Last day to apply for Startup School

Today is the last day to apply for Startup School, which will be hosted in Cupertino, CA on October 11. 

Apply here.

Speakers include:

Ron Conway
Founder and Special Advisor, SV Angel

Jim Goetz
Partner, Sequoia Capital 

Reid Hoffman
Founder and Executive Chairman, LinkedIn

Jan Koum 
Founder and CEO, WhatsApp

Andrew Mason
Founder, Detour and Groupon

Eric Migicovsky
Founder and CEO, Pebble

Hosain Rahman
Founder and CEO, Jawbone

Danae Ringelmann 
Founder and Chief Development Officer, Indiegogo

Emmett Shear
Founder and CEO, Twitch 

Michelle Zatlyn
Founder, CloudFlare

We hope to see you there!
YC Team

Exploding Offers Suck

Exploding offers suck.  Founders should be able to choose the investor they want to work with, not have to make a decision based on time pressure.

As the world of accelerators gets more and more competitive, we’re seeing more and more exploding offers where an accelerator tries to force a company to make a decision about a funding offer before the company has a chance to finish talking to other accelerators.

This is terrible behavior.  It may be the best thing for accelerators to use time pressure to get founders to accept their offer, but it’s definitely not the best thing for founders. 

I want to make our stance on this public: after we make you an offer, we’ll give you until the beginning of our program to decide (though most companies accept quickly, because you can’t start having office hours with us and participating in other ways until you accept).  We ask companies to be transparent with us about needing more time--we won't rescind our offer.  It’s usually about 45 days from interview to the start of the batch.

Some accelerators use a line about needing to make an announcement about who is in the upcoming batch—which, again, is maybe in the interest of the accelerator but the company should launch when it’s ready.  Sometimes they say they have a fixed amount of desk space, but in practice, if a good company wants to join late, they always make room.

We encourage all other accelerators to join us on this.  It should be an easy yes.  Exploding offers are the wrong thing for founders, and an accelerator that does the wrong thing for founders will not last long.

And founders should think very hard about joining an accelerator that puts forth a short-fuse offer.

YC Investment Policy and Email List

We’re making a change to the rule for YC partners making follow-on investments.  Previously, partners could invest in companies after they had either raised $500k or 3 weeks after Demo Day.  This reduced a lot of the conflict and signaling issues, but not enough—partners investing during the batch still caused issues.  So the new rule is that partners can only invest some amount of time after Demo Day (we’ll experiment a little to figure out exactly how long) or as part of a Series A. 

Our hope is that this will further reduce investors looking for signal from YC partners.

We put this policy in place for the summer 2014 batch, and it seems to be working well.

We will continue to make exceptions to the investing rules when a company is running out of money and about to die, but we think they are good and no one else wants to invest.  We may make other exceptions, which uninvolved partners will approve on a case-by-case basis.

While I’m on the topic of reducing conflicts, I also want to talk about our relationship with VCs.  Over the years, we’ve had direct LP (with Sequoia) or LP-like (with Andreessen Horowitz, Maverick Capital, SV Angel, Yuri Milner, General Catalyst, and Khosla Ventures) relationships with several VC firms.  This caused other investors a lot of consternation.

We still like all those firms a lot, and they continue to invest in a lot of our companies.  But they no longer have LP relationships with us, and no information rights or anything like that.  We do still have some VCs come in and meet companies about 10 days before Demo Day so they can get some pitch practice.  We expect to rotate through a list of trusted investors for different batches.

In the interest of a level playing field, we have created a new email distribution list that we will use for all of our companies raising rounds outside of Demo Day (before or after).  We'll use this email list instead of individual introductions so that we don't unintentionally miss an investor who might be really interested in a company.

The rules for membership are simple—5 total investments in YC companies of any size or 2 big ones, a positive reputation among our alumni, and no history of bad behavior like breaking term sheets without great cause, pressuring founders into advisor shares in addition to an investment alongside others in a round, etc.

We will of course continue to make introductions to newer investors not on this list as it makes sense.  In fact, some day, we’d like to have a larger distribution channel for all interested investors that we’d send companies to and integrate with some crowdfunding companies.  But we have to sort through the rules around that first.

