URX (YC S13) Raises $12 Million, Sets Sights on Links Inside Apps

With a fresh $12 million in the bank, San Francisco startup URX is hoping to solve a problem bedeviling smartphone users and app developers: links that work inside apps, where smartphone users spend most of their time.

The company specializing in “deep linking” technology has now raised a total of $15 million. The latest round was led by Accel Partners and values URX around $40 million according to CEO John Milinovich. Accel was joined by Google Ventures, SV Angel, and First Round Capital in the financing. Rich Wong of Accel is joining URX’s board.

YC's Sam Altman and Elizabeth Iorns talk to Nature about funding biotech startups

Y Combinator, a company that backs technology start-ups, is famous for its early support of successful software firms such as Airbnb and Dropbox. It historically has invested a few thousand dollars into web-based businesses that require only small grants to get up and running at their earliest stages. But the programme is now expanding its reach to back biotechnology start-ups, says company president Sam Altman.

Altman spoke to Nature together with Elizabeth Iorns, hired last week as a part-time partner at Y Combinator, which is based in Mountain View, California, for her expertise in life sciences. A former cancer biologist turned entrepreneur, Iorns has herself benefited from Y Combinator funding — she co-founded Science Exchange, a firm in Palo Alto, California, that provides an online marketplace where scientists offer up spare capacity and instrumentation to do other researchers’ experiments.

Codecademy (YC S11) hits 24 million students and launches a redesign

Codecademy (YC S11) announced today that they've launched a redesign:
Two years ago, we started building a product that would help teach people the skills they needed to succeed in a digital world. As more than 24 million people took Codecademy courses on our web and iOS platforms, we too learned and grew. Now, we’re excited to show you our latest project — a new Codecademy designed from the ground up, aimed to help you learn skills hands-on, with real projects, and constant feedback. Better yet, the new Codecademy experience helps to connect you with the real skills you’ll need to succeed in today’s workplace.

Comprehend Systems (YC W11) is hosting a Health IT event on 4/25

Comprehend Systems is hosting an event in Redwood City this Friday for anyone interested in Healthcare IT startups.

Meet Comprehend’s founders and hear from three great guest speakers. Topics include “Impactful Health IT” by Rick Morrison, “Health IT in the Hospital” by Dr. Bassam Kadry, and “How to Get Physicians Engaged in Technology” by Dr. Gautam Sivakumar.

Comprehend Systems, 2010 Broadway Street 
Redwood City

, CA 94301

 Friday, April 25th 2014, 5pm – 7pm

Learn more about the event and RSVP here.

The New Deal

We have a new standard deal at YC—we’ll invest $120k for 7%.  While we may deviate from this in exceptional cases, it will still be the case for almost all of the companies we fund.

This replaces our previous standard deal of on average $17k for 7%, plus a safe that converted at the terms of the next money raised for another $80k.

The investment will come in two chunks, which together will represent a flat 7% of the company.  Although YC itself continues to have no LPs (and that way we have the flexibility to do things like fund non-profits), a portion of the investment is from a fund YC manages that does have LPs. 

Most people don’t do YC for the financial investment—they do it because they want the advice, the help of the network, the benefits of the program, etc. But still, more money for less equity is definitely better.

A bit of history—in 2011 Yuri Milner and SV Angel started offering $150k to every startup we invested in on an uncapped convertible note. This went through a number of iterations in terms of structure and partners, and eventually we renamed it YCVC.  Among other changes, we reduced it to $80k on top of our $17k—the $150k extra was enough to cause real problems for the companies around founder breakups, for example. Also, the partners making the investment have changed over time, and for the last batch were Andreessen Horowitz, General Catalyst, Maverick Capital, and Khosla Ventures.

$97k was about right at the time, but the cost of living in the Bay Area has gone up substantially. So we’re increasing the total to $120k, which we hope is enough for the founders to run their business and pay their living expenses for at least 6 months, and sometimes longer.

This also marks the end of the automatic investments from the four firms mentioned above.  As YC has become a larger and larger part of the startup ecosystem, we had to deal with things like signaling risk (e.g. a YCVC investor not making a follow on investment in a company caused some other investors to think the company may not be good) and information issues.  All of these issues were issues of perception—the YCVC investors are great firms that always behaved really well, and we’re going to continue to work with them very closely. But we hate complication, and we hate anything that causes issues for our startups, even if it’s just an issue of perception. This should help level the playing field. 

Speaking of hating complexity, we’ve tried to make the new structure really simple. The convertible notes and safes we used got complicated in terms of how they got priced, and complexity often causes unintended consequences. It was hard for founders to actually predict how much total dilution they were looking at.

Our new investment structure should be very simple—$120k for 7% equity (regardless of the number of founders). We hope that it will help the companies we fund.

For non-profits, I’m delighted to announce that Teespring has agreed to give each non-profit we fund $50k.  This will be on top of $50k from us for $100k total.  Thanks, Evan and Walker!

Finally, it’s sometimes hard to compare offers from different accelerators. Just to be clear, we don’t charge any fees to the companies to be part of YC. We understand the complex reasons around LPs and tax issues that cause some accelerators to charge a fee to the companies they invest in, and while we don’t think it’s bad behavior, obviously companies should deduct those fees from the investment when they’re thinking about those offers. We also try hard to avoid any “gotcha” terms like low caps in certain situations, weird anti-dilution terms, etc.

TwoTap (YC W14) and Semantics3 (YC W13) work together to streamline e-commerce

We love it when YC companies work together.

Two Tap (YC S14) recently announced a partnership with Semantics3 (YC W13). Semantics3 provides product feed data for over 35 million products. With Two Tap integration, it is now possible to directly purchase the products displayed in Semantics3's API results. This makes it so users can buy products within an app or website, without breaking to load Safari or Chrome. 

Read more about the partnership on TwoTap's blog and Semantics3's blog.

Welcome Kat, Yuri, Patrick and Elizabeth

I’m delighted to announce a promotion and three additions to the YC team.

Kat Manalac has been our director of outreach since 2013.  She’s done an incredible job, and we’re making her a partner.  In addition to regular partner responsibilities, she’ll continue to be responsible for outreach to prospective founders and for our PR.  Before she joined YC, she was Alexis Ohanian’s chief of staff.

Yuri Sagalov joined us as a part-time partner last September, but we never got around to announcing it. Yuri is the cofounder and CEO of AeroFS, which he started in 2010.  Yuri will be especially helpful to enterprise companies we fund, which is not an area we’ve historically had much expertise in.  Several founders from the most recent batch went out of their way to tell me how much they’ve liked working with him.

Patrick Collison is joining us as part-time partner.  Patrick is the cofounder and CEO of Stripe.  He knows a lot about every part of running a startup, but he thinks about hiring and company culture better than anyone else I know.  Previously, he cofounded Auctomatic.

Elizabeth Iorns is also joining us as a part-time partner.  She’s the cofounder and CEO of Science Exchange.  She has a Ph.D. in cancer biology and knows a great deal about life sciences, which is very helpful given that we’re starting to get a lot of interesting biotechnology companies applying that we’re currently unqualified to judge.  She’s been an informal advisor to a number of Y Combinator companies, and they all praise her startup expertise. 

Welcome to the team!