How Y Combinator is Propelling More Female-Led Startups


Kirsty Nathoo, CFO and partner at Y Combinator has heard every possible excuse for why startup founders don’t apply to Y Combinator’s funding cycles. They all sing the tune of, “I’ve heard that Y Combinator accepts only x,” with x being anything from a demographic to the stage of a startup. Some startups don’t apply because they think they have too much funding to apply, and then others don’t apply because they don’t think they have enough. For every “too much” of something that prevents a startup from applying, there’s another startup who doesn’t apply for having “not enough” of the same thing. And to everyone who says or thinks this, Y Combinator wants you to know something: You’re wrong. Here’s the right statement: Y Combinator accepts only talented startups, regardless of the stage or any detail about the startup’s founders. There’s a misconception that YC accepts only twenty-something male Stanford graduates, but that’s all it is – a misconception.

Nathoo, herself, is the perfect example of how talent is all you need to get access to YC’s resources. She started as the in-house accountant when Y Combinator wasn’t even on the map. Having been accepted to the Winter program in 2008, Nathoo’s husband, Amir, had to move from the United Kingdom to Silicon Valley. After graduating from the accelerator, he felt that moving to Mountain View would be a smart move. At the time, YC was looking for an in-house accountant. Because Kirsty was working at PwC as the UK equivalent of a CPA, she already had a considerable amount of experience with tech and startups. It only made sense for YC founders Paul Graham and Jessica Livingston to ask Kirsty to join the team. She wasn’t being asked to be the in-house accountant for the largest and best startup accelerator in the world; she was asked to be the in-house accountant of a startup that wanted to help other startups.

YC felt like a small family business at the time – it wasn’t what it is today.

Today, Nathoo’s CFO and partner position matches YC’s high caliber in the startup industry.

Not only has YC come a long way in its applicants and programs in terms of diversity, but it has also grown from 4 initial partners to 17 partners – 4 of whom are women. That may seem like slim pickings, but check the numbers; it’s not. YC has always done events open to anyone interested in starting startups, but they wanted something that could speak to women who were in the field or thinking about joining.

Y Combinator started holding an annual Female Founders Conference in 2013 to dispel the myths that prevent women from living up to their entrepreneurial potential. There is so much negative press about the whole startup world – that it is a male-dominated industry, and that it’s too hard for women to get by. Naturally, this kind of talk is intimidating.

The Female Founders Conference gives attendees more information about why launching and running a startup is a definite possibility for anyone by bringing in female alumni of YC funding cycles.

To anyone who wants to go into the startup industry, here are the key points from Kirsty Nathoo and fellow YC Partner Carolynn Levy’s lecture on How to Start a Startup:

Always, always, incorporate your business in the state of Delaware. Incorporating your business in Delaware is a no-brainer, and not doing so could potentially cost you hundreds of thousands of dollars in legal fees.

Move on and keep focusing on what you need to do. Keep it simple. Keep it organized.

Kristy Nathoo, Partner at Y Combinator

Resist the urge to give a disproportionate amount of stock to early players. “If the expectation at your startup is that each Founder is in it one hundred percent, for the long haul, then everything that happened before the formation of the company shouldn’t matter.” At the same time, be mindful of equity allocation.

Value is more than the initial capital received or the basic idea of the company; “value is created when the whole Founder team works together to execute on an idea.”

Be on top of your legal game. “The main things here are sign the paperwork, sign the Stock Purchase Agreements, sign the 83(b) Election, and make sure that you actually have proof that you sent that in.”

Vest. Vesting prevents the founders, or founder if you’re solo, from bailing on the company and keeping full ownership. In other words, vesting is insurance to the other co-founders and investors that they won’t be screwed over down the road.

Don’t set the price of your company. YC will take in a company at any stage – whether the price or valuation of the company hasn’t been set (seed stage) or it has (Series A or Series B). Nathoo recommends not setting the price because it’s more efficient to getting money and moving forward.

