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I have been an entrepreneur for 15 years now, building my third company - MagicBell. I bootstrapped the last one, SupportBee, to over half a million in ARR. However, I decided to trade it for a new company and follow the venture-backed route this time around. The first stop on this journey naturally seemed like YCombinator, and I am happy I applied and was accepted.
In this post, I want to talk about my experience in the W21 batch that's still underway as I write this. TLDR; It's worth it - apply!
While I bring a ton of technical and business experience to a new venture, the fact that I never worked in a FAANG or venture-backed business means I don't have the network to raise money. Some people around me felt that my experience bootstrapping my last business should be enough to close seed funding, but the only thing that helps close funding is the fear of missing out on your deal. I witnessed this first hand after we launched to #2 on Product Hunt. We got some good inbound investor interest, but I couldn't create the pressure needed to close funding - there was no forcing function like the demo day. We had already applied to YC by this time (and were invited for an interview), but this experience reaffirmed my desire to get into YC.
YC has been around for a long time, and so have I.
Naturally, I had some ideas about the program that weren't necessarily accurate. The biggest one was that Ycombinator is all about raising money, and if you are not in the mindset of 'raise as much as you can, as often as you can,' you won't fit in. Even in the first few weeks in the program, it was evident that YC advocates building a solid business - ideally without funding. Ironically, that leads to investors wanting to invest in you. However, YC never pushes you to raise money or raise more than you need.
I had some concerns about the fully remote batch, but in the end, the remote setup turned out to be a really positive thing in many unexpected ways. More about that further down in the post.
YCombinator pioneered the open application model of startup funding. I have applied before - several times, in fact. However, I was never accepted. In fact, I was never even invited for an interview. Looking back, I realize I made a few mistakes with my application process. Some of these are surprisingly common:
Solely focusing on how customers find your product useful is a mistake. Customers make the startups tick, but early-stage startups are about the vision of what the business could become one day if everything goes right. You use the customer traction to back that story up. It's important to write in your application why this can become a large business and what you envision that journey to be. Michael Siebel has a video on it.
It's much better to write clearly and let your traction and your background do your bidding instead. You don't have to convince people that your business cannot fail - investors understand the nature of bets. However, you have to convince them that the resulting company would be massive if everything goes well.
If your business is making progress and you think YC can benefit, keep applying. A lot of companies get in after multiple attempts and go on to do very well.
One of the biggest mistakes I made in the past is not getting feedback from YC alumni and ex-partners on my application. Many proactively offer to help with your application on Twitter. Take them up on it! You may have a certain writing style, but these people understand how YC thinks (and reads) and can help you craft a narrative that can help your application resonate with the partners. If you receive an interview invite, seek out help with mock interviews too, but avoid doing too many of them as they can make you sound overly rehearsed.
You can read our YC W21 application or see the application video below
Finally, let's talk about the YC experience, and then we can touch upon the remote experience.
The batches keep getting bigger and going remote has only accelerated this trend. However, YC is very software-driven, and the structure of the batch facilitates scaling up. In fact, Startup School is YC's approach on a much larger scale.
The batch is divided into several groups, and the groups are divided into several sections. Each group has four partners. This structure has implications for your interaction with your peers and partners, as I'll take about in the next section. You'll end up getting to know the companies in your section very well.
For example, HUBUC, the embedded financial services provider, was one of them. We chatted with Hasan Nawaz, the CEO and Co-founder, about our shared YC experience in one of the MagicBell podcast episodes. Another one was Stacksi - a company that makes security questionnaires a pain of the past. Since security and privacy certifications really matter when closing large enterprise deals, we were very lucky to get to know them early on.
Generally, YC tries their best to match you up with companies in your timezone, industry, and stage.
The first week of the program is the Bootcamp - a lot of talks on product development, customer development, and sales. There are also special workshops for Biotech companies. From the second week onwards, things fall into a predictable routine - Tuesdays are talks from successful alumni, Thursdays are group events, and Fridays are group office hours. You are encouraged to book 1-1 office hours with your partners every 7-10 days, but they aren't mandatory.
The program itself is different than I had imagined. Like I mentioned earlier, it's a lot more focused on building a great product and a business that can run without raising money, and then using that momentum to raise money.
This leads to two distinct phases. In the first one, which lasts roughly two months, most of the talks are focused on building a great product and company. Some founders do use YC to raise money, but that's certainly not what the partners encourage. The office hours are about discussing your demo day goals and the roadblocks in achieving them.
The next phase kicks in the final month, and then everything is about the demo day and fundraising. In the group events on Thursdays, the alumni talk about their fundraising experience, the office hours deal with fundraising questions, and the Slack chats are about fundraising too :)
Apart from getting help in setting up the company, the resources (AWS credits, great deals on other software), I found a few things very useful about the experience
The number one benefit is the advice you receive from the partners. Partners at YC have worked with hundreds of startups and have good advice. You may not agree with everything and that's ok - but they can be a good sounding board nevertheless.
The talks by successful alumni are very inspiring. While I had read about some of these alumni and seen their talks on Youtube, the Tuesday talks are much more candid since they are completely off the record. People share the ups and downs of their journey in ways they can't do otherwise. This time many of them called in from their homes and so the talks (and the people) felt even more relatable.
When building a startup, you need to get things done, quickly. The YC community is a great resource for finding service providers to work with - lawyers, accountants, software vendors, domain brokers. You are usually one post away from getting trusted recommendations.
Given that YC gets tens of thousands of applications and accepts a small percentage of them, your peers are very smart and ambitious. Everyone is working hard and trying to make a lot of progress on some very ambitious demo day goals. In group office hours, everyone shares their progress and seeing your peers make a ton of progress week on week is very inspiring.
YC is very supportive of women founders and minorities. There are several female partners, and as far as I know, every group has at least one. My group's partner Reshma has been very supportive, checking in proactively at times to make sure I am doing well.
If you have read this far, you can tell that most of the benefits I have talked about are easily leveraged in a remote setting. The Tuesday talks are probably even better in a remote setting because you get to see successful entrepreneurs in their homes - away from their offices' glitz, increasing the relatability.
The office hours work very well remotely, too, much like the other meetings you are having. Finally, not moving to the Bay area and looking for an expensive short-term rental was a relief. I'd love to hang in the Bay Area, but I much prefer to do it after product-market fit!
One interesting side effect of the remote batch was that I got to see a big group interact remotely. I have worked remotely since 2015 but never had hundreds of people on our Slack. With tools like Donut to facilitate serendipitous connections, the Bookface platform to share knowledge and book time with the partners, and Zoom meetups, the remote experience works great for a large group. Since we aspire to be a large remote company one day, it is useful for me to have a mental model of how it would feel.
Obviously, remote has some cons too. Most notably, the timezone issues. It can be challenging to participate in some events or book office hours with the timezone gap. If you are in the EU, it's not too bad, but anything further east is much worse. There is a non-zero probability that you'll be added to a group because the companies are in the same timezone and not necessarily in the same industry/stage.
I hope this post gives you a good sense of the YC experience, and sheds some light on how things work remotely. I'll be happy to answer any questions on Twitter.