What are the implications of this? For Founders? For VCs? No wrong answers. Curious to hear thoughts. "YC’s $500,000 Standard Deal" blog.ycombinator.com/ycs-standard-d…
My take: (1) definitely good for YC; (2) probably neutral to negative for most founders (it's not a lot of cash, but it puts the squeeze on the next round, especially if that round is small)
(3) Puts a ton of pressure on founders to increase the valuation of the next round, which creates its own set of issues.
(4) Further evidence supporting my observation that accelerators and early-stage VCs are at war with each other - whether they realize it or not.
(5) Strengthens the argument I've made recently (and have gotten in trouble for) that most accelerator programs are just not fit for purpose any more. 7-10% dilution for minimal cash just makes no sense these days, and YC can now claim it's $500K for ~7%.
(6) Yet another challenge for early-stage / first-check funds (like Angular) who are getting squeezed from all sides.
First-check firms like Angular are competing against other first-check alternatives (such as YC). It's a very different product offering. For some founders, YC may be optimal. For others, what Angular (or our peer firms) bring to the table is optimal.
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