The YC Dilemma - Thoughts About YC Reject

Paul Graham likes to say that the most important quality of a founder that they (YC) is looking for is determination…aka being¬†Relentlessly Resourceful.

Well, one of the things that have always struck me about YC’s selection process, is that they are almost self-selecting for a 50:50 success rate (success in the sense of picking the winners).

I am not saying that 50% of their companies will go bust, but given that we know that at least 1,000 applied to the batch before the last one (can’t find reference, but it’s out there somewhere), and YC only chose 40+, there is a high likelihood that the rejection will be a catalyst to many companies to prove YC + team wrong. Even if just 0.5% of those rejected (950) are the ones that prove them wrong, that’s still about 45 companies.

If those 45 companies turn out to be ‘significant misses’ on YC’s part, that works out to about a 50:50 success ratio (where they successfully only chose 50% of likely successful companies from the entire batch).

However, given those odds, don’t just assume that because 950 startups were rejected - the most successful of those will migrate to YC Reject and as such YC Reject will be as successful as YC. But it is possible that YC Reject could tap into that latent pool of PG’s ideal candidates that were somehow missed by PG himself.

Could the next Heroku, Dropbox, Airbnb come from YC Rejects and not YC itself ?

Interesting times ahead.

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