The Ledger
Every statement that passed quotation and attribution checks. Mix any filter with any other: certainty 1/5, debate potential 5/5, or both at once.
why aren't all 59 resolved? a statement only gets an assessment when the public record can support or contradict it. opinions and what-ifs never can, and 0 checkable ones are still open, waiting for their date. predictions held up or didn't; assertions are supported or contradicted. on every card: ▮▮▮▮▮ certainty · ▮▮▮▮▮ debate potential. speakers are clickable
Ralston: Y Combinator would not have funded a young Steve Jobs
“I don't think we'd fund a Steve Jobs at YC. Well, that's not good. Yeah. And the reason is, especially when Steve Jobs was starting off, he was an asshole.”
Ralston: Magic Leap raised $2.3B but seems to have almost nothing
“Magic Leap raised 2.3 billion dollars, and they seem to have almost nothing.”
Ralston: Seed investors demanding five-year financial projections are inexperienced
“If you run into an investor who is asking for five-year projections at seed, you've run into what we colloquially call a noob. They don't know what they're doing. Who has five year predictions at this point?”
Ralston: Pitch decks are largely useless for raising seed funding
“For raising seed, I think decks are not that useful. As an angel investor myself, I almost never even look at the deck. I just want to look at the founder and hear their story and see how they tell it.”
Ralston: VCs are not all brilliant, but they easily detect founder dishonesty
“If there's one thing, VCs aren't all brilliant, they're not actually all that good at being a VC, but what they are good at is sniffing this stuff out.”
Ralston: Unequal equity splits like 51/49 are better to maintain control
“It's usually better to have somewhat equal shares, not, not, but not completely equal, and if one person has 51% and the other person has 49%, then they can control.”
Ralston: The best startup founders are often unemployable
“One thing to remember and keep in mind is that often startup founders are unemployable. Not always, but often. The best ones.”
Ralston: SAFEs beat debt because debt allows investors to kill viable startups
“About lifestyle companies and why I think the safe is preferred in general to debt is because we've seen too many times where the fact that there's debt there is used to kill a company that didn't have to die. And it's too easy for investors to call that debt …”
Ralston: Angel investors mostly have marginal or minimal impact on startups
“Angel investors can, in limited cases, have substantive impact on the companies in which they invest. Mostly their impact is marginal, minimum.”
Ralston: Combining Early Stage and Growth Investing in One Fund Is a Bad Idea
“VC started doing both early stage and growth, sometimes in the same fund, strangely, which I don't necessarily think is a great idea.”
Ralston: Startups Are Raising as Much Money in ICOs as Traditional VC
“Radical in that, like so early, there's an equal amount of money in ICOs being raised by startups as venture money.”
Ralston: The Startup ICO Fundraising Boom Is Not Sustainable
“Don't really believe it's sustainable.”
Ralston: Conditioning angel checks on round completion makes investors useless
“Don't try to be the last money in because you don't have any confidence in yourself. So some of the worst investor behavior is to say, Craig, I like you. I like your company. You're raising a million dollars. I'll put a 100,000 dollars in as soon as you raise …”
Ralston: The venture capital fundraising market is neither rational nor fair
“It seems like kind of an open market, but it's not rational. It's seldom fair.”
Ralston: The right investor is often whoever writes a check first
“Sometimes the right investors will be the investor With whom you resonate the best and who you think is going to be the best added value. Sometimes the right investor be the person who is willing to write you a check first.”
Ralston: Startups should ideally raise capital when they don't need it
“The best time to raise money is when you don't need it. This isn't always possible. But when you don't need money, investors see the biggest opportunity.”
Ralston: Founders should raise enough capital to reach profitability
“One thought process to go through is assume when you raise money that this is the last time you'll ever be able to raise. So raise enough so you won't need more, so you can get to profitability.”
Ralston: Magic Leap raised billions of dollars purely on a story
“Look at Magic Leap. If you've heard of Magic Leap, they raised billions on just a story.”
Ralston: Top investors prefer backing startups before they gain expensive traction
“Interestingly, the very best investors want to get you before you have all that stuff, because you're expensive by then. The greatest, best investors are Airbnb before they're Airbnb, before they have traction.”
Ralston: Setting too high a valuation cap can kill a fundraising round
“It is really dangerous to choose too high a valuation. And in fact, it can kill your fundraising, because it's quite difficult to go to, ah, an investor who might kind of be interested, and you say, I'm gonna raise at a twelve million dollar cap. On my safe. A…”
Ralston: Y Combinator no longer recommends startups use convertible notes
“And a convertible note is a kind of debt as well, although we don't recommend you use convertible notes anymore.”
Ralston: YC advises founders against priced equity in seed rounds
“We don't recommend you do equity in a seed round. Usually it'll be on some sort of convertible.”
Ralston: Investor meetings go well when investors talk more than founders
“Also, a good sign that an investor meeting is going well is when they talk at least as much or more than you do.”