In general, we don’t start introducing startups to investors until a maximum of 10 days before Demo Day (and most wait until Demo Day).  We also suggest startups take at least about 10 days to get to know major investors before making a decision.  We appreciate investors cooperating with us on this; it’s in everyone’s best interest for the startups to be able to focus on their product during the YC batch.

This should address all of the issues around investing we’re currently aware of at YC.

Founder Stories: Tracy Young of PlanGrid (YC W12)

PlanGrid founders Tracy Young, Kenny Stone, Ryan Sutton-Gee and Ralph Gootee

Tracy Young is the founder and CEO of PlanGrid, an app that lets construction companies store blueprints and documents on mobile devices. Since going through the YC’s Winter 2012 batch, PlanGrid has grown from a team of 4 to 40 and now hosts over 9 million blueprints in their cloud.

We talked about what it’s like going from construction sites to a startup, losing a co-founder to cancer, and building PlanGrid with her best friends and husband.

Q: How did PlanGrid get started?

A: Ryan Sutton-Gee and I went to Sacramento State where we majored in construction management. After we graduated I went to work for a construction management firm in the Bay Area and Ryan went to Stanford to get his Masters.

We were construction engineers—with hardhats and safety boots—and we were shocked by how inefficient the construction industry was. We were specifically surprised by how bad paper blueprints are. Blueprints are constantly changing so it's difficult to physically ship paper out to every single field worker on the jobsite and ensure they’re looking at the most current information. It's also heavy, cumbersome and expensive, but the biggest problem is accidentally building off outdated drawings which happens often.

Version control of construction data is a huge problem, and there was no software to help manage it. It was so obvious that there shouldn’t be paper blueprints. You should be able to stick them in the cloud and view them on mobile devices.

Ryan and I started working on a blueprint app as a side project. We were two domain experts who didn’t have a technical cofounder, so we convinced our friend, Antoine Hersen, to join us. Antoine agreed to join on the condition that he would be PlanGrid's Chief Mad Scientist. He’d gone to Sacramento State, too, and was based in Chicago working as a high frequency trading engineer.  

I also got my boyfriend at the time, Ralph Gootee, to join us as well. He was a rendering engineer at Pixar Animations.

Q: At what point did you decide to apply to YC?

A: Antoine and Ryan had always wanted to join Y Combinator. They were obsessive about HackerNews—they even got me to read it.

Right before we applied for YC, Antoine was diagnosed with a rare form of cancer. At that point Ralph and I decided to quit our jobs. We took a train to Chicago to hang out with Antoine and worked on several projects with him. PlanGrid was just one of them.

We all applied to YC in October of 2011; Antoine was already really sick at that time. I remember how happy it made him when we were accepted. He was able to come to the first YC dinner that winter. He passed away in January 2012 at his home in France.

One of the last gifts Antoine gave to us was recruiting our fifth cofounder, Kenny Stone.  Antoine had told us “Kenny is the best engineer I’ve ever worked with” and without Kenny we would not have been able to build PlanGrid to what it is today.

Q: What is the most important thing you learned from working with Antoine?  

A: Antoine was hacking till the very last minute before he passed away. He cared so much about coding.

He gave me some advice before he left. He told me, “Life is short. Take care of the ones you love. Don’t be afraid to try new things. Never do anything that makes you unhappy.”

There’s not a day that goes by where I don’t think about it.

Q: What has been the most surprising part of starting a startup?

A: For some reason I thought it would get easier. We always knew that while we were at YC it would be non-stop work. But it’s 3 years later and we’re still working constantly. It feels like we’re working more now, even though we have a team of 40 people.

Q: Is there anything that surprised you about YC?

A: I had an idea that everyone would be super brilliant. What I didn’t realize was how nice everyone would be. All the partners are nice, funny, good people.

YC believes in me at times when I don’t even believe in myself. That goes way beyond being nice actually. They truly care about motivating us to do our best.

Q: What was the most useful piece of advice you’ve heard from one of your advisors?

A: Almost every Tuesday night dinner, a speaker would say: “Fire those who deserve to be fired and fire them fast.” At PlanGrid, we've taken this advice to heart, and it's always been the right decision, no matter how emotionally difficult it was.

