← Uncapped with Jack Altman
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- [00:00]
A
I think AI and a big change like this favors younger people for all sorts of reasons, so I get it.
- [00:06]
B
For what it's worth, I'm a late bloomer. I did YC when I was 27.
- [00:09]
A
I was 26.
- [00:10]
B
Yeah. So, hey, late bloomers. High five.
- [00:14]
A
The old guys. All right, guys, I'm really excited to be here with you. Thanks for all doing this with me. So I guess just to start, when did you all first go through YC as founders?
- [00:23]
C
I think I did it first. I was summer 2006, so the third batch ever.
- [00:26]
D
I did winter 2007, so six months
- [00:29]
B
later, and then summer 08.
- [00:31]
A
Okay. So a long time. It's, like, pretty close to the beginning. So I guess where I want to start is you all have, in many incarnations, seen what YC has been like as founders, as partners. You've sort of worked outside of yc, inside of it. What has changed? And so I guess maybe the lens I want to ask this question through is, what was the value proposition to founders in 2006 versus 2016? 2026. What has changed? What has stayed the same? Yeah.
- [00:59]
B
What was it like in 06?
- [01:01]
C
The most surprising thing to people from the outside I found is actually how little has changed. And I think that's kind of by design, which is like the thing that Paul Graham created that we all did in the early 2000s. It was great. It was a great product. And as you know, when you have a great product, you're like, don't fuck with it. There are some things. Height of change, but I would say in broad strokes, it's much more the same than it is different.
- [01:25]
A
How would you capture the essence of that product? Like, to a founder, if you had to boil it down to two or three things, what is that product about?
- [01:32]
C
So we recently worked on a redesign of the Y Combinator website. Actually. Gary, hide it. We actually tried to write it down, possibly for the first time. Do you want to explain this as it's really your words on the website?
- [01:45]
B
Oh, gosh. I mean, it was team effort, but, like, honestly, we tried to return to what is the founder's experience? And then we found all of these old photos of, actually, your brother is like, the first one on there. And it's like, here's the double pocked collar. Yeah. And then we'll pop that up on the screen, and then you start flipping through, and it's Patrick and John Collison, it's Brian and Joe and Nate at Airbnb. And you see them so young. And then you see them ring the bell and it's like basically what we're trying to create is disneyland for transformation. From startup founders who are just starting out to literally the people who sort of make the companies that really matter. It's actually a social process. All reality is sort of socially constructed. And then uniquely. I remember when I found YC and then came to my, my first startup school, it was kind of like being a fish out of water and then jumping into water. Like, I was surrounded by people who were builders, who like, were earnest and you know, basically when you get into yc, like we take people who are earnest and technical and then at the end of that process, hopefully they become formidable. And so when you go to the homepage, that's what that's about. It's like YC is like a transformative process. Yeah, it's like Hoffman or something. It's like this. It's not that New agey. It's actually very chill. It's more like, you know, I don't know how you would describe it.
- [03:17]
C
I'm a Harry Potter fan, so I prefer to think of it like Hogwarts.
- [03:19]
B
That's good.
- [03:20]
C
Yeah, yeah.
- [03:20]
A
I mean, I kind of felt like when I did in winter 16 and I felt like starting a company is such like a. It's such like a weird, odd experience. And in some ways having this group that normalizes what it's about where you're like surrounded by other people where they like talk about like, here's the new language and the new set of things you should be thinking about. It almost like makes the strange dream that you're in, you get calibrated or something like that.
- [03:43]
C
Totally.
- [03:43]
A
So I thought that was a big part. And then I guess also there's always been the thing of. There is some stamp of approval. I think that's hard to sort of underweight. I'm curious how you guys think about that with outsiders in particular. One of the things that seems different to me at least is now more than 10 years ago, and I'm sure more than 20 years ago, the ecosystem is an understood thing. And a lot of founders, they can read a lot of stuff online. People can read a lot about them online. There's more known in general, but I still feel like there's this thing that YC can do, which is take people who maybe aren't yet in that vortex and identify talent somehow and bring them into the vortex. I'd be curious if you guys spend active cycles thinking about that all the time.
- [04:27]
B
I mean, actually I'm in the middle of my very intense addiction to Claude code and Codex. And actually using this stuff is pretty wild because like I basically recreated my 2008 startup. It's like 70,000 lines of code. I did it in about like, I don't know, 90 hours over two weeks because I have a full time job and like also like trying to raise kids. But it just like really compressed a lot of my sleep. But at the end of it, I have a code base that is better than what it took like five engineers and me taking anti narcoleptics to like build for my YC startup.
- [05:05]
A
Yeah, it's crazy.
- [05:06]
B
It's like unbelievable, right? It's like actually something, something happened November, end of November, when Opus 4.5 came out that, you know, I heard about it. I was like, hey, what's going on? Like the most interesting thing for us is like we'd been talking about it for years and we'd been using it for years. And then it wasn't until really even December where AGI's here, guys, for code. Like, I feel like I could create like in 80 hours something that I could not create with $5 million and five engineers in two years.
- [05:38]
A
So to stick with that, like this coding topic, I guess my two questions flowing from that are one, what are you trying to identify as greatness? If before this moment you were like, we need to find great engineers, like, what is the, what is the thing you're looking for now? How has that changed? And then my second question is like these startups, you know, like the advice has been, you know, write code, talk to users. Like, what's. What is that now? Is that different?
- [06:04]
B
It's prompt and talk to users.
- [06:06]
A
Yeah, but like there's a lot less time prompting, I guess.
- [06:08]
B
So we just like literally this happened and then all of us have been sort of collectively do like Harj did a project like Jared's coding all the time. Our team is all using this stuff. And then we realized, hey, why don't we actually put it in the application process? So for the first time, for the spring batch, you can upload a transcript of your Codex or Claude code transcript making a feature and we're like starting to figure out how to process it. And we put it in a security sandbox. Cause we figure it'll be prompt, injected very quickly. You can tell a lot about whether someone can build just from like how they prompt the agents. And it's like, do they know systems? You know, for yc, you get a T shirt says make something People want on day one, it's like, you know, if you look at a resume, like, you can sort of guess at whether they can make something and then you really can't tell whether they can make something people want. You can look at their GitHub and you can maybe see if they can make something. Like, the only way you can really tell if they can make something people want is like, they did it already.
- [07:09]
A
Right. And there's not exactly like a GitHub for prompting, I guess. Yeah, if that's what you're asking people for.
- [07:14]
B
But, you know, you can tell how, you know, do they use plan mode? Like, do they think about systems? Like, you know, are they prematurely optimizing? Are they over engineering? Like, you know, are they. Yeah, basically, like, what. What is a feature to them? What is the complete release? Do they think about, like the edge cases? Yeah. How you do anything is how you do everything. My favorite Steve Jobs quote. I mean, he talks about, like, you know, if you're a carpenter, you can tell other really great carpenters and you don't look at the front. Like, everyone looks at the front. And I'm like, oh, yeah, this seems good. What a great carpenter does is an artisan looks at the back of the cabinet, because the back of the cabinet only other carpenters are going to look at. And so I feel like that was one of my favorite things. Like when I funded companies that initialized when I was a partner at YC the first time around, that was my number one thing that I loved, which is like, is there game recognized game? Would this person, would I go work for this person if I weren't doing the thing that I was doing?
