[seanccox]

YC really has succeeded in building a recognized brand in the tech startup space, such that they can really define that space. I'd compare YC to Harvard or Davos (the World Economic Forum), where the challenge is to get accepted. Once you have passed the gateway, the wealthy/powerful recognize this by extending opportunities to new members.

This is true of almost any club (the Free Masons, your local BPOE, Boy Scouts, etc.). You join, you get to know people, those people help you with your interests, and in return you help them with their interests. It isn't particularly difficult to see why this success might backfire and reduce/limit actual innovation, because it creates a powerful echo chamber – in part by design, to achieve specific goals, and in part by accident, because the people accepted by the club tend to meet predefined expectations.

The problem is, as I see it, that escaping that kind of feedback loop is very difficult, once an organization is in it, because the momentum making the loop bigger is difficult to redirect into an energy to make the loop different. Harvard could announce that it will no longer accept children from powerful/wealthy families, Davos could release a statement that this year it will be hosted in conjunction with the Communist International, and YC could relocate to Uganda for a season – but that's not what these organizations do, so after a point, they aren't able to innovate outside of very specific boundaries.

The answer to that, of course, is create new organizations with different boundaries/priorities, but Christ, that reeks of effort.

[dkarapetyan]

Feedback loops and echo chambers are an excellent way to describe it. There is an analogy that I think is relevant but most people don't get when I bring it up or just think I'm plain crazy. The analogy is the fire ecology.

In certain ecosystems fire is a necessary component of ecological vitality. It is destructive in the short term but leads to a more robust and diverse ecosystem in the long term. Coming back to your points we have reached a certain kind of equilibrium in the startup ecosystem where the incumbents through network effects have become entrenched and are now actively detrimental to diversity and innovation. I don't know what the equivalent of fire would be in the startup and technology ecosystem.

[seanccox]

I believe the 'fire' is something akin to the post-2000 tech bubble collapse. When markets correct or collapse, investors tend to become more conservative (or outright scared) and risk averse. That dries up the sources of capital available to more risk-prone endeavors, like funding tech startups. Even with lower capital costs, a VC firm looking for tech opportunities will be more selective in post-correction market. Whether that means startups will be more innovative or diverse, to impress VCs, or become more homogenous but cost-effective, in order to attract investment, is an issue I don't know enough about to predict. In any event, I like the idea of a fire ecology. I think it's a good one.

[webwright]

"Coming back to your points we have reached a certain kind of equilibrium in the startup ecosystem where the incumbents through network effects have become entrenched"

So, with ~50% of the top venture backed companies being founded by immigrants and 75% of them having immigrants in key product/management positions, you think we're in a "burn it down" moment? This doesn't even account for the non-immigrants-non-insider people who succeed in the Valley every day. I'm all for working to reduce cronyism, racism, ageism, etc. But I don't think we're remotely near needing to set fire to things (metaphorically or otherwise).