Q: Is there one particular Tuesday night dinner speaker that stands out in your mind?

Kevin Hale. His Tuesday night dinner talk was so inspiring we asked him to come to PlanGrid to speak again. Everyone knows that Wufoo cares very much about support. They take it to extreme levels. We based our company on that principle as well.

We are really serious about support. There’s a chatbox on our website that we man 12 hours a day, 5 days a week. Our support ticket response time is just a few hours. Everyone at PlanGrid does support and talks to users, including the founders.

Q: What’s been the hardest thing about starting a startup?

A: The hardest part of starting a startup is fixing mistakes fast and adapting.

You’re going to make mistakes. But you have to learn from them and adapt quickly. My cofounders and I have made our share of mistakes, but if we were to hold onto every mistake we would have never moved forward. It's easy to wallow in mistakes and place blame instead of learning from them.

Q: Is there anything you wish you’d known when you’d first started PlanGrid?

A: I’m looking around my office and I’m kicking myself for not buying smaller desks. The secret to space efficiency is small desks.

Also—things aren’t ever that bad. We had a cofounder die. Everything else is so small in comparison.

Even if PlanGrid wasn’t doing well (and we’re doing really well right now!), at the end of the day I have my co-founders and best friends and we’d just go build something else.

Q: What advice would you give for people applying to YC W15?

A: Assuming they have some kind of beta, do whatever it takes to figure out sales by yourself. This is one of the reasons PlanGrid has been so successful.

After YC, we brought on a VP of Sales, but he couldn’t sell the product. At the end of the day, we knew the product best, we knew why it would add so much value to our users. Who better to sell the product than the founding team?

We didn’t want our company run by a salesperson. We went out, talked to users, figured out how and when they would pay us, and got to that point.

It's nice not to have to rely on fundraising to sustain the company. It’s nice to have months where we’re cash flow positive. Figure out how to get to that point with just the founding team. You can't rely on others to sell the product you built.

BillForward (YC S14) Wants To Change The Way You’re Charged For Subscriptions

Amazon Prime, Netflix, utilities, the New York Times, HBO Go, the gym…

When you stop and think about all the subscriptions you have, the list probably is a bit longer than you thought.

But even as more subscription services become available, from ride shares to make up kits, it seems companies still offer customers limited subscription options due to constraints with their billing systems. Subscriptions rarely take into account how much you actually use them (If they did, most of us would probably be paying a lot more for Netlfix and a lot less for the gym).

Calling themselves “Stripe for subscription billing,” BillForward helps companies create customized billing services. BillForward CEO and co-founder Mark Parry said current subscription billing service software is outdated or difficult to use, and its time consuming and costly for companies to build their own.

San Francisco Open Exchange (YC S14) Aims To Be The E-Trade Of Bitcoin

Y Combinator-backed startup San Francisco Open Exchange (SFOX) is an online trading platform that helps people find the best bitcoin prices at various exchanges. In other words, it would like to help you buy, sell and invest in bitcoin exchanges kinda like and investor buys and sells stock on E-Trade.

Co-founder Akbar Thobhani left his job at Airbnb to create this platform. However, he soon found that using bitcoin was even more expensive than using credit cards. This is because there’s not a lot of transparency. So he started thinking that if he could find a way to compare prices this would help drive widespread adoption for the bitcoin market.

UPower (YC S14) Is Building Nuclear Batteries

Despite the promise of bountiful, cheap, and clean energy nuclear energy didn’t overtake fossil fuels like everyone expected them to in the middle of the 20th century. Among other things, fear of radiation leaks and waste products that have to be buried for hundreds of years turned the United States away from adopting it for more than a fraction of our energy usage.

Y Combinator batch company UPower Technologies is hoping to change that by offering reactors that cut out those factors at a scale where regulatory issues and billion-dollar construction costs aren’t a problem.

UPower founder and CEO Jacob DeWitte describes the company’s first reactor design as a plug-and-play nuclear thermal battery. The idea is that customers will order a reactor that will be shipped in a container with everything needed on the reaction side and then connected to a power conversion method that makes the most sense for the particular application. Some projects might hook it up to a steam turbine, while others might use it in concert with something much closer to a jet engine.