"No online demo yet. It might be awhile before we have a dashboard and mocking up a fake API for you doesn’t seem worth it."
Honestly my favorite part of the application. It gives the implication that "you're smart enough to understand that this would be a waste of both our times"
Not sure I understanding the 'hacking a system' answer..
> When I started in Newark, I didn’t have a computer or an email, and City Hall didn’t have wireless. So I tracked down one of the wireless networks I could find - owned by a bails bondsman close to the court, and negotiated with them for their wireless password.
Why did you need the wireless password if you didn't have a computer or email? Needed wifi for mobile device or something?
I was working for the city but didn't have a computer or email. Brought my laptop to work but couldn't do all that much without Internet--couldn't access the network and no public wifi. Point was I got that through chatting with a bail bondsman. It's not the greatest hack in the world.
This is ironically close to a proposal over at https://news.ycombinator.com/item?id=6556415 that I just saw the other day. We were complaining that there isn't a standardized, thought-out API for getting bank data, and someone got motivated to apply the YC with the idea. Is OP's proposal basically the same thing?
It's a subset of what we're doing, yes. We've focused on taking internal bank systems -- information, payments such as ACH, wires, bill pay, other products most people aren't aware of like virtual card numbers -- and presenting them as clean, RESTful APIs.
Also see https://plaid.io/ which is more directly going after Yodlee.
That's not a reason not to apply / work on it though. It's an ecosystem with a lot of space for innovation. Or you could come work with us!
What positions are you hiring for? I'm not a programmer but I would love to work with you. I've been paying attention to your blog since reading the post about online-offline businesses. It struck a nerve with me and I was thinking to contact you about my idea for a marketplace.
The idea kind of crashed and burned right after that because Balanced changed their merchant agreement regarding "high-risk" and I can't use them. The only way to make it work seems to be to become a processor too and I don't have the money/experience for that if it is even a good idea. I'll send you more info if that is okay.
One thing that leaps out at me from the few successful YC applications I've read is some of the informal language used. For instance, I would never write 'Most banks suck at technology' If it was still legal when I was in school, my English teacher would have beaten me with a ruler for writing that.
On the other hand, I can't think of a way to state the point more succinctly.
I see big-O notation as shown in the application all the time, and it's completely meaningless. People, please do not use it as estimation function, but rather a bounding function with respect to the size of the input. The details are a tad more fine grained than that, but Wikipedia is a few clicks away.
Indeed. Sorry for the error. My point was merely to indicate orders of magnitude and I was using is as short-hand for the word "order", as you might use that term in a Fermi problem.
The thing I kept thinking when I was reading this was pedigree, pedigree, pedigree. Brown grad, University of Chicago, met at Harvard Summer School. Invested in a YC company already. One works at Stripe. This is quite the resume for two people.
On the other hand, it kind of worries me, because a lot of the most successful founders don't have anywhere near the level of accomplishment that is listed on this application. I think pg mentioned this at the last Demo Day. More and more "qualified" people are applying to YC now. I don't say this to diminish the quality of the application, I just wonder if these types of applicants are pushing out the young hackers that might have made it to an interview a few years ago.
The common perception is that YC is very big on pedigree (top schools, serial founders, worked at top companies). They are known for having a prototype (they liked to call it patterns) of what is the ideal founding team.
500startups for example are willing to take more risks on people and look more deeply at the product if it has traction and a business model, even the founding team is unknown / international.
There's a lot of different investment thesis, which all make sense for different reasons.
It interesting because Dan and I are partially heavily motivated by the chip on our shoulder. My father was a mailman and my mother a waitress, etc. Its hard for us to imagine ourselves as "the man" although we pretty clearly are in a prima facie reading of our resumes.
Having said that, I do think their seems to be a much wider variance in the ages and experiences of YC founders than most people think. If I had to guess, the median age for our batch was likely 25/26 with a standard deviation of 3 years. Not 19/20 and I think that's been true for a long time.
There are also a ton of different education backgrounds. I'm not going to lie and say that there aren't a lot of people who went to Harvard and MIT, but there are also people who went to state schools or no college at all.
How did you get in contact with the banks? Neither founder seems to have a background business development or banking, so I'm curious how you were able to pitch to them.
The short answer is that we basically know a ton of people both in financial technology and in the valley. If people know you, know you're a good person, and know you're looking for something specific they'll often help you.
Tons of people have been surprised by our success to be honest. We had a talk with a potential investor recently and we told him who we were working with at [big bank]. The potential investor was shocked - the gentlemen leading our project at [big bank] is in charge of a 10-digit-a-year business and is a hard man to find time with. But one of our lawyers, who is also an investor, introduced us. They are old friends. Banking innovation / payments / technology, etc, is a small world.
Interesting question. The only people I interacted with in a work context through Stripe was Wells Fargo Merchant Services, a joint company of Wells and First Data. I've never spoken to one of the people again because it's a completely different part of the bank than the one I deal with now. One didn't lead to the other.
Key reasons this was accepted (in my opinion, anyway):
1) Stripe employee.
2) Very clear product. Potential market is huge and has money and is willing to pay for this service - they already pay banks for it. First successful product in this market will create huge barriers to competition by essentially setting the standard in banks. Also very clear descriptions of how/where they are tackling the problem shows a lot of understanding.
3) Second time founder, already built a successful product - Giftly.
I would like to think that its overwhelmingly due to #2. It's a really articulate, I-know-what-the-fuck-I'm-talking-about explanation of a huge problem and market. Rest is icing IMO
I think #2 is the primary reason. We got an interview, which we didn't accept, for the Winter 2013 batch. I didn't work at Stripe then. Dan didn't found Giftly.
