Good morning 👋
YC believes it’s the Golden Age of Building. They’re incentivized to believe that, but still, we agree.
They released what areas are most interesting to them earlier this week, and we’re breaking down our thoughts below.
P.S. 💰 Are you a full-time investor AND do you want to get paid more?
Today’s highlights
YC’s request for startups
Founder vesting benchmarks
Forerunner raises a massive new fund
One thing to change how you think about money
TOP
Building szn 👷♂️
YC released its request for startups earlier this week, and a lot of the areas are not what you might expect.
Here’s where they’re seeing the most opportunity to build (and why) over the next few years:
Government software
Our country’s deficit is massive (and growing quickly)
AI is powerful enough now to automate many mundane tasks that the government wastes billions on each year
Elon, Vivek, and the Department of Government Efficiency will put more pressure on the government to become less bloated and adopt software before hiring more labor
Public safety technology
Advanced computer vision: Identifying suspicious activities or people in distress from video feeds, without compromising individual privacy.
Emergency response enhancements: Improving the speed and coordination of emergency responses are lifesavers.
Community safety tools: Improving how communities and law enforcement interact. Think Nextdoor but with more communication to law enforcement if necessary.
Efficient law enforcement technologies: Help law enforcement do their jobs more effectively and fairly (workload management, increasing accuracy in their operations, etc.).
Manufacture in the USA
Over the past 50 years, America has given up its role as the biggest workshop in the world, and we have outsourced this task to other developing nations
Hollowed out US manufacturing has led to social and political division, and bringing back American manufacturing is a bipartisan issue
ML-based robotics systems will make it possible to automate far more, which will reduce the cost-of-labor arbitrage that pushed manufacturing to other countries in the first place
Stablecoins 2.0
Stablecoin payment volumes have surged this year and are now over a fifth of Mastercard’s volume
Almost 30% of global remittances are now facilitated through stablecoins
Traditional finance institutions like Visa are offering platforms for banks to issue their own stablecoins
Stripe recently acquired a stablecoin startup, Bridge, for $1 billion, which will only attract more investor interest and capital into the space
LLMs for chip design
Each breakthrough in AI creates demand for more powerful chips to train larger models
Domestic chip design and manufacture is not just about economics anymore, it's about survival in a post AI world
Fintech 2.0
The SVB collapse feels like a distant memory, and investors are warming back up to the idea of fintech investing
There are structural advantage for a small startup without any legacy systems or processes to quickly build global financial products of the future
New space companies
The cost to reach orbit has dropped 10x since 2006 (SpaceX first launch)
If we are entering a future with access to space being as routine and inexpensive as commercial air travel, shipping or trucking… what new businesses does that unlock?
AI-aided engineering tools
Engineering tools have not evolved for several decades, but that is changing fast
With reasoning capabilities built into the new AI models that solve math and physics, we can unleash engineers to design and build physical systems faster and better than ever before
One million jobs 2.0
In the past, when massive technological change came about, people have ended up doing different types of work than they did in the past (machinery creating less farmers)
This could include tools for more people to run their own local businesses, or be able to earn a living by providing services to other humans either online or offline.
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LINKS
💣 7 Harsh Truths You Must Realize Before It’s Too Late: Greater Minds brings these truth bombs
🧐 What’s the Difference Between Venture Capital and Private Equity?: CJ Gustafson’s post explains
🔟 The 10 Biggest Mistakes I Made Bootstrapping to $1M ARR: Melissa Kwan built eWebinar with determination, trying, failing, decisions made, and lessons learned compounded over years
⌛️ Founder Vesting Benchmarks: Data-Driven VC shares the latest data from Carta that shows many investors are advocating for longer vesting or re-vesting from founders
🤝 Uplevel Your Founder-VC Relationship: Nfx gives some great takes of how founders can manage their relationship with investors
TWEET
HEADLINES
Forerunner, consumer tech VC that backed Warby Parker, Away, raises $500M Fund VII (Pitchbook)
SoftBank Vision Funds architect departs as funds log best gains in years (Pitchbook)
Altos Ventures, an early backer of Coupang and Roblox, raises $500M fund (TechCrunch)
Real Estate Startups Aren’t Seeing Much Love (Crunchbase)
Donald Trump Jr. Will Reportedly Join An Anti-ESG Venture Capital Firm Instead Of The White House—Here’s What We Know (Fortune)
MEME
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RECS
Harmonic: The startup discovery engine we use to find the coolest companies of tomorrow
POLL
Which YC request for startups are you most-bullish on?
Thanks for reading this far and giving us a little bit of your attention this week.
Feel free to unsubscribe whenever this stops becoming valuable to you.
- Clay
RESULTS
Here are the results from our poll question in yesterday’s piece:
What percentage of VCs today would you guess have real company-building experience on their resume?
🟨🟨🟨⬜️⬜️⬜️ <10% (3)
🟩🟩🟩🟩🟩🟩 10-25% (6)
🟨🟨🟨🟨⬜️⬜️ 25-40% (4)
🟨🟨🟨⬜️⬜️⬜️ 40-60% (3)
🟨⬜️⬜️⬜️⬜️⬜️ >60% (2)
18 Votes




