In the tech world, a few things are considered gospel. One is the notion that a startup accelerator, Y Combinator (YC), is the only path to success. During a difficult time for the venture capital market, Michael Seibel, Partner at YC and CEO, debunked this myth on TechCrunch’s Equity podcast, co-hosted by Natasha Mascarenhas and Alex Wilhelm. Seibel argues that there are many ways to build a successful company, and YC is not the only option.
He discusses the benefits of pitching at the right moment, his theory on larger batch sizes and a growing standard agreement, competition, and the power of venture capital.
We’ve summarized his main points for you here. What do you think? Are accelerators worth it? Let us know in the comments!
Myth #1: To apply to Y Combinator, you must be a programmer.
Reality: While it helps if you know how to code, we’ve funded companies with a wide range of backgrounds. Programmers do not find the majority of our companies.
Myth #2: You automatically become successful if accepted into Y Combinator.
Reality: Less than 1/3 of our companies can raise enough money to qualify for an investment from us. And even fewer go on to become billion-dollar businesses.
Myth #3: If you’re not in Silicon Valley, you won’t be successful.
Reality: We’ve funded companies worldwide, and many of them have gone on to be extremely successful. It helps if you’re close to Silicon Valley so that you can take advantage of our network, but it’s not a requirement.
Overall, Michael Seibel believes that acceleration programs are still worth it for most startups due to their benefits (mentorship, educational resources, etc.). However, he advises against blindly applying without doing your research first and ensuring that your business is ready for what an accelerator can provide. Have you ever participated in an accelerator program? What was your experience like? Let us know in the comments!