Ralston: A founder's primary leverage against experienced VCs is delaying
“They're almost certainly better at you in negotiation. So if you do get into a negotiation, a deep negotiation, the one thing you have on your side is you can delay.”
Ralston: Over-optimizing fundraising terms distracts from building great products
“This merely means that the most important thing that you guys can do is build great products that customers love, and that has little to do with fundraising, except as an enabler of that. So trying to get the last dime out of fundraising is taking away from th…”
Ralston: The best investor introductions come from your existing committed investors
“The absolute ultimate best way to connect with an investor is via an investor who invested in your company who will connect you to another investor. That is the best possible introduction.”
Ralston: The average YC startup seed valuation cap exceeds $8M
“The vast majority of companies that go through YC raise seed, and the average cap tends to be over eight million now, so it's clearly not a handicap.”
Ralston: Building extensive features assuming you know the solution is always wrong
“Like, what happens if you think you know the solution and you build lots of stuff for it, you're going to be wrong. Cause you just don't know it.”
Ralston: Raising excess capital exerts gravitational pull that bloats startup organizations
“Money just sitting there has sort of a gravitational effect. It makes your organization fat.”
Ralston: Investors make a mistake by not evaluating if founders attract talent
“If you're not evaluating that when you talk to founders, you're making a mistake, because if you think about it, every giant company is built with an incredible team. And if you don't believe that the founder you're talking to can recruit and build this team o…”
Ralston: Angel investors must lose money before becoming experts
“Meeting founders and making decisions is way more of an art than a science, and as Dalton says unfortunately in this game I think you have to Lose some money before you can really become an expert, as much as anyone is an expert at answering the questions you …”
Ralston: SAFEs Benefit Founders By Being Simple, Fast, and Cheap
“Why would you do a safe? Well, because it's simple, it's easy, it's fast, and it's cheap. It's better for founders.”
Ralston: Founders must target problems so dire users accept imperfect solutions
“You need to find problems so dire that users are willing to try half-baked The one imperfect solutions.”
Ralston: Investors who claim to be 'A-plus' are not A-plus investors
“One thing that, ah, for founders, it's easy to tell when an investor is not an A-plus investor is if they claim to be an A-plus investor.”
Ralston: Picking multi-billion dollar startups does not prove investor skill
“Just because you've made a lot of money investing, do not forget there's a significant component of luck. Involved. And it's great if you all are the lucky ones that pick the one or two or three companies in this batch or YC, for example, that become multi-bil…”
Ralston: Siding with founders increases odds of landing fund-returning outlier startups
“That if you end up on the founder side more often than not, then your probability of getting in the one company that will make all those other investments irrelevant is much higher.”
Ralston: Typical angel check sizes range from tens to hundreds of thousands
“It sort of tends to be a minimum in the tens of thousands of dollars, up to a maximum of, you know, hundreds of thousands of dollars, usually.”
Ralston: Founder resilience and belief matter more than market size, capital, or intelligence
“You know that if you don't have the resilience you need, the toughness you need, the determination you need, the belief you need, it, none of the other things matter. Nothing else. How big the opportunity is, how much of competition there is or isn't, how much…”
Ralston: First-time angels must calibrate by meeting multiple startups before investing
“But it is true in the very beginning, before you've made your first angel investment, calibrate. So do spend, I don't know if it's a hundred or 10 or 15, you should.”
Ralston: Angel investments should default to zero value until proven otherwise
“You have to be prepared to zero out that investment. In fact, you know, my default position when I invest in a startup is that that investment is not worth zero. It's not like if I put, pick a number, 25,000 dollars in a company, And then I track that. Its val…”
Ralston: Mistreating Failing Founders Destroys Deal Flow and Returns
“In fact, if you think about it, if you act like a jerk to a founder, that might be, even if that gets you an extra 50% of your return, your investment back somehow, That might actually cost you way more in the long term because the way you get deal flow is bec…”
Ralston: Most angel investors do not get into later rounds
“The fact is most angel investors don't get a bite at the later rounds.”
Ralston: YC's standard fundraising document is now a post-money SAFE
“We've changed that, and now the standard YC document that Kirsty will go into more detail is a post-money safe.”
Ralston: Dropbox raised its first round at a $2M-$3M valuation
“Dropbox raised their first round at like a two or three million dollar valuation. And it worked out okay for Drew and team, right? They won IPO this year.”
Ralston: Buchheit Built Gmail Solo While RocketMail Had a Team
“Paul Buchheit, who actually has more of a claim on actually writing Gmail than I do have a claim on writing Yahoo Mail. I wrote some important parts of Yahoo Mail, but Paul was kind of by himself doing Gmail almost, and we had, we were a little more intentiona…”
YC will award $10,000 equity-free grants to 100 Startup School companies
“And we're going to choose a hundred companies that get that grant based on, well, the, how they do during the course and the information we're going to get from the advisors and the progress that company makes. So we're going to judge how promising that compan…”