The reason the Start Fund works is that the terms are so good--uncapped and no discount--that if you're planning to raise money at all, you should take it, and so the investors get a real index, including the potential home runs.
These terms are significantly below the mean for the last YC batch, and I'd bet that some of the best startups don't take the deal. It's a decidedly less clear strategy to invest in only the not-so-good startups in a batch.
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The reason the Start Fund works is that the terms are so good--uncapped and no discount--that if you're planning to raise money at all, you should take it, and so the investors get a real index, including the potential home runs.
These terms are significantly below the mean for the last YC batch, and I'd bet that some of the best startups don't take the deal. It's a decidedly less clear strategy to invest in only the not-so-good startups in a batch.