Y Combinator co-founder Paul Graham on the cover of the June issue of Inc.
Prior to launching Y Combinator, Paul Graham founded Viaweb, a company he sold to Yahoo for $49 million in 1998.
Y Combinator co-founder Paul Graham
Graham's ambition now is to mass produce the start-up. He invests small amounts of money in a large number of start-ups, and mentors the founders extensively.
A whiteboard illustration of Y Combinator's process
This whiteboard in Y Combinator's offices illustrates the various stages of start-up life as Graham sees them.
A whiteboard illustration of Y Combinator's process
Not long after a its launch, for example, a start-up falls into the dreaded "trough of sorrow" as it struggles to gain any traction whatsoever.
A whiteboard illustration of Y Combinator's process
Things only get worse, as most start-ups experience a "crash of ineptitude" when it becomes clear their hopeful business plan won't pan out as expected.
A whiteboard illustration of Y Combinator's process
After a few key adjustments, however, start-ups with staying power will see "wiggles of false hope" as a few customers respond to their re-tooled offerings.
A group of Y Combinator founders at dinner
To provide them with a respite from the grind of start-up life, Graham regularly invites Y Combinator's entrepreneurs to dine on noodles or rice and beans at Y Combinator's headquarters in Mountain View, California.
Loopt founder Sam Altman
Among the companies Graham has funded: Loopt, a social-networking application for mobile phones, founded by Sam Altman (center.)
Reddit founder Steve Huffman
"I can't comment on the acquisition price," says Reddit founder Steve Huffman.
Omnisio founder Ryan Junee
"I guess it shows that the best way to sell your company is not to try," says Omnisio founder Ryan Junee.
Scribd founder Trip Adler
Scribd founder Trip Adler, who founded a file-sharing site for books and other written documents, says "we're on our way to being one of the top 10 websites on the Internet."
Justin.tv founder Justin Kan
"We hardly spent any money," says Justin.tv founder Justin Kan, adding that the company's CEO slept on the balcony of his cramped two-bedroom apartment.
Wattvision founder Savraj Dhanjal
"One of the hard things about Y Combinator is forcing yourself to get things done after it ends," says Savraj Dhanjal, the founder of Wattvision, a start-up that aims to make a real-time tool to monitor a building's energy consumption.
Y Combinator co-founder Paul Graham
Graham himself has been raising money. Earlier this year, Sequoia Capital provided him with a $2 million bankroll to invest.
Y Combinator co-founder Paul Graham on the cover of the June issue of Inc.
Y Combinator founder Paul Graham appears on the cover of the June issue of Inc. magazine.