- [08:14]
D
Now, this is how you spotted our povo with Instacart, right?
- [08:17]
B
Yeah, he came in and honestly, like, it was craft again. He literally had built an iPhone app that was a demo app. Claude code didn't exist, so he actually had to build it himself. And then the way I could tell is turning the cabinet to the back was he could scroll it and it scrolled really smoothly. And that wasn't true for that era of iPhone apps like the App store. And the iOS app was brand new. And then I feel like you guys do this all the time.
- [08:44]
D
I think so. I mean, to your question of, like, how does it change the way we might think about picking founders? I think it's going to just expand the net versus necessarily change it. I think we're all still in agreement that we absolutely want to fund genius engineers who aren't necessarily using flawed code. There's going to be a Patrick Collison of every era and you want to fund those people. The way we've talked about it internally is that this is probably an era where we might find more Parker. Conrad's Parker when he applied with Zenefits at least 2013, I remember the application extremely well written, but single founder, kind of not in central casting. Like, kind of not quite technical. Like technical enough that I think he had like a demo but didn't have a CS degree. Wasn't like sort of like the traditional YC archetype. As soon as. I think actually the only reason we interviewed him is at that point his previous company, Sig Fig I had used it. It was like a personal finance app. He was clearly capable of doing stuff. In the interview, it was clear immediately that he deeply understood what he was talking about. Super articulate, clearly like a really strong product thinker. It worked out for him because he recruited a co founder during batch and then obviously Zenefits had its thing, but then rippling is obviously huge. But I suspect that there's probably just like, if Parker hadn't got his co founder during the batch, it would have been a totally different story. And I suspect now Parker of today is just in Claude code, actually building quite sophisticated applications.
- [10:03]
A
I guess it's also interesting because Parker is one of the most probably commercially intelligent people there is. And I guess, you know, coding applications are probably making people with that shape increase, you know, increase their advantage. Obviously. I'm sure, like, you know, the real technical breakthroughs are always going to be really important.
- [10:23]
B
And this is like markedly better than just looking at a resume or really. I mean, you know, I, you know, when I first came back to yc, like I read all the feedback, like I, you know, we're on r y Combinator 2 with our anons and we know, like, you know, what people are saying is like, yeah, like we should pay attention to this and frankly, like, we need to do better than that. Right. Like, just because someone, you know, Parker did go to Harvard, but like, actually we shouldn't fund someone because they went to Harvard. We should fund someone because they actually understand the user and are super unbelievably tenacious. Yeah, that's actually universal for any product, any vertical, any like, set of customers you could have. Like, the most important thing is, you know, agency and taste. Like, agency is I see this person and they have this problem and I believe I can solve it using technology. And then taste is like, oh, well, let me actually build the first version and Then get it in the hands of people and did it work? And like, oh, how did it break? You go all the way into the weeds and it's like this incredible amount of. Imagine this, hundreds of thousands of lines of code and then you're going through and fixing all the bugs. Think about the tireless, ceaseless gardener that is necessary to. Have you ever been to the Baha' I Gardens in Haifa? Is the most beautiful gardens I've ever been. There's not a single weed. There's not a leaf out of place. It's like, I think about like the best products in the world. The best experiences in the world are like that set of gardens. And it's because people like, it's actually a religion and like they really, really care.
- [12:00]
A
Actually, I'm interested on that topic. I feel like a piece of advice I found myself change a little bit over the years is I think it used to feel a little bit more like you could just like ship something broken fast and then iterate from there. And I still think that's like a good general mindset. But I do feel like the bar for products is just so high now. Like, you know, like the quality of a software product at Series A seems really high to me lately. I don't know, how do you guys like advise people as they're like getting like MVPs out?
- [12:32]
C
Well, if Gary was able to ship 70,000 lines of code in a week while also running YC at the same time, and the kids, I feel like the bar for what two founders working on their idea full time could do before they interview with YC should be a lot higher.
- [12:45]
D
We see this in the batches. A few weeks into the batch we do or some of the groups do what we call, we call it product showcase. Now you just get up there and quick demo of what you've built so far and it's just like every six months over the last three years. It's like the bar for what you should demo even a few weeks into the batch just keeps going up and up.
- [13:02]
A
It also makes me wonder, inside a batch, a company ought to be able to pivot more times than they used to be able to. Like company ought to be able to try stuff, see if they get traction in a few weeks and if they don't like it move. Like are you seeing that happen? I mean, I know a lot of this is new, but do you feel like that's going to be happening? Is it happening?
- [13:20]
C
Absolutely. I think we're seeing companies try many things during the batch.
- [13:24]
A
Do you advise in that direction. I felt like historically there was the YC school of thought. I interpreted a little bit more as like, ship fast, iterate, see where you're at, go from there. And I've interpreted versus. In contrast, the Keith Rabois school of thought was like, you're a movie producer, dream your movie and then ensure it happens and don't let anybody say no.
- [13:45]
D
I feel like the YC job is so much more in sort of almost like the psychology therapist end of the spectrum on this stuff. And I think when it relates to ideas, at least for me, a lot of it is more going off the vibe of the founder. I don't really have a blanket. Should you pivot quickly and give up on this idea or stick with it for a long time? It's just like usually when you're meeting with founders, you can just tell if someone's been working on something. They never seemed excited about it, and two weeks in they're still not very excited about it. It's hard to tell them, oh, you just need to persevere and keep going. It's usually better for them to find the thing they have the spot about. What do you think? Yeah, I agree.
- [14:24]
C
I think an anti pattern for founders who are pivoting is like they have no existing prior on what a good idea is and they're hoping that the outside world will tell them what a good idea is. And so they launched like five totally different things or five totally different groups of users hoping that one of them takes off. They usually don't. Typically what I'll try to do is I'll try to dig deeper with them to try to find an idea that they actually care about and then see how we can turn that into a startup idea.
- [14:52]
A
One of the things that I've noticed, which a lot of people have noticed, this isn't some big insight, is that the sort of median startup in YC batches is a good indicator of like trends that are upcoming. Like I noticed a couple years ago before AI was like there was like one batch where like all of a sudden like half the companies were AI companies. Then the next batch it was like 75%. And then it was like, it all looks like AI companies basically, except for, you know, hard tech.
- [15:16]
B
You got hard tech too, 10% hard tech.
- [15:17]
A
YC is the hard tech of hard tech.
- [15:18]
B
Yeah, but there's a lot of.
- [15:20]
A
But so what is the trend right now that you are seeing a lot of that you think YC might be particularly attuned to early?
- [15:31]
C
I don't think there's any strong trends yet.
- [15:33]
A
It's all just AI right now.
- [15:35]
C
It's all just AI right now. I'd say some things that are smaller trends might be glimmers of the future. Just in the current batch. Prediction markets is big. I think Kalshi is very inspirational to a generation of people. Stablecoins and crypto stuff might be another interesting non AI trend to talk about. Yeah.
