Only 3% of the top 100 YC companies rely on advertising for their main source of income. Advertising businesses need organic virality to succeed, like Google, Facebook, and Twitter. They become popular hubs where users gather, just like marketplaces. Reddit and Twitch, for example, have strong network effects. To build a massive company, it's crucial to remember that using ads as the primary business model is challenging unless aiming to be a top 10 internet site. Overall, the lesson is to find alternative monetization methods.
One of the most common topics that founders ask us about is pricing and monetization. In this talk, YC Group Partner Aaron Epstein outlines 9 different business models, and highlights lessons from top YC companies on how to best monetize and price your product.
Business Model Guide: https://www.ycombinator.com/library/Gh-business-model-guide
Apply to Y Combinator: https://yc.link/SUS-apply
Work at a Startup: https://yc.link/SUS-jobs