This is such nonsense. We like hustlers too. Every investor does. It's good if they're also good hackers. But (as I've said over and over) we learned early that determination matters more than intelligence in this business, and that's what we look for.
He seems to be trying to give the impression that 500 Startups is for plucky underdogs, and YC isn't. It would certainly be in his interest to have founders believe that. But the fact is that when the black swans show up on our doorstep, they don't seem like they're going to be black swans. That was the whole point of my essay; that's why I refer to them as black swans, and why I say that "we're in a business where we need to pick unpromising-looking outliers."
Airbnb, who Dave uses as an example of a billionaire startup club member, is the definition of an underdog making the big time through pure hustle -- I seem to recall a story about selling cereal boxes to make ends meet before funding started to pour in post incubation
Whether or not it was his intention, Dave McClure successfully framed 500 in the discussion of the premier accelerator program - YC. And he also sent a battle cry to his portfolio, pitting them as the underdogs. I'd say this post was pretty well done regardless of whether you agree with his points.
I think pg recognizes the post for it's marketing brilliance, which is why he is calling bs.
It was interesting that aside from having the scrappy image, many of the athletes used in the analogy(Ichiro, Nash, and Dirk) happens to be foreign. The post is an attempt to differentiate from a leading competitor for talent on multiple fronts(Home Run vs Singles/Globalization vs Valley/Hackers vs Marketers).
"Law of the Ladder" strategy of the post is a good play.
Another point about the scrappy image: one of the points of PGs essay was to state that sometime the non-obvious guy/gal wins the biggest the end. 500 is saying they are that non-obvious accelerator.
"trying to give the impression that 500 Startups is for plucky underdogs, and YC isn't."
Essentially he is saying YC is Hertz and 500 is Avis.
"Their corporate motto is "We Try Harder" It was adopted in 1962[4] (during the tenure of Robert Townsend as its CEO) to make a more positive reference of Avis' status as the second largest car rental company in the US, at the expense of its larger competitor The Hertz Corporation. "
A well intentioned strategy of "attacking" (if you want to call it that) the market leader in the category. Doesn't even matter if they are really Avis by the way. Why? There is fresh kill on the internet every day. And those "fresh kill" are reading things like that and believing it.
"sure most folks at YC feel like they try harder too"
It's great to be the underdog it makes everything fun as you are trying to get somewhere. Once you get there you have something to lose. So you either becomes paranoid or you can become lazy and complacent.
You might remember the Dirk Diggler character in "Boogie Nights". First time he won the award he gave a big speech and thanked everyone. Next time a little less, next even less. After he had won so many awards he would just go up on the stage and say "thank you" as if it didn't even matter anymore. Later, he couldn't even "get it up" he became impotent. That's what you have to guard against. Your strategy is great.
While I agree that bit of Dave's article is about trying harder to appeal to underdogs. Is YC investing in companies abroad then? I am not talking about companies started abroad but essentially cater to US and/or global audience(I know you guys do invest in such companies) but Companies for example that were started in India and cater to Indians. Is YC investing in such companies? Last I wrote to YC, answer was no.
Dave McClure post was framed as 500=APPL, YC=MSFT analogy. Artists vs geeks. Intuitivity vs analytics.
It's not about being an underdog or a black swan. Both 500 and YC must differentiate. It's the only way for the founder to grasp the accelerators' pitch.
Everyone wants to put out their expressive character. Michael Jackson can be recognized from the silhouette, so can you do with your company.
So it's fine that Paul Graham played out the analytical card and Dave McClure counterplayed the same card as Apple played against Microsoft - we are the hippies, not the science guys.
If you're looking for unpromising-ness + determination, how do you avoid the thesis devolving into "invest in everyone that's smart and determined since you just never know"?
of course i realize YC appreciates hustlers as well as hackers, however don't you think there's some truth to YC being exemplified by the "hacker" way? i certainly meant that in a complimentary way.
in any case, didn't mean to mis-characterize your post... just thought it would be useful to identify some of the differences in YC & 500 re: style, philosophy, practice.
I'm afraid there's too much hay to be made from your essay, both because of the content and because the author. In the HN discussion honest (AFIAK) misreadings were rife so it isn't surprising to see someone with an agenda try to pick up the ball and run with it.
He seems to be trying to give the impression that 500 Startups is for plucky underdogs, and YC isn't. It would certainly be in his interest to have founders believe that. But the fact is that when the black swans show up on our doorstep, they don't seem like they're going to be black swans. That was the whole point of my essay; that's why I refer to them as black swans, and why I say that "we're in a business where we need to pick unpromising-looking outliers."