- [15:55]
A
Do you have a sense for why Kelshi and Paul, like, why are these companies. Because I agree they've captured something like what is. What is that, do you think? Like, I feel like there is a generation that has been very motivated and interested in it and it's clearly taking off. Do you have a feel for what that thing is?
- [16:12]
B
I mean, anytime there's a regulatory change, you know, these things were like in a gray area and then now it's green light. So dude, everyone's going to do it. Like there's, you know, capital flows to it. You know, capital is required for building consumer businesses and boom, you got a consumer business growing super fast. Like, you get more capital, the flywheel happens and you got another doordash, which is great. I mean, capital, you know, capitalism, bludgeon works there really, really well.
- [16:37]
A
Yeah, it's interesting.
- [16:38]
B
So, but what's funny is like, it's not clear to me capital as a bludgeon works as well with AI companies anymore.
- [16:45]
A
What do you mean?
- [16:46]
B
Like, you kind of don't need to have like the thousand people company anymore.
- [16:50]
A
It's interesting. I still feel like I'm waiting for that. Where like, I know there are obviously some companies, like I see companies that are like, I'd love to, like, you know, I invested and I'd love to invest more, but they're super profitable. I'm like, okay, that's great. I'm very happy for you.
- [17:01]
B
Yeah.
- [17:02]
A
But there's also companies raising bigger rounds than ever and consuming crazy amounts of capital. And in some ways it looks even more capital consumptive than ever before. And I don't feel like I have a good mental model to square exactly why that's happening.
- [17:15]
D
It certainly seems like it's easier to get to like a million or $2 million of ARR without hiring like anyone. Like, we're always, we're used to seeing this. We get so many investor updates and usually we're used to seeing like we just hit a million ARR and we had like 10 people and now it's just like consistently like, and we haven't hired anyone. So that's like new. I agree that like the step after that though, it seems like the bees are bigger than ever.
- [17:37]
A
Like they're huge.
- [17:38]
D
Yeah, right.
- [17:39]
B
Well, I mean venture is contracting a little bit. It's like not on a dollar basis. On a dollar basis, like there's a quote unquote flight to quality. And then one of the things we've been talking about internally is like the world is actually increasingly full of these mega funds that are friends and they do great work, but it's like more and more dollars behind fewer and fewer people.
- [17:59]
A
And so you're actually fewer firms.
- [18:01]
B
Yeah, fewer firms and fewer people at those firms. Right. And then the natural thing is like then capital is a bludgeon. Like the fixes in which is great. Like often like for YC, YC is sometimes the number one, number two and number four, you know, of any given like vertical SaaS space. And we're in the billion dollar one, we're in the half a billion dollar one, we're in THE arm, the rebels one that works with the partner. Like this happens over and over again.
- [18:26]
A
I mean so do you think in this environment then is the like king making meme, is that like more true because of the capital as a bludgeon thing? Like is it more effective in this type of environment?
- [18:36]
B
Basically if the founders are good, like the capital like helps them get there a little faster. But I don't believe that like capital as a bludgeon, especially when things move
- [18:47]
D
so quickly, you can end up having capital and then moving fast in the wrong direction.
- [18:52]
B
Like Hearts funded Giga and these guys beat. I mean we love Brett, we love Sierra, but yeah, Giga, this sort of 10 person team beat all the incumbents for things like DoorDash back to back to back. It's like they have the best tech and I think there may be still under 20 people right now.
- [19:13]
C
And Jack, speaking of insiders versus outsiders, that's such a classic insider vers versus outsider story. I mean glad were the backgrounds of the gigafounders.
- [19:20]
D
Oh like there were two IIT in India.
- [19:25]
C
They were still in India when.
- [19:26]
D
Yes, they were in India when they funded them. Yeah, they actually couldn't make it out here for the batch for visa reasons. But they were just like brilliant. They were clearly like brilliantly smart. They were like the top ranked IIT students. They had done their sort of as undergrads, they'd done sort of PhD level research in fine tuning LLMs before everything really took off. So they were just like clearly exceptional on that.
- [19:45]
A
Yeah, I mean to this point about the king making stuff. And not to talk around BookTube much, but like, you know, Ligoro is a, you know, startup that was like coming behind something that was seems really established and they're based in Europe and then they went through IC and they're doing great. And so it doesn't seem like stuff is like left up immediately.
- [20:01]
D
And that's a good example of like the price. Like even if you have the capital, you might not build like the right product off the bat. And then things change.
- [20:09]
B
I think the model's getting better. The model's getting better. So. So like back to back to back, like every single year the models are getting better. You know, the rumor for Harvey is that like, you know, you might, they might have spent a bunch of money, a bunch of the VC capital on fine tuning models that are like not better than the frontier models. I mean, you don't have a crystal ball. You couldn't have guessed that, that, you know, there was just an idea that maybe that might happen. Of course it did happen. And then now we're sort of in this situation where like, you know, if you have hundreds of millions of dollars sitting in your bank account, you're tempted to use it.
- [20:42]
A
The models thing is so interesting to me because one of the things that has struck me is that a lot of the source of product market fit actually exists outside the startup delivering the service. And so it's, you know, like you take an amazing founder like Max, you put them in a market like Legal, where there's just a lot of uptake for some set of reasons. And then it's like you have this tailwind outside the startup that's actually driving a lot of the like, aha moment not to take away from anything that they've done, but this is the case for all these startups. And so that just sort of changes some things.
- [21:11]
D
I think this is from the founder's perspective at least, and a reason why they're raising the bigger B rounds, one of them. I mean there's always that case of just like bank the money while you can get it, but it just feels like the surface area for the product is bigger than ever and they are still fundamentally constrained on the number of people they have to go and execute on things. And it feels like we're now SaaS era was sort of like you build one core feature and you hit product market fit with that and maybe just run with that for a few years and then add on things. Whereas now it's like even within the Batch people are trying to add more into the product and have it do more. And so they just fundamentally feel constrained by how much they feel they should be doing. And then they have competitors and competitors are moving faster. So haven't as yet seen that, like once you're post product market fit, it doesn't feel like that, oh, people won't need to hire as many or they're at least not acting on the belief they don't need to hire as many people yet.
- [21:58]
A
I would say one thing that doesn't seem automated yet is sales. For example, like, it seems like you still a lot of people thought that it would be automated by now. It hasn't been automated by now. Support has, but sales hasn't. And so like you still need a lot of salespeople. Seems like, you know, engineers are way more effective. But if you've got the capital, 50 engineers still going to be better than five engineers. So I think some of these things just haven't necessarily played out intuitively.
- [22:19]
D
It's great for everyone using the products. It's just like the bar for what you expect out of the products you use just keeps going up and up, which is awesome.
- [22:26]
A
There's also a lot of these markets that are so genuinely blue ocean and they look like good ideas and they are good ideas and it's totally new. And so the result of that is 50 startups doing something similar. And I think that's like a good thing for end consumers. Obviously you guys have a lot of companies that are in that situation, like we all do. I'm curious, like, how you, you know, in this competitive of a market moment, when every startup's got a ton of competition, like, does that change anything? Like, when you're working with like specific companies, do you find yourself saying you need to go faster, you need to be thinking about something differently. Does it update anything when we're in this type of environment? Me,
- [23:07]
C
I felt like Gary was holding back an answer.
