Your company is not “too far along” for YC

7 min readOct 12, 2015

Applications for YC’s Winter 2016 batch are closing soon, and that has the team at WayUp (formerly Campus Job) feeling pretty nostalgic. During YC, the company grew faster than ever, we hit the crazy goals we set for ourselves, and we closed our Series A around Demo Day, bringing our total fundraising to $9.1M. And on top of all the traction, our team of 8 had a ton of fun.

Yet one year ago today, my co-founder Liz and I made the decision not to apply to Y Combinator, so we were lucky to have been there at all. I want to prevent you from making the same mistake of thinking you shouldn’t apply.

So how did we get into YC?

How it all began

We launched as Campus Job in September 2014. Soon after launch, we thought we were “doing great” — we’d raised $1M in VC funding pre-launch, we had a team of 5, we had ~$12k/month in revenue (with a 100% take-rate), and we had tens of thousands of users. We also thought YC was only for companies who hadn’t yet launched or didn’t yet have traction, so we didn’t even think of applying.

Our lead investor BoxGroup generously let us work out of their beautiful office overlooking Union Square, and we were lucky enough to be sharing that space with Zach and Henri of Shout (YC S14). They introduced me to Aaron Harris, a YC partner, a student of marketplace models, and a YC alumnus himself. I was an avid reader of Paul Graham’s essays and knew YC well, and I was excited to have the opportunity to learn from a YC partner even if we thought we were “too far along” to apply. We met at Cafe Grumpy. To my surprise, he spent almost the entirety of the conversation talking about how we absolutely needed to apply to Y Combinator.

We were flattered…but we didn’t apply; we were sure YC just wasn’t for us. Aaron followed up again later, as well.

The deadline passed.

I responded to Aaron, “We want to do YC for the purposes of mentorship and community, but because we’re already generating revenue and have enough funding until our Series A, we weren’t sure that the economics around being a part of YC made sense for us. What do you think?”

Aaron responded, “I do kinda think it’s a no brainer. At least you should apply and see what happens.”

Why didn’t we apply at first?

Here are some of the things we’d assumed:

7% for $120,000 didn’t make sense from a valuation perspective — it was a worse valuation than we had raised for our seed round.
We already had a team of five and were still hiring. YC companies rarely had employees.
YC companies were all pre-revenue, and most even pre-launch.
It would look bad that we were doing an accelerator after having already raised a seed round — even though YC is the most prestigious accelerator in the world.

Deciding to apply

We needed some advice

Still unsure of what to do after applications closed, we went out to lunch with the BoxGroup partners (David Tisch and Adam Rothenberg), the two people who led our seed round and believed in us before our product was even built. At lunch, it became clear that the two of them thought that YC would be a good decision, whether because of the customers we’d acquire through the loyal YC community, the extensive network we’d join, or — yes — the great valuation we could potentially get. As the founders of TechStars New York, there were few people who could give better advice on this than David and Adam.

With their backing, after having spoken with nearly a dozen YC companies about their experiences, and figuring there had to be a reason Aaron was pushing us so hard, we filled out the application and made our video. Even if we were accepted, we still had no idea whether we would accept the funding. (Looking back — this couldn’t have been a more amazing situation to be in, despite that it felt so uncomfortable and stressful at the time.)

And then, we got the interview:

What would the team think?

We knew if we got into YC, we’d be taking the whole team with us, no matter how big the company was —we weren’t moving to the Bay Area without them. So we approached the team, telling them about YC, the application, the opportunities, and the dangers. It could be an amazing experience to live together for three months and work our butts off. Or, it could be an expensive and dangerous distraction to our business to move to California when we had a pretty good thing going. It was all of us or none of us — we decided if even one member of the team didn’t want to do YC for any reason, we wouldn’t accept the offer.

After a weekend to think about it, it was clear: they wanted in. Not only would being in YC mean that we would get to miss an NYC winter (blegh!), but everyone was excited about what living and working together for three months could do to help our team and our company grow. After that, we also got buy-in from most of our existing investors (though not all of them).

In November, Liz and I flew out for the interview, and then the rest is history.

The truth: YC is even better when you’re “big”

7 months after having completed the W15 batch, we’re so glad we did it. As it turns out, not only is YC extremely worthwhile for post-seed companies, but Liz and I believe that we were able to get much more out of it because we already had traction and a team.

We could execute more quickly

Since we were a team of 8 by the time we started YC, we were able to iterate much more quickly than we would have if it were just me and Liz. As one example, in the first two weeks of YC, we completely changed our pricing structure and launched a new product. We continued building the product while growing both our student userbase and our sales by double-digit percentages each week, and it was only possible because we had hardworking team members specializing in each aspect of our business.

We could focus on growth

We were able to use our office hours with the YC partners to focus on refining our focus and and supercharging our growth. The partners are amazing at guiding companies towards viable ideas, but they’re even better at helping companies achieve insane growth.

We had incredible options for our Series A

YC truly shines when it comes to Demo Day and fundraising — YC will make your fundraising process better.

But Series A rounds are harder to close than seed rounds, and so YC had an even more significant impact on our raise. The partners (especially Ali Rowghani, the former CFO of Pixar and COO of Twitter) helped us with everything from pitching, to negotiations, to getting better at speaking with investors.

Especially if you’re not based in California, YC is an unparalleled opportunity to meet and start building relationships with Bay Area investors. No matter what/when/where you’re thinking of raising now, having these relationships in place will be invaluable for later rounds. Before YC, all of our investors were NYC-based. Now we frequently get great advice from many West Coast investors and we’re already working with a few, including Index Ventures, Slow Ventures, and SV Angel.

It’ll be the best 7% you’ll ever spend

The 7% equity for $120,000 may or may not be worse terms than what you had raised at before. That shouldn’t matter. Every YC company we spoke to before applying told us how they looked back and laughed at any concerns they had over the 7% equity that YC takes. We now look back and laugh as well, and you will, too. The mentorship, the community, and the experience are more than worth it.

Because we had raised on better terms before the YC funding, we viewed it as our company spending money for the opportunity to go— and that made us work even harder to make the most of YC.