[DaveWalk]

Pricing aside, I disagree: YC is in part a startup incubator, no? Those driven to work in an incubator space are precisely the kinds of people who can benefit from a "Hacker News for..." site.

That said, there are many biotech incubators across the country, so perhaps this isn't my/your favorite. But even so, I commend them for getting the site off the ground.

[rafeed]

As mentioned in another comment[1], the reason HN grew and got off the ground was because of who was behind the incubator/site. PG was well known in the scene when it started. I certainly commend them for getting the site off the ground, and if it gains traction, major props to them.

However, reading the team, I haven't really found any names I instantly recognize for doing something big/memorable for the industry. I'm not saying they're not qualified, they certainly are. (I'm in the biotech/biomed scene)

[1]https://news.ycombinator.com/item?id=7481752

[Snail_Commando]

> Pricing aside, I disagree: YC is in part a startup incubator, no?

[Update: Before you read this wall 'o text, please consider the comment in the context of the update at the bottom.]

I disagree, YC is not an incubator. Well, to be fair, incubator is kind of a nebulous term.

I define incubator as: "entity that charges entrepreneurs for privileged access to ostensibly valuable [x y z]" or "entity that hires so called 'entrepreneurs in residence' to build companies under its roof in exchange for exorbitant equity."

YC is only superficially similar to whatever you would describe Harlem Biospace as.

The essential difference is in how the two types of entities derive value from their offering.

The distinction is that [YC, 500S, TechStars] invest in the upside of companies. Harlem [and its ilk] make money per unit of offering sold [units of monthly [x y z] access].

The reason "incubators" (the ones that charge entrepreneurs) are usually worse than the YC's of the world is because they adversely select for all the wrong things, as a side effect of their design.

Since an incubator ostensibly helps startups win big, why charge per unit [startup]? Why not invest in portfolio upside?

Per unit charges seem to be a good way of making money in the near term, at a constant rate (might not be sustainable if companies don't succeed in the long run.)

Upside investment seems like a good way to make money in the long run (assuming you are sufficiently able to (a) pick the right startups and/or (b) influence them to succeed.)

So investment seems to signal that you believe that you can do (a) and/or (b).

Sure, an investment portfolio may lose money on most of the companies. However, if it has a group of companies of sufficient expected success, one will likely reap massive returns.

If the value investors provide is worth enough to attract the right kinds of founders, the expected value of investing in entrepreneurs should exceed the expected value of charging entrepreneurs.

In the long run, charging per unit of offering, may signal that the long-term value of the seller's [x y z] offering is relatively low when compared to entities that are willing to invest in entrepreneurs.

Basically, if you value the unit cost higher than the investment return you are signaling that you (a) can't pick good startups and/or (b) you can't help a sufficient number succeed.

What kind of entrepreneur would want to go to that entity?

Since portfolio companies tend to return value later in their timeline, long-term value of offering is what matters. The YC's of the world are willing to eat the short-term costs and bet that they will influence some startups to return big.

The Harlem's of the world are making a constant per unit income, but are unwilling to bet on the long tail equity upside.

These incubators are not equivalent to [YC, 500S, TechStars], they are glorified co-working spaces.

[Update: If you've read this far, please see the discussion further on the thread. I unfairly characterized Harlem as an "incubator". Harlem Biospace certainly offers value. I do stand by my comment on "incubation" in the context of consumer internet companies. It's a different ball game for capital intensive industries. One aspect of Harlem is that it is affordable lab space that is group funded. Undeniably important.]

[owensmp]

Agree with you in general, however, Hb was established as it was because the NYC ecosystem needed affordable lab space. The equipment made available turnkey through the member fee each month would otherwise be a large capital investment for each company. Thus we are providing considerable concrete value and allowing projects to proceed that otherwise would not be able to. Above and beyond this we provide a community of other life science entrepreneurs and a physical hub for the broader biotech community here in NY that didn't exist yet in the city.

Whether or not our model changes in the future remains to be determined, however, as Dave mentions in his next comment the long timeframe tech risks inherent to investing in many early stage biotechs present some unique challenges to a YC model in biotech.

[Snail_Commando]

I just want to say, I jumped the gun a little with my original response to Dave earlier. I misunderstood what Harlem actually was. I realized you made a capital investment in lab space after I commented. Please see my second response to Dave for elaboration.

I stand by my original statement about "incubators", but now I'm weaseling out of calling you an "incubator". You definitely add essential early value.

Capital intensive companies definitely have different requirements than consumer internet companies at inception.

I'm really sorry about mis-characterizing you.

If it were up to me, I might consider re-branding as a sort of bio-coworking space or bio-collaborative space. For some reason, the word "incubator" makes me think 1999 Silicon Valley. But that's probably just me.

It would be really cool if you started investing, too.

Best of luck, I genuinely want you to succeed.

[DaveWalk]

Very good points. Especially if you are a tech-based startup, the "glorified co-working space" is a model to be wary of. I concede that perhaps YC is less an incubator and more of a bootcamp, as mentioned upthread.

I'd like to point out, however, that there several thriving biotech incubators around the country. Surely the demand must be coming from somewhere when tenants must be found to pay the bills. Indeed, I think the startups that enter an incubator space are well aware of the rent prices, and do so to to take advantage of the certified lab space provided which is impractical to build on one's own.

A takeway from all this, for me, is that I'm wondering what one could do to make a biotech-focused YC a workable model. Unfortunately, the (comparatively) glacial pace of biotech startups dampens a lot of enthusiasm.

[Snail_Commando]

> I'd like to point out, however, that there several thriving biotech incubators around the country. Surely the demand must be coming from somewhere when tenants must be found to pay the bills. Indeed, I think the startups that enter an incubator space are well aware of the rent prices, and do so to to take advantage of the certified lab space provided which is impractical to build on one's own.

Yep, I was just about to update my answer with the following:

--[I want to emphasize that there isn't inherently wrong with co-working spaces. They just aren't in the same class as [YC, 500s, Techstars]

Also, I read up on Harlem, they claim that they are providing laboratory space. That's a pretty solid value add. So I can understand why they may be wary of losing their investment in capital.

I didn't consider this, but there is an argument to be made that things are different in more capital intensive industries. Unlike software, the incubator model may be more palatable in these industries.

Still, I think they should hypothetically re-price equity demands compared to software equity demands, not charge per unit. Just demand more equity.

Charging entrepreneurs is still bad signaling and can lead to adverse selection (if you market yourself as being equivalent to [YC 500s Techstars])--

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> A takeway from all this, for me, is that I'm wondering what one could do to make a biotech-focused YC a workable model. Unfortunately, the (comparatively) glacial pace of biotech startups dampens a lot of enthusiasm.

Honestly, I think it's a bit early for the YC model in biotech. Too many subsets of the market are just too capital intensive, time expensive, and subject to regulatory burden.

However, with exciting technologies like CRISPR and high throughput sequencing starting to come on to the scene, genetic engineering and DNA derived technologies may be much more viable as a low capital cost subset of the market. Also, DNA looks suspiciously like software embedded on extremely high density storage tape to me... :)