- [23:09]
B
I'm hoping you guys have a good answer.
- [23:11]
A
I can answer my own question, by the way.
- [23:14]
D
I guess the reason maybe why we're pausing on it is again, just the yc, like getting things off the ground. It's usually, I know, especially during the batch we're so focused in on the like, is this even like, is this worth investing, like another two weeks of your time in and sort of like the units of time, is there a
- [23:29]
A
glimmer of product market fit or not anything? And that doesn't really have to do with competition.
- [23:33]
C
Yeah, at all.
- [23:33]
A
Exactly.
- [23:34]
C
And so I Feel like we actually spend the vast majority of our time talking about competition, telling founders not to worry about competition because it's all founders who are like, like, imagine if the Lagora founders had like, not launched Legora because they looked at Harvey and been like, oh, it's over. That's what we see a hundred times back is that story. And so it's just being like, don't worry about it. Like, just out execute them.
- [23:54]
B
Yeah. I think we always just go back to the make something people want and that, like, it says make something people want. It doesn't say, like, do a market map.
- [24:01]
A
Yeah, yeah.
- [24:03]
B
Based on what, you know, perplexity tells you, you could add that.
- [24:05]
A
You could say, make a market map and then make something people want within it.
- [24:08]
B
That'd be. We should make an April Fool's T shirt that says that.
- [24:11]
A
That'd be good.
- [24:12]
B
It's just like, make a market map, then make something people want. It's like, what the hell are you talking about? Like, that's definitely not how you do this.
- [24:18]
A
So, like, let's say like, somebody's working on customer support. Like, I'm pretty, like, that market is not saturated. Like, I'm pretty confident that a good team that comes into customer support and is like, I'm going to go find some more customers, like, they could do it. And so basically the view is just like, hey, if you can find customers and you get it going, like, don't even think about who else is out there, just go.
- [24:35]
D
I think that's basically, I mean, like, it's like, go out and get customers and if you have good competition, then, like, you have a hard time getting customers. It's like, and if I try and launch a new payment processor, I'm going to run into Stripe and like, it's going to be hard for me to grow really quickly and think that ends up being a lot of the advice during the badge.
- [24:50]
A
Yeah. I'm curious how much you guys think at like a macro level about stuff. Because I know, like the, the most important thing, which is, I believe, obviously correct, is to think about the micro getting this startup off the ground and going and then things can go from there. I am curious about some of the, like, macro things. Like, one of the ones that comes to mind for me is like the recent, you know, trend in public markets about sort of like SaaS multiples just getting totally hammered. Do you guys feel like SaaS is dead? Does that resonate for you? Do you see anything different in the companies you're working with?
- [25:23]
C
Is SaaS dead.
- [25:24]
B
I mean, I think it's dead. The thing is, it doesn't. If you run a SaaS company, you don't have to be dead. All you have to do is embrace cloud code or you have to embrace top to bottom agentic view of how everything's going to work. Put it this way, the same week that I personally realized that everything was different, I funded a team from Meta Superintelligence who had left and they were pointing out, like, you know, Meta has 20,000 people working on reality. You know, Alexa has 20,000 people. And it's like. And I thought about my experience. It's like I didn't even have like 20,000 people. I had five people. And like, why did it take two years? Well, it's because, like, I knew what the architecture was, I knew what I wanted to build, and then I had to farm this out. But then I had to have meetings and I had to, you know, come up with a doc. And then other people have other opinions and we have like five meetings about like, the architecture and like, we argue about it and then, you know, two weeks later, like, maybe something happens. But if you're in a big company, it's like three months later, something maybe happens and it's like, look, like we don't have to do that now. Like, we could just try both, like go into plan mode and then just do it. And then literally like an hour later we will have something done that would have taken like two weeks, two or two months, or sometimes two years for. If you're not a tech company and you know, you're an incumbent, like, it's like two years or never that you would even make that decision, right? So, like, the speed of making that decision, like how decisive you can be, like, honestly, I think like going back to the transformation thing, like, that's actually the thing that I feel like I learned at yc. It's not like I didn't know how to do it, it's just that, like, I was, you know, I was employee number 10 at Palantir. It's like we were moving like I was sleeping at the office. The big difference was realizing, like, instead of, you know, getting 20 basis points of Palantir, which now is actually an astronomical amount of money, by the way, like, we didn't know it at the time. I was like, we'll run some math.
- [27:21]
A
We'll put the math, it's in the billion. That's a thumbnail.
- [27:27]
B
Yeah, that's perfect. Yeah. I mean, basically I wanted 97% of the company that I started, right? And then I think that that's, like, I went from a place where it was already fast, and then being the founder and the CEO, like, YC sped me up even more because you're in office hours with people, and it's like, oh, man. This person actually grew 10% this week, 20% this week. Like, how did they do it? I need to do it. And I think all of this is an accelerant, like, cloud code and Codex. And being able to, like, make two years worth of product progress in about two weeks, how could that not make YC more insane?
- [28:04]
A
Totally.
- [28:05]
B
Like, the amount of things that you could try and do, it's like, honestly, you could do two years of work, realize that, like, actually, nobody wants this, or there's too much competition, and you throw it out and then do it again. And the thing is, like, that's not throwaway. You learned something. You also got better at, like, using these tools, and then you went out and you get another shot. And so what's funny about, like, like, SEED is you could think of people raising, like, two or three million dollars, you know, that used to be Series A, by the way, which is hilarious.
- [28:33]
A
Now it's barely a seed.
- [28:35]
B
Yeah, yeah, yeah. I was like, oh, that's kind of a small seed. It's like, are you serious? That's so much money. This is outrageous. You don't even need this money. It's crazy that you can go so much faster.
- [28:44]
A
I actually. I do want to come back to fundraising advice, because I feel like it's gotten into an interesting place there. But the opposite question of the isaas dead is what do you feel is not AI, but safe from AI? Are there areas where you feel that you think are sort of insulated from this megatrend that you're happy to back
- [29:03]
D
without the obvious one? Yeah, I'm certainly on the first one. Just like marketplaces that are aggregating people. I think Airbnb is very safe. I think, while not safe, I think there's a bunch of marketplaces. Since DoorDash is totally safe, it's going to be a very clear one.
- [29:18]
C
Right.
- [29:18]
B
One of the things we've been talking about is what the agents want, what the coding agents tell you to do turns out to be, like itself, a really big moat. So geo, like, making your API docs actually written to prompt, inject Claude code to force it to use you. I'm just joking. It's not clear that you can do that, but if you could, you would, because it's that powerful. Like, people will just, I need X and then, you know, what's the best thing on the Internet to do that? And actually that's really powerful. Yeah.
- [29:50]
D
I think the other thing you might say, like, maybe the SaaS thing is even within SaaS, you might say like things that feel like they are essentially databases or systems of record, things like rippling feel like they're going to be in a good spot. And then things where they like the moat was around the number of integrations they built or like data connectors or that kind of stuff which you can now just like code in 30 minutes is brittle.