Accredited investors – not your uncle or neighbor – know what they’re doing and the risks associated with it. Only add an investor to your board if you believe that will add value to your company.

You don’t have to end up like Eduardo Saverin. “Pro-rata rights are a way to avoid dilution.”

“Surprising as this may sound, one of the hallmarks of a really effective founder is how well he or she handles employee terminations.”

Even if you don’t go down the startup accelerator or VC path, know that a lot of running any startup relies on following the rules and taking it seriously.

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I'm On Track To Save $100K By 25. Here's How You Can Too.

Three years ago, I made a deal with myself - I wanted to have $100,000 saved when I'm 25. But I didn't mind if it didn't happen until the day before my 26th birthday.

One of my biggest priorities in life has always been to save as much money as possible — and I owe much of that to my parents, who made sure I had a strong financial education at a young age.

My dad even helped me start a vending machine business when I was nine. The experience taught me essential skills like how to pitch a business, cope with rejection and open a checking and savings account.

For the past three years, I've never made more than $80,000. About a year ago, I reviewed my rate of savings and investments and realized that I was on track to save $100,000. With only a car loan away from being debt free, I've got another year and $10K to go!

I want to acknowledge that privilege is a key part of my story. I'm white, I come from a middle-class family, and I was able to graduate college without any debt. All these things helped a great deal.

But my parents didn't raise me with a silver spoon. Paying for college was a collaborative process. We'd sit down at least twice a year to discuss how we were going to pay for the next semester. The first question they'd always ask me was: "How much can you contribute?"

I've been fortunate. But it also takes a lot of hard work, sacrifice, and responsibility to save and maximize your earnings. Feeling motivated and knowing that I'll be prepared for whatever life throws my way fuels my drive to keep making smart financial decisions. Here's how I'm getting to $100K.

  1. I side-hustled

This kick-started my journey towards six-figures. In addition to saving the majority of my 9-5 salary, my first year of freelance social media marketing made me quite a bit of cash that I could immediately save. I was able to establish both a SEP IRA and a fully-funded emergency fund with my earnings.

2. I started investing early

Knowing that compound interest is so important, I wanted to start investing early to have my money work for me. Once I started my first big-girl job, I opened my first Roth IRA. Starting to save for retirement at age 22, I was able to max out my Roth each year and also contribute to aSEP IRA and a non-retirement investment account. My first job out of school had a 401(k), but you couldn't contribute until you were there at least a year. Knowing I wasn't planning on staying long — I was at that job for a year and a few months — I opened a Roth 401(k) and then rolled my earnings to my Roth IRA.

3. I negotiated salary offers and raises

Negotiating should be a collaboration, not a confrontation. Growing up, I watched my father sit on hold, patiently waiting to negotiate our cable and phone bills. Negotiation was always part of my life, and I grew up with parents who knew how to do it. So when I was offered my first social media freelance gig, I negotiated over $10k more than they offered. And after achieving a 20% bump at my first 9-5, I negotiated $20k more than what was offered at my next job. And $10k more at the next job. If negotiating for raises freaks you out, here's a guide that can help.

4. I've automated my savings

Automating your money not only makes your life easier, but it makes you feel like the percentage you're saving just doesn't exist. I have 26% of each paycheck automatically deposited into a high-yield savings account. This savings account is purposefully at a different bank than my day-to-day checking account, so I'm less likely to withdraw from it and less likely to think about it. This "set it and forget it" level of financial freedom was something I worked hard for -- through money diarying, budgeting, and conscious spending. So now, my savings amount is completely on autopilot.

At the age of 24, I know that I am on the right track to make my goal a reality. Inspired by my own journey, I wanted to help women everywhere to have that same feeling of confidence that financial education gives — and get information from someone who isn't an old, rich white dude. As a money speaker and coach, I run Her First $100K, a financial literacy platform for millennial women on the path to get their first $100K too.

It's possible to achieve your first $100K — whether that's debt paid off, earned, saved, invested, or something else. With intentional strategies and focus, you've got this!