[domp]

(took out the first paragraph I had here. I should have read the full article!)

People that are applying for YC definitely are just seeing this as another possibility and not an end all to their idea. I'm sure that a very small amount of people are going to give up their business if rejected.

[edgeztv]

I think the music parallel was right on, actually. You need users to tell you what they think of your product at least as much as VCs or execs. If users don't like your product, trying to pitch it to VCs is a waste of time.

[domp]

I took it that he meant that the artist wasn't willing to work at his music enough to gain traction and wanted a quick track to success by signing to a big record label. With that being said, I think that the majority of YC submissions aren't looking towards this as an only alternative but one of many routes that could be taken.