- [30:14]
A
Do you think it's system of record that makes payroll sticky or do you think it's touching money?
- [30:18]
B
Touching money? Regulatory. I mean, once it's you, I mean you have systems that are working, you don't want to touch that unless you have a really good reason.
- [30:26]
A
Yeah, because like one of the ones that comes up a lot right now is like, are CRM safe? You know, like our old. Which I don't have any. I don't have actually a particular strong opinion too, but it just seems like an interesting question where it doesn't exactly touch money. Doesn't exactly touch regulatory. Includes a lot of information that's important, but like that information also now can like live in email or somewhere else like that.
- [30:45]
D
So, yeah, I think Salesforce is probably screwed. Like, I feel like there have been so many attempts to do the stripe strategy of you get the startups in a YC batch using your CRM because everyone hates Salesforce, but no one could ever really grow into a big company because at some point your head of sales is like, no, I need like these reports.
- [31:01]
A
And to your point, you need the integrations badly.
- [31:03]
D
Exactly. And now like that's all just going away. So I don't, I suspect like the next Salesforce is going to come out of like a YC batch that sells to all the other YC startups and investors will say, oh, it's not going to grow because, like, no one can really compete with Salesforce and like also
- [31:18]
A
all its customers are YC companies. It can't be.
- [31:20]
D
Yeah, exactly, exactly.
- [31:24]
A
What about hardware? Is hardware safe?
- [31:26]
B
Hard tech is just hard. So the moat comes from it being just, you know, hard to source, hard to make it work. Like, I mean, it's just another.
- [31:33]
A
And it's atoms. Like, but the air hasn't exactly come. The AI hasn't exactly come for atoms yet.
- [31:39]
B
Yeah, robotics in a little ways, but we just need more. We need ASI we have, I think we have AGI now and then ASI is coming, like super intelligence is just clearly just around the corner.
- [31:50]
A
You think it'll just be like a. When we know, we know or you think there will be like a thing that to you would say that like that new moment is here?
- [31:57]
B
I mean, I think like we have limited versions of ASI right now.
- [32:00]
A
Like I saw like all the bots talking together. That was crazy.
- [32:03]
B
Yeah, that was crazy. I mean that's a great example of like, that's the first example of like swarm intelligence.
- [32:08]
A
Oh no, it's bad.
- [32:09]
B
Like in AI research that's like swarm intelligence is like this huge field. But like this was a huge validation for that field because, you know, it's kind of an interesting question, like will there be like all the, the main labs talk about, if you talk to the AI researchers at big AI labs, they're like, yeah, we're just going to build the God model.
- [32:29]
A
Yeah.
- [32:29]
B
You know, it's going to be mega big. And you know, just think about like Dr. Manhattan or something. And then, you know, biological systems and even human society are not modeled that way. It's like we have lots of people with lots of diverse hardware, a lot of different opinions about all kinds of things and then you sort of come together and see what sticks. And that's what like research is, for instance. So I think swarm intelligence versus you know, sort of God level intelligence is actually very, a very interesting thing. That that's like just the beginning of that, that just happened literally last week.
- [33:02]
A
Is there a type of project or pathway for a startup to build that you're not currently funding that you'd like to. And like the example that I'm thinking of when I'm, you know, I'm thinking about some of these hardware companies or projects at the beginning that I don't think can start with a million dollars. Like some of these genuinely do need to start with 10 or 20 million dollars. Is that something that you think about? Is that something that like, is that. Would, would a divergence like that ever be worth it to yc? Or is it like we don't need to back every single type of company of all time.
- [33:37]
D
We would like to back every single type of company. Well, time maybe.
- [33:41]
A
Yeah, that's actually the kind of thing I was curious about. I was like, is the conversation when you guys are thinking about like YC growing and all of that, is it like we have our style and we like to just get everything within that or it's like, no, we'd like to back every company of all time.
- [33:53]
B
We're generalists. And then the smart. I mean, YC funded Coinbase when crypto was like, the weirdest thing. But, you know, Brian Armstrong was in the risk team at Airbnb. It was like, you know, in the anti fraud team. And he was already in the family. And then he said, oh, well, how do I start a company? This is clearly the way to do it. And then what's funny about it is, like, you could start, like, 20 other Coinbase competitors, but, like, all of them died because it's sort of like when you're early, it doesn't matter. It matters more like, who's the person and what do they believe? And then that person goes on and creates the future. So being generalist is an incredible thing. It's truly the best.
- [34:31]
A
Is there a slice of the market or a type of company or founder that you feel like you want better exposure to that you're, like, actively working on?
- [34:40]
B
I mean, coming back to yc, one of the things we realized is, like, we have a huge media presence, but on the other hand, on its own, if you just watch the YouTube channel, it's like, oh, this is like something in the sky. I heard it's, you know, 1% acceptance rate. Like, people just kind of, you know, think that it's maybe not for them. And then what we find is, like, all of our best people either know someone who did YC or they met a partner directly and at a. At an event or they actually came. Like, we actually have to be in the community. We can't just be, like, in the sky on the Internet.
- [35:13]
A
Right. You can't just wait for apps to come in.
- [35:15]
B
So, I mean, Jared led this, like, you basically got us to how many college campuses last year?
- [35:22]
C
Over 30 college campuses. Yeah. So we have a huge boots on the ground effort now to go and talk to undergrads everywhere. We just got back from a big trip to Europe. We're going to India in the spring. To also go back to your point, though, about groups of people that we would love to see more of, we have a big effort this year to do what we've done with undergrads over the last two years, which I think has been pretty successful, and to expand that to grad students and people who are more like Brian Armstrong's age, like more like mid and late twenties.
- [35:47]
A
Yeah, I will say, in a good way, they're unbelievably impressive. But YC founders are young and they seem like it's like in Recent batches have trended even younger.
- [35:55]
C
Potentially. They have, yeah.
- [35:57]
A
Which makes sense.
- [35:57]
D
I think.
- [35:58]
A
AI and a big change like this favors younger people for all sorts of reasons.
- [36:02]
B
So for what it's worth, I'm a late bloomer. I did YC when I was 27.
- [36:06]
A
I was 26.
- [36:07]
B
Yeah. So hey, late bloomers, high five the old guys.
- [36:12]
A
But that's the old guys for YC.
- [36:14]
D
Many of the biggest YC companies were started by founders in sort of like mid to late 20s DoorDash shame.
- [36:20]
B
Super old.
- [36:21]
D
You should definitely quote me on that.
- [36:23]
A
We have tons of old people, 26 year olds.
- [36:28]
B
You know, we started with going back to colleges and I mean this was kind of driven by them though. I mean, I think big tech stopped hiring. And then simultaneous to that, like we have a real vibe inside the batch sometimes among the young founders. That is the last time to participate in capitalism, which I definitely think not. But it's like a powerful idea.
- [36:50]
A
I think a lot of people feel that way.
- [36:51]
B
Yeah.
- [36:51]
A
Yeah.
