YC demo day valuation tensions, how VCs can find gems, Substack's performance & more | E1716
This Week in Startups
Jason Calacanis
4.2 • 1.4K Ratings
🗓️ 7 April 2023
⏱️ 47 minutes
🧾️ Download transcript
Summary
Jason breaks down the valuation tension surrounding YC demo days (2:36), how to get better prices on YC-equivalent startups (8:59), Garry Tan's response to complaints (15:18), and more! Then, Jason reacts to a law firm's leaked expectations list that went viral (29:29) before wrapping with some thoughts about Substack (41:59).
(0:00) Jason tees up Friday's topics!
(2:36) Understanding the valuation tension of YC's demo day; why some investors resent YC
(8:59) Jason's three ways to avoid overpaying for YC startups
(13:56) Embroker - Use code TWIST to get an extra 10% off insurance at https://Embroker.com/twist
(15:18) Garry Tan's response to demo day valuation complaints; Harry Stebbings and Garry Tan's back and forth on valuations/expectations
(24:07) Linode - Apply to Linode's Rise program for a $500 credit and up to six figures in discounts at https://linode.com/twist
(25:34) How startups that got accepted into YC can cold email top VCs to raise pre-demo day
(29:29) Jason reacts to a law firm's leaked expectations list that went viral
(36:13) QuickNode - Get one month free by using code TWIST at https://go.quicknode.com/twist
(37:25) Reactions to the viral expectations list
(41:59) Substack publishes 2021 gross revenue, net loss, and cash on hand and Jason breaks down the company's position
Email your pitch deck to yc@launch.co if you were rejected by YC and want to meet with the LAUNCH team!
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Transcript
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| 0:00.0 | Hey, everybody, it's Friday, first up on this show. |
| 0:02.5 | I'm going to talk about why commentators demo day |
| 0:05.2 | and why a lot of VCs are hand-ranging and complaining |
| 0:08.9 | about, oh my God, the high valuations |
| 0:11.2 | of Y-COVID-AIR companies. |
| 0:13.3 | I will explain why there's resentment |
| 0:15.1 | from the investment community |
| 0:16.6 | at Y-Cominator companies getting $20 million |
| 0:18.9 | valuations when non-YC companies |
| 0:20.7 | with the same amount of traction |
| 0:21.8 | are commanding five or $10 million valuations. |
| 0:24.2 | And I'll explain the three ways investors |
| 0:26.7 | can avoid paying $20 million, |
| 0:28.8 | but if they want to do the work. |
| 0:31.9 | Three specific strategies to avoid overpaying |
| 0:34.6 | when you're investing in startups. |
| 0:36.2 | I'll also talk about what Y-Cominator companies should do |
| 0:39.4 | in terms of raising money before demo day |
| 0:43.0 | or listening to the basic rule of waiting till demo day. |
| 0:46.7 | I have an answer that might be very different. |
| 0:48.4 | I'm going to give you an actual script |
| 0:50.2 | on how to email VCs that you're not raising money |
... |
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