"you need one of your alumni companies each year to achieve an exit in the $25 million range"
In the case of a company like WUFOO, YC & PG did a follow on round of ~$100k bringing YC's total equity stake to say 10% and with an exit of $35m YC made off with $3.5.
The point being the initial $15k investment is to gain access to great companies at the beginning so that investors can make follow on rounds in the best companies in the class. This is where the real money is made with incubators and how this differs from the privies bubble where VC's would invest $10m in an idea for a company with zero revenue. Looks like capital efficiency to me...
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"you need one of your alumni companies each year to achieve an exit in the $25 million range"
In the case of a company like WUFOO, YC & PG did a follow on round of ~$100k bringing YC's total equity stake to say 10% and with an exit of $35m YC made off with $3.5.
The point being the initial $15k investment is to gain access to great companies at the beginning so that investors can make follow on rounds in the best companies in the class. This is where the real money is made with incubators and how this differs from the privies bubble where VC's would invest $10m in an idea for a company with zero revenue. Looks like capital efficiency to me...