- [36:52]
B
Why is that?
- [36:53]
A
I think there's probably a lot of people who are like, if AI is going to like actually stay on this trend, what are we possibly better at? So I gotta, I gotta do it while I'm still better at something.
- [37:03]
B
I feel like that is so like shortsighted. It's unbelievable. Like Ryan Peterson always talks about, like, don't you think that, you know, human capacity for desire is like virtually unlimited? Like we're just, you know, we have a God shaped hole in our heart, you know, like we're gonna want more and more stuff and the thing is like, like we can do it now. Like I was just thinking about the turn of phrase. Like I'm sure you've been in business meetings or like making decisions about products where it's like, whoa, whoa, whoa, let's not boil the ocean now. And it's like, I love that term of phrase because I've said it a lot. I've used it to like justify not doing things. But like in the age of intelligence,
- [37:37]
A
you can just do things.
- [37:39]
B
Why not? Like, I mean, maybe not boil the ocean, but let's boil a few lakes. Why not, right? Like actually this is sort of the moment. And so when you connect that to what Ryan says, it's like that's what that would look like, you know. Why? You know, if you're an investment firm and you like, you know, beat the market, you're like 20% net IRR back to back. It's like, you know, what does this stuff mean? Does it mean that we're going to hire, like, we're going to fire all of our analysts and like, we're just going to have the AI do it. And like, this one person who runs the firm is going to make all the money. Why would you want to do that? Because your competitor isn't going to do that. Your competitor is going to say, you know what, we have AI now. I want 50% now.
- [38:13]
A
That's the thing I have not understood about like, oh, we won't need capital. Because I'm like, why would you only want five engineers if your competitor has 50? Yeah, doesn't make. Unless they can't do anything productive with all the agents. It doesn't make any sense to me.
- [38:25]
B
Yeah, I think it's just like, yeah, let's boil a few lakes first and then we can boil the ocean. Like, I think, I mean, I'm not serious about that. Obviously there are limitations to it, but like the, the invective against AI and this idea that like society is going to fall apart is so extreme that I'm like, maybe that is like, we need some other alternative turns of phrase than like apocalypse.
- [38:48]
A
It's been a weird, I mean, on that it's been just like a weird thing watching sort of the efforts to both sort of like manage, but also like impact sort of like societal, like understanding of like what AI is. And I feel like there is still a lot of like fear embedded. And like, I think outside of San Francisco, you go to other places in the country. I think, like, you know, I'm from St. Louis. Like, I don't think everybody trusts AI fully and, and whether that's right or wrong. I do think it's important to get out of our little bubble sometimes on a lot of this stuff just to know where the world's at a bit more.
- [39:20]
B
That's for real.
- [39:20]
D
It's interesting though, it feels different this time because clearly in our little bubble here, everyone's all pro AI. I always say my other extreme, I have parents, immigrants don't speak great English. My mom's totally digital chatgpt because now she can just do all this stuff that she can just send letters to reply people in a way that's super empowering for her. It's like the kind of middle the people who are threatened by is AI going to take my job? Has it really been a threat to knowledge work or white collar people? Usually I feel that people who are actually not early adopters but tend to get on the train immediately after the San Francisco train takes off are now resistant to it and it sort of bypassed them and has gone to the other end.
- [40:02]
B
I mean, I sympathize with that. And as labor that became management and capital, I totally feel that. And I think it is actually about, you know, in the Marxist sense. It is actually about like where you fit in there. And then my argument would be like, it has been way more important to become a founder, which is like management that becomes capital now than ever. It's way more possible. Yeah, I think that like that fear of for workers about like what's going to happen, that is actually something that management and capital has to take. It's a responsibility.
- [40:36]
A
I think so too. I think it's like very easy to like be like, oh, in the arc of history there's always these new technologies and people find new jobs. It's like, well, yeah, but there's like a lot of structural unemployment that happens in the middle of that and that's like real.
- [40:49]
B
Yeah, but this unemployment only happens in zero sum games, right? It happens in a case where it's like, actually my company does X. Like I make widgets. The widgets will never change, they will never get better. There's, I mean, some of it is in the context of like, no competition. One of the things we learned from hard tech companies, for instance, is that like it's impossible to get like a certain block of methods. Like you have, you know, you have to get it fabricated or like smelted in China. Like America's like lost the ability to do it, right? Like when you have a market that is so broken that you can't get it inside America, like, how did this happen? Right? And so I would go back to, you know, capital and management and say this is a lack of fucking imagination, right? Like, we're not here to like just continue to do like let's shave off like 1 or 2% every single year and like increase our net profit and that's it, right? Like we need to think way more about how can we use this technology to radically change how businesses work. How, like, what products are, how much better could they be.
- [41:48]
A
I completely agree and I think if capital management don't like take some responsibility there, there's not just the unemployment, there's also like reduced employment. There's also like, the whole world's getting more expensive, home prices are going up. While there might be like pressure on wages because you can do it more cheaply with AI and so you have like inflation happening with wage pressure at the same time. Like, like, I do think it's like A more real thing than like our echo chamber. Once, like, and again, totally for it too. But I think it's like, I think it's an important thing.
- [42:18]
B
I mean, that's why we've been so vocal about this idea of little tech. You know, we have Luther Low who used to work at Yelp, and he's in D.C. full time fighting for startups to be able to actually train AI models, to be able to enter markets. And you know, frankly, like, I know we, we have lots of friends at Apple and Alphabet and we have huge respect for those companies. And then once in a while you'll see in the press like, oh yeah, we submitted an amicus about Apple and Alphabet, not because we hate those guys, but because actually we need tech to allow new startups and new entrants to come in. And so to me, it's all very consistent. It's like we need to be way more aggressive about what our products and services should be and can do. And then we need markets that allow those people to actually, you know, exist, thrive, hire lots of people and create new, like, new jobs. Like, that's basically like, you know, a lot of people are like, oh, I work in tech, I don't know how to do this. And it's like, look, it's actually abundance. Like, we actually have to build again. Like, we've become a litigious culture. I'm sure you've read this book, Breakneck, about like China versus the us It's Dan Wayne's book. It's incredible.
- [43:33]
C
It's really good.
- [43:34]
B
It's basically we, you know, we built a lot in like the 40s, the 50s, and then sometime around the 60s and 70s, you know, 6, 7, I mean, they literally stopped building. Right? And we've been in this sort of, you know, we can't build high speed rail. It's insane. Like, why? Because like, basically we're totally a litigious culture that cannot like, get out of its way.
- [43:55]
A
Yeah, I saw some Peter Thiel talk about, like, we built all this stuff till the 70s and then for like 50 years, nothing happened except computers, more or less. And even right now, most of the revolution is in computers, which is great that it's better than nothing. And obviously other stuff is happening too, but it is. You look at what China does standing up a city in no time, and it's like, they're really good at robotics. What are we doing on this sort of just societal topic? Obviously you guys are very engaged with the city and the state and things like that.
- [44:27]
D
Some more Than others.
- [44:28]
A
Some more than others. Yeah, maybe. Like, my one question on this, this is, like, what do you think is the posture that San Francisco and California need to be taking? Like, what's the most important thing posturally that we need to be taking?
