Silicon Valley's most famous startup accelerator has a lot of participants who have already done the program. Tech founders share why they rejoined Y Combinator even after launching successful startups.

Michael Seibel

It was March 2005. YouTube
has just launched. Google unveiled a
new product called Maps
. “Selfie
had yet to truly enter the the popular lexicon. And English
computer scientist Paul Graham welcomed the first group of
entrepreneurs to Y
Combinator
.

In the 14 years since then,
the renowned accelerator program
has gone from hosting a
handful of inspired entrepreneurs on meager living stipends to

funding some of the biggest private startups in Silicon
Valley
.

Next week, Y Combinator will host another of its famous Demo Day
events, during which entrepreneurs from the program’s Summer 2019
class pitch their products to some of the biggest venture capital
investors. This year, for the first time in San Francisco, Y
Combinator’s Demo Day will be two-day event taking place on August
19 and 20. 

“That first Demo Day was just a bunch of Paul’s friends, not the
luminaries of Silicon Valley investment that you have now,” Kiko
Calendar and Justin.TV cofounder Emmett Shear told Business
Insider. “I don’t think anyone raised money at that Demo Day even
if they raised money later.”

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This summer’s batch, as the cohort of entrepreneurs taking part
in
the 3-month program
is lovingly referred to by YC alumni and
investors, includes 10 founders that are giving the accelerator a
second go. In the last 14 years, 150 entrepreneurs have returned to
the program at least once to launch a new startup. 

paul graham y combinator

“YC is like a tool and the better you are at using tools, the
more you can make out of it,” Y Combinator CEO Michael Seibel told
Business Insider. “The first time you were doing it you were just
kind of learning how things work. Having done YC, I thought it was
more educational, and you don’t feel like you have to go get a
degree again. When I thought of it as a tool, suddenly everything
clicked.”

Before leading the program, Seibel was one of its earliest
participants as an entrepreneur. He
cofounded Justin.TV with repeat YC’ers Shear and Justin Kan during
the Winter 2007 batch
. The live streaming startup later became
Twitch and was
purchased by Amazon for $970 million in August 2014
. Seibel
returned to YC in 2012 with
Socialcam
, a streaming app that was a rough predecessor to
Snapchat, with a new founding team and a working prototype, a step
up from his experience in 2007.

“I was a second-time founder, my cofounders were first-time
founders,” Seibel said of the Socialcam team. “Spinning out of
Justin.TV, they were actually my employees. Now they were my equal
partners and I wanted them to have the same foundation that I
had.”

Fourth time’s the charm

Kan cofounded
Kiko, a calendar app
, with Shear right out of college as part
of the inaugural YC batch in 2005. Kan told Business Insider that
the first batch was structured similarly to subsequent batches, but
the main difference was that the weekly dinners — a hallmark of
the YC program — were hosted at Graham’s personal residence in
Boston.

Paul Graham of Y Combinator

“YC was just an experiment. It was much smaller, there was no
brand, and our Demo Day was like a 15-person audience,” Kan said.
“It was pretty weak.”

Kan and Shear struggled to get traction for Kiko, and eventually
their startup folded. That’s when they joined forces with Seibel to
launch Justin.TV. In total, Kan has gone through YC four times,

most recently with Atrium, a legal services startup for other
startups.

“I think YC is really good for setting the DNA of your company
early on,” Kan told Business Insider. “I really liked that it was
insanely customer-focused. With Atrium, we are a company that sells
to other startups, so our market was YC founders. We wanted to
start close to our customers.”

A ripe sales environment

Seibel said that Kan’s route isn’t unusual for repeat YC
founders. Although many first-time entrepreneurs go through the
program with a consumer technology idea, repeat founders go after
solutions to sell to other startups given the built-in customer
acquisition strategy.

“There were more startups the second time, and they were really
great first-time customers for us,”
Gusto cofounder Eddie Kim
told Business Insider of his second
YC experience in 2011. “YC founders are paying themselves so they
needed a payroll system, and we needed customers that needed
payrolls.”

Aside from the collaborative community, Zeus
Living cofounder and YC alum Kulveer Taggar
attributed the
healthy sales environment in YC to founders’ need to be
scrappy.

“If you are a [enterprise] company, YC is a huge asset,” Taggar
said. “A good example is Stripe, because YC really helped them when
they first started. YC founders are great customers because they
give you feedback and are okay with glitches. Everyone knows how
hard it is and everyone was willing to help each other out.”

The next 10 years of YC

By the time Seibel sold Socialcam in August 2012, YC had offered
him a role as what was then called a part-time partner. He’s been
on the YC payroll ever since, and now leads the accelerator program
as CEO.

“This kind of new generation of people who were former YC
founders are coming in to run YC, and now it’s time to build on
that foundation as opposed to change it,” Seibel said.

Seibel points to some of the program’s new tools, like the
remote Startup School program and Series A initiative, as examples
of building on top of the existing program and adding what he
wished had been available when he was a founder. But aside from
that, he is focused on what he sees as the first decade of YC
before jumping ahead.

“It’s weird, because the kind of hopelessly sad part is that
I’ve only been a YC founder, so I’m running this accelerator and
it’s great and I enjoy it, but what’s weird is YC is all I’ve ever
known,” Seibel said. 

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Silicon Valley's most famous startup accelerator has a lot of participants who have already done the program. Tech founders share why they rejoined Y Combinator even after launching successful startups.