The 17k for 7% is what always stopped me from considering the Y Combinator route. It's a huge chunk of your company for not very much money. If the new deal had been in place when we started, I think we would have been very tempted to join.
The real benefits of YC though are the focus it brings you, and being able to get access to the YC ecosystem. Oh, and being able to attend Demo Day, but with so many companies in the YC program, I think Demo Day isn't what it used to be (I think you get 90 seconds now?).
We would have loved to have had access to those resources, but since we had already invested far more into our company in terms of cash, it's hard to justify giving up that much equity for so little. Kudos to Sam for the new program.
17K for 7% isn't as raw a deal as you think when you realize that at an "acceptance" into YC essentially doubles your valuation to most seed investors.
Absolutely. Being vetted by YC certainly won't hurt your company, but it's still tough though when you've dumped $100k-$200k of your own money plus your time and energy (which is not insignificant when you're an engineer in the Silicon Valley), and you're giving up that amount of equity.
Depends on what you're trying to achieve I think. I worked on my own stuff for 3 years before doing YC and it was well worth it. My thoughts after going through the program:
If you have no product and no track record, it's definitely worth it.
If you have something working, but growth isn't amazing, it's a risk because there's a chance you don't get the absolute most out of demo day due to timing -- so one might feel what you describe. That said if you blow up later, I'm sure they will do a fantastic job of getting you to the people you'd want to meet with - eg. Homejoy.
But if you come into YC with good growth (like doubling in size every month) it is without a doubt one of the smartest things you can do. You will probably never have as much leverage as you get while going through YC.
The real benefits of YC though are the focus it brings you, and being able to get access to the YC ecosystem. Oh, and being able to attend Demo Day, but with so many companies in the YC program, I think Demo Day isn't what it used to be (I think you get 90 seconds now?).
We would have loved to have had access to those resources, but since we had already invested far more into our company in terms of cash, it's hard to justify giving up that much equity for so little. Kudos to Sam for the new program.