- [44:42]
C
I mean, this is Gary's area. Gary, how do we fix California politics? Gary has a plan. I'm kidding. But, like, actually he does. Yeah.
- [44:49]
B
I mean, Matt Mahan just announced his race for the governor. I think that he is the perfect example of someone who is not virtue signaling. He's, you know, he built more than 1,400 homes in San Jose. The year before that, he hadn't passed all of the legislation he wanted. So zero market rate housing was built in San Jose in 2024. When he came into office, he reduced homelessness by 20%. Like, more than a thousand people came inside and got treatment and recovery because he actually supports treatment and recovery. I didn't want to be involved in politics, but when I saw that my Asian American grandpas and grandmas, like, couldn't walk down the street without being assaulted and killed. When I saw, like, people like me when I was, you know, 16, 18, like, you know, I wanted to participate in tech, I knew I wanted to be an engineer. I didn't know that I would get into Stanford. Like, you know, I wouldn't have been able to do that if I didn't have algebra in, like, middle school, public middle school. Like, my kids, like, you know, my kids go to private school, but I went to public school school, you know, and we should have a government that, like, doesn't require you to be rich to become a startup founder or good at math even. Like, I mean, is this, like, how do we get this bad?
- [46:03]
A
So. Well, I'm glad you're fighting for it. It's very important and it's not pleasant. And I see you fighting on Twitter in a way that I would not have the stomach for. And I'm glad you're doing it.
- [46:11]
B
Yeah, Yeah, I appreciate it.
- [46:13]
C
Yeah.
- [46:13]
B
No, I mean, I think for people watching, it's like, look, I'm not going to get all the takes right. And, like, I want to hear when I don't get it right. But on the flip side, it's also, like, have the debate.
- [46:22]
A
Yeah. No, and you have the courage to, like, it takes a lot of courage to say stuff that you think and, you know, you might be wrong about and you might get, you know, a big blowback on and, like, or even if you have it right, people are gonna get mad.
- [46:32]
B
San Francisco and California got this bad because the people who, you know, I mean, they run businesses, they have jobs, like, they, you know, are trying to raise their families in California. It's like all of it was so big and so scary that. That we stopped paying attention. And, like, San Francisco is on a better path because we started talking about it. Like, at dinners, we started talking about it, hey, did you hear about so and so they got assaulted? Like, did the police actually show up? Like, what happened with the judge? You know, like, we're gonna try to unseat some judges in San Francisco for whom, like, you know, I was looking at the records. Like, there are a hundred cases and like 90% of the cases, this judge, she basically just like, dropped it on the floor at an extreme rate. Like, I think it was like three or four times higher rate of just dropping cases on the floor purely for ideology. It's like, unbelievable. Like, how is this person serving the people? Like, they're not. And then the thing is, there's a reason why we elect these people. Like, there is an election coming and, you know, we have to make sure that we hold these leaders to account.
- [47:42]
A
Totally. No, it's great. I mean, it's super important, and it's like, not easy work. So people got. Someone's got to do it. And I'm glad you're doing it.
- [47:49]
B
I appreciate it.
- [47:50]
A
Yeah. Okay. Politics tangent aside. Although I could talk about that the whole day.
- [47:53]
B
I know, right? But we'll do the politics episode.
- [47:57]
A
Gonna get you and some politicians on here. One of the things that I'm curious about that has been an obvious topic for me on other episodes has been like, mega influx of capital into venture. Is that a positive or a negative for you? And in what ways do you experience it as both?
- [48:14]
C
I think it's mostly positive for us. Why I see it its best is not competing with other venture firms for deals. YC at its best is convincing people who didn't seriously think about starting a startup to go for it. And then being there for some believer, YC only works if there's a large pool of downstream capital that can then fund all the subsequent rounds for those companies. And so I think actually YC does best in those environments.
- [48:39]
B
Yeah, we're a managed marketplace, so we need, like, as many great investors as possible. And then actually what's funny is, like, in that managed marketplace, if, you know, the sort of supply goes up, like, we need to go out and find the best possible people, and then we're actually really good partners to the rest of the industry like VC can, you know, 2x, 5x or 10x over the next 10 years. And we will meet the demand with companies with really the smartest people of our generation. And if that happens.
- [49:07]
A
So you're saying you feel limited by the amount of capital still?
- [49:10]
B
How about this? I mean, capital from VCs like you are VCs, like our friends. Seriously, like, I mean you gotta do the work, show up, like, don't disappear, don't be a dick, like you know, do no harm.
- [49:23]
A
Right.
- [49:23]
B
When I first came back to yc, like one of the most interesting evolutions of like how to deal with investors was that like most investors are actually what B's, like B or B plus. Like you should be so lucky to have someone who like does not mess with you. That's really good. And then obviously bar solo. Yeah.
- [49:44]
A
I mean basically damage the company.
- [49:46]
B
Right. If there's someone who you know, has a great network or you know, can make the Keynesian beauty contest happen for you and your company and year round, obviously they're a investors and you know they're going to catalyze something crazy for you, you know, you should work with it. Last time we were here is like, yeah, if you can get like Keith Raboy to invest in your startup and give you like $20 million, you should probably take that money, man. Like you know, do it right. But for everyone else it's like you gotta, you know, find people who sometimes you gotta do B plus capital. It's okay, you know.
- [50:17]
A
Well, it's sort of interesting because you know, you made the point which I agree with, which is that there's, despite the total volume of doll, there's like in some ways a consolidation of the number of venture firms or players or things like that. I don't know if it's like more companies getting funded or if it's just a lot more dollars going to just like a couple breakout successes. I guess both of those help.
- [50:35]
B
I mean we actively think about we need more A and A, you know, investors.
- [50:40]
A
Like humans doing the work.
- [50:41]
B
Exactly. I mean, and I think they're all going to be YC alums like you. I mean, I think you're great. ILI Sukar is incredible. Dan Levine at Accel, like, you know, Yuri Sagalav now runs the seed program at GC and he's incredible. Like I, you know, I fully hope and expect like the top like 80 out of the hundred spots of the Midas list in the next 10, 20 years will be all YCL.
- [51:05]
A
That's funny. You're like funding VCs like just on a 10 year delay.
- [51:08]
B
Yeah. I mean Liz, Liz. The first round is killing it. She's incredible. Right? So I think that's like, you know, scratching the surface. Like I think we're gonna have like dozens of the most legendary people and they're all gonna be YC alums who like deploy all the world's capital.
- [51:22]
D
Increasing the number of good startups in the world is I would argue, just the core founding principle of YCE. When I first started working at YCE in 2010, it was the first thing PG said to me and it wasn't actually clear why he wanted to hire anyone. This seems like it's a nice family business. Two of you working on it seems great. And his whole point was that there's the conventional wisdom in the VC industry. It all comes out of Andy Ratchliff's research. There's only going to be 10 companies per year that will go on to reach $100 million in reven you and be significant in IPO at some point. And you just have to be in one of those ten companies every year. Otherwise you may as well just stayed at home. And PG was like, well, I don't want to, I'm not like a vc. I don't want to go out and fight for those 10 companies. I just like, we're going to make more of them.
