Hi Kyle, thanks a lot for your thoughtful comments. I think you highlighted some of the key assumptions this program hinges on. Here are some thoughts on the points you mentioned.
I think you’re correct in saying that idea generation in the for-profit sector is more efficient than in the nonprofit sector, as feedback loops are both shorter and stronger. In fact, we don’t plan to do a lot of research into the specific ideas, at least in the first instance, but rather support participants in ideation and validation. The idea you start with seems to be regarded as less important in this space (ideas are cheap, as the saying goes) and companies will pivot in their quest for product-market fit.
One of the main value add of the current incubation program, which applies to this one as well, is matching participants with a talented, complementary and value-aligned co-founder. This would probably be pretty hard for a single person to do, going through thousands of applications, picking the top 15 or so and spending 4-5 weeks working with them to find the best match. The co-founders are often regarded as the chief ingredient of a startup, and I think CE has a solid know-how in this domain. Moreover, a lot of incubators look for projects/companies a bit further down the line (post-cofounder and post-idea), and this program aims to fill the gap between zero and this stage.
I think both paths you are describing are plausible, and notably, the second one of convincing entrepreneurs to donate has already been validated by Founders Pledge in a sense. Creating successful entrepreneurs might not be easy for sure, but convincing people to buy into effective donations might be more challenging than what people expect. Founders Pledge did mention that it is hard to change what people care about, and according to their website, only about a quarter of the donations by their members go to what we would call effective charities.
One key advantage of working with EAs or EA-adjacent people at this early stage is that we could expect considerably higher pledged percentages and donation effectiveness. Of course, we need to balance this with the lower number of companies of this approach compared to the Founders Pledge on, but I think both approaches have their merits.
Yes, 40% might sound a bitoptimistic, at least in the first instance. But I don’t think it is totally unrealistic that we can optimize both the selection process and the program for what YC is looking for and that we can have a substantially higher conversion ratio than the base rate. The CE vetting process is very selective and usually only about 1% get through, which already applies a lot of filtering. Moreover, YC is only one of many incubators, and if a company doesn’t make it into YC, it might qualify for other incubators.
Indeed, I think you are right that by adding constraints to the ideas we are considering, we are somewhat reducing our chances. However, by looking at the list of YC’s top companies, not a lot struck me as blatantly net negative. My sense is that most of those companies have a neutral direct impact (using the EA definition of impact), and some even have plausible positive flow-through effects (like Wave). Of course, assessing flow-through effects is pretty hard, so all this is to be taken with a grain of salt.
There you have it, here are some thoughts. I hope that they can shed some light on some of the rationales. This program is definitely hits-based, but I don’t dislike our chances and I think we have a pretty good shot. And thanks for your support!
Hi Kyle, thanks a lot for your thoughtful comments. I think you highlighted some of the key assumptions this program hinges on. Here are some thoughts on the points you mentioned.
I think you’re correct in saying that idea generation in the for-profit sector is more efficient than in the nonprofit sector, as feedback loops are both shorter and stronger. In fact, we don’t plan to do a lot of research into the specific ideas, at least in the first instance, but rather support participants in ideation and validation. The idea you start with seems to be regarded as less important in this space (ideas are cheap, as the saying goes) and companies will pivot in their quest for product-market fit.
One of the main value add of the current incubation program, which applies to this one as well, is matching participants with a talented, complementary and value-aligned co-founder. This would probably be pretty hard for a single person to do, going through thousands of applications, picking the top 15 or so and spending 4-5 weeks working with them to find the best match. The co-founders are often regarded as the chief ingredient of a startup, and I think CE has a solid know-how in this domain. Moreover, a lot of incubators look for projects/companies a bit further down the line (post-cofounder and post-idea), and this program aims to fill the gap between zero and this stage.
I think both paths you are describing are plausible, and notably, the second one of convincing entrepreneurs to donate has already been validated by Founders Pledge in a sense. Creating successful entrepreneurs might not be easy for sure, but convincing people to buy into effective donations might be more challenging than what people expect. Founders Pledge did mention that it is hard to change what people care about, and according to their website, only about a quarter of the donations by their members go to what we would call effective charities.
One key advantage of working with EAs or EA-adjacent people at this early stage is that we could expect considerably higher pledged percentages and donation effectiveness. Of course, we need to balance this with the lower number of companies of this approach compared to the Founders Pledge on, but I think both approaches have their merits.
Yes, 40% might sound a bitoptimistic, at least in the first instance. But I don’t think it is totally unrealistic that we can optimize both the selection process and the program for what YC is looking for and that we can have a substantially higher conversion ratio than the base rate. The CE vetting process is very selective and usually only about 1% get through, which already applies a lot of filtering. Moreover, YC is only one of many incubators, and if a company doesn’t make it into YC, it might qualify for other incubators.
Indeed, I think you are right that by adding constraints to the ideas we are considering, we are somewhat reducing our chances. However, by looking at the list of YC’s top companies, not a lot struck me as blatantly net negative. My sense is that most of those companies have a neutral direct impact (using the EA definition of impact), and some even have plausible positive flow-through effects (like Wave). Of course, assessing flow-through effects is pretty hard, so all this is to be taken with a grain of salt.
There you have it, here are some thoughts. I hope that they can shed some light on some of the rationales. This program is definitely hits-based, but I don’t dislike our chances and I think we have a pretty good shot. And thanks for your support!