3min snip

The Social Radars cover image

Paul Graham, Co-Founder of Viaweb and Y Combinator

The Social Radars

NOTE

First investors - where Y combinator is based on

The first investor in the company provided $10,000, did all the legal work, and received 10% of the company. This initial investment and arrangement served as the foundation for the YC deal, which was a similar structure but slightly more favorable. The success of this investment demonstrated the mutual benefits of such a deal, where both sides saw significant value and supported the need for this type of investment model.

00:00
Speaker 1
Now which came first Julian, your first investor or Trevor? Because I want to hear the stories of both. Julian, I think. Okay. So tell Carolyn about Julian. So Julian was Julian Weber was the husband of a painting teacher of Harvard. And he was the super nice guy. He was a business guy, but not a suit. Like he had been the president of the national lampoon. It was sort of business experience he had. So he was a business guy, but cool. Yeah. And a lawyer. So he could do this magical thing of incorporating us, which probably seems pedestrian to you, but it seemed astonishing to us that Julian could just like file some papers and we were a company. Yeah. Yeah. So he gave us $10,000. And in return, an end did all our legal work. Nice. And was on the board and would tell us really basic things. Wait, what state were you incorporated in? Probably New York, but I can't say for sure. Okay. All right. I mean, he was in New York. Yeah, that makes sense. I don't know. I don't know. Does he pay attention to those details? I know, I know. Okay. Only you would ask a question like that. Of course, of course. That was my first first thought. Well, I know. What did he get in exchange for his 10k? You got 10% of the company. Oh, wow. I know. Wow. Honestly, this was the deal that YC is based on. As I remember, when we got bought in the end, right? We got bought for $50 million. So even after the dilution, that 10% of the company was worth a lot more than the 10,000 paid for it. Yeah. And so I thought to myself after that, whoa, Julian got a pretty good deal. And then like half a second later, I thought to myself, but wait, we would have died without Julian many times. And so we got a good deal too. That's weird that something could be such a good deal for one side, but also a good deal for the other side. And that was how we knew that YC's deal was like that it was needed. We took a deal like that ourselves. Right. In fact, YC was a better deal because it was slightly more than $10,000 for slightly less than 10%, right? Right. Right. But that was how we knew that a deal like that was a viable thing, that there was a need for something like that, because we had taken it.

Get the Snipd
podcast app

Unlock the knowledge in podcasts with the podcast player of the future.
App store bannerPlay store banner

AI-powered
podcast player

Listen to all your favourite podcasts with AI-powered features

AI-powered
podcast player

Listen to all your favourite podcasts with AI-powered features

Discover
highlights

Listen to the best highlights from the podcasts you love and dive into the full episode

Discover
highlights

Listen to the best highlights from the podcasts you love and dive into the full episode

Save any
moment

Hear something you like? Tap your headphones to save it with AI-generated key takeaways

Save any
moment

Hear something you like? Tap your headphones to save it with AI-generated key takeaways

Share
& Export

Send highlights to Twitter, WhatsApp or export them to Notion, Readwise & more

Share
& Export

Send highlights to Twitter, WhatsApp or export them to Notion, Readwise & more

AI-powered
podcast player

Listen to all your favourite podcasts with AI-powered features

AI-powered
podcast player

Listen to all your favourite podcasts with AI-powered features

Discover
highlights

Listen to the best highlights from the podcasts you love and dive into the full episode

Discover
highlights

Listen to the best highlights from the podcasts you love and dive into the full episode