Livingston: If I remember correctly, it was the Monday after we conducted the in Font

Make Data Matrix in Font Livingston: If I remember correctly, it was the Monday after we conducted the

interviews. We got a lot of applications, more than we thought we would. And then we chose about 20 groups to come to Cambridge to interview over a Saturday and Sunday, all day long. On Sunday night we called everyone. We chose eight that we had wanted to fund, and all of them but one said yes. I give the founders a lot of credit, because this was a brand new concept and Y Combinator had no track record. The deal was: move to Cambridge for the summer and get $12,000 or $18,000, depending on whether you were two or three founders. We based the amount of money on the MIT graduate student stipend, which was a couple grand a month. We said, Come to Cambridge and we ll work with you, and we ll get together for dinner and hear from guest speakers every week. (Unfortunately for Paul, we hijacked his personal office to use for Y Combinator.) So seven of them said yes, and I went into work on Monday thinking Y Combinator is real now even though we didn t even have Y Combinator legally set up at this point. I gave my notice that day, I think. But that day something else very memorable happened. There had been one group, two guys from UVA, who were still seniors and were graduating that spring Alexis Ohanian and Steve Huffman. They came to us with an idea that we just thought was wrong for two young guys with no connections in the fast food industry. Their idea was ordering fast food through your cell phone. And we didn t fund them. We told them, Sorry, we really liked you guys, but we just think your idea would be a bit too challenging. But that morning when I was at work, Paul called them and said, We like you guys. Would you be willing to work on another idea They were on an Amtrak train heading back to Virginia. I remember Paul emailed me and the subject line was muffins saved. I had nicknamed them the muffins, because I just loved them. It was just sort of an affectionate name. I remember thinking, This is so exciting. They had gotten off the train in Hartford or something and headed back to Boston to go meet with Paul to brainstorm new ideas. I thought, These are the kind of people I want to fund people who would get off the train and go back and make it happen. So we wound up funding eight companies that summer.

Loopt was in that batch. There s actually a funny story about him, too. He had submitted an application and at the time he d been working with a few other people, but he was the only one who could come to Cambridge that summer. So Sam emailed us saying he was the only one who could come and Paul wrote back to him, saying, You know, Sam, you re only a freshman. You have plenty of time to start a startup. Why don t you just apply later Sam wrote back something to the effect of, I m a sophomore, and I m coming to the interview. I ll never forget that how we tried to brush him off. Sam was in a Stanford business plan contest the same weekend as our interviews. He wound up winning on Saturday and he took the red-eye to Boston that night and arrived for his interview just him on Sunday. We met with him for 25 minutes or so and I remember thinking in the first 5 minutes, This guy is amazing. All of us were just blown away by Sam. His poise and intelligence, and just the way he was. We knew that there was something special about him. We also had Justin Kan and Emmett Shear of Justin.tv. We originally funded them to make an online calendar called Kiko. They built it that summer and got a little bit of angel funding, but Google Calendar came out soon after and crushed them. So they came to us later on and said, I think we re gonna move on from Kiko, and they started talking to Paul and Robert about new ideas. I remember I walked in and Paul said, Hey, Jessica, listen to their new idea. Justin s going to wear a camera on his head 24 hours a day and film his entire life. I thought this was one of the craziest ideas I d ever heard. But Y Combinator funded them because we really liked them, and Paul, Robert, and Trevor liked their idea. And we had Phil Yuen, who started TextPayMe, which was acquired by Amazon. Originally he was working on a different thing called FireCrawl, which was going to crawl your company s website and find errors and broken links, etc. But Phil and his cofounders found they weren t super excited about that, so in the fall they switched to a new idea for cell phone payments. Do you remember learning anything surprising that summer

Livingston: I learned a lot that summer, because it was our first run at everything. Looking back, I think the most surprising thing was all the convincing we had to do that this idea of Y Combinator providing small amounts of funding to batches of startups would work. It had never been done before, so everything was brand new. I tell founders this all the time that if your idea has never been done before, everyone will think it s crazy. A lot of people either pooh-poohed our idea or didn t care at all. Very early on, we met with a big VC firm and one of the founding partners was there. We told them all about our new model and hoped they d be interested in meeting with some of the startups. At the end, we invited them to come to one of our dinners to meet the startups and the senior partner made it very clear that he