David Cummings on Startups

Y Combinator and TechStars are Very Different

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David Cummings

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Lately I’ve been reading The Launch Pad: Inside Y Combinator, Silicon Valley’s Most Exclusive School for Startups by Randall Stross. A future post will be a book review but I want to touch on a topic within the book first: Y Combinator and TechStars are very different. In fact, I know several people that have gone through each program, and their feedback and insight into the respective programs corroborates the differences.

Here’s information on each program:

Y Combinator

  • 60+ startups per class
  • Single city location (Mountain View)
  • No shared office space
  • No third-party mentors
  • ~$18k investment for ~6% of common stock
  • $150k convertible debt with no cap
  • Strong independent team orientation

TechStars

  • 10 – 15 startups per class
  • Multiple cities (Boulder, NYC, Boston, and Seattle along with affiliates)
  • Shared office space
  • Third-party mentors
  • ~$20k investment for ~6% of common stock
  • $100k convertible debt with $3MM cap
  • Strong fraternity/group orientation

Now, it isn’t that one is better than the other, only that they are very different. Y Combinator is more like grad students doing independent research projects and TechStars is more like a fraternity with everyone working on different projects in the house.

What else? What are some other ways that Y Combinator and TechStars are very different?

Comments

3 responses to “Y Combinator and TechStars are Very Different”

  1. Rob Forman Avatar
    Rob Forman

    They do seem to have very different goals and strategies. Here is Dave McClure’s synopsis: http://500hats.com/screw-the-black-swans. Pretty interesting.

    Reply
  2. Aarjav Trivedi Avatar
    Aarjav Trivedi

    Comparing the YC experience to an independent grad project is apt with one qualification: The amount of trust that teams place in other teams, and the amount of help they get from other teams in their batch, are both hard to overstate. The advice and help I got on everything from the iOS idiosyncrasies to feedback on investors were definitely as valuable as the advice and help I got from partners.

    With 60+ teams, I have heard potential applicants worry about getting “enough attention” as well. Yet, there hasn’t been a single time this year when I wanted office hours with a YC partner and could not get them, even in the 6 months after YC “ended”.

    The book is a good if somewhat incomplete snapshot of the YC experience. I feel like Mr. Stross missed out on capturing the camaraderie between teams. Also, quite appropriately, he didn’t cover sensitive details about the nitty gritty of fundraising and YC’s role there in, but that is often a very important part of the journey for many startups.

    Reply
    1. David Cummings Avatar
      David Cummings

      Thanks Aarjav! I appreciate the great insight and feedback.

      Reply

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