- [52:07]
B
Yeah. He's like, there's more.
- [52:08]
D
Then let's see. We can make like two of them. Why is it 10? It's just like such an arbitrary number. And I think clearly over the last 15 years that's proven to be true. And I just feel like everything we do here is driven by we want that number to go up. What are the bottlenecks? Are the bottlenecks like more founders? Let's go find more.
- [52:24]
A
Yeah. When you went to four batches, that
- [52:26]
D
was exactly a good example of it. That was a bottleneck. You shouldn't have to wait six months to do a YC batch.
- [52:31]
A
What needed to be true for you guys to go from 2 to 4? What was hard about that? What did you have to change if anything? Was it just you didn't get as much time between to source new companies?
- [52:41]
D
Maybe this is in the weeds, but one of the structural changes we made at YC since Gary came back is to sort of of decentralized yc. I would argue it was pre Gary coming back a lot more centralized. There was sort of like a team that sort of ran the batch and sort of things were More top down,
- [52:58]
A
decentralizing decisions, batch operations.
- [53:01]
D
Yeah, but yeah, just basically maybe if I start from the bottom. It's like now each YC partner is essentially picking their own companies and then we club together to form a group that runs a batch. But we're just like more nimble. Like we can just sort of do things in a way that wasn't as easy before. Yeah.
- [53:16]
B
And plus we have 15 people now. This is like the most number of partners we've ever. We have 15 visiting partners right now. So there's actually like something like 30, 31 partners total right now.
- [53:27]
A
Do you feel that there's a limit to those numbers or do you think you could, could you double the number of YC partners and therefore double the number of companies? Like what, what do you think? If you're imagining a world where you're funding four times more companies than you are today, what would you need to overcome still?
- [53:40]
C
Well, a cool thing about the way YC is structured now, and I think this is something that's like often misunderstood from, from the outside, I think when most people Hear that a YC batch is 200 companies, but they imagine the batch experience is like a room full of like 400 founders showing up every day.
- [53:58]
A
It's actually four batches of 50 Pikeshire Halt.
- [54:00]
C
Right. But it's actually more like each partner is running their own Autonomous Mini YC and it's 30ish companies. We call them pods. I mean I had my whole pod over to my house for dinner last night because approximately the same size as YC was when Gary went.
- [54:18]
B
We basically run like seven or eight simultaneous 2008 batches with PG.
- [54:24]
C
Exactly.
- [54:25]
B
And we have 15 PGs now. Yeah.
- [54:27]
C
And so with that kind of structure, there's no inherent change that has to happen if you go from 15 to 30 of them because it's like fully paralyzed already.
- [54:34]
A
I mean, one of the ways I've perceived YC change over the last several years or something was there were, there was this period I guess when like my brother was here where there were like a bunch of new projects. And then I felt you guys kind of you, you clearly went back to the core and then did more of it. Like I could feel that very clearly that it was like this is our thing and we're going to refocus on that, but we're going to make it more and bigger. And I think that's been super successful. And you guys have like clearly throughput more companies. The companies are awesome. You know, I'm saying that as a Biased person who invested a lot of them. But it feels that way to me. Are there initiatives outside of that core that you are interested in? With the new market moment, are you like we're gonna just do more and more of this distilled core or does it depend on the day?
- [55:20]
C
Well, first off, I think that's a good overall description of like how YC has changed, especially since Gary came back, is like refocusing on the core. That's been sort of like the high level of the last three years. But yeah, we do have some big projects in the works. I'm not sure which ones we can talk about.
- [55:33]
B
I know there's so many and just
- [55:35]
A
talk about them in the works. Yeah, I don't know.
- [55:39]
D
It's not like we have of new initiatives that don't feel core. I still think it all falls under the umbrella of the core. Thing is how do we create mortgage startups and keep pushing down on that? And as Jared mentioned, fellows, just an example of something we just launched last year, which is what's another bottleneck, is more founders. We want to meet the founders earlier college students before they're ready to do startups. And so we've started offering just grants and community to exceptional college students that we feel like maybe they're not ready to do a startup right now, but they might be in a year or two.
- [56:12]
A
That's a good ex example of widening the base even further because it's almost like you could narrow the top and you could say, you know what, we're going to actually put a bunch of money into growth. Obviously you did that. But the other way to go is you could widen the base and you could say actually we're going to try to have some engagement with 10,000 founders or something like that.
- [56:28]
D
That's basically what we think a lot about.
- [56:30]
C
Yes.
- [56:30]
A
Yeah.
- [56:31]
C
Because amount of follow on capital is not really the bottleneck right now. Really the bottleneck for us now is getting more great founders to want to do startups and to do yc, which is what the bottleneck should be like. If the bottleneck is anything else, something is weir. That's what the bottleneck always should be. For a long time YC was just struggling so much to just scale the operational side. We were like a post product market fit company that couldn't keep up with demand. And so instead of focusing on growth, how do we get more users? We were like YouTube when it was scaling by 2x every month and just everyone was just trying to figure out how to keep the site up that was certainly the first few years of me at YC was just trying to figure out how to not fall over. But now that we've really got the operations down, we can go back to focusing on what we should be focusing on, which is like, how do we broaden the base? How do we get more great people into our ecosystem early? How do we inspire more people to start companies?
- [57:23]
B
I mean, one of the most fun things from. I mean, I pinch myself that, like, I get to, you know, I had left YC and then now I get to, you know, go hang out with PG and Jessica again and hang out with Brian Chesky who's on the board, and then one of the directors from the board. That's awesome. Is you need to make sure that we're having fun. Like, and that was true, like, back in 2011. Yeah, yeah. Basically like that. You know, that's sort of the. The directive we got this year. That's like not a directive at all. It's like, you know, awesome, actually. It's like, if we're not having fun, then we're doing something wrong, actually. Like, and, you know, I remember, like, just YC being around YC and the partners and PG and, and PB and Jeff and all these, you know, it's like, it was just very, very hilarious all the time. It was like, unbelievable how weird, you know, startups can be. And like, can you believe this thing happened? And then I feel like our partner lunches with that again, which is really fun. It's like.
- [58:20]
A
And that's so important, like, having, like the partnership like that where everybody, like, trusts and enjoys each other and respects what people think. Like, that's just gotta make the whole experience so much better.
- [58:29]
D
It's why everyone's a former. All the partners are former YC founders. So it's like, just feels just like a little bit more than a job for everyone. Like, everyone's got sort of a pay it forward. YC changed their life in some way. Like, just adds to the good vibes, I think.
- [58:42]
A
Yeah. It is obviously an iconic and very important institution and you guys are doing a great job running it. And so I'm sure it is both. Like, it feels like a heavy responsibility, but I'm glad that you are. I'm glad you're having fun with it. You guys, this was really fun. Thanks for doing it. Really appreciate you making time.
- [58:55]
D
Thanks for having us.
- [58:56]
B
Thanks, Jack. So when are you going to be a YC partner?
- [59:04]
A
Keep checking my inbox.