natural fit for their main value proposition, but it also means that the best time to do modern YC is essentially straight out of school.

[skeeter2020]

I don't think this is a valuations vs. stagnant offer scenario. I think it has more to do with YC scaling up from dozens to hundreds and thousands of investments in a very competitive landscape. From a few early successes when no one was doing what they did, to having way more money to invest than there are good ideas and now it's spray & pray; trade on the YC name and with some luck hope there's a pay-off. If we start with the apocryphal "VCs look for 1 in 10 home runs", well the earliest YC classes only had like ten in a batch, so they had the time, energy and NEED to have a success. YC added a lot of partners who had a successful exit - or didn't - and surprise, they look like every other VC partner in the industry, at least minus the identical headshots in navy blue suits.

[vessenes]

This was absolutely Paul's strategy -- read his essay reflecting on returns from their early portfolio (AirBnB and Dropbox). His take -- "we should have done another 1000 investments to get a third hit" (coinbase, it turns out. And he was correct).

The math for YC's seed stage returns is overall inexorably towards more checks being written - the checks are incredibly cheap. YC's IRR is currently roughly 176%, yielding an 81,000x return since 2005 -- another way to say it: a single $25k investment from 2005 could be deployed into 81,000 $25k investments in 2026. Or another way to say it, for every check they wrote, they're able to write another check off that investment every 8 months, compounding all the way back.

YC's main problem is that there aren't 81,000 even slightly viable startups in the world. It's true they've lost their "exclusive" vibe, but to be honest, when they started it was more "small and quirky" which briefly became "gold standard exclusive." It was never their original brand, and I don't think it was ever really part of the strategy.