[brudgers]

The description raises a question in my mind.

With $725,000 already raised, what does that mean for YC's investment? Does YC's $17,000 only buy 1 or 2 percent ownership? Or do they still get 7% and the earlier investors get screwed?

Some companies may not fit within YC's portfolio.

In my opinion, Fair != equal

Good luck.

[rbargagli]

Thanks for asking. We have some stocks (Founder stocks + Advisor Stocks) that we will give to YC in case they are interested in us without screwing the angel investors. There are a lot of things that YC adds that money can´t buy and without affecting previous investors.

[brudgers]

After a bit more thought, I see a potential "product-market" disconnect.

Rightly or wrongly, YC's template is to invest in people more than companies. While on the one hand, a track record of successfully raising capital makes the team more attractive, having raised a substantial amount prior to applying places the team in a position where they are pitching the company rather than themselves.

A team which has to devote time to placating investors has less energy for product development. In addition, a team with substantial outside investment is less able to pivot, and may therefore present itself as less likely to succeed.

I would add that the tax liability for YC under the proposed stock transaction might be several times their normal investment.

Finally, relocating your current venture to Silicon Valley might provide improved networking opportunities and better access to technical capital.