My question after reading this application is why do you need YC?
YC, at least as it was originally conceived, was designed to help young very bright hackers with no or very little business knowledge.
You guys are very far from this category. I guess YC is still useful for their network and the simple fact that being a YC startup will open a lot of doors for you. But the fact that you were accepted could mean that YC is slowly drifting away from its original mission.
YC is slowly drifting away from its original mission.
I think that they tend to fund people who they think will have the highest chance of success. You end up with priorities like:
1. Previous successes
2. Company with traction
3. Employee at Stripe/Google/Apple/etc
4. Smart MIT/Harvard/Stanford student
5. Misc. high magnitude achievements
I think what you're seeing might be a higher number of 1-3 applying to YC, not leaving much room for 4 and 5. The four and fives who do get accepted are extraordinarily impressive.
I agree with you because (afterall) they aren't a charity. They makes money by investing early in these start-ups, so they need to focus on bringing people through their program that have a higher chance of success.
Yes. And according to PG, age is neither a penalty nor a bonus. He writes: “I don’t actually know the numbers. We don’t keep track. But I know there haven’t been any with founders in their 50s, and only 2 or 3 with founders in their 40s or their teens. Most founders are in their 20s or 30s. Completely guessing, I’d say 15-20% have founders in their 30s.” (That was a year ago, so the numbers may have changed.)
Basically, the age distribution of YC companies is pretty close to the age distribution of applicants. More YC founders are 25 than 35, but more 25-year-olds apply than 35-year-olds.
(Paul has an essay[3] where he says the ideal range to start a startup is 22-38. As far as I know, that isn’t a rule, just a suggestion. YC has accepted plenty of people younger than 22, and at least a few over 38.)
The key reasons they got an interview (and accepted).
-The application was concise.
-They seem to understand the hurdles ahead, had a plan.
-Founders have been friends a VERY long time. This removes a lot of risk since startups die when founders don't get along.
-Little bit a domain experience.
Definitely cracked a smile when I got to the "who do you fear" answer --
I used to work for one of the large banks on a commercial operations team. It was one of the most bogged down, regulated things I have ever witnessed in my life.
This product will end up doing extremely well; then I see the regulators and major financial institutions going "hey wait a minute, these guys are making too much money, let's fix that"
Best of luck to the team -- I think you're onto something huge, should make the speed bumps worth it.
Can you guys discuss how far along you were at pitch day and how you strategized or optimized your time at YC given you had to deal with large BigCo's? Did this come up at all in the interview, do you have best practices, etc.
We certainly were not as far along on demo day as we (or the YC partners!) would have liked. That's the reality of big enterprise sales. Our customers have incredibly long procurement and sales cycles. We aimed to get signed LOIs by demo day and instead we got very serious negotiations.[1]
We spent the summer building the product to support a heavy amount of sales and business development work. We put together a prototype (we essential built the platform against something we call "fake financial") where we can use the terminal and some simple application to show banks and bank customers how easy it would be with our platform-as-a-service.
[1] Whats important here is that you can't bullshit investors. The proof is in the pudding. We had to account for where we were with every potential customer, who we were speaking to at the companies (investors might end up knowing them!), what terms were discussed, etc.
Ultimately they're very different businesses. Card payments and banking are related but not directly. The truth is that all I know from Stripe about the card networks, card risk, etc, has proven not useful in commercial banking. I couldn't even use their IP if I wanted to (!) and they know that as well as I do. If I started a payments processor I'd be in deep trouble. But a different part of finance, with a different business model...no one seems that worried.
We were the only two people in the same two classes.
The real answer about staying in touch is the internet -- yay AIM, the best communication tool of 2003. In reality though we didn't live that far apart in New Jersey so we could hang out from time-to-time.
A lot of people are going to do exactly what I did, "Oh this is cool maybe it'll work for......wait a tick! These guys have done amazing things! Of course they were accepted."
I can't quite tell if you're calling me a phony or yourself one. If you're call me phony then I'm sorry I come off that way. I have a lot of personal and professional flaws (far too long to enumerate here) but I don't think a lack of genuineness is one of them.
If, on the other hand, you're saying you don't want to apply because you feel phony, well, then, that's hogwash. Impostor syndrome is deep in most YC founders, in most ambitious people, and in Silicon Valley more generally. If you have an idea that you're passionate about then you should apply.
I guess the feeling I get is that to even bother applying, I need to present a phony picture of myself; to reflect certain values and use a certain language to increase my chances. Of course you can say that 'just be yourself', but no system works perfectly, or necessarily even well..
I know very little about the YC application process, but if you are confident that the problem you are tackling is real, and have done your homework, I don't see why you would need to present a phony picture of yourself. In fact I'm pretty sure that the YC folks have enough smarts and experience to pick out phonies.
If you're presenting the phony picture because you don't really have a clear understanding of the problem, then yeah, you will have bigger issues with your business outside of getting into YC.
If you've put in the work and still feel like a phony, try to ignore the feeling - it's probably just the impostor effect.
I get the feeling that he sees himself that way and I can relate to that a bit.
Seeing these applications... well, they're full of people coming from the best schools in the world, having the best connections one can imagine, usually having several successful startups under their belt - or, barring that, they're often behind immensely successful open source projects. They're people who seem to have been recognized as absolutely amazing from early childhood on.
I think it's natural that this can feel a bit intimidating, and yes, sometimes these amazing people can come off as a bit standardized themselves, too.
Honestly my favorite part of the application. It gives the implication that "you're smart enough to understand that this would be a waste of both our times"