Prior to launching Y Combinator, Paul Graham founded Viaweb, a company he sold to Yahoo for $49 million in 1998.
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.
This whiteboard in Y Combinator's offices illustrates the various stages of start-up life as Graham sees them.
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.
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.
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.
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.
Among the companies Graham has funded: Loopt, a social-networking application for mobile phones, founded by Sam Altman (center.)
"I can't comment on the acquisition price," says Reddit founder Steve Huffman.
"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, 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."
"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.
"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.
Graham himself has been raising money. Earlier this year, Sequoia Capital provided him with a $2 million bankroll to invest.
Y Combinator founder Paul Graham appears on the cover of the June issue